As Scully leaves Apple, image lingers of a leader distracted by his vision

Charles McCoy, Staff Reporter
The Wall Street Journal

October 18, 1993

John Sculley leaves Apple Computer Inc. with a reputation as a high-tech visionary who built an industry powerhouse, but ultimately may have been blinded to the mundane matters of running it.

Mr. Sculley, who for many months has worked out of New York, resigned Friday as chairman of the Cupertino, Calif., company that he has dominated since wresting control from Apple co-founder Steven Jobs in May 1985.

The resignation wasn't unexpected. Mr. Sculley, according to friends, had been in limbo since he gave up his job as chief executive officer in June. At the time, Apple and several directors called Mr. Sculley's move voluntary. However, there has been speculation, and recently allegations in a lawsuit filed by a former Apple official, that Mr. Sculley was forced out as chief executive by outside directors. None of Apple's top officials has commented on that lawsuit. Also, several executives close to Apple have said that it was agreed between Mr. Sculley and the Apple board that he should leave before year end.

Mr. Sculley, 54 years old, couldn't be reached to comment. An Apple spokesman said the resignation was purely Mr. Sculley's idea.

Mr. Sculley's departure set off much musing about his legacy for Apple -- and for the entire computer industry. His story is well-known by now: Tired of soda-pop marketing, Mr. Sculley left PepsiCo Inc. to come to Apple in 1983. Apple was hardly out of the garage at that point, but it had more than $600 million in annual sales. Though Mr. Sculley was a marketing man, he brought a measure of professionalism to a company that at the time was still essentially dominated by technical whizzes and young dreamers, including Mr. Jobs.

In 1985, Mr. Sculley, worried about amateurism and drift at Apple, engineered a board-room coup that led to Mr. Jobs leaving the company. Mr. Jobs is founder and chief executive of Next Computer Inc.

Under Mr. Sculley, Apple's sales ultimately rocketed to their current level of about $8 billion a year. The sales growth largely reflected Mr. Sculley's ability to push Apple's flagship Macintosh products into new markets, among other coups.

"John had a unique ability to articulate a vision of what new avenues Apple could explore," said Jean Louis Gassee, a former Apple executive. "And early on, unlike in some other eras in Apple history, John had an important ability to look reasonably well-balanced and businesslike to the financial community."

Yet Mr. Sculley's record at Apple is decidedly mixed, particularly in recent times. For one thing, Apple's stock has languished: It was $20 a share, adjusted for a stock split, when he arrived in 1983, and about $9 a share when he took control from Mr. Jobs. In national over-the-counter trading Friday, the stock soared $4.50 to $28.25, apparently reflecting better-than-expected earnings for the fiscal fourth quarter. By comparison, rival Microsoft Corp., whose Windows software dominates the market, has seen its stock rise many fold just since 1986.

In recent months, Apple has been badly wounded by the PC industry's price wars, to which Mr. Sculley was slow to respond. And the Newton, a hand-held computer Mr. Sculley personally had championed that was introduced in July, has been ridiculed because of problems in its handwriting-recognition software.

Indeed, many computer pundits suggest Mr. Sculley became too enchanted with the future of technology to manage Apple in the here-and-now. Mr. Sculley spent much time pondering notions as convergence, interactivity and the information highway. He may have been ahead of his time, but Apple has yet to benefit from such visions. Mr. Sculley spent much of last fall hobnobbing with politicians, including Bill Clinton, at a time when Apple was getting killed in the marketplace because of price cutting. "He just stretched himself too thin," said Tim Bajarin, an analyst with Creative Strategies Inc., Santa Clara, Calif.

Still, Mr. Sculley is given high marks for popularizing technology. "He really helped develop the public's vision of computing as being something beyond nerds with keyboards," said Mitchell Kapor, founder of Lotus Development Corp.

What's next for Mr. Sculley? He's been considered for almost every big corporate job that has come open lately, including the top posts at International Business Machines Corp. and Eastman Kodak Co. But several friends said they don't envision Mr. Sculley heading another big company right now.

"John seems to me to be more interested in finding an opportunity to build a business," said Mr. Kapor, who had lunch with Mr. Sculley two weeks ago. "He's done the big company thing."

Mr. Sculley is succeeded as chairman by A.C. "Mike" Markkula, 51, an Apple co-founder who had been vice chairman. Mr. Markkula held some of the positions that Mr. Sculley took over when Mr. Sculley first arrived at Apple.