Apple may have finally gotten too big for its unusual corporate structure

“If GE can build jet engines, tidal energy farms, freight rail data systems, mining equipment, and medical devices, how is it that the world’s most valuable company can’t find the time to make a full line of personal computers and PC peripherals alongside its market-leading smartphones and tablets?” Matthew Yglesias writes for Vox. “The answer goes back to Apple’s corporate structure, which, though fairly common for a startup, is extremely unusual for an enormous company.”

“There are two main ways to structure a business,” Yglesias writes. “You can build divisions that are built around particular lines of business or you can build functional groups that are built around particular kinds of expertise.”

“If you look at [Apple Inc.’s] executive team you’ll find that there’s no senior vice president for iPhone who works alongside a senior vice president for Mac. Nobody is in charge of Macs or iPhones or iPads or really anything else, because Apple is almost entirely functional,” Yglesias writes. “Most CEOs do not attempt to manage enormous global companies with purely functional structures, because even though it sounds good, it’s extraordinarily difficult to make it work in practice… Functional Apple struggles to walk and chew gum at the same time.”

“Even though regularly updating desktop Macs should not be that difficult, objectively speaking, it tends not to happen in part because it’s not anyone’s job to make it happen,” Yglesias writes. “The functional organization values collaboration on top corporate priorities above all else, and that means basically everything comes ahead of desktop Macs.”

Tons more in the full article – very highly recommendedhere.

MacDailyNews Take: Yup.

What if Apple were to spin off the Mac by creating a subsidiary – Macintosh Inc. – so that the resulting company could focus solely on the Mac and give it the level of attention it currently lacks but so richly deserves?MacDailyNews, November 23, 2016

And, as we wrote a year ago:

Sometimes Apple, the world’s most profitable and most valuable company, still operates as if they only have five guys from NeXT working around the clock trying to do all the work on a shoestring budget.

Can’t manage to have a compatible Remote app or Apple Music-capable Siri for the Apple TV launch… Can’t have enough Pencils and Keyboards for the iPad Pro launch. Seriously? Can’t have any stock on hand for two months after the so-called the Apple Watch launch date. Can’t update their professional Mac for nearly two years and counting?

Why are these amateurish mistakes and lapses happening with startling regularity? You know, besides mismanagement?

Oh, you say, but Apple is making tons of money! Why, yes, they certainly are!

Listen, let’s be honest, Steve Ballmer could’ve generated the same kind of money “running” Apple Inc. given the massive momentum Steve Jobs handed over at his death. Sometimes, in fact, it looks like Steve Ballmer is running Apple. Although, no, it doesn’t really, because even Ballmer would have updated the Mac Pro by now, made sure he had enough Apple Watches ready so as not to pretty much totally kill launch momentum, and also had enough Pencils and Keyboards on hand for the iPad Pro launch. Of course, Ballmer would have never had the handle on the big picture that Tim Cook has – our issues with launches under Cook have to do solely with launch supplies and software polish.

We’re coming up on two years now (this December 19th) since the Mac Pro debuted with no updates which, along with the rest of the string of snafus (going back to John Browett, Apple Maps, no iMacs for Christmas 2012, no iPad 2 units for launch, etc.), is what understandably prompts this sort of “joke” and “failure” talk and the feeling that Apple is a bit sloppy in recent years.

We hold Apple to a high standard and we expect the company to execute better than they have of late. (read more) — MacDailyNews, November 27, 2015

Apple is missing out on holiday sales of Air Pods – November 25, 2016
What’s really wrong with Apple’s Mac Pro? – November 23, 2016


  1. For the Mac Pro in particular it wouldn’t even have to be a large division, it could me more akin to a specialist manufacturer because they’re really not going to be selling them in huge numbers. They really don’t even need the design resources because to be blunt a lot of users would be fine with essentially a box (like the old Mac Pro was). These are the customers who build the apps and content that Mac users consume, to ignore them seems stupid. You could perhaps understand it a little when it came to servers, but to ignore such a loyal and important customer base seems insane. I don’t even blame Tim Cook, because when Steve Jobs was around it was hardly the most important line to them.

    1. True. The leadership at Apple spend more on themselves and their architectural self-worship than they do thinking about the users who actually depend on Apple to make a living. Cook assumes that 3rd party products will just magically fill in the gap when he continues to march ahead making fashion accessories that can never and will never replace work tools.

      It was blatantly short sighted for Apple to abandon servers and server software. Now as Cook attempts to sell us a patchworked cadre of rebranded cloud services now advertised as iCloud, it’s plainly clear that Apple doesn’t have the in-house tools to do it better than anyone else. Apple’s own business relies on HP servers and rented servers from Akamai, Google, Amazon, and Microsoft. With all the money Apple has sitting around, its leadership isn’t even smart enough to put forth the effort to lead behind-the-scenes tools that every business now relies on.

      Cook is the Ballmeresque caretaker CEO that people warned you about. The more Apple attempts to rely on iOS and iCloud, which by definition means signing people up for subscriptions and then ignoring them because you assume you have them hooked for life (see the cable TV business), the less capable Apple will be to see the next thing, and the less able it will be to support the diverse range of user needs that it used to support so well. That’s what happens when you have a leadership team that is more interested in appearance and fashion than they do about serving prior customers.

      Apple: instead of abandoning market segment after market segment as you have been, you need to offer better products that hit a broader range of the market. Become a leader in something besides selling iOS apps that someone else wrote. The world is waiting for better PERSONAL and PROFESSIONAL computing experience from the Mac lineup — but all you do is sell old stale models and overpriced executive fashion models. Moreover, your display, wifi, and server businesses were viable until you decided to leave them to rot. Get with the program or your old fans will pack up and leave.

      1. Pros are Always a small minority…. but their opinion has a huge weight on credibilty of a computing platform . IOS , MacOS ….etc….

        Its wrong of Apple to overlook this !

        Its not all about dollor and cents on every product… some items are meant to be iconic of a companies prowess.
        In In Apples case .. Computing. They have to offer the best of the best in every category/front .. NO HOLES … to justify their premiums .

        I hate to see increasing chatter that the best and most powerful computeing hardware are not Apple anymore.
        That was not the image or the chatter a few years back.

    2. The first part of this restructure should start at the top and Apple desperately needs a concerted vision and new leadership.

      After getting a competent and innovative CEO Apple does need to spin off the Mac division or the damage Cook has already done will cause it to disappear.

      Apple also needs to clean house on the executive ranks. Aside from maybe Federighi, everyone else should be shown the door ASAP.

      1. I agree. Lets make Apple just like Dell, cause we all know how well that worked.

        Does anyone here understand that the Apple ecosystem is not a bunch of lone parts that do not talk to each other???

        1. Bs. Go ahead and use an iPod shuffle with your Apple Watch. Attempt to take your 4K video from your iPhone and quickly share it with a windows using business client on the road without internet access. Try to use your iPhone to unlock or remotely do anything with your Mac.

          Apple advertises that its ecosystem is so powerful but when it all comes down to reality, the iCloud is rubbish and we must use wires adapters and tons of 3rd party solutions to get Apple products to work for us.

          Perhaps if all you do is live in perfect wifi at all times and have no large files, then apples latest gear is good enough

    3. I have no problem with someone like Ive concentrating on other things because frankly does something with the target demographic of the a Mac Pro really need any direct involvement from him? It’s one thing to be focussed on what you do and not to get distracted by all the pie in the sky nonsense that companies like Google have over the years, but the Mac Pro is important to Apple beyond the devices they sell.

  2. Apple must continue to innocvate AS REQUIRED to maintain its edge.

    The consumer phone/tablet devices willl rule the consumer world, no doubt. Macs will do the heavy lifting for people needing to create the content people eventually see on those phones.

    A Mac division would make sense in focused efforts by an accountable team.

    On the OPPOSITE View: Apple over the last few year may have deliberately scaled back Mac work for iPhone on seeing the push for the ultra upscale smartphones from Samsung.

    Apple may have been aiming to keep its dominance over Samsung, and dare I say, to cause Samsung to “flame out.”

    Apple may now be spending the time on the next Mac models. Time will tell.

    1. “Apple may now be spending the time on the next Mac models”

      That’s the problem though. Apple has the money to run parallel operations at the same time.

      In computer terms, Apple is a multi-core processor, and there’s plenty of power and RAM. There’s no excuse for not having enough power for the Mac team to run at 100% power through one of the cores. Instead, the Mac team seems to have been throttled at the CPU, and more than half its operations swapped out to disk.

      1. Hmmm. yes lets make lots of different models with little changes from each other so we can sell a few to select people and we can ignore them working well with other Apple products cause different is more important than works.

        Cool thoughts… I think.

  3. According to the Many Worlds hypothesis in Quantum Dynamics, there are an infinite number of parallel universes and some physicists think they interact or overlap. So the problem is that we’ve someone moved into a universe where Apple dislikes the Mac, but rest assured, there is another universe not too far from here where the Mac Pro is updated every year. That’s the real problem in a nutshell.

    1. Tim Cook is not the one to perform the reorganisation. It is long past due for the board to take the long term view and realize that Cook has undermined the future of Apple by making it a one-trick pony. Aside from the iPhone, practically nothing that Apple makes anymore is intuitive, refined, high value, cost effective, or competitive in the marketplace.

      Just as bad, the board should recognize that Cook as screwed long holders of AAPL stock by essentially throwing away money to fund debt in a failed bid to bounce the stock price. It hasn’t worked, because many tech investors do not fall for short term stock games. They invest because they believe that technological advancement unlocks value and improves the quality of life. As more people use the technology that Apple used to create, the more people will flock to create products and services in association with Apple, multiplying value to everyone. But what has happened is that Apple stopped trying to support users and started self-worship. It builds donut offices and $10k gold watches and its chief designer is off decorating xmas trees. Its head of retail wouldn’t know a Mac if it fell on her big empty head.

      The board should stop heaping insane financial rewards on Cook and his lackluster lieutenants. The Board should fire the millionaire caretakers and hire someone with vision, with longterm product strategy, and with an undying focus on all the user segments that Apple used to support. You know all the areas that Apple used to be a leader and now doesn’t even compete.

  4. While we are talking of such things…

    Why isn’t APPLE’s web browser – SAFARI – secure enough to be allowed for use on government web sites and for use in doing business with GRANTS.GOV?

    It’s a small thing, but come on APPLE!, get with the program. This simple deficiency should have been cleared up long ago. This has been going on for years now.

    I’m forced to FIREFOX (v.49) when doing business with the federal government.

    1. So you are saying that the US govt is really smart??? Weren’t they using Android just a little time ago?? Maybe you would like us to use samsung 7 units as official govt units… ??

  5. Having separate divisions for product categories that do not have a lot in common or do not have the need to interact with each other, such as jet engines, tidal energy farms, freight rail data systems, mining equipment, and medical devices, is quite logical. Apple’s products and services have to interact, it’s an ecosystem. It’s Apple’s strength, and maybe also it’s weakness.

  6. IMHO MDN’s takes are the best ever.

    The core of the problem is Apple itself. No want for cash or funding, just need to FOCUS and manage resources responsibly.

    Lack of Pro Macs is perennial inexcusable!

  7. So now we have some insight and it’s a real cluster. No one is is in charge of anything and everyone is in charge of everything.

    Very good MDN next we need some perspective on the impotent BOD.

  8. If you follow Apple for a long time one would realize Apple’s structure is built that way because ALL THE THREADS OF THE WEB ENDED IN THE HANDS OF STEVE JOBS.

    Apple was designed as an EXTENSION of Jobs.
    Jobs thought of the ideas, planned the marketing etc and his lieutenants executed them.

    All the CEO in such a structure is DECIDE what to do , make a list and get his SVPs TO DO.

    For example the CEO should say : one new iPhone a year (radical new features every two years. “the new Phone should be LIKE THIS “), Macs updated “(this, this and this model etc every x number of months with THESE NEW FEATURES : , work on THIS new project (Watch, Apple TV etc).
    The CEO of Apple has to be the LEAD INNOVATOR and DECIDE course of Action.

    HE DOES NOT ‘DECIDE’, he rather (as other articles detail) ‘COACHES’ i.e he says “Hey Guys what do YOU LIKE to WORK ON?”

    Jony Ive goes like ‘Watch bands, Coffee Table Book, Fashion Show, Christmans tree… ”
    Cue “Fashion Shows, rock concerts, Sex filled romp of Dr. Dre’s Life… ”
    Ahrends “Fashion boutique.. ”


    Cook could EASILY have said ‘Do iPhone, Do Macs’ and “Software guy (Federighi) get the OS Ready, new version every two years, Hardware guys (get me the designs, I want the Macs and the iPhones to be like THIS… ) etc.


    I know I am being CRUDE here, but I’m using the above extreme examples to illustrate the differences.
    In short for Apple to work with it’s structure you need a genius like Jobs who is Entrepreneur and innovator, hardware, software guy, marketing guy, inspirational leader, negotiator etc.

    With a Manager, a Operations guy who just wants to PROVIDE TOOLS to his team but NOT LEAD it don’t work so well.

    (CHEW ON THIS : Jobs had such good taste he could ARGUE WITH IVE as history records — in spite of Jobs saying he said no one tells Ive to do Ive has told reporters he stormed out of meetings after being unable to shift Jobs and even Forstall argued with him. Now in reality no one argues with Ive, if he isn’t interested in certain types of Macs like Towers — as it isn’t fashionista enough — it ain’t going to be made. Like I’ve written extensively before it isn’t about money, demand –Msft shipped 300 million win 10 licenses and aiming for 1 billion — , resources or iPads — iPads demand has fallen to about HALF it used to be and Macs make more money etc ).

    1. Dave, do you really think that is how business is done? Well ok, it is in very unsuccessful companies. The guy up top rambles on about doing things and the company just produces… wait.. isn’t that how microsoft works under Steve Ballmer…

      It just worked so well…. how many Billions did they just throw away???

      1. I believe I’m right at about Apple.

        Ballmer’s Microsoft was the REVERSE. Msft under Ballmer was divided into DIVISIONS with each responsible with it’s own stuff and reporting to Ballmer. there was little of the CROSS RESPONSIBILITY that was common in Apple where for example Ive does both iPhone AND Mac. Federighi does both OSX and iOS.

        Msft was rife with internal problems because of these divisions , there was for example issues between the Mobile group and the Windows Desktop group. Windows Mobile was under the Entertainment and Devices Division which also had Xbox etc. They controlled various MOBILE OS like Win Mobile, Win CE, Zune, Kin etc and made different phone versions but the Powerful Windows Desktop division crushed all those efforts (perhaps realizing that iOS at Apple was actually more powerful than DESKSTOP) and took over the Phone work as well. Because of this the Microsoft phone version are not compatible with the earliest (the OS is completely different) and Win Mobile became a dead end.

        In recent years there has been re organization at Microsoft to make it more unified.

        Note also what I’m saying is actually close to what the ARTICLE describes, I’m just adding the reason why Apple is so unique is that Jobs created it that way as himself in the centre.

  9. My view is that the company may have become way too fragmented as a result of all the obsessive secrecy to a point where the right hand does not know what the left hand is doing… and that each group utlizes its own design/product philosophy rather than A coherent, comprehensive and consistent companywide vision.

    I see this fragmentation even at intra -product level…

    Too many inconsistencies…

    Hope all these go away soon.
    Plus i cant wait for the move to the new campus to be completed ….. i have no doubt its a huge distraction.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.