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Summary:

Apple announced the longtime SVP of Hardware Engineering’s retirement, but two months later he reversed his decision. A Businessweek piece has the details on the soap opera that ensued and how Cook convinced Mansfield to stay, in addition to other revelations about post-Jobs Apple.

bobmansfield

There was some serious drama at 1 Infinite Loop this summer: Longtime SVP of Hardware Engineering Bob Mansfield retired. Then he suddenly un-retired. A Bloomberg Businessweek article published Wednesday sheds light on what happened. It turns out that there was a near-mutiny by Mansfield’s employees over having to report to his replacement.

It did seem a bit odd at the time that Apple announced Mansfield’s retirement at the end of June, but didn’t give a date he’d be leaving. They did name one of his longtime deputies as his replacement. But it was surprising that two months later he reversed his decision, vowing to stay on as an advisor to CEO Tim Cook.

In the ensuing time after Mansfield’s retirement announcement, things apparently got a little awkward in Cupertino, according to the report:

According to three people familiar with the sequence of events, several senior engineers on Mansfield’s team vociferously complained to Cook about reporting to his replacement, Dan Riccio, who they felt was unprepared for the magnitude of the role.

But Cook had already announced Riccio would succeed Mansfield as head of iPad and iPhone engineering. So Cook did what he had to do to keep the peace:

In response, Cook approached Mansfield and offered him 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.

As embarrassing as this episode is for such a secretive company like Apple, it at least does one thing: it reinforces Cook’s ability to seal the deal when he needs to.

The Businessweek piece has a few other good nuggets of detail, including:

  • Cook has given his executive team huge bonuses to convince them stay on at Apple. The report says they’re worth $100 million total.
  • There’s been some internal infighting that Cook’s had to mediate.
  • Steve Jobs had considered removing Google as a search option in the iPhone, but thought users would be unhappy about it.
  • Apple has thought about moving away from Intel chips in its Mac lineup.

The whole piece is worth a read to get an understanding of what Cook has had to do to keep Apple on track following Jobs’ death a year ago Friday.

  1. Seems to me Tim Cook’s lack of an owner’s perspective (he did not start or grow Apple to its current size from ‘nothing’) will eventually cost Apple a ton of money. We’re seeing that he is taking the easy way out on many issues by simply throwing money at the problem. An owner knows that hard work must always be done, difficult decisions must always be made and throwing money at problems is NOT the answer… even when you have all the money in the world. It encourages entitlement mentality to creep into an organization. There was a very good reason Steve Jobs was a holy terror. He motivated and manipulated using psychology, not money.

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    1. Well said Dan. Buying loyalty is a short term solution and a mutiny among senior engineers shows that either these guys think too highly of themselves or the replacement selection process was flawed. Either way, Cook has to work on redefining these relationships without using money as the facilitator for his management team to succeed.

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    2. So being a holy terror is better than providing financial incentives? Having had nasty bosses, I would *much* rather be offered money than have a nasty boss – any day of the week – and I’m thinking lots of people agree with that.

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  2. Keeping top talent means paying top dollar and working on bleeding edge technologies. Given the current market of competition for experienced engineers, there aren’t many persuasive powers besides money. So I disagree with Dan wholeheartedly.

    Tim Cook has been at the company long enough to know what it was like to grow the business, he was there long before the current rise to fame (1998), just a year after Apple almost went bankrupt, so the lack of owner’s perspective is a boondog of an argument.

    I don’t see the connection between doing hard work and making difficult decisions. Obviously the entire chain of engineers felt that Bob’s replacement wasn’t ready, so they asked Bob to come back until such a time where they felt they had a replacement how could do the job. Not doing so would have meant either product launch pushback or mistakes within the hardware chain being made. Apple unfortunately doesn’t have the luxury of either of those things, however it does have the luxury of monetary success.

    Thus it appears that the decisions made were good ones.

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  3. Interesting article Erica, but that is a terrible photo on the homepage. Perhaps use the headshot that 9-to5 Mac used? http://9to5mac.files.wordpress.com/2012/08/screen-shot-8-31-12-at-12-56-35-am.png

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  4. Michael W. Perry Wednesday, October 3, 2012

    Apple’s in a Catch 22. The more they pay these execs to stay on, the easier I’ll be for them to leave. And the more labor it expects from them, to recoup those cost, the more attractive and early retirement will be.

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