Chapter 35 Chapter 1 on the verge of extinction

Now, let's go back to the beginning of the book again. In the summer of 1997, Joe, who returned to Apple, was appointed by the board of directors as interim CEO. We already know that Joe's leader at that time was about the most tangled person on the planet.On the one hand, Apple is facing internal and external troubles and is on the verge of bankruptcy; on the other hand, Qiao Gangzhu, who was ruthlessly abandoned by Apple, still loves Apple after 12 years of wandering. Even if Gangzhu Qiao is a god, in the summer of 1997, he was just a god who had just reunited with his former "lover", but was full of confusion about the future and was in a dilemma.

In 1997, Silicon Valley editor Michael Murphy (Michael Murphy) said: "Apple needs a savior anyway. This person must be a great manager, prophet, leader and statesman at the same time. The only person who is qualified may be Jesus, but he was crucified 2,000 years ago." Charles Haggerty, CEO of Western Digital, teased: "Apple can still be saved, but you have to call God." But we also already know that in the 10 years since then, Apple has undergone a magical and remarkable resurrection.If the miraculous products such as iMac, iBook, iTunes, and iPod that appeared in front of the world one after another were not enough to shake the whole world, then in 2007, 10 years after Jobs returned, Apple directly "smashed" the iPhone on the planet, It was the blockbuster that proclaimed that Gangzhu Qiao would rule the world again.

In May 2010, Apple surpassed Microsoft to become the technology company with the highest market value on the planet, returning to the undisputed throne of IT hegemony. Really, that is, in 10 years, Joe has done what only God and Jesus can do. The question is, how did he do it? Apple is a magical company marked by the return of Jobs. Before Jobs' return, Apple's normal state was to fire its leaders every now and then; after Jobs' return, Apple's normal state was to release products that shocked the world every now and then. In 1981, Mike Scott, the first professional manager hired by Apple, brought a dismal end to his Apple career with the massive layoffs on Black Wednesday. In 1985, the Macintosh sales crisis turned the CEO and founder against each other, and Jobs was expelled by Sculley.But the departure of Jobs did not change the tragic fate of Apple CEO.Among the successive CEOs of Apple other than Jobs, Sculley is actually the best one.

After Jobs left, Sculley relied more on technology from two computer scientists from Xerox, Alan Kay and Larry Tesler.In terms of product sales, in addition to maintaining Apple's dominant position in the education market, Sculley also tried to expand into professional fields such as publishing and design. The Macintosh Portable portable machine released in September 1989 seemed to inject a boost to the sluggish Mac computer, and the sales situation once recovered. In October 1991, Apple released the PowerBook, a notebook computer in the true sense, which drove the market share of Apple Computer to rebound slightly.During the period from 1989 to 1991, although he could not compete with the Microsoft and IBM camps on the frontal battlefield, Sculley still brought Apple into another golden age since the Apple II dynasty with his excellent detour strategy.

Seeing the company's slight improvement, Sculley began to feel elated.He felt that even without Jobs, he, Sculley, could do what Jobs had done, using technology to change the world. Sculley quickly saw an opportunity to "change the world."Apple engineer Steve Sakoman is working on a computer the size of a book.Sculley’s eyes brightened: If Jobs and Wozniak turned the computer into the size of a cardboard box, it was enough to change the world. Then, if I, Sculley, can bring this book-sized computer to the market, it will be better than Jobs. Greater? Sculley arranged for Larry Tesler, the founder of Apple's research and development center ATG, to be in charge of the project, and gave the book-sized product a scientist's name—Newton (Newton).

In January 1992, at the Consumer Electronics Show (CES) in Las Vegas, Sculley imitated Jobs on the podium and introduced Newton's product concept to the public.Sculley called this new product concept a Personal Digital Assistant (PDA). Standing on the podium, Sculley was inexplicably excited.He excitedly told everyone that PDA will completely change people's understanding of computers, and will also create a brand new market.In the not-too-distant future, people can use these small computers that can even be stuffed into pockets to connect to the Internet anytime, anywhere, handle personal affairs, or work, listen to music, play games, and watch movies.Sculley also tearfully made a superb prediction that he might regret for the rest of his life:

"The market created by PDA will reach a scale of 3,500,000,000,000 US dollars in the near future!" That's right, we didn't hear wrong, and we didn't count wrong.Sculley was talking about an astronomical figure of $3.5 trillion! In one sense, Sculley's prediction was not wrong.The PDA concept he invented was carried forward by a company named Palm a few years later, which produced a good-selling PDA computer.But Plam only flourished for a few years, and the concept of PDA was covered by smart phones.The rise of smartphones such as Black-Berry has made PDA gradually fade out of people's sight.A few years later, Feng Shui turned back to Apple.Whether it is the shocking iPhone or the iPad that sold 10 million units in the first year, there are actually some remnants of PDAs in the bones.

Sculley's mistake was that he used an incomprehensible astronomical figure at an incorrect time, trying to predict an opportunity that did not belong to him at all.The dismal performance after Newton’s listing was so far from the 3.5 trillion market size that Sculley swore to predict, so that the public and the media could not believe that Sculley was a sane person anyway. "Business Weekly" wrote an article mocking Sculley's boasted PDA market as nothingness: "PDA may not represent 'Personal Digital Assistant' (Personal Digital Assistant), but 'Probably Disappointed Again' (Probably Disappointed). Again)."

After 1992, the PC camp became stronger and stronger, and the advantages of the Mac in the graphical user interface were gradually caught up by Microsoft's Windows, and Apple fell into a trough again.Sculley, who was in trouble, even thought about selling the company to IBM or AT&T, but the cooperation negotiations came to nothing. In 1993, Apple laid off more than 2,500 employees, and the salary of the entire company was frozen, and another winter came.At Apple, that usually means another leader has to pay the price. In June, Sculley was fired as CEO, and Michael Spindler, who was promoted internally, became the new head of Apple.

Spindler is a tall and strong German. Because he can work continuously without rest, he is nicknamed "Internal Combustion Engine".But diligence does not necessarily mean talent, and hard work is often synonymous with incompetence.Spindler may know some products and sales, but he has little technical knowledge, and he is also clumsy about management and operations, often neglecting one another.He didn't like to show his personal charm in front of the media and the public like Jobs did. On the contrary, he trembled all over when he encountered difficult things, and his back sweated as soon as he stood on the podium.

During the years when Spindler was Apple's CEO, Microsoft officially declared Apple's defeat in the computer war with Windows95. The camp of IBM, Intel and Microsoft won without dispute, and Apple, the inventor of the personal computer, could only survive in a small market share of around 7%. In 1995, the loss in the last fiscal quarter alone reached 69 million yuan. In 1995, 14 of the company's 45 vice presidents resigned, and more executives were planning for their future. In January 1996, Spindler had to wield the sharp edge of layoffs again, and more than 1,300 employees left. Kai-fu Lee, who witnessed all this at Apple, commented: "Apple at that time was a company that lost its soul. When Jobs left the company, the soul was lost. The financial statements were terrible, and useful innovations could not be brought to the market. Years of hard work went to waste, which broke the hearts of Apple people. When layoffs, many employees left in tears." In the precarious wind and rain, Spindler's seemingly strong body finally collapsed.He suffered from heart disease and anxiety attacks.Colleagues have witnessed the scene of him crawling under the table with his head in his hands when he was in pain. In January 1996, Spindler was admitted to the hospital because of a heart attack. The doctor gave him an ultimatum: Either resign as CEO and take a good rest, or wait for the day when the heart ruptures while busy. During the period when Spindler was at the helm, Apple also tried to copy the compatibility model of the IBM PC, authorizing some computer manufacturers to produce Macintosh clones.But this effort was too late. Instead of helping Apple expand its market share, cloning computers turned and encroached on Apple's own territory. In February 1996, "Business Weekly" commented on Apple's situation in the personal computer market: "This time, Apple has lost something irreparable-the kind of innovative technology that made the Macintosh stand out and was ahead of the times. Millions of Apple users still insist on defending Apple, saying that the Macintosh is still better than the average PC. But Microsoft has gone to great lengths to improve Windows, so much so that most new computer buyers today can't see the difference between a PC and a Mac— — except that Apple computers are more expensive.” At that time, Sun was already eyeing up, trying to annex Apple.Beginning in September 1994, Spindler started serious acquisition negotiations with IBM and Sun, but in the end they failed to negotiate due to price reasons. At the general meeting of shareholders on January 23, 1996, shareholders collectively demanded Spindler's resignation.Markkula continued to defend Spindler insincerely: "The board has full support for Spindler." But just a few weeks later, the board formally fired Spindler.At that board meeting, a director pointed at Spindler excitedly despite his serious heart disease and said, "Mr. Spindler, it's time for you to walk." To drive away Spindler, the "firefighters" invited by the board of directors are Jill Amelio, the protagonist of the first chapter of this book.Like Scott, Amelio also came from National Semiconductor.From taking office in February 1996 to being replaced by Jobs in July 1997, Amelio's Apple CEO career lasted about 500 days, the shortest among Apple's previous CEOs. The 500-day "firefighting" experience is like a play, with twists and turns and exciting ups and downs, but it ends in a flash.In the eyes of many commentators later, Amelio was like a clown with low skills and ignorance of current affairs. In the 500-day CEO experience, he played the role of playing a role for Jobs to return. To be honest, in the short 500 days, Amelio has still conscientiously done what a "firefighter" should do.He re-wrote Apple's strategic plan, tried every means to save money, abolished products that lack strategic value on a large scale, and tried to build a good relationship with industry giants such as Microsoft... If you look at what Jobs did after he became the interim CEO, people may One would ask, didn't Amelio do the same thing before Jobs returned?Why did Jobs succeed and Amelio fail? Sometimes reality is so cruel.Even if you do the same thing, if the method and style are wrong, the result may be completely opposite.Amelio is by no means a lazy and stupid CEO, but his style of doing things is incompatible with Apple's DNA, which directly doomed his tragic ending after 500 days. On the day he took office, the new CEO, Amelio, approached Kai-Fu Lee, who was in charge of the company's cutting-edge interactive multimedia department at the time.Hearing that the interactive multimedia department was going to hold a staff meeting that day, Amelio insisted on attending and asked Kai-fu Lee to keep the last 15 minutes of the meeting for himself. Facing Kai-Fu Lee's team, Amelio said confidently: "Don't worry, the situation of this company is much better than those companies I rescued from the ghost gate before. Give me 100 days, and I will tell you the way out of the company. where." A manager on Lee's team, Howard Green, raised his hand and asked Amelio, "So what do we have to do in the first 100 days?" Amelio's answer: "Keep your cash flow healthy." That's right, keeping cash flow healthy is not only the top priority for all companies on the verge of extinction, but also a minimum requirement for a new CEO.But the root cause of Apple's disease at that time was the lack of innovative spirit. For this root problem, Amelio had no good solution. When accompanying Amelio out of the meeting room, Kai-fu Lee asked Amelio how he felt.Amelio said haughtily: "Apple is really undisciplined, not at all." Li Kaifu was inexplicably surprised by these words.Amelio's arrogance, arrogance, and a hint of hierarchy run counter to Apple's traditional tech culture.Amelio even asked Kai-Fu Lee to address him as "Dr. Amelio," a far cry from the way most technology company employees call each other by their first names.Li Kaifu was a little more worried about the savior invited by Apple. Amelio, who took over the helm of Apple, complained from the beginning about Apple's lack of strategic direction. He said: "Apple has never had a formal description of corporate strategy." Ever since, Amelio and the "think tank" he brought with him began to design the so-called "strategic plan", but they rarely listened to the ideas of Apple employees, and the whole plan was completely on paper. After 100 days, when he threw out a whole set of strategic plans, no one understood and no one supported him.Even if someone had fantasies about this "firefighter", they would have turned around and left by this time. When Apple's cash flow was tight and the company was saving money, Amelio even decorated a suite for himself as the CEO's office, which also had a private bathroom.In this way, he doesn't have to come out to show his face, and he can stay in the office all day and be his "lonely person". In addition to ignoring the advice of Apple employees and failing to integrate into Apple's DNA, Amelio also has no clear understanding of Apple's brand value.At that time, there were many quality problems with Mac computers, and even Apple's traditional field of strength-schools began to consider switching to the Windows platform.Some major customers who use Apple computers for office work have even invested in the PC camp. On one occasion, Chinese entrepreneur Gareth Chang, a member of Apple’s board of directors at the time, called Amelio in a hurry: “Nike is planning to abandon the Mac and switch to a Windows computer. You have to send them a new Power Book3400, let them see how powerful the new Mac is." At the same time, Zhang Zhenzhong hoped that Amelio would be like Jobs in the past, visit the site of a big customer like Nike, and regain people's confidence in the Apple brand with an inspiring speech. But in Amelio's mind, it's not a big deal for a company to replace several office computers with Windows computers, and it wouldn't bother his CEO to go there himself.He rejected Zhang Zhenzhong's request, and at the same time lost the opportunity to reshape the Apple brand. The company's performance continued to decline. Brother Amelio didn't find the reason from himself, but pointed the finger at the employees.In addition to continuing the mass layoffs, he pointed at all employees at an all-hands meeting and said, "Damn! Please, don't give me a hard time, okay?" In June 1996, Kai-fu Lee, who really couldn't stand Amelio's poor management, resigned from his position as Apple's vice president, just passing by Jobs who returned at the end of the year.When Amelio arrived, the company had more than 40 vice presidents. After 500 days, fewer than 20 of them are still with Apple. Amelio, who was fired by Apple, published a memoir in 1998 called On The Firing Line: My 500 Days at Apple.In this book, Amelio attributed the main reason why he was forced to leave Apple to a series of "conspiracies" implemented by Jobs in conjunction with Oracle's Larry Ellison and others in order to regain the CEO power after Jobs' return.Amelio said in the book: "The way Steve Jobs treated me made me annoyed. Although I have come out of this shadow, I will never forget the pain. For Jobs, maybe returning to Apple And taking back power could finally melt the ice left behind by his expulsion in 1985." Amelio's argument was questioned by most of the parties involved, and many of the examples he cited in the book were deliberately exaggerated, distorted or fabricated.A former Apple director who personally witnessed Amelio’s departure told the author: “In Amelio’s book, it’s all lies.” Of course, Amelio's 500 days are not without merit.At least, he did three things that are enough to determine the history of Apple. The first thing is that after Amelio took over Apple, he somewhat improved Apple's poor financial situation by abolishing projects and cutting expenses, and invited a capable CFO Fred Anderson.These measures at least dragged Apple back from the edge of the cliff and prevented Apple from collapsing quickly. Second, when Amelio continued the acquisition negotiations with Sun, he resolutely rejected Sun's low offer, and basically gave up the idea of ​​selling Apple, and focused all his energy on saving Apple.Just imagine, if Amelio persuaded the board of directors to sell Apple at a low price, wouldn't everything become a phantom today? The third thing is that when Amelio decided to outsource the operating system during Apple's software crisis, he did not exclude NeXT because of the rift between Jobs and Apple's top management.If NeXT hadn't been acquired by Apple, Joe's return might have been delayed for another year or two. Without Joe, whether Apple could survive this year or two, I'm afraid no one can say for sure. A former Apple vice president commented on the three CEOs before Jobs returned: "Sculley has actually done a very good job. Under Sculley's leadership, Apple's annual revenue has grown from more than a billion US dollars to nearly 10 billion US dollars. Dollar. Many Apple employees like him very much. However, Sculley’s shortcoming is that he is not good at predicting industry trends, does not know how to employ people, and is not good at making decisions. Spindler is a very bad CEO. He knows some sales, But terrible in management, technology, and product. Amelio was a traditional, old-fashioned CEO who killed some projects, improved the financial situation, and bought NeXT, which somewhat prevented the big ship from sinking too quickly. But he Powerless to save Apple. His style determines that he cannot mobilize the full potential of Apple." In any case, when Jobs decided to be the interim CEO of Apple in 1997, the three predecessors left such a mess: the stock price fell to a trough, the market share continued to decline, the internal product line was chaotic, the strategic direction was unclear, and the main product failures were frequent. Out, the employees are panicked, and the outside world is surrounded by powerful enemies... In October 1997, interim CEO Jobs announced that Apple's fourth-quarter loss reached 161 million U.S. dollars, and its revenue for the entire fiscal year was only 7.1 billion U.S. dollars, a decline of 28%. The gang leader has returned, but the big ship is still leaking. Let's take a look at what Joe did to finally achieve Apple's shocking reversal.