Thursday, January 15, 2009

Apple Individual Icon or Sustainable Investment

Apple (AAPL) finally realized that its chief star is seriously ill. Do not get me wrong I do not wish ill health on anyone. Steve Jobs has to take a leave of absence as his health concerns are more complex that originally anticipated. Given the secrecy that had shrouded his health it is not surprising that more bad news is coming out.

As I blogged in the past, Apple needs to know that it can operate without Steve Jobs. If it turns out he was the only one making the wheels turn, than buy a life insurance policy and sell the stock. This six month leave will establish if Apple has the bench strength that some in the media believe it has.

As a financial skeptic I see this as the law of unintended consequences coming to fruition. Steve Jobs is in part the manufactured construct of brilliant PR. Steve Jobs allowed the PR guy’s to do this and make him into a Sun God. The board went along and allowed the PR campaign. Now the PR dynamic cannot deal with medical reality. You would think in the modern age a company should be able to transition seamlessly to new leadership. Instead we are all caught up in an ancient construct that when the emperor dies he takes everything with him. Steve Jobs as brilliant as he was is not a demi-god.

Look at how well Apple will handle product announcements and any pitfalls or difficult decisions that may occur. If they are waiting for Steve Jobs to return it’s all over. Firstly he may not return. Secondly the company needs to operate despite him. No forward momentum for the company means the company has nothing to offer. We will soon learn if this company truly had maturity and depth that creates shareholder wealth.