When a company as great and as innovative as Apple (NASDAQ: AAPL) loses the visionary that kicked off a once-in-a-generation rags-to-riches corporate reinvention, naturally investors are going to be skeptical that the party can continue. Indeed, without Steve Jobs at the helm, investors have repeatedly claimed that Apple has lost its "innovative" spark. While I vehemently disagree with this (Apple's R&D spend has never been higher), I can understand why investors may not be so hot on Tim Cook after years under Jobs.
That said, Tim Cook was hand-picked by the late Steve Jobs himself and it's becoming apparent - particularly after Apple's general meeting - that Jobs made the right choice.
It's Not About The ROI - Bingo!!
I quote the following from an Ars Technica piece covering Apple's General Meeting that caught my eye over the weekend,
"When we work on making our devices accessible by the blind," he [Tim Cook] said, "I don't consider the bloody ROI." He said that the same thing about environmental issues, worker safety, and other areas where Apple is a leader.
He didn't stop there, however, as he looked directly at the NCPPR representative and said, "If you want me to do things only for ROI reasons, you should get out of this stock."
While this may seem like a pretty trivial concern when discussing a $170 billion-plus company that lives and dies by its ability to command profits in a fast-growing, but highly competitive, mobile devices market, it's really not. Management is the single most important factor that will make-or-break a company/stock long-term. A great management team with the right vision, attitude, and priorities can make the difference between a company with a stock chart that looks like this:
And a stock with a chart that looks like this:
Technology companies that last long-term are those that are willing to take risks, invest heavily in R&D (even at the expense of short-term profits), and are willing to venture out and explore into new areas, both adjacent to the company's core cash cow(s) as well as ideas that are far out in left field.
Now, Cook would have been impressive enough if he were simply talking about potential R&D projects that end up not bearing fruit, but in this case, he was speaking more broadly, addressing - in one shot - environmental responsibility, accessibility of Apple's products to the disabled, as well as the general notion that not everything Apple does is done solely to maximize ROI.
That, interestingly enough, is exactly the kind of attitude that is the mark of a CEO/management team that knows how to run a rich, profitable, and growing technology company for many years to come. Companies that fail to pursue opportunities and potentially disruptive technologies, and those that fail to want to make life better/easier for others, are those without long-term vision and are - in the long-haul - probably doomed to mediocrity.
Tim Cook Is The Right Man For The Job
Another thing that was noteworthy was reading about just how angry Mr. Cook seemed to actually get at the suggestion that Apple should do things only for profit. Of course, this must have been insulting to Mr. Cook who is head of the most profitable technology company in the world, but the more important point is that sometimes myopically chasing only things that are obviously profitable today leads to tunnel vision. This, in turn, could doom the company's long-term prospects if the underlying markets change.
That said, the real item of note here was that Tim Cook could actually get angry and exhibit some real passion in front of an audience. Many of the criticisms levied against Mr. Cook is that he isn't enough like the passionate Jobs, but it's becoming clearer that Cook's fairly calm public image fails to convey a potentially Jobsian passion for Apple, its products, and its future. This - coupled with an understanding of what Apple is all about - is what it takes to have a shot at filling the very large shoes that Jobs left behind.
And, while the story is far from over, Cook seems to have what it takes to guide Apple through the next generation of challenges and to capitalize on the next generation of opportunities. Steve Jobs appears to have made the right choice - yet again.