Taking Apple to new heights | The Daily Star
12:00 AM, February 14, 2012 / LAST MODIFIED: 12:00 AM, February 14, 2012

Taking Apple to new heights

Tim Cook

It was January 24, 2012. Investors, business analysts, in fact, the whole business community were eagerly waiting as Apple was expected to announce its first quarter financial results for fiscal 2012 at 5pm from Cupertino, California. This particular event drew special attention of the business world as this was the first full quarter led by Tim Cook after the legendary Steve Jobs had stepped down as Apple's CEO on August 24, 2011, because of his unfortunate health issue.
It was an extraordinary result from many aspects. Apple earned record breaking quarterly revenue of $46.33 billion, which was $26.74 billion in the same quarter of the previous year. The company posted record quarterly net profit as well -- $13.06 billion, a huge jump by over $6 billion they made a year ago. Some of the highlights of Apple's performance in this particular period were:
* iPhone sales had a growth of 128 percent over the comparable quarter in 2010. They sold 37 million iPhones in the quarter.
* iPad sales also had a significant rise of 111 percent. Around 15.4 million iPads was sold in the quarter reported.
* Mac sales stood at 5.2 million, an increase of 26 percent.
* iPod sales experienced a downturn of 21 percent as the iPhone cannibalises sales of the more limited-function devices.
* The company holds $97.6 billion cash on hand.
* Revenue from iTunes hit $1.7 billion.
* There are 1.5 million iPads being used by educational institutions.
* iCloud has 85 million users. There are now 550,000 applications available. Developers of such applications have earned more than $4 billion, $700 million in quarter one.
* Apple Stores produced $6.1 billion in revenue for the quarter. The average revenue per store was $17.1 million vs. $12 million last year. There are about 22,000 visitors per store per week.
* Apple's revenue for the quarter was higher than the company's revenues for its entire fiscal 2009.
In the backdrop of prevailing fierce competition in the tablet and smart phone industry, these were spectacular results and not really expected by many analysts and industry experts. It was a bolt from the blue to the business world when Jobs resigned from his position as CEO. There were a lot of discussions on how Cook would fill the shoes of Jobs who is regarded as one of the greatest CEOs the world has ever produced. Many experts from Silicon Valley were cynical. One of their main arguments was that Cook lacked creativity in regards to product design and introduction of innovative products for which Jobs was renowned. Some experts branded him merely as an “Ops Guy”.
It was a kind of a myth that “Steve is irreplaceable”. Cook even once commented, "Come on, replace Steve? No. He's irreplaceable… That's something people have to get over. I see Steve there with grey hair in his 70s, long after I'm retired.”
Cook clearly had Steve's blessing. According to Jobs, Cook's name was already down in an existing CEO succession plan. In fact, it was Jobs who brought Cook to Apple in 1998. Cook is a seasoned campaigner and has significant experiences and achievements under his belt. He has a successful career of 29 years in the computer industry, 13 of which have been spent at Apple and 12 at rival IBM. In addition to his work with Apple, Cook is also a member of the board of directors at Nike.
Cook is known for being a calm, collected and quiet man, quite contrary to the very animated style of his predecessor. His work style is fairly intensive to the point that he is often described as being a “workaholic”. A typical day might see Cook begin checking and sending emails at around 4:30 am. He is known for holding staff meetings on Sunday nights to prepare for the week ahead. Cook proved his intense devotion to work during his tenure at IBM -- even once volunteering to work over the Christmas and New Year holidays just so IBM could complete its orders for the year. With intense devotion to work, his former IBM boss Richard Daugherty said Cook had “a manner that really caused people to enjoy working with him.”
Cook left IBM in 1994 and joined Intelligent Electronics in the computer reseller division. He had become the COO of that division before he moved to Compaq for a short stint of six months. He started his journey at Apple with an office near Jobs and as senior vice president of worldwide operations. The first thing he started was to steer Apple away from manufacturing components themselves. Instead, he ensured Apple established strong relationships with external manufacturers. Cook's relation with supply chain was best described by an anecdote reported by CNN. It happened in 1998, soon after he joined Apple. In a meeting convened to tackle a problem in China, he had said: "This is really bad someone should be in China driving this." Thirty-minutes in the meeting, he looked at Sabih Khan, the then operations executive, and said, "Why are you still here?" Khan, without even getting a change of clothes, immediately booked a ticket to China.
He made tremendous success in managing inventories, which were troublesome for Apple at that time. A report in business magazine Fortune acknowledged his success -- “As a result, Apple's inventory, measured by the amount of time it sat on the company's balance sheet, quickly fell from months to days. Inventory, Cook has said, is 'fundamentally evil … You kind of want to manage it like you're in the dairy business. If it gets past its freshness date, you have a problem'.”
Cook never looked back. As time progressed, he started taking on more responsibilities, which included leading the sales force, customer support, the Macintosh division from 2004 and in 2007, becoming Apple's COO. He served multiple stints as an interim CEO -- first in 2004, then in 2009, and he has been at the helm of the company since January 2011 while Jobs continued to battle health issues. Those responsibilities would have played a big part in his selection for the CEO position today.
It is no wonder that expectations form the Apple CEO is sky high from all quarters of the society -- be it investors, analysts, consumers or even employees. Cook has so far been managing the pressures efficiently. Jeffrey Pfeffer, a professor at Stanford's Graduate School of Business, said, "Tim Cook doesn't need to be Steve Jobs -- he needs to be the best Tim Cook he can be. Cook understands what he is good at and what he is not good at."

The writer is head of pricing operations, Asia Pacific, of Syngenta Asia Pacific Pte Ltd, Singapore.

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