Apple appears to be on verge of creating a minor firestorm for their actions regarding the information leaked regarding their future products. I agree with those observers who say that Apple has every right to enforce their non-disclosure agreement. However, as many have also mentioned there are some larger issues in play here. Unless I have misunderstood the issue, Apple employees leaked the information. Apple has been unable to find out which Apple employees broke their NDA.
Now they are going after people who did not sign Apple non-disclosures. In essence Apple can't control their own people so they want the courts to help them. I like many others think this is wrong and has the potential to harm the blogging movement.
This comes at time when citizen driven journalism is desperately needed. Even in the venerable New York Times, there is great concern over the current state of the news media.
"But we've now entered a new twilight zone: in 1972, at least, the press may have been stacked with jokers but not with counterfeit newsmen."
Frank Rich, March 6, 2005
There is little doubt that there are huge problems in country which are compounded by the lack of real reporting. We are right to worry about lack of a vigorous press to act as a check on a government that has lost its way. My thoughts about the recent election are recorded at my writing site so what I am really concerned about here is Apple and the lack of real reporting on Apple.
There are few bloggers or reporters who are doing an outstanding job of tackling the real barriers to success in corporations. We mainly hear about great products or quarterly results which are better or worse than expected. Most reporting is clearly within the "reality distortion zones" of celebrity CEOs such as Steve Jobs. It is time to get beyond the reports that only pay homage to the greatness of the CEOs and products they deliver often on the backs of their often ignored employees.
The story about Apple going after the websites is probably only a hint of a much greater story that will likely never be investigated. However, It is important to those of us who would like to see Apple break the habits that continue to make it hard for the company to break beyond its measly 2% market share. As I have said before, there is something fundamentally wrong with a company whose strong hardware products and world class operating system can only garner a tiny piece of the world's computer market. It cannot all be blamed on price. Hiring HP's marketing person will likely not fix the fundamental problems either.
In spite of everyone looking for external factors as the reason for Apple's true lack of success in computers, perhaps this latest glimpse of the real Apple will get both bloggers and interested business reporters to dig a little digger to get inside that carefully controlled Apple image.
The first question one might ask and I have already asked if in my first post to this blog, "First Slices", is why there are no real Apple blogs? Microsoft and Sun have blogs, Apple appears to have none. Does Apple not want to have a dialogue with customers?
The next question is does anyone know someone that is serving on an Apple customer advisory council?
The third question would be how many people do you know who say "I love Apple's products but the company is real pain." Sometimes that statement gets much closer to the point, "Love the products, hate the company."
Finally if Apple is such a great company and makes such wonderful products, why is Apple missing in action in the top companies to work for lists? Apple has nearly a $5B cash horde, surely its employees must be doing great.
I would love to see reporters and bloggers start talking to ex-Apple employees and ex-customers and partners. I know Apple very well, and I suspect Apple's corporate shine would disappear pretty quickly. That could be healthy thing if it led to real change in attitudes towards customers and employees.
Apple is so concerned about controlling its image, that as many people know each year, after their WWDC event where their next OS release is shown to thousands, Apple field employees can do little after the event but refer customers to web sites for information. In essence Apple employees can't talk about their own products even when talking about them will lead to greater sales.
What is so surprising about Apple not being able to track down its leaks is that so few Apple employees know anything about future products, that usually there are only a handful of people who could leak the information. When new Apple products are announced, as many customers who have attended events will attest, Apple employees find out the products at the same time that customers do.
As some of the few Apple customers who have received product non-disclosures will tell you, usually their Apple sales people are asked to leave the room before any information is disclosed. That puts the sales force in an unusual position of not knowing what their customer knows.
Of course inside the rabbit hole, that is standard operating procedure along with a number of behaviors that have a detrimental effect on any Apple effort to grow their market share.
Key among the negative behaviors is the whole idea that Apple knows better what customers want than customers themselves know. While this might be true in innovative ground breaking consumer products, it is certainly worth debating whether this is the case or not in products targeted to the enterprise. I believe that for Apple to be really successful beyond their clearly clever products they need to listen to enterprise customers and take their requests seriously. I have discussed this in my blog, "Connecting the Dots." The enterprise, education, and consumer markets are far more connected than Apple likes to think.
One of Apple's truly counter productive behaviors is driving away their best people because Apple is truly a culture where anyone who makes waves is not tolerated. This was a subject of another of my blogs, "Chasing Away Your Best People." Anyone whose ideas are counter to management's thoughts will not last long at Apple. The Bush team could take lessons from Apple is creating an environment where no one challenges the boss. Right now everything looks great at Apple because of the iPod. A closer look reveals that in spite of a few highly publicized deals, Apple's success rate with computers is just not what it should be given the products, both hardware and software.
To me that leaves the management of the company and the culture that the management team has created. One thing you can be certain of at Apple, is that the best eventually leave because there is almost no chance of promotion. Apple has a policy of getting their management teams from outside the company. Long gone are the days when Apple was a company that cared about people enough to develop them and them give them jobs which matched their abilities. In fact it would be interesting to see how many older employees leave Apple only to be replaced by younger less expensive employees.
As I talked about in my "Employee Development" blog, most employees develop themselves at Apple trying to deliver what their customers need in an Apple environment that is devoid of most of the normal corporate mechanisms that help sales people meet their customer's needs.
Apple's product marketing folks often believe that Apple products are capable of doing far more than the products can really do. It is often only the sales people and the unlucky first customers who find out that Apple has neglected to really test things in serious production environments. I remember a customer wanting to use a specific OS X feature to handle 2,000 seats. It took us a long time to find out that it had only been tested with three seats since product marketing tends to ignore the field sales force. We had to arrange our own test in the field and we found out in a five hundred seat test that there were a lot more challenges before the solution could be deployed on 2,000 seats. One clue to Apple is that product marketing runs the company. Little else matters.
Unfortunately for Apple, there are few Apple customers with large enough numbers of seats where Apple can partner to test anything but a very few products. This is the nature of Apple. The company is reluctant to release products to customers for testing before shipment, so the products get very limited field testing before they hit the market. It makes for some great surprises when things don't work exactly as expected.
When it comes to partners, the story is more complex than one would
expect. There was a time when being an Apple dealer was a great
thing, I helped run a five store chain myself in Canada in the early
eighties. Later for Apple I managed some great Apple resellers.
Unfortunately as many resellers will tell you, Apple has always wanted
to have its cake and eat it to. First education business went direct,
then higher education has been direct, then an agent model, and then direct
again with some agents. All of these changes have huge impacts on resellers. The real key to reseller problems has been
Apple's love-hate affair with mail order resellers. Apple has often
needed them to soak up excess inventory at quarter's end, but then they
have all but driven out the margin available to storefront based
resellers. On top of this you have to layer Apple's own direct efforts,
both at the store front level, on the web, and with a direct sales
force, both inside and outside.
With this many efforts at selling to customers, one would think that Apple would be tremendously successful. The reality is that most of these organizations end up fighting over the same customers with some seriously detrimental impacts on Apple's margins. Who gets the customers often is determined by which internal Apple organization gets the best prices from finance. This often has no relationship to which organization created the opportunity or which organization has the best capability to build a relationship with the customer for future sales.
All this ends up causing confusion among customers and Apple sales people. It also makes the effort of finding and winning new customers very risky. You can put in the effort and lose to someone who has done nothing more than show up with a better price. Over time it meant that good resellers could not afford to have great support people since they would just lose to mail order houses. It also means that most of Apple's technical resources are focused on pre-sales efforts. The goal is to come in and win the business before another competing internal or external organization knows about the business. Of course this leads to even more secrecy but that is fine since Apple management believes that internal competition over customers leads to a more aggressive sales force.
Unfortunately, the Apple sales force is so tiny and arrayed against thousands upon thousands of Windows people, and the whole Open Source movement, that it is really very hard for Apple to do much more than fight over their existing customers. Apple isn't even background noise in the battle for the customer desktop, servers, or storage.
When an Apple organization does do well, it has to break out of Apple's corporate mold which means that it risks making its executives look like they don't know what they are doing. As I mentioned in my "Whacky Numbers" Apple has a negative response to anyone who is being successful doing something that is beyond the core consumer-education focus of the company. If you rub salt into the wounds of Apple executives by being successful in unorthodox ways that they didn't think of before you, you're likely gone as soon as they can find a way to get rid of you. Remember Apple is a no waves zone.
It is hard to tell if I am still too close to the Apple situation to be objective, but I know that Apple can be more successful with their computer products. The current gating factor is the company culture and the management. The interest at looking a little closer at Apple that this recent trade secrets story has created is certainly positive in my mind.
I want to have a choice beyond the Windows and Linux world. I am not certain that Apple under its current management is going to sustain that choice. I also want my remaining shares of Apple stock to grow in value so my hope is to create positive change at Apple before the iPod isn't there to carry Apple.
The consumer public is certainly fickle. Apple is riding something of a bubble in consumer enthusiasm, and Apple is really good at deflating its own bubbles. Attacking web sites because Apple has created an employee culture that wants to leak information is something that Apple should be ashamed of, especially if it ends up destroying the very valuable contribution that blogging and websites are making to our society. We need citizen journalism more than we need Apple to fire a few leaky employees. Perhaps if some of those employees were treated a little better they might be a little more loyal to Apple.
Remember Apple long ago disappeared from the lists of top places to work. There are lots of reasons for that, maybe for Apple to be really successful in computers once again it is time some of those reasons were exposed to the light of day.
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