Apple -- with its obsessive cult of fanboys, pioneering devices, groundbreaking design and, of course, its charismatic co-founder, the late Steve Jobs -- is arguably one of the most watched companies in the world. But most of what goes on in the company headquarters on Infinite Loop in Cupertino, Calif., has been very scrupulously hidden from view.
Even Walter Isaacson’s hefty Jobs biography didn't pull the curtain back on exactly how the Apple business model really works, focusing more on the co-founder than ground-level view of its workings.
Adam Lashinsky's "Inside Apple: How America’s Most Admired -- and Secretive -- Company Really Works" has changed that.
The book is an outgrowth of a much-touted article by Fortune's senior editor-at-large in May. In a concise 223 pages, Lashinsky describes “a frighteningly harsh, bullying and demanding culture at Apple … throughout the organization," with few of the perks of most other thriving Silicon Valley tech giants.
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As Lashinksy is told, “Everybody at Apple wants out, and everybody outside Apple wants in.” And he quotes Gina Bianchini, CEO of a neighboring Valley start-up, on the Apple work climate: "Fear is palpable there ... no other company has that level of fear."
The author quotes Jobs as saying employees found working at Apple “the most fulfilling experience in their lives … people love it, which is different than saying they have fun. Fun comes and goes.”
The secrecy Lashinsky cites in his book’s title is “strictly enforced from within,” he says, citing a project where special locks were put on one floor, doors were added to sequester the development team and the employees on the project were made to sign agreements that they wouldn’t speak of it to anyone, including their wife and kids.
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One ex-employee recalled Jobs’ warning in a meeting that: “Anything disclosed from this meting will result in not just termination but in prosecution to the fullest extent our lawyers can."
Former Apple senior hardware executive Jon Rubenstein told an interviewer, "We have cells, like a terrorist organization ... everything is on a need-to-know basis."
Lashinsky details an annual “ultra-secret gathering called the "Top 100," an internal elite who annually meet in a room that is first swept for bugs: “Relatively low-level engineers would attend, because Jobs wanted them there, while certain vice presidents would be excluded.”
Rank doesn’t always confer status at Apple, Lashinsky writes. He describes “an unwritten caste system” in which “the industrial designers are untouchable” and tells how the former “cocks-of-the-roost” Macintosh specialists came to be considered “second-rate“ in the Apple hierarchy as software engineers tied to online functions came to rule.
Apple's organization chart is so tight, the author says, that there are just 70 vice presidents for a company with more than 24,000 non-retail employees.
And the bosses' hours are no shorter than their underlings' are -- perhaps the reason most of them live "almost exclusively down in Silicon Valley close to work," says Lashinsky. (Many of the younger, especially ITunes-centric employees, do live in San Francisco proper.)
Jobs, of course, drove to work each day from minutes away: "We would think of Jobs as being this cultural dynamo but he was really a suburban kid who never left the suburbs."
We’ve all had a lot of Apple info flooding over us for years and months, particularly Walter Isaacson’s big bio. What can you bring to the party at this stage?
There’s plenty new; it explains the process of how Apple goes about doing what it does. The storyline of how it engages in all this secrecy is the storyline of my book.
This is about how this very successful business operates.
Your strategy was to skip the bosses, who don’t talk anyway, and find the past and present mid- and lower-level Apple vets.
Walter set out to write a biography of Jobs from the perspective from people closest to him. You don’t get a view from the middle and lower part of organization. I wanted to say, "What is it like to work there? How do they operate as a company?" Isaacson came away with this "official" sense of how Apple operates. You don't get that in my book -- I hope you get a better sense.
You've spoken about how Jobs lectured a local Girl Scout that he wouldn’t buy any cookies “because they’re sugary and bad for you." And a former marketing VP said if you didn’t work as a team, “Steve will rip your nuts off." Then this past week, the FBI report arrived, full of his foibles. Is the revisionist tidal wave coming for him?
I do believe the Apple alumni will begin to talk a little more openly, and not just because of Steve’s passing but because the story is becoming so broad and the company coming under such under such scrutiny.
People are beginning to think again about their careers and the fact that they exist as people. They want to take credit for own accomplishments -- they’re proud of them. So tongues do get looser.
The company has had a very understandable position -- it wants the attention focused on the products. But many of the human beings would like to see their story told.
I leave you to draw cause and effect but I believe more former Apple employees are quoted by name in my book than in any single place before.
Tim Cook takes over as CEO having run operations. He’s got the work ethic -- he would hold Sunday-night phone meetings to be ready for what’s always a substantial Monday meeting. As you depict it, the “bloke on bass guitar” now has to replace the “rock star."
I've been asked if Cook could be president of the U.S. And it is analogous in that you’re gonna face a crisis and you don’t know what it is on Inauguration Day.
Just last month, the New York Times did a major exposé on hideous conditions at Apple’s Foxconn plant in China ...
He’ll face some crises as CEO -- he’s running the most valuable, and one of the most scrutinized companies in the world. This Foxconn issue is going to be very important, but I don’t think it’s going to define his tenure.
It’s fascinating with Apple -- everyone sees what he or she wants to see, and the media goes up and down with Apple. In the span of a week this month we had the report of their $13 billion profit in 13 weeks last quarter, and we had the Foxconn report that "they’re horrible people." And we’ll go through that roller-coaster ride because that’s the way the game is played, right?
You quote Jobs as saying, “We had to get rid of about 4,000 middle managers.” He may be exaggerating for effect, but it was Draconian, yes?
I don’t think it was like the French revolution and they put thousands of middle managers’ heads on the chopping block and said, "Goodbye, you’re gone today." But I don’t think it’s apocryphal that during that time from mid-1997 to 2001 when they started to have the iPod strategy in place, thousands of middle managers left the company.
He got to be the savior, with free rein to make any changes he wanted.
You can look at it like that, as he had the advantage of the company having been on its knees at the time, 90 days away from insolvency, things weren’t working, and got license to crack some eggs, right? Having said that, Apple has been incredibly good at cannibalizing itself over the ensuing 15 years, even when times were good.
For example, letting the iPhone almost entirely supplant the iPod?
That’s part of the genius of the modern Apple, that willingness to cannibalize its own product line. So for this amazing $13 billion quarter they just reported, iPod sales were down precipitously -- and no one cares, because the iPhone is basically the iPod now.