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Epic fail?

January 16, 2009

I can’t believe it. As if the lessons in these past few months weren’t enough, Wall Street got smacked with yet another big lesson yesterday – the dangers of making people indispensable.

This time its Steve Jobs of Apple Inc. who came forward with a bombshell. He’s taking MC for 6 months, admitting that his health issues are turning out to be “more complex than originally thought.”

“A shock revelation that Apple Inc (AAPL.O) chief and tech icon Steve Jobs will bench himself for six months sent shivers through investors who fear a change at the top will chill a product line-up struggling to come up with the next big thing.

Many expect Apple shares, which plunged 7 percent on Wednesday following the announcement, to be stung by the news.”

Source

And as to why,

“…many fear his departure would deprive the company of its most vital and imaginative resource.”

To add to the drama, in a depressed market Wall Street has been clamoring for a new device to act as a catalyst for its stock and Steve had always been that knight in shining armor.

Every investor dreams of having someone as illustrious as Steve Jobs on their side so to be clear, the problem is not Steve. The problem is having no clear succession plan. That plan, which will see the immediate mobilization of a clear no. 2 if no. 1 is incapacitated, should’ve been in place years ago. Firstly, because we’re talking about a major market mover company of national interest here and not some two-bit company. Secondly, Steve’s physical condition had been deteriorating for months. He was getting thinner and thinner which fueled speculation about his health problems.

As soon as the news broke, the successor should already be out there giving well-rehearsed press statements about business continuity instead of letting journalists do the guessing game.

Instead, rumors are running rife, fueling my suspicion that they had no succession plan. I think Apple will have to struggle with a longer period of uncertainty than it needs to.

For all the talk, its just amazing to find an IT firm with no backup, pardon the pun.

Already, analysts are talking about Jobs in the past tense. Apple shares are tumbling. Dude, I can’t believe a company like Apple is letting itself get into this PR mess.

No doubt, this is the window of opportunity that Apple’s competitors will seize.

Still, I hope Steve will recover soon from whatever’s ailing him.

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3 Comments leave one →
  1. January 16, 2009 9:30 am

    =_= grrr i was about to write something on succession plan after knowing about Steve’s health. Aiseh. =_=

    Anyway, this is the result when an individual becomes greater than the company. Maybe that’s why management gurus always advise people to focus on the business, rather than the individual. Build a business which can go on without its most influential leader…without any -ve impact.

    That’s how business continuity should work. And in this case, I feel M$ n Bill Gates are doing better than Apple n Steve Jobs even though I’m a big fan of the latter (without buying anything from them before due to the price tags).

    Haha, the topic hit me as I watched CNBC so I just hammered it out. 😀 Anyway, succession planning is a big problem in companies, especially in family-operated ones where the children may either fight each other for successor’s rights or not want to touch the business at all. Sometimes, boards surprisingly aren’t clued up on leadership “insurance,” believing that a superstar can live forever. In Steve Jobs case, the fact that he’s so brilliant makes it difficult for them to even think of a no. 2. In doing so they painted themselves to a corner.

  2. January 16, 2009 11:33 am

    Threading a thin line here, that’s what I think. If we throw out individuality or personality in business, we also have to throw out the ‘people are our assets’ slogan.

    The problem is still in the bubble, perception, and the herd instinct.

    Yeah. If we can ever run away from perception, then the way to counter a perception is to create another perception to counter the first one. In this case, the perception that even without Steve in the picture, the company will run fine with a no. 2. Apple seems to have failed at that.

  3. LC Teh permalink
    January 20, 2009 9:26 am

    Back to the succession question. I think it all depends on what the founder/top guy thinks about more often. It’s either yourself or the organisation & people. If you’re just thinking of your toys and your great important self, you’d neglect to think of your mortality. And you neglect the future of the company.

    The same works for a country. Cases in point: Zimbabwe’s Mugabe and Singapore’s Lee. One worried about his wives, wealth and ‘castles’, the other about his country’s future generations and their relevance in the world.

    In the US, there’s a saying that the presidency is greater than the president. Its a bureaucracy that’s designed to continue operating even without the president. In Singapore’s case, yes personalities lead the way but even if thats not the case, I believe life will still continue. They have no choice. On corporations, many shareholders do make succession plans mandatory via the board. Its a natural self-preservation measure.

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