What Happens When Steve Jobs Leaves Apple?
Steve Jobs is a one-of-a-kind business icon and Apple has come to symbolize American innovation. What happens to the company he cofounded 33 years ago if Jobs doesn't return from his medical leave of absence? Does it continue on its highflying trajectory, fall apart at the seams, or does the answer fall somewhere in between?
Well, you only get to the right conclusion by starting with three fundamental concepts:
- Just like people, all companies have lifecycles. This should come as no surprise since people run them.
- When it comes to evaluating companies and businesses, people tend to have very short memories.
- Product and brand momentum counts for something, but when a technology company stops innovating, it's over.
It's been 12 years since Steve Jobs returned to Apple after being gone for - that's right - 12 years. Apple floundered famously in Steve's absence, and while it's had a helluva run since his return, it's easy to forget that that run started very, very slowly.
Jobs returned to Apple in 1997 and began a restructuring that included launching the iMac a year later. But the company didn't launch the groundbreaking iPod and iTunes until 2001, and didn't begin its current run of operating outperformance until the 2004-05 timeframe. Until then, Apple's performance was relatively flat and in line with peer companies.
Reciprocally, Apple's demise after Steve's departure should take about as long as it took for his return to materially improve operating results. That's about seven years (five if you think the dot-com bust had a dampening effect).
That said, tech pundit John Dvorak puts Apple's prospects without Jobs this way:
But at some point, Apple becomes like a John Wayne movie with no John Wayne. You begin to notice something is missing.I've known Dvorak for some time, and while he's not always right, he is this time. Apple's brand reputation and product pipeline certainly count for something, but in a competitive market, that's no more than a few years without its current level of innovation. Sony's demise, for similar reasons, took about 5-7 years - consistent with the above analysis. That's all Apple's got without Jobs.In the case of Steve Jobs, it is a maniacal ability to find what isn't there but should be, combined with an outrageous sense of aesthetic attractiveness.
Who but Jobs would have found that hi-resolution touch screen used on the iPhone? That came out of left field, to say the least. Now every device maker uses them.
Jobs force-fit the iPod into a market that was moribund with various MP3 players but without any raw appeal.
Apple without Steve Jobs is Sony.
[Image of Steve Jobs courtesy James Martin, CNET]