After Steve Jobs, Could Apple Face A Brain Drain?
In Silicon Valley recruiting circles, Apple employees are considered notoriously difficult to poach. From top executives to entry-level engineers, most have been content holding lucrative stock options, designing the latest iPad or iPhone and working for Steve Jobs, who inspired deep loyalty from his staff, recruiters and observers say.
But after Jobs' death on Wednesday, some observers say Apple could be vulnerable to a "brain drain" as competitors scramble to hire away top executives who had more allegiance to Jobs than to the company.
"In many ways, they had a personal loyalty to Jobs and he's not there anymore," said Rob Enderle, principal analyst at the consulting firm Enderle Group. "When you lose the person you're loyal to, you suddenly start to think about other opportunities."
He added, "There's going to be a lot of soul-searching over the next 12 months about what they want to do next."
Jobs, the 56-year-old co-founder of Apple, died Wednesday, reportedly due to complications of pancreatic cancer. In August, he resigned as chief executive of Apple, recommending Tim Cook as his successor. But Jobs remained chairman of the board and many analysts expected him to remain actively involved in the company's operations.
Now, though, Apple executives may start looking elsewhere, especially since "they don’t have the apostle to follow anymore," said Andy Hargreaves, a senior research analyst at Pacific Crest. Such an exodus of talent could be damaging to the company's long-term health, he said.
"There's a ton of talent inside that company that doesn't get recognized by the public," Hargreaves said. "But if you lose those people, you lose a lot of the experience, history and talent that makes those products what they are."
Some say the brain drain at Apple has already begun. Earlier this year, retail chief Ron Johnson left Apple to become chief executive of J.C. Penney, and Bertrand Serlet, who led the development of Apple's operation system, also left the company.
It will be up to Cook to keep Apple's top managers on board, analysts say. But for many, the option to leave and take the top spot elsewhere may be tempting.
"If every person reporting to Tim [Cook] left Apple, they would be CEO of any company out there," said Horace Dediu, a blogger who covers Apple. "They would be superstars in their own right. But if Jobs were there he would have kept them in check and given them reason to believe they were on a mission that had importance."
Others, however, say that Apple will continue to recruit and retain top talent because Jobs created a culture that inspires creative people to do their best work. For most Apple executives, leaving the company to go elsewhere "would be a step down," said Charles Wolf, an analyst with Needham & Company.
"This is not Wall Street where anyone would go anywhere for money," Wolf said. "A lot of companies would love to have these people but I don’t think they're going to get them. I think it's going to be exceedingly difficult to pick off these people."
Several Silicon Valley recruiters agreed. If Apple's stock price fell or several Apple executives left, others may follow, they said. But otherwise, many do not think Apple employees would leave just because Jobs is no longer around.
"Even though Steve Jobs is no longer running the company day to day, Apple is still going to be a magical place for people to work," said Ed Zschau, a Silicon Valley recruiter with Inductus Associates.
Most importantly, Jobs' small circle of trusted executives -- including Cook, Jonathan Ive, Apple's iconic designer, and Phil Schiller, Apple's marketing guru -- are less likely to leave now that Jobs is gone, said Tim Bajarin, president of the consulting firm Creative Strategies and a longtime Apple observer.
"All of these guys are well-compensated and they love working at Apple," Bajarin said. "They are fundamentally committed to preserving Jobs' legacy and carrying forth his vision and I think they will be more diligent at that now to honor him."
But Enderle said Apple may start to experience the gradual loss of talent that took place at Microsoft after Bill Gates stepped down. Several Microsoft executives have left the company in recent years, perhaps most notably Ray Ozzie, who was chief software architect of the company.
Google has also suffered a documented brain drain, notably losing Sheryl Sandberg, who is now chief operating officer at Facebook. The death of Jobs raises questions about Apple's ability to retain talent because many employees wanted to be at the company because Jobs was at the helm, Enderle said.
But others disagreed. Robert Greene, the founder of Silicon Valley-based GreeneSearch, Inc., which specializes in recruiting for tech startups, said he has tried to lure employees away from Apple for seven years, but has never succeeded.
"It's a great place to work," Greene lamented. "I wish I could say otherwise."