Cook receives praise for Apple’s ‘cabinet reshuffle’

The feedback to the news of Apple CEO Tim Cook’s reorganization of his executives has been largely positive, with some suggesting that the news shows that Cook is taking charge at Apple and learning from his mistakes.

It seems likely that the investor activity on the stock markets will reflect the sentiment towards the Apple news when they open at 2.30pm GMT. Hurricane Sandy has kept the US stock market closed over the past two days. With Apple having fallen to $604.00 on Friday, after a low of $591.00 during the day’s trading, it is likely that trading in Apple will be particularly hectic today. Watch the markets to see how the investors react.  

Tim Cook takes charge at Apple 

Some are describing the management shake up as issuing in a “true era of Tim Cook.”

It is thought that yesterday’s announcement that two of Apple’s executives, iOS head Scott Forstall and retail head John Browett, were to leave the company was intended to restore peace at Apple. 

There have been suggestions that under the late Steve Jobs’ rule those managers with big personalities were kept in check because Jobs always had the last word. For example, reports have claimed Ive and Forstall had clashed to the point where they would refuse to be in the same room. “They didn’t cooperate at any level. They always let Steve decide,” claimed a Wall Street Journal source. 

WSJ sources claim that Forstall recently claimed that there is no “decider” with Jobs gone.

That report suggests that the shake-up demonstrates Cook’s resolve to tackle the personnel issues that Jobs had let fester. Jobs’ departure “forced those clashes into the open”, according to WSJ sources. Browett is also said to have been “unpleasant to work with”, people close to the situation told WSJ.

The management changes are being interpreted by some as Cook’s attempt at steadying the ship.

However, as the Wall Street Journal notes: “The latest changes bring some risks. It fails to address the question of who will fill Mr. Jobs’s role as Apple’s ultimate decider on products. Mr. Cook has said he spends less time on products than Mr. Jobs and has empowered individuals to run their groups. It also creates a new hole in product leadership. Mr. Forstall, for one, was seen by many as the Apple executive most knowledgeable about software at a company stacked with hardware pros.”

Tim Cook’s mistakes

The news that Forsall and Browett are to leave Apple also highlighted one of Cook’s biggest mistakes since he took hold of the reins at Apple. Browett was Cook’s first hire having interviewed Browett personally, and that raises questions about how good a judge Cook is.

Another of Cooks’ mistakes was also highlighted by the news of the reshuffle. His handling of hardware engineering head Bob Mansfield’s retirement. Mansfield announced his retirement earlier this year, then this summer it was announced that Mansfield would be returning to the company. Reports at the time claimed that Apple engineers had kicked up a fuss about Mansfield’s replacement, Dan Riccio, causing Cook to go to Mansfield and ask him to stay. At the time it was said Cook offered Mansfield an “exorbitant package of cash and stock worth around $2 million a month to stay on at Apple as an adviser and help manage the hardware engineering team”.

Reflecting on this, and the news that Mansfield will now be heading up a new “Technologies” division at Apple, Forbes asks: “For a 51 year old to retire (maybe I’m old fashioned but isn’t that a little young to retire for a rock star SVP at the most valuable company in the world?), unretired, and then get promoted, it makes me wonder what’s been going on behind the scenes for the last 6 months with management?”

Another mistake that happened under Cook’s reign was Apple Maps. While Forstall has been assigned much of the blame, Cook did in fact admit fault in the matter, as the CEO of the company Cook should accept over-all responsibility. Should Cook have addressed the developer feedback on the Maps issues prior to release? Should Cook have held back the release until the software was ready?

It looks like Cook has been learning from his mistakes, however. In one day he has fixed issues in his management team, addressed his failed hire of a retail head, and announced that iTunes 11 would be delayed while the company works on making it better.  

Analyst reaction to Apple’s cabinet reshuffle

Horace Dedieu of Asymco: “Seems like a good plan. Apple’s biggest threat is corrosive politics and the entropy that follows. But I have no data.” ( Via: Forbes).

William Powers of Robert W. Baird & Co: “This appears to be part of Tim Cook putting his own stamp on the company, and importantly, he is still surrounded by several key long-time Apple executives and innovators.” ( Via: iDownloadblog)

Gene Munster of Piper Jaffray: “Apple is consolidating leadership around core long term executives, and the probability that key management is committed to Apple appears to have increased.” Munster refers to Cook and Ive as: “The two most critical management figures” and noted that the changes seem to confirm that Jonathan Ive will be with Apple for the “foreseeable future.” Munster believes Ive’s expanded role should put to rest “a recurring investor concern of an Apple without Ive.” Via Apple insider.

Brian White of Topeka Capital Markets: Sees Apple’s management shakeup as a result of the company “pushing for new levels of future innovation.” He suggests that the changes are a “natural evolution” for Apple. Via Apple insider.

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