Apple CEO Tim Cook's First Full Year at the Helm: 10 Mistakes He Must Avoid

 
 
By Don Reisinger  |  Posted 2012-01-31
 
 
 

Apple CEO Tim Cook's First Full Year at the Helm: 10 Mistakes He Must Avoid


Apple CEO Tim Cook has a difficult job. Looking back at the history of his company, there has been one CEO-co-founder Steve Jobs-who has been able to lead Apple to greatness. Other executives at the helm after Jobs was forced out in 1985 came perilously close to driving the company into the ground. There is a general concern among shareholders that Steve Jobs and Steve Jobs alone knew how to run such a big and sophisticated company as Apple.

But Cook's troubles go far beyond filling Jobs' shoes. The Apple CEO is also running the world's largest company and based on calendar fourth-quarter earnings, it's a firm that is generating more cash than any other competitor in the technology space. To give all that back because of poor decisions would be a huge black mark on Cook's record and more than likely limit his chances of ever coming close to looking like a Steve Jobs replacement.

So, there are a host of potential pitfalls waiting for Cook. And if he's not careful, he might just fall into them. But luckily for the Apple CEO, we have him covered.

Read on to find out what mistakes Cook can't afford to make at Apple this year:

1. Put an end to the secrecy

One of the key elements of Apple's success over the years has been its penchant for secrecy. The company uses the rumor mill to promote its products and build hype, and all the while doesn't allow a single sliver of real attributable news to leak out. It has worked beautifully in the past, and it's something Cook must not ditch as he starts making decisions this year.

2. Make the announcements less special

At the same time, simply sending out press releases or having half-baked press events to announce new products would be a mistake. So far, Cook hasn't proved that he really understands the value of major press events and has largely left them up to his executives to handle. That needs to stop. He needs to be the face of Apple and prominent at major product introductions.

3. Maintain status quo on production

Unfortunately, production facilities Apple relies on around the world are becoming increasingly troublesome for the company. Many workers at a Foxconn, a company that produces Apple products, complain of poor working conditions and practices. What's worse, some workers have committed suicide in the factories. Granted, Apple doesn't own those companies, but as a petition from watchdog group SumOfUs explains, Apple has the ability to "overhaul the way its suppliers treat their workers." Cook must not maintain status quo in overseas production facilities. Things must change.

4. Forget Steve Jobs' lessons

As noted, Apple co-founder Steve Jobs has been the only chief executive at the company who really knew what it takes to make it successful. So, the last thing Cook should do is throw out all the lessons Jobs taught him to try a different course. Jobs' strategies worked. And Cook must accept that.

Licensing Mac OS X or iOS Is One of the Worst Ideas


 

5. Turn his back on the iPod

During Apple's first fiscal quarter (calendar fourth quarter), the company revealed that only iPod sales were down during the period. That has caused some to wonder if Apple will start to turn its back on the iPod this year. To do so would be a huge mistake. The iPod, while not as popular as it once was, is still a great way to get young kids and people in emerging markets to warm to Apple's products. Turning his back on the iPod would be a huge mistake on Cook's part.

6. Get into licensing

Although many people have called on Apple to license iOS and Mac OS X to hardware vendors, Cook must fight that urge. Yes, the idea would yield Apple boatloads of cash, but it would also hurt its hardware business. And as Jobs said time and again over the years, Apple is a hardware company first.

7. Make a dumb acquisition

Apple has nearly $100 billion of cash on hand and can pretty much buy any company that it wants. But to simply spend cash on companies that might not add too much value to its bottom line would be a mistake. If Cook plans to make some acquisitions this year, staying away from a dumb buy should be paramount in his mind.

8. Leave iCloud as it is

Apple's iCloud platform is a great first step for a company that's trying to get into the cloud services business, but it doesn't go far enough. This year, Apple should bring video streaming, more enterprise features and a host of other improvements to iCloud. Cook must not ignore iCloud as a future major contributor to his company's bottom line.

9. Hold on to all that cash

As noted, Apple has enough cash to keep its business secure for years. But that doesn't mean that the technology giant should just hold onto it. Cook should consider doling out dividends to shareholders, acquiring companies that make sense for Apple to own, and investing in new research and development activities. Just sitting on $100 billion in cash is not necessarily a good thing.

10. Deliver nominal upgrades this year

For many Apple customers, 2011 was a bit of a down year. The iPad 2 turned out to be an iterative update over its predecessor, and despite hopes for a dramatically redesigned iPhone 5, Apple only showed off an iPhone 4S that mimics the design of the iPhone 4. Letting one year pass like that is fine, but two years is unacceptable to Apple fans. Cook better deliver major upgrades this year, or he could see a sense of disappointment grow among Apple's otherwise loyal and happy fans.

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