Apple and the innovation dilemma
Just how long can Apple run the table in the post-Jobs era? It was simply a matter of time before those whispers turned into a question asked out loud. George Colony, the CEO of Forrester, a research and advisory firm that has followed the company as closely as anyone, is taking a particularly dim view of Apple’s future. In a blog post that was guaranteed to spark a conversation, Colony says Apple’s days as a market leader are numbered; its “momentum will carry it for 24-48 months” and then, absent a “charismatic leader” in the Jobs mold, it will devolve from “being a great company to being a good company.”
Colony doesn’t get too specific about what this means, but we know. It’s not just about market cap, or stock price or any other shareholder metric. Colony is talking about that combination of imagination and execution pixie dust that has made Apple the most significant high-tech company of the moment, and one of the most important ever.
It’s a pretty big statement, especially since Apple is on fire: $6 billion earned on $40 billion in revenues in the most recent quarter, the iPhone selling as briskly in the rest of the world now as it did in the United States for years, 65 million iPads sold in two years, more cash than it knows what to do with, and at least one analyst speculating that it’ll be a $1,000 stock before long.
It’s also not the toughest bet to make, since high-tech companies, in particular, almost always glow hot for only so long, with rare exceptions – especially after the charismatic founder leaves or is kicked out. We’ve seen it at Sony, Polaroid, Disney and even Apple, Colony argues, when Jobs was kicked out in 1985.
But it’s a sucker’s bet. Here’s the easy counter: There is virtually no chance Apple doesn’t have tricks up its sleeve that were developed in the Jobs era. And it’s those tricks, of course, that got them this far. They have something everyone can see: a management team in CEO Tim Cook and designer Jony Ive, handpicked by Jobs more than a decade ago. Indeed, Cult of Mac editor Leander Kahney says Ive is all the proof you need to know that Colony has it wrong:
Apple’s design chief Sir Jonathan Ive – the man Steve Jobs once called his “spiritual partner” and the genius behind Apple’s iconic aesthetic and design language – is still working at Apple. More importantly, as Jobs bragged to his biographer, Jony Ive has just as much operational power at Apple as Tim Cook himself. Cook is only nominally Ive’s boss: In reality, thanks to Steve, they’re equals.
Apple’s demise will come not from a lack of inventiveness, but – if it comes as swiftly as Colony postulates at all – because someone else comes up with a game-changing something that nobody else, Apple very much included, saw coming. That’s the way giants are toppled: Personal desktop computers kill the mainframe, laptops marginalize desktops, tablets steal the PC’s thunder.
The real danger for Apple is that no company has a monopoly on the gift of thinking different. What’s more likely is that missteps for which Apple has been forgiven will be seen as failures rather than as forgivable works in progress by a mad genius. What would the tech press have made of the Apple TV hobby in the hands of anyone but Jobs? Without Jobs, how much leash would they have given Apple during the tortuous cloud timeline that began with .mac and sucked through three incarnations, until last year’s iCloud?
In fairness, this can be argued either way. This is the sort of bet that people easily take sides on, but for which there is insufficient empirical data to really know the outcome. Like two big-city mayors betting on their NFL teams in the Super Bowl, there is a rooting interest and a delightful salon game component.
And, yes, Apple will – someday – be a shadow of its former self. IBM is the classic high-tech survivor, but the number of times it has reinvented itself is head-spinning. Palm, which owned the personal assistant market until it was slow to see the futility of unconnected PIMs, is at the other end of that spectrum.
Colony’s mistake (if I may be so bold) is not in the fear factor, but in the time frame. I’d be shocked if Apple doesn’t have a five-year plan and sufficient institutional knowledge to plough that field – the absence of the serendipitous Mr. Jobs notwithstanding. The real danger begins in the following five years, as founders we haven’t heard of, working right now, come out with something different. Something Jobsian. What will Cook and Ive, who might have grown weary of Apple or each other by then, do in response?
But that’s years off. Until then, the over/under seems a pretty safe bet to me.
PHOTO: Carmen Shippy (L), the first person in line to buy the newly released Apple iPhone 4S at an Apple Store in Clarendon, Virginia, high-fives staff as she leaves the store, October 14, 2011. REUTERS/Jason Reed