What's Next for Apple?

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By Phil Baker

As a design engineer by training, I love Apple products. I appreciate how well they work, how well they're made and how well they look. The company has raised the standards for consumer electronic products around the world, due mostly to the fanaticism that Steve Jobs has brought to the product design process. He's innovated not only in the software and user interface, but with new materials, new form factors, new manufacturing processes, new hardware, and new packaging. No detail was too small that he didn't improve upon; even replacing the tie wraps on the cables with easy to remove clear ribbons. While he may not have done everything himself, he was responsible for setting the tone and expectations of his team.

With Jobs now taking an indefinite leave, there's been speculation about what this will mean for the future of the company. If Jobs doesn't return, will Apple be able to continue its growth and continue to innovate with new products?

While many analysts are optimistic that Apple's growth will continue on the same trajectory as it's on today, I think there's an equal likelihood that the company will go through some significant upheaval and struggle to recover from Jobs's absence.

Until Jobs returned to Apple in 1997, the company was directionless and dabbling in a variety of areas. Its main product line, Macintosh computers, tottered at around three percent of the PC market. While attempts were made to break into new areas, including digital cameras and handheld computers, the products were not well-implemented and failed. The Mac business was falling behind the competition. For example, Apple was late to market building CD drives into notebooks, thinking it was a passing fad. I know this from personal experience, being part of the Newton and PowerBook teams.

Like many large corporations, there was intense infighting among the various divisions, with no one to referee. So not only was there no clear roadmap and underperforming products, but the organization was in disarray.

When Jobs returned he applied an intense focus to turn around the business. He cut products, including the Newton, and prioritized on building the core foundation of the company, revamping and improving the Mac platform and working with Intel to enable the Mac to run Windows. While few customers wanted to use Windows, it was marketing brilliance that took the risk out of buying a Mac.

He also revamped his organization and created a team that has been stellar in each of their areas of expertise: engineering, operations and industrial design. Jobs and his organization transformed  the product lineup to one with no equal, iPods, iTunes, iPhones, iPads and Macs.

This team has coalesced around Jobs and has been intensely loyal to him, much like to a benevolent dictator. He single-handedly has been providing the organizational and the product leadership.

I observed a similar situation when I worked at Polaroid when Dr. Edwin Land led the company. Polaroid and Land, the inventor of instant photography, received similar admiration from the business community and the public. In fact, the two leaders share much in common, from being intimately involved in the design of every new product, to mesmerizing audiences when they each introduced them.

But when Land left the company, it began to disintegrate because there was a sudden lack of strong leadership. Under Dr. Land any innovation that didn't come from him was discouraged. In fact, when he learned that one of his engineers was designing an improvement for the SX-70 camera, he threatened to fire him. (That engineer was me; in the end we shared the patent on that invention).

Because of Land's top-down leadership, the executives under him were rewarded for the execution of his vision and not for innovating on their own. This left a weak and unimaginative leadership when he left.

There was no succession plan, and those left behind competed to fill his role, constantly bickered, and failed to agree on how to enter the digital camera revolution. The company eventually went into bankruptcy.

Now Apple is not Polaroid. Apple has a much deeper product portfolio and the times are much different. Apple likely has two years of products in the pipeline, a loyal customer base, and intensely loyal employees. But Polaroid in its day was one of the most progressive companies with some of the smartest, most loyal employees, as well. There was the same reverence to Land as there is to Jobs.

In Jobs' absence, as with Land's, I would expect to see a resurgence of internal rivalries that are common to most big companies that don't have a strong, inspirational leader. They will compete to fill the vacuum created by his departure, and that will effect how well the team will work together. In most companies there are rivalries between operations and engineering, engineering and industrial design, and industrial design and operations. It's a natural consequence of  competing objectives that are not always aligned.

It will be fascinating to watch how this plays out and to see if Apple can maintain its momentum for years to come. I personally think we may be seeing Apple hitting its peak over the next year or two and then going through some turbulent times.

Phil Baker is a product development consultant, author of "From Concept to Consumer", and the technology correspondent for The San Diego Daily Transcript. His Website is www.techspertsinc.com, and his email is pbaker@gmail.com.

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James Fallows is a national correspondent for The Atlantic and has written for the magazine since the late 1970s. He has reported extensively from outside the United States and once worked as President Carter's chief speechwriter. His latest book is China Airborne. More

James Fallows is based in Washington as a national correspondent for The Atlantic. He has worked for the magazine for nearly 30 years and in that time has also lived in Seattle, Berkeley, Austin, Tokyo, Kuala Lumpur, Shanghai, and Beijing. He was raised in Redlands, California, received his undergraduate degree in American history and literature from Harvard, and received a graduate degree in economics from Oxford as a Rhodes scholar. In addition to working for The Atlantic, he has spent two years as chief White House speechwriter for Jimmy Carter, two years as the editor of US News & World Report, and six months as a program designer at Microsoft. He is an instrument-rated private pilot. He is also now the chair in U.S. media at the U.S. Studies Centre at the University of Sydney, in Australia.

Fallows has been a finalist for the National Magazine Award five times and has won once; he has also won the American Book Award for nonfiction and a N.Y. Emmy award for the documentary series Doing Business in China. He was the founding chairman of the New America Foundation. His recent books Blind Into Baghdad (2006) and Postcards From Tomorrow Square (2009) are based on his writings for The Atlantic. His latest book is China Airborne. He is married to Deborah Fallows, author of the recent book Dreaming in Chinese. They have two married sons.

Fallows welcomes and frequently quotes from reader mail sent via the "Email" button below. Unless you specify otherwise, we consider any incoming mail available for possible quotation -- but not with the sender's real name unless you explicitly state that it may be used. If you are wondering why Fallows does not use a "Comments" field below his posts, please see previous explanations here and here.
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