The Drucker Difference

A Different Steve Jobs Departs This Time


In 1985, when Steve Jobs left Apple (AAPL) in the wake of an ugly boardroom struggle, Peter Drucker wasn't the least bit surprised—or sympathetic. The problem, he suggested, was that Jobs didn't adequately understand the discipline of management.

Jobs and Apple co-founder Stephen Wozniak "never got their noses rubbed in the dirt," Drucker said. "Success made them arrogant. They don't know the simple elements. They're like an architect who doesn't know how one drives a nail or what a stud is.

"If you look at the successful companies," Drucker added, "they are the ones who either learn management or they bring it in. In the really successful high-tech companies, usually the originator isn't there five years later. He may be on the board; he may be honorary chairman. But he is out, and usually with bitterness. … Jobs lacked the discipline. I don't mean the self-discipline. I mean the basic knowledges and the willingness to apply them."

The Difference This Time

More than two decades later—with Jobs again departing Apple, this time for his second medical leave since 2009—it's a good bet that Drucker wouldn't say such disparaging things anymore. Jobs, after all, has more than mastered the fundamentals that Drucker thought he failed to grasp in his younger days.

Jobs, who returned to Apple in 1997 after several more-seasoned chief executives had nearly run the company into the ground, has emerged as particularly adept at implementing one of Drucker's core principles: creating a customer.

"Markets are not created by God, nature, or economic forces, but by executives," Drucker wrote. "The want a business satisfies may have been felt by the customer before he was offered the means of satisfying it. Like food in a famine, it may have dominated the customer's life and filled all his waking moments, but it remained a potential want until the action of businessmen converted it into effective demand. Only then is there a customer and a market."

Or perhaps, Drucker continued, "the want may have been unfelt by the potential customer; no one knew that he wanted a photocopier or a computer until these became available." To this list, of course, we would now add the iPod, iPhone, and iPad.

A Deep Bench

But Jobs has apparently grown into a terrific manager in another respect: He has surrounded himself with a highly talented group of senior executives, including chief operating officer Tim Cook, who will serve as chief executive during Jobs' absence; Phil Schiller, Apple's worldwide marketing chief; and Jonathan Ive, the senior vice-president for industrial design, who is widely credited with giving many of Apple's products their sexy look and feel. Without question, the bench is much deeper than conventional wisdom would have it.

"At its inception, a company is often the 'lengthened shadow of one man,'" Drucker wrote in his 1954 landmark, The Practice of Management. "But it will not grow and survive unless the one-man top is converted into a team."

Drucker pointed out that even if only one person carries the CEO title, he must have a coterie of equally—if not more—talented colleagues "who are on his level and who do not therefore want anything from him; people with whom he can 'let down his hair' and speak freely, with whom he does not have to watch every one of his steps or words, with whom he can 'think aloud' without committing himself."

Getting to this stage takes diligence. "Teams cannot be formed overnight," Drucker cautioned in his 1985 book Innovation and Entrepreneurship. "They require long periods before they can function. Teams are based on mutual trust and mutual understanding, and this takes years to build up"—three at a minimum.

To be sure, many people—especially among those who aren't ardent Apple watchers—view Jobs as strictly a solo act. And that's for good reason: He qualifies as what Drucker called "a CEO superman." The trouble is, Drucker noted, "organizations cannot rely on supermen to run them; the supply is both unpredictable and far too limited." Ultimately, he explained, "organizations survive only if they can be run by competent people who take their job seriously."

More About Elves

For Apple, that's precisely the point: The company clearly boasts an impressive slate of competent people. And though no single one of them may make a perfect replacement for Steve Jobs, as a team they might very well remain highly successful.

In the meantime, it would benefit Apple to showcase the contributions of some of these other, extremely capable leaders better. As Yale School of Management professor Jeffrey Sonnenfeld remarked this week: "You only hear about Santa, but it's time that we hear more about the elves."

The No. 1 elf, at least for now, is Cook, who by all accounts did a splendid job overseeing Apple during Jobs's previous hiatus. This week, with many wondering whether Jobs will ever actually come back, Cook tried to mollify people's concerns. "The team here has an unparalleled breadth and depth of talent and a culture of innovation that Steve has driven in the company," he said. "Excellence has become a habit."

If that turns out to be true in the long run, Jobs will have proven himself more than a great visionary; he will have proven himself a great manager.

Wartzman
Rick Wartzman is the executive director of the Drucker Institute at Claremont Graduate University.

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