Apple’s senior management has always been known for its stability, but now it is facing a new challenge: an unprecedented wave of executive departures.
Apple CEO Tim Cook
Over a period beginning in the second half of 2022, Apple lost 11 executives, most of whom held the title of vice president, just below the senior vice president who reports to CEO Tim Cook. . They are some of Apple’s most important figures, responsible for the day-to-day operations of many core functions.
The backbone is leaving
These departing vice presidents were responsible for a wide range of businesses, including industrial design, online stores, information systems, Apple cloud computing, hardware and software engineering, privacy issues, emerging market sales, subscription services and purchasing. In all, 11 key personnel left, well above the number of departures Apple has seen in recent years.
Over the past few years, Apple has likely lost a vice president or two within a 12-month window, such as when the head of its self-driving car program jumps to Ford in 2021. Today, it’s notable that Apple has such a large group of people leaving, whether they’ve retired, been fired, resigned, or moved to another company.
Apple top management
Of course, this has also been accompanied by an influx of new executives. Apple has brought in a new chief people officer to replace retail chief Deirdre O’Brien and a chief information officer to replace Mary Demby. ) and David Smoley.
But in most cases, these departures lead to Apple reassigning responsibilities or promoting people from within. For example, Anna Matthiasson, vice president of the online store, was replaced by her direct report, Karen Rasmussen; Responsibilities were transferred to Vice President Dan Rosckes and his promoted direct report David Tom.
In these examples, there are successors within Apple who can step up, or at least some executives who can take responsibility for departing employees. But Apple couldn’t find a suitable replacement for outgoing industrial design chief Evans Hankey. Instead, it has individuals on the design team reporting to Chief Operating Officer Jeff Williams. Likewise, Apple has not replaced its chief privacy officer.
Resignations continue to spread
Most of Apple’s recent executive departures were veterans who had been with the company for more than 15 years. But in terms of people like the vice president of design and services, the executives Apple lost were in the prime of their careers and could have risen to the rank of senior vice president someday.
And, this wave of evacuations may be just the beginning. Many of Apple’s vice presidents have been with the company for decades and may retire in the next few years. It’s a similar situation at Apple’s top management: 10 out of 12 executives are about the same age. Half of them joined Apple before 2000, and the age gap between Cook and his most likely successor, Chief Operating Officer Williams, is only about two years.
Former Marketing Director Schiller Steps Out of Apple Management
Meanwhile, many of the longtime mainstays who helped reshape Apple are nearing the end of their careers. Former marketing chief Phil Schiller, for example, is transitioning to an Apple Fellow position with lesser responsibilities, focusing on the App Store and media activities. Dan Riccio will step down from all hardware engineering responsibilities except for the mixed reality headset team.
Plus, Apple’s lower-level personnel are ripe for mobility. Apple insiders believe that some director and senior director level executives (two management levels directly below the vice president) are also considering resigning in the near future.
Can’t make it through
The accelerated turnover of these people may be partly due to the increasing responsibility placed on the shoulders of managers. Over the years, Apple has become increasingly bureaucratic, especially when it comes to product development. Apple is a huge multinational corporation, which means it’s hard for an individual to stand out. Internal politics and bickering across departments can make it harder to navigate.
Moreover, Apple’s internal resources have been diverted to longer-term plans, some of which may take years to be ready. Some managers may be unhappy that their people are being drawn to mixed reality teams and self-driving car teams.
In some cases, Apple’s vice presidents are seen as candidates to replace senior vice presidents, and promotions can come with four- or five-fold raises. However, Apple likely never made it clear if or when that would happen. Take Hankey, the outgoing head of design, who is said to lack authority, including the ability to override engineering decisions made by other departments.
Apple headquarters
Apple’s organizational structure itself is a source of stress. The company is organized by function, which means that teams contribute to all important products. For example, the vice president of hardware engineering helps oversee parts of the iPhone, Apple Watch, iPad, Mac and AirPods. And the head of software engineering will oversee the teams that contribute to iOS, macOS, watchOS, and tvOS, which run on dozens of hardware products.
This organizational approach made sense in Apple’s early days, but led to increased product development delays, overspread distribution of resources, and additional engineering complexity. Of course, this has the benefit of getting Apple’s best minds involved in the development of every single product in the portfolio.
Income fell sharply
Finally, don’t forget one of the biggest reasons people leave a job: money. Apple shares fell nearly 30% last year after three years of big gains. This puts pressure on employees’ pay. Take Apple vice presidents as an example, their stock income may be much more than half of the total compensation.
Even Cook has been hit in this regard. On Friday, Apple shareholders approved a new pay package that included a roughly 40 percent pay cut for Cook. In 2023, more than 80% of Cook’s revenue will come from stocks, 75% of which are tied to company performance.
But don’t worry too much about Cook leaving anytime soon: His shares won’t be fully vested until 2027.
