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CXO

Apple's boss proves that leadership results in performance

During a difficult environment, can strong leadership still create great results? Or is the smarter move to cut expenses until sales come back? Executive coach John M. McKee says the answer can be found in Apple's recent numbers.

Apple's Q3 operating results, up 47%, far exceeded Wall Street's expectations.  For comparison's sake: the most recent numbers for Dell showed it down 23%, HP was down 2%, RIM (BlackBerry) dropped 4%, and Microsoft was down 17%.

What's behind Apple's surprising results? Although industry analysts had expected it to do better than competitors, even they were blown away. Further, this performance comes during a retail environment where many big name retailers are flailing around, just trying to survive.  Additionally, all reports about consumer spending say that it's way down year over year, too.

Many would say the answer for Apple's continued success lies in their usage of the  classic marketing matrix.  Developed back in the 60s, it remains the backbone of many advertising and marketing plans created today. In summary, it states that all marketing decisions fall into one of four categories:

  • Product
  • Price
  • Place (distribution)
  • Promotion

Let's consider it in this case: Arguably, Apple's product have a cachet among many of its fans - to them, it's much cooler than many of its rivals. But most techies would note that the hardware is not the best available.  Price-wise, Apple is not inexpensive. Many competitors offer more for less. So what about distribution?  Well today, that means a combination of online sales and retail, and Apple is good at both. But is it better than Blackberry, Dell, or HP?  Hard to argue that it's highly superior to them on this element. Promotion, which is usually considered to be, "off pricing, discounting, enhanced offers, etc." is rarely used by Apple.  However, it does spend a lot on brand development - like those ads with the guy from Mac and the guy from Microsoft.  But if you want to watch really big money spending on brand development, watch Microsoft's launch of Windows 7: I expect they'll buy any possible opportunity to ensure that every human being in the world knows about it.

So, what's behind Apple having their single best quarter in history?

I think it has everything to do with their leader, Steve Jobs. As most people will know, he has created a culture that is very different from the others cited in this article.  Some say it's great. Others contend it's too demanding.  A few say it's too dependent upon the boss himself. Regardless of where you stand regarding him and his style however - his results are hard to debate.

As an executive and leadership coach, I'm often involved in discussions regarding the ultimate power of an individual leader. It's worth noting that, in defense of themselves, or their lack of performance:

1. Many leaders will tell me that they are hamstrung by the need to show certain quarterly results. These people contend that they'd like to do things differently, but don't have the autonomy.

2. Some leaders simply don't buy into the concept that any single person can have that great an impact on performance overall.  They've probably never seen, or had, a great boss who accomplished things others could not.

3. Fiscal responsibility stops them, I hear. These bosses whine that - while they believe it's possible to get better results by investing in culture, team performance, or even individuals - "now" is not the right time to do that.  ("Now" is always when they say it is.)

4. Worse still, many leaders actually still equate investing in people as merely increasing expenses. Such thinking doesn't even consider the ROI that can be generated.  (Good leadership coaching has a quantifiable return in the range of 500% according to independent studies.)

If you don't know already, Steve Jobs has many detractors. Many people have left Apple because they couldn't work for him. But ultimately, Apple's results can be directly linked back to his strong leadership.

When leadership causes - and expects - strong performances from every person in the company; the payoff is always improved results.

john

Leadership Coach

About

John M. McKee is the founder and CEO of BusinessSuccessCoach.net, an international consulting and coaching practice with subscribers in 43 countries. One of the founding senior executives of DIRECTV, his hands-on experience includes leading billion d...

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