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Summary:

Now that Apple CEO Steve Jobs is taking a second leave of absence for health-related reasons, it’s impossible not to wonder: Can Apple continue to be successful without its visionary leader? For the answer, look no further than the people who will lead in his stead.

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It isn’t the first time the question’s been asked, but now that Apple CEO Steve Jobs is taking a second leave of absence for health-related reasons, it’s impossible not to wonder: Can Apple continue to be successful without its visionary leader?

That the question is even asked at all is a testament to Jobs. Since his return to Apple in 1996, the 55-year old co-founder of the company has led it with a sense of purpose and focus of direction rarely seen among multi-billion dollar, publicly held corporations. Under Jobs, the iPod became for MP3 players what Kleenex is for facial tissue; the iPhone started a consumer rush on what was once a market relegated mostly to business users; and the iPad beat all expectations and single-handedly brought tablet computing mainstream. It’s Jobs’ extreme degree of control that accounts for much of Apple’s success, but might it not also lead, ultimately, to failure?

The problem with extreme authority is that once it’s removed, chaos often ensues. Even if someone else steps up to fill the power vacuum, that person won’t be Steve Jobs, no matter what other qualifications he or she brings to the table. And without Steve Jobs, in the minds of loyal followers, the general public, stockholders, and maybe even Apple employees, Apple just isn’t Apple.

At least, it isn’t the Apple we now know. But does it necessarily follow that an Apple without Jobs will be a failure? That’s a much more extreme claim, and one that ignores a number of very important factors. The first is history. Remember that we’ve been here before; from January to June of 2009, Jobs took his first medical leave, which turned out to be for a liver transplant. During that time, Apple COO Tim Cook stepped in as interim CEO. After an initial dip following the announcement of Jobs’ leave (like the one we’re seeing today, as Mathew reports), Apple stock prices rose steadily during that time, peaking at around $145 at end of Cook’s tenure, even amid rampant speculation that Jobs’ absence may become permanent. Apple was so impressed with Cook’s performance that the company gave him a $22 million bonus.

Cook isn’t exactly the only luminary in Apple’s talent pool, either. There’s top product designer Jonathan Ive, whose signature look has made Apple products the go-to gadgets for the fashion conscious and image-obsessed. And there’s Senior VP of Worldwide Product Marketing Phil Schiller, who came to Apple with Steve upon his return, and who has played a significant role in past company presentations. Schiller is now also arguably Apple’s most prominent social media presence through his Twitter account.

None of these potential successors have the celebrity status that Steve Jobs enjoys, but there’s no reason they should as of yet, since that role’s been more than adequately filled by Jobs himself until now. And while a celebrity CEO has been a major boon for Apple in the past, it doesn’t necessarily follow that the company will flounder without one. To suggest so is to ignore the hard work and resourcefulness of the Apple employees that turn Jobs’ vision into a reality. In fact, according to some Apple employees who spoke to us, you often have to work around Jobs subtly on issues where he’s very clearly in the wrong. Having a more reticent corporate leadership could allow dissenting opinions to surface, leading to products that would otherwise come to market late or not at all (a 7-inch iPad, for instance).

While Jobs’ current leave comes as a surprise to us in the media, there’s little chance it was something Apple isn’t prepared for as a company. Steve Jobs may be largely responsible for Apple’s success, but he won’t also be responsible for its failure. That has, and always will be dependent on the quality of the products it creates, and on the resourcefulness and ingenuity of the thousands of employees that work every day to make those products a reality.

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  1. Apple Turnover Monday, January 17, 2011

    The end of Steve is the end of Apple and from today things will only get worse. Apple has lost all credibility as an investment and Wall Street will start downgrading the stock immediately using the Steve Health Factor. 50% of Apple’s value will be gone in an instant and nothing will change that. Shareholders will lose hugely despite a record quarter. Steve giveth and Wall Street taketh away. A very poor investment, indeed. Friday, the company looked strong and on Tuesday the carcass will be picked clean as the hedge funds feast.

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    1. Sorry. I think you’ll be eating your words come Wednesday. Tomorrow’s earnings will be stellar. People are buying products. They are not ET style devices, they won’t stop working if Steve grows ill or dies. There is enough development in the pipeline to keep Apple running along for 2-5 years.

      “50% of Apple’s value will be gone in an instant and nothing will change that.”
      So you are saying that tomorrow morning, ahead of earnings Apple will drop to 175 dollars or so? Well I’ll take that short. You will be seriously at a loss. Meet here on Wednesday afternoon to see just how well your prediction pans out.

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  2. Darrell, are you saying a 7-inch iPad is late to market? If yes, I’m not sure I agree given the overwhelming success of the current iPad. Apple can only do so much, and singlehandedly creating a very large market where everyone else failed for 10 years is pretty huge.

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  3. No train-wreck at all:

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  4. Maybe not a trainwreck, but…

    Last time Steve took time off we ended up with Antennae-gate, the mysterious White iPhone and buggy releases of iOS.

    Tim’s gotta do a better job of quality control if he’s going to carry this company.

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  5. Joseph Futral Monday, January 17, 2011

    I’m sorry. We have yet to see a 7″ market emerge. Just because everyone other than Apple is making them, the sales COMBINED are still dwarfed by iPad. Besides, I have a suspicion that the only reason the rest of the industry went to 7″ tablets is because Apple bough all the only viable larger screen.

    Joe

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  6. Apple Turnover:

    Bitter? Sure sound like it. For Apple to drop to 50% would make a ridiculous forward P/E. The same people (Jonathan Ive and Tim Cook) have been a the side of Steve, executing a decade of well-thought out plans.

    AAPL overseas is down 7% as of Monday. Big Whoop. As a long-time AAPL shareholder, you’re going to have to do a lot better rendition of “the sky is falling” before you shake me loose of my shares.

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    1. Doubt he’s being bitter…more likely, he sold his sister to be able to buy shares and is trying to downpush them as much as he can so he’ll be able to buy more and make more money when the shares come up again :)

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  7. Look at the bright side, maybe now Apple will loosen up on the control bit. It might also help to have a little more function over form amd a little less form over function.

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  8. Thanks for the video LS. It was almost as inspiring as Job’s Stanford commencement speech.

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  9. Well, that was disappointing. I was really hoping @Apple Turnover was right. Heck, I would have taken even a 20% pullback in Apple’s stock. But barely 5% wasn’t even enough to hit any triggers. And that pull back disappeared by the end of the day.

    So much for the “Apple death knell.”

    Joe

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  10. [...] Will Apple lose the ability to be a motivating force for market upheaval when he’s gone? I say no, because Apple has a corporate culture based, from the top-down, on fostering innovation and [...]

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