Apple’s Recent Leadership Changes Suggest Transition From iPhone Reliance to Focus on Services

A new report out today by The Wall Street Journal takes a look at the recent shake ups to Apple leadership, and how the changes could be an indicator that the company is transitioning from relying on iPhone sales to prioritizing its services business and other divisions.

Newly appointed executive John Giannandrea also heads Siri development

Specifically, the report claims that recent hires, departures, promotions, and restructurings have led to several projects being put on hold while the new managers reassess priorities. This has left many existing Apple employees "rattled" as they have become unaccustomed to such frequent changes in leadership prior to the shake up at the company.
The primary reasons for the shifts vary by division. But collectively, they reflect Apple’s efforts to transition from an iPhone-driven company into one where growth flows from services and potentially transformative technologies.
These changes include the promotion of John Giannandrea to senior vice president, from a machine learning and AI role. After his promotion, Giannandrea decided to move Bill Stasior, head of Siri, to a lower role at the company. In terms of high-profile departures, retail chief Angela Ahrendts recently left Apple after spending five years with the company. These three major changes happened within the past two-and-a-half months.

Along with the staffing updates, Apple has trimmed around 200 employees from its autonomous vehicle project, and continues to redirect much of its engineering resources into its streaming TV service ahead of the planned 2019 launch.
“This is a sign the company is trying to get the formula right for the next decade,” said Gene Munster, a longtime Apple analyst and managing partner at venture-capital firm Loup Ventures. “Technology is evolving, and they need to continue to tweak their structure to be sure they’re on the right curve.”
Now, Apple is focusing on building its services catalog and enhancing artificial intelligence features, which should in turn encourage more hardware sales. Replacing Stasior as the head of Siri, Giannandrea is said to be "looking to improve Siri's accuracy and performance."

iPhone sales dipped over the 2018 holiday season, leading to many reports about Apple's new plans to combat stagnating smartphone sales. The company is said to have cut back on new hires, and in January Apple lowered its revenue guidance for the first quarter of the 2019 fiscal year by up to $9 billion due to fewer iPhone upgrades than it anticipated.


At the same time, Apple's services business hit an all-time high in Q1 2019, up 19 percent year-on-year. During the first fiscal quarter of 2019, Apple's services business brought in $10.9 billion in revenue, including platforms like iTunes, the App Store, the Mac App Store, Apple Music, Apple Pay, and AppleCare. Thanks to their success in the wake of flagging iPhone sales, these services are expected to be a growing focus for the company over the next few years.


This article, "Apple's Recent Leadership Changes Suggest Transition From iPhone Reliance to Focus on Services" first appeared on MacRumors.com

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Angela Ahrendts Talks Apple Retail in New Interview: ‘Retail is Not Dying, But it Has to Evolve’

Apple senior vice president of retail Angela Ahrendts gave a new interview today at Cannes Lions, an annual international festival in France that celebrates individuals and companies in creative spaces. During her talk, Ahrendts discussed a variety of topics related to Apple and its pivot away from retail "stores" over the last few years to become community gathering places (via NBC News).



Ahrendts' discussion also included Apple vice president of marketing communications Tor Myhren, and the SVP of retail explained that Apple's approach is to be "in the human business" and to "humanize technology."
I love the creative arts... that's kind of when we came up with the tagline: maybe we're in the human business. Maybe the largest tech company has these 65,000 kids and maybe it's our job to humanize technology.
Looking to the future of retail in general, Ahrendts mentioned numbers from an analytic firm that suggest while the majority of shopping will move online, many customers will still venture out to physical locations to finalize a purchase. This means that shoppers will use apps and online websites to research products and items, and perhaps reserve them for in-store pickup, much like Apple already does today.
You have your instincts and you use a lot of smart outside guys, and the smart outside guys they don't say retail is dying. They say digital is gonna grow at three times the rate of physical, but in the next five years... 75 percent of people will shop online, shop to learn [about what they want to buy], but 75 percent of business will still be done in physical stores.
Because of this, Ahrendts explained that "retail isn't going away" or "dying," but it will have to "evolve" as time passes. Apple has already made moves to change up Apple retail locations with next-generation layouts that emphasize communal gathering and encourage interactivity during Today at Apple sessions. This plays into another of Ahrendts' talking points in the interview, when she said, "I think [retail] has to serve a bigger purpose than just selling."


Ahrendts also discussed an internal social network that Apple calls "Loop," which was built for the company to measure how well it is doing in its retail mission to keep customers happy, accomplished through surveying both customers and retail employees. Loop is examined by Ph.D. students and results in data that helps Apple executives "improve systems" surrounding its retail business.

Ahrendts went on to discuss Apple store employees:
“They are not hired to sell," she said. "There is no commission, no quotas. What we’ve tried to do is keep uniting them around the big vision and the impact we want to make.”
Ahrendts routinely discusses Apple's next-generation retail plans in interviews, and last year even appeared onstage at the iPhone X event to briefly talk about retail and Today at Apple sessions. Shortly following that September event, Ahrendts climbed to the 13th spot on Fortune's Most Powerful Women list for 2017, jumping from 14th in 2016 and 16th in 2015.


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Angela Ahrendts Announces New App Prototyping ‘Today at Apple’ Sessions Coming Later in June

Senior vice president of Apple Retail, Angela Ahrendts, today tweeted out an announcement for a new "Today at Apple" session focused on app prototyping for aspiring developers. News of the session arrives as Apple's annual Worldwide Developers Conference comes to an end today, after first kicking off with a keynote in San Jose, California on Monday.

Ahrendts describes the new program as a way to help app makers get started with prototyping, which she describes as "one of the most important steps of the design process." The session itself is based on a popular talk from WWDC, and events for the prototyping lessons will begin at Apple retail locations later in June.



Ahrendts has spearheaded Today at Apple sessions since the program expanded globally in May 2017, after originally beginning at Apple's flagship store in Union Square in San Francisco. Today at Apple offers free sessions to teach skills in photography, videography, music, coding, art, and design, all using Apple products like iPad and Mac.

You can find Today at Apple sessions near you by visiting the company's website, although it appears to be too early for the new prototyping sessions to be listed.


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Apple’s Angela Ahrendts to Join Ralph Lauren Board of Directors This August

The Ralph Lauren Corporation today announced that it intends to add Angela Ahrendts to the company's Board of Directors this August. Along with Ahrendts, Qurate Retail CEO Michael George will be added to the board, bringing the number of directors to 13.

Ahrendts joined Apple as the Senior Vice President of Retail in May 2014, where she now spearheads the company's retail strategy, contributes to real estate and development areas, and oversees the operation of Apple's physical stores around the world. Prior to joining Apple, she was CEO of Burberry, Executive Vice President at Liz Claiborne, and President of Donna Karan International.


In joining Ralph Lauren's board, Lauren himself said one of the reasons the company chose Ahrendts was due to her "deep expertise in luxury retail."
“I am delighted to welcome Angela and Mike to the Board of Directors,” said Mr. Ralph Lauren, Executive Chairman and Chief Creative Officer. “Angela is an industry leader and innovator with deep expertise in luxury retail and an outstanding track record of growing global brands. Mike brings invaluable experience as a senior leader and board member, helping companies drive consumer engagement and growth. Their counsel will be incredibly valuable as we continue to build the future for our iconic brand.”

Ms. Ahrendts said, “I have admired Ralph and been inspired by his pure global lifestyle vision for many years. It is an honor to join this Board as he and Patrice continue to evolve and expand his incredible aesthetic.”
Last September, Ahrendts climbed to the 13th spot on Fortune's "Most Powerful Women" list for 2017, rising from 14th in 2016 and 16th in 2015. During her time with Apple, she has launched the company's new "Today at Apple" retail initiative, offering a range of classes on coding, art, music, design, and photography at Apple stores around the world. Ultimately, Ahrendt's goal with the new program is to change the perception of Apple stores as "forums" or "town squares," and not places where you go to just shop.

While George has been appointed to the board effective today, May 9, Ahrendts will be nominated for election at the company's annual stockholders meeting in August. Ahrendts will retain her duties at Apple following her appointment to Ralph Lauren's board.


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Angela Ahrendts’ Makeover of Apple Retail Outlined in New Profile

A new profile of Apple retail chief Angela Ahrendts has been posted today by BuzzFeed News, providing a look into Ahrendts' move from Burberry, the inspiration for her approach to retail from late Apple CEO Steve Jobs, and her partnership with Apple design chief Jony Ive. Ahrendts has been in the spotlight lately following her presentation during the iPhone X keynote event in September, where she explained Apple's new retail initiative, Today at Apple, and provided a sneak peek into upcoming locations around the world.

Ahrendts said that her approach to the new retail strategy began with an inspiration from Steve Jobs, comparing the brick-and-mortar locations as the retail team's "hardware" and the inner workings of the store -- like Today at Apple programs -- as the "software."

Image captured by Hoss Ghertassi via BuzzFeed News
Ahrendts’s approach to retail harkens back to the late founder Steve Jobs’ insistence on building “the whole widget” — in other words, constructing the look and feel of a device, as well as making the operating system and the processor that runs it, in order to fully optimize — and control — the entire user experience.

“This is our hardware,” she said, pointing to the Indianapolis store’s glass doors and indoor ficuses. ”Then you say, ‘What’s the software of the store? How do we turn it on?’ Because this unto itself is magnificent, but it's not just what it is, it's what it does,” referring to the new Today at Apple program, under which locations host events like photography workshops and coding classes.
Ahrendts has tweaked parts of Apple's retail "software" by changing employee t-shirts to a softer material, and removing lanyards so employees "make a human connection" with customers. One former Apple Genius said that while removing lanyards made uniforms "cleaner," the high amount of customers visiting Apple every day is a "reality of retail" that made connecting with every customer difficult.

When she was creating her strategy, Ahrendts discussed the design and look of the new Apple locations with Jony Ive, who was said to have told Ahrendts, "Don't mess with the tables," referring to the iconic wooden tables that line every Apple store. Ive further described these tables as "sacred."
Before embarking on the redesign, Ahrendts consulted creative chief Ive, whom Steve Jobs once called his “spiritual partner.” “In one of those very early conversations,” Ahrendts recalled, Ive “said, ‘Don't mess with the tables. They're the same tables we used in our design studio and I love that it goes from the studio to the stores.’ He said, ‘They're sacred.’”
Ahrendts also recalled the company's expansion into China, where she asked all United States retail employees if they would be interested to move overseas and assist in running new stores in China. The executive said she was expecting 100 or 200 responses, but ended up with 2,000, half of which ended up moving overseas with plans to stay for between 1 and 5 years. Those who remain in the U.S. said that under Ahrendts' leadership, worker benefits have improved.

Image captured by Hoss Ghertassi via BuzzFeed News
All of the employees who spoke to BuzzFeed News agree that Ahrendts improved their benefits soon after she joined in May 2014. For example, Ahrendts introduced restricted stock units, or gifted Apple stock (which could previously be purchased at a discount), that vests every three years. She also extended school tuition reimbursement to part-time workers. Most said they were happy with their pay, which ranges from $17 to $20 an hour for non-Genius roles and up to $30 an hour for Geniuses.
Still, some employees have described their work as starting to feel "increasingly corporate" under Ahrendts. One technical specialist stated that Apple retail "now feels more like a Circuit City, a Best Buy" because of increased micromanagement, rising repair prices, a focus on moving customers in and out of the store as fast as possible, and an "emphasis" on attracting business accounts.

The rest of the profile on Ahrendts covers much of the same ground as BuzzFeed's iPhone 8 launch video about Apple's "war room," as well as an interview with CEO Tim Cook and Ahrendts posted yesterday. In that interview, Ahrendts said it was "fake news...silly" that she was being groomed as future Apple CEO. Cook then said, "I see my role as CEO to prepare as many people as I can to be CEO, and that’s what I’m doing."

Check out the full BuzzFeed News article on Angela Ahrendts here.


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Angela Ahrendts Says Apple Won’t Try to Upsell Customers to iPhone X

Apple Store employees won't try to upsell customers to the iPhone X, according to Apple's retail chief Angela Ahrendts.


Ahrendts, who is in Chicago today for the grand opening of Apple's new Michigan Avenue store, told CNBC that Apple recognizes each customer has different needs that may not require purchasing the most expensive iPhone model.
"Internally we said the tagline was 'an iPhone for everyone,'" she said. "I prefer that we ask you who you're buying it for. If they're 6 or 7 years old, what do they need? If it's someone who's leaning into something else, what do they need? We do that with Mac, we do that with iPad, why wouldn't we do that with [the] phone?"
iPhone X starts at $999 in the United States with 64GB of storage, while a 256GB model is available for $1,149. By comparison, the iPhone 8 and iPhone 8 Plus start at $699 and $799 respectively.

Ming-Chi Kuo, a reputable Apple analyst at KGI Securities, recently said only 2-3 million iPhone X units will be available to purchase when the device launches. Pre-orders begin October 27 at 12:01 a.m. Pacific Time.

Related: iPhone X vs. iPhone 8 vs. iPhone 8 Plus

Related Roundup: iPhone X

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Here’s a Behind-the-Scenes Look at Apple’s Pre-Order ‘War Room’

BuzzFeed News has put together a video of how Apple prepares for an iPhone launch day around the world.


When iPhone 8, Apple Watch Series 3, and Apple TV 4K pre-orders began at 12:01 a.m. Pacific Time last Friday, dozens of Apple engineers were assembled in a so-called "war room" to ensure the process went smoothly.


For around three hours, these engineers sat in front of at least 10 TVs forming a larger display, which appears to show the system status of pre-orders in launch countries. One engineer had a map of the world open on his iMac.


"Over half of the orders that night will come in through the Apple Store app," said Apple's retail chief Angela Ahrendts. "We turn the whole world on at once. I think you saw the map with everything lighting up all over the world."

BuzzFeed reporter Nicole Nguyen then visited UPS's Worldport shipping facility in Louisville, Kentucky, a major hub for Apple products.

Nguyen said the volume of Apple products is so large that UPS has to set aside time to sort just those deliveries. Apple's launch day haul took up an entire large room, and the products later traveled along miles of conveyor belts.


UPS delivers some of the orders to Apple retail stores, while others arrive directly at customers' doorsteps.

Apple retail stores usually attract long queues of customers on launch days, but the crowds have been smaller for today's iPhone 8 and iPhone 8 Plus launch. Many customers are likely waiting for the iPhone X, which launches November 3.


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Angela Ahrendts Climbs to Thirteenth Spot in Fortune’s ‘Most Powerful Women’ List for 2017

Apple's senior vice president of retail stores, Angela Ahrendts, has climbed to grab the 13th spot on Fortune's "Most Powerful Women" list for 2017. In 2015 Ahrendts took the 16th spot, and in 2016 she rose to the 14th spot.

The top 5 women on the list this year are Sheryl Sandberg (Facebook COO, #5), Abigail Johnson (Fidelity Investments CEO, #4), Marillyn Hewson (Lockheed Martin President and CEO, #3), Indra Nooyi (PepsiCo CEO, #2), and Mary Barra (General Motors CEO, #1).


Fortune's list includes a brief summary of Ahrendts' latest accomplishments at Apple:
Since being persuaded by Tim Cook to join Apple in 2014 (she previously led British fashion brand Burberry), Ahrendts has been heads down on the tech behemoth’s largest store redesign in 15 years. In May the company launched its long-awaited “Today at Apple” initiative, which seeks to supplement public education through free courses on everything from coding to music production to photography. Apple’s highest-ranking woman, she oversees 60,000 retail employees and is responsible for the in-store experiences of a more than a million daily customers. Research firm eMarketer estimates that the combined revenue from in-store and online sales is nearly $50 billion. Ahrendts was the second executive after Cook—and the only woman—to take the stage at September’s keynote, where she spoke at length about Apple’s “town squares”—the new moniker for its retail stores.
Ahrendts joined Apple from Burberry in the spring of 2014, when she said she'd bring a personal touch to Apple's retail management. Three years later she has spearheaded the launch of Apple's next-generation retail store design and "Today at Apple" classes worldwide.

Last week, Ahrendts also appeared on stage during Apple's iPhone X keynote event, where she went into detail about new and upcoming Apple Town Square locations in Chicago, Paris, and Milan.

For more information on Fortune's ranking, the site has published a few articles today: explaining the list's continued importance, highlighting the newcomers, and pointing out those who have dropped off the list this year.


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