The Secret of My Success(or)

What do Steve Jobs and Peter Gabriel have in common? Steve Anderson explains.

At first glance, there might not be a huge amount of similarity between the challenges currently faced by tech giant Apple and those confronting the rock group Genesis at the tail end of the seventies. Look a little closer though, and certain correlations do begin to appear. Genesis had built considerable success with flamboyant frontman Peter Gabriel providing an unmistakeable focal point for their live shows and records. When he quit the band, his departure left a void that the remaining members had to quickly fill. Gabriel was the face of the Genesis ‘brand’. Maintaining momentum without him would be one heck of a task.

Turning to Apple, the parallels are clear. Steve Jobs is the visionary figurehead who turned a second-tier computer manufacturer into one of the most recognisable and well-loved brands in the world. His presentations and product unveilings at the annual Macworld events caused hysteria among his audience that wouldn’t have looked out of place at a rock concert. So, when Jobs was forced to take a leave of absence last year as a result of his battle with pancreatic cancer, the impact on Apple’s fortunes was dramatic. Stocks plunged and the firm’s investors began to get edgy, fearing that the Apple cash cow couldn’t function without its talismanic leader. So news at the beginning of 2009 that Jobs was to step back from the company’s day to day running while he dealt with his ongoing health problems has caused further consternation. Along with investor unrest, there have even been calls for an SEC investigation into Apple’s failure to disclose details of Jobs health.

When Genesis lost their figurehead, they promoted from within. With Phil Collins at the helm, the band went on to achieve their biggest successes. The uncertainty surrounding Jobs’ future and the lack of a clear successor for when he does finally depart, make Apple’s leadership future far more murky. Quite simply, Steve Jobs is Apple. He has been the driving force, totem and evangelist for the company for years. He’s a control freak who, even if he is taking a back seat, won’t relinquish control until he is forced to. Obviously a leader like that can be a tremendous boon, but there comes a time when everyone must be replaced. Human lives are measured in decades, successful companies can be measured in lifetimes.

It is fair to say that Apple is a special case. There aren’t too many CEOs as long serving or as closely identified with their companies as Jobs, particularly in these times of financial downturn. However, the challenges faced by any organization in replacing a charismatic and successful leaders are broadly similar whether that organization is multinational company, an SME or even a rock band.

But perhaps it’s time to take a step away from the slightly tenuous Apple/Genesis comparisons and look at more directly analogous situation. Microsoft also recently faced the departure of a talismanic architect and leader in the shape of Bill Gates. But the way that Apple’s rival handled this regime change should serve as an object lesson for any organization planning to replacement of an influential leader. Microsoft set the date for Gates’ departure years in advance, allowing current CEO Steve Ballmer to gradually take on more an more responsibility. Gates began to take a back seat well in advance of his departure, so that when he finally did leave there was very little drama. By the time it actually happened, the transfer of power was a virtual non-event.

Of course, every organization and leader is different, but comparing Microsoft and Apple’s approach clearly highlights some key considerations. First of all, the subject needs to be discussed well before any changes need to be made. While that can be difficult for the person on their way out, it is essential if their successor is going to be able to hit the ground running. It’s also important to develop any potential candidates for leadership even if no obvious successor has been identified, so that you have a pool of possible replacements available. If too much power is concentrated at the top of the pile, finding someone with the ability to lead can prove extremely difficult. A power vacuum can have seriously unbalancing consequences.

Managed correctly, a change of leadership can even have positive effects for an organization, allowing new ideas and new energy to reinvigorate. After Genesis’s change in leadership, the band went on to enjoy hitherto unseen levels of popularity and success. Unfortunately, Apple’s protracted and uncertain change of power is less likely to bring such a positive outcome. Though it might be hard for the visionary creators of the iPod to accept, when it comes to succession planning, it looks as though Microsoft have the best ideas.

Follow the leader
Aside from Jobs and Gates there are a few other business leaders who would be hard to replace.

Warren Buffett - CEO Berkshire Hathaway
Know as the ‘Oracle of Omaha’ because of his astonishing knack for making the right moves in business. Starting out with a paper route, he filed his first tax return at 13 and was worth roughly $60 billion in 2008. Though his fortunes have taken a few knocks as a result of the credit crisis, he is still widely regarded as one of the most successful investors in history. That he has bequeathed a significant part of his fortune to charity only makes him more singular.

Richard Branson - Chairman Virgin Group
Branson’s face is as familiar as the logo of his company. Rare among business leaders, he has never shied away from putting himself in the picture and, whatever people may think of him, the identification between the man and his brand is incredibly strong. With nearly 400 companies under the Virgin umbrella, Branson has been involved with everything from publishing, to air travel, to soft drinks. His frequent World Record attempts and the launch of space tourism business Virgin Galactic highlights Branson’s love of column inches as well as profits.

Phil Knight – Chairman, Nike Inc.
As co-founder and long time CEO of Nike, Knight progressed from selling running shoes from the back of a car at US track meets to leading one of the largest and most recognizable brands in the world. Knight’s canny identification of stars such as Michael Jordan and Tiger Woods as ambassadors for the brand helped to elevate the athletics shoe to the status of a fashion item. Despite stepping down as CEO in 2004, Knight remains a vital component of Nike’s aggressive business strategy.