At least for now. Apple said “the transition in leadership” was necessary, and that Amelio has “firsthand working knowledge” of the company from his year on its board. The new chief, who also replaces longtime Apple power A. C. Markkula as chairman, brings with him a reputation for saving sinking ships; last year he even wrote a book, “Profit From Experience,” on transforming troubled companies. Beneath the lofty admonitions (“It takes bold moves and a clearly articulated Vision. . . to hear the clarion call of a new day”) lies the story of how this physics Ph.D. who holds 16 patents brought National Semiconductor from the brink of bankruptcy back to solid fiscal footing. His secrets: touchy-feely participatory management, prudent cost-cutting and lots of deep thinking about strategy.
The rot at Apple will test those skills. The PC maker lost millions under Spindler, the German executive known as “The Diesel,” as its profit margins eroded and its forecasters badly misjudged how many Macs shoppers would want. Nearly everyone in computerdom cheered at the prospect of the new boss’s arrival, and Apple’s stock rose by 88 cents to $29.25 on the news. Employees, who’ve spent recent weeks taking calls from headhunters and telling old jokes about the company (example: What’s the difference between Apple and a kindergarten? A kindergarten has adult supervision), welcome a replacement to Spindler, who’d been lambasted by shareholders and derided as a “lame duck” who was doomed to be fired. Complains one staffer: “There’s [been] no fire at the top, no one with a gun telling the troops, ‘Let’s go get ’em’.”
Whether Amelio’s arrival means that Sun’s campaign for Apple has ended is an open question. Most observers say Apple’s board turned to Amelio because it couldn’t get a high enough price from Sun, which reportedly offered Apple only $20-something per share when its stock was trading above $30. But that doesn’t rule out some sort of joint venture or, less probably, a deal to sell off some of Apple’s assets like its Newton handheld computer business. Another possibility, experts say: after Amelio spends some time polishing the fallen fruit, Apple could get a better bid from Sun–or another high-tech suitor. His first tasks are to stop the exodus of engineers and executives, and to clear the shelves of the bulging inventory. “If Amelio [does] the right thing, Apple could be trading at $60 or $70 a share instead of $30,” says industry consultant Pieter Hartsook. Others insist that if the new boss fixes what’s broken, there’ll be no need for Apple to find a buyer.
Amelio wasn’t talking, but his book gives some clues to his thinking. In chapter one he dismisses managers who use quick fixes to right a company’s wrongs and then ride off into the sunset. “The extreme turnaround manager is a pirate who sails away leaving a floundering crew on a plundered ship heading toward disastrous storms,” he writes. This much is clear: in the months ahead, Amelio will learn lots about guiding a ship that’s sailing dangerously close to the rocks.
