Mini-Case Can You Follow an Icon and Succeed?

Apple and Tim Cook After Steve Jobs Steve Jobs was Apples co-founder and iconic CEO. A number of observers feel that much of Apples phenomenal success, especially after 2000, is a product of his genius and leadership. Because of this and a leadership style that varies significantly from his predecessors, some have questioned Tim Cooks ability to succeed Jobs as Apples CEO. Yet, in 2014, several years after assuming the CEO position, Apple had what Tim Cook referred to as an unbelievable year given that the firm sold 200 million iPhones and generated $200 billion in revenue. Apples stock price increased by 65 percent, and the companys market value reached more than $700 billion, the largest ever of any U.S. firm. At the time, Apples market value more than doubled that of Microsoft. Prior to assuming the CEO position, Cooks primary experience had been as manager of operations; his success in this domain led to his appointment as COO prior to assuming the CEO role. Interestingly, a significant percentage of Apples sales flow from products developed and introduced to the market under Jobs leadership. As such, the jury is still out on Cook, especially with regard to developing marketplace successes in the form of new products, tasks at which Jobs excelled.

Jobs and Cook have different leadership styles. Some thought Jobs was ruthless, impulsive, and almost maniacal in developing new products and finding paths through which they became marketplace successes. Cooks knowledge and skills do not make him an expert in product development, design, or marketing. Because of this, he delegates those responsibilities. As the firms key strategic leader, Cook tries to buffer and maintain Apples corporate culture that developed largely during Jobs tenure. Thus, the emphasis remains on innovation that is valued in the marketplace. To support this emphasis and to nurture the firms all-important culture, Cook hires talented individuals to join the top management team who blend well with the culture. He has made some very good hires, such as Angela Ahrendts who now heads Apples very important retail stores. As a leader, Cook is less emotional in his style and actions compared to Jobs. Some refer to this aspect of Cooks style as a measured emotional approach to leadership. He empowers his top management team members in ways that allow each of them to manage the functional area for which they have responsibility. He also encourages each team member to adopt a long-run perspective while leading.

Observers have been able to highlight other differences between Cooks and Jobs strategic leadership approaches. Compared to Jobs, Cook more regularly shares the limelight with his leadership team, spotlighting their contributions while doing so. One analyst suggested that Cook is a good leader who builds an effective team around him. With respect to strategic choices, Cooks decisions have resulted in major acquisitions (e.g., an audio company for $3 billion) and developing enterprise solutions for corporate IT units; Jobs opposed actions of these types. Under Cook, Apple formed an alliance with IBM to develop enterprise applications with a focus on the iPad, especially the new and larger versions.

During Cooks early tenure as CEO, Apple introduced several innovations including the Apple watch, which entered the market in April 2015. This products marketplace success is yet to be determined; initial reports suggested that demand exceeded supply, causing Apple to increase production. In addition, hints provided by Cook suggest that Apple may be planning to enter the television market. Most importantly, Cook claims that Apples goal is to change the way people work. The firm intends to focus research and development efforts to develop products to achieve this objective.

In mid-2018, some analysts were questioning the delays Apple was encountering when introducing products to the marketplace. Of three major product launches under Cook since becoming the firms CEO in 2011, AirPods earbuds and the HomePod speaker missed publicly announced shipping dates. The Apple Watch, mentioned above, entered the market later than the firm desired, initially causing customers to experience long wait times to buy the product. The Apple Pencil and Smart Keyboard, two critical accessories for the iPad Pro, also entered the market later than announced initially. On the other hand, Apples first quarter 2018 results yielded all-time highs in both revenue and earnings. In an overall sense, only the march of time will yield insights needed to determine if as CEO, Tim Cook was a success as Steve Jobs successor. With a market value of over $900 billion in early 2018, it seems that as Apples key strategic leader, Cooks effect on the firm he was leading was positive.

Case Discussion Questions 1. What makes a CEOs job so complex? Use the challenge Tim Cook faces as Steve Jobs successor to provide examples that support your answer.

2. Tim Cook came from Apples internal managerial labor market to succeed Steve Jobs. In your view, was using the internal managerial labor market the best approach to follow when replacing Jobs? Use materials in the chapter regarding the internal and external managerial labor markets to explain your answer.

3. Given their different leadership styles, describe the differences you see in Apples culture under Tim Cooks leadership compared to the culture in Apple when Steve Jobs was CEO.

4. Using information in this Mini-Case as well as additional materials available to you via searches, how do you evaluate Tim Cook as a CEO? Is he an effective strategic leader or not? Use examples from the chapters discussion of Key Strategic Leadership Actions to justify your answer to this question.