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Apple Post Jobs

Wed Oct 12, 2011

One student noted it had been a long time from Edison to Jobs. Another wonders if Apple stock will go down now that Jobs is gone. 

An op ed by Holman Jenkins  in today's WSJ makes the point that Jobs made the decisions at Apple, not a committee. He was able to force deals on companies like Sprint that made a lot of money for Apple. 

 This would be a good time to check out Bob Lutz comments on Authoritative Leaders.

That was a good post. Lutz makes the point that someone has to make the tough decisions. And if you think about it, that was the hallmark of Edison or Henry Ford (not a nice guy but an authoritative one). 

Without Jobs, Apple is quite likely to fall into Group Think, this is what Lutz is referencing, we had a great time and respected one another but did anything get done. 

As I said in that previous post, Carroll Shelby observed that Enzo Ferrari was the only person who ever got to run his own car company, no shareholders, no committees. 

A committee did not plan the Sistine Chapel, and I am sure the cost dept would never have approved a vour year time frame to finish it. 

Ross Perot ran EDS that way and George Patton did the same thing with Third Army racing to Berlin. 

As the saying goes,

the giraffe and the zebra are committee creations. 

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3 responses to “Apple Post Jobs”

  1. Luis Martinez Avatar
    Luis Martinez

    If a committee created any particular animal, it had to be the platypus! Authoritative leaders with vision are successful. Authoritative leaders with no vision (usually narcisists, by the way) end up running their companies into the ground or get booted by the board of directors.

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  2. Jerry Avatar
    Jerry

    Dr. Elam, its been a while and admittedly I had to google your name to find your blog again. But its in my feeds now so expect some commentary going forward.
    With regard to a “one man/woman” decision making company, I hadnt considered the difference. Even in banking. As you know I have been in banking for quite some time now and you may not know; however, that I have moved on from Sterling Bank (now Comerica Bank-Turns out you were right all along, Sterling could not recover from the sale of the mortgage company, but I digress) to Texas Capital Bank (NASDAQ: TCBI), a much healthier bank ($6B in assets with just 12 offices). The reason I mention the banks is this. While each bank’s deicisons are made by a board, the lending structures are entirely different, and partly the reason Sterling didnt make it. Sterling used the committee system for all credit decisions. While underwriting standards were well kept, the committee system allowed for far too many opinions on whats what, leading to high concentrations of commercial real estate, specifically hotels, and retail centers in the portfolio. When credit crunched so did the portoflio. When the bank tried to dip its hands into the C&I piece of business, the committee system didnt allow underwriters to get packages approved in a timely manner, only because each voting member (5-10 of them)wanted their suggestions to be inserted into loan packages. In the C&I business, those industries need their loans quickly. Sterling lost many deals from what I experienced. TCBI employs the signature approval method. Each individual, typically four or five, depending on loan size, reads the package and either approves or not. Meetings are held in the back ground and the underwriter typically doesnt see the flow of the package as its approved. This method allows each approver to read the deal on their own time and make the decision, yes or no. The ultimate credit officer is the deal killer or saviour. The signatures before the credit officer is basically a “blessing” to let the deal continue its journey up the pipeline. This works better as “bad” deals are vetted early in the process. If the first approver doesnt agree it does not need to go any further. In essence each person has the power at that point in time.
    Thanks for the post!
    In many ways, still your student.
    Jerry

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  3. Dennis Elam Avatar
    Dennis Elam

    All Classes
    We are all better for Jerry becoming a regular on this site again. He wrote one of the best descriptions of his group job interview at Sterling I have ever read.
    Jerry, what does C & I stand for, I am not up on bank nomenclature. I look forward to your posts and insight!

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