Does Apple Need a 25 Year Old on the Board?
Innovation is slowing dramatically at Apple. The average age of the board is 63.1. Think it’s crazy for a 25 year old to join the board? Guess how old Steve Jobs was at Apple’s IPO?
I think most people would agree that the original iPods and iPhones were truly revolutionary products. I’m sure most of us can remember the way it changed the way we play music, make calls and so much more. These days however, it seems that each new product release is nothing more than an incremental update. Apple’s failure to innovate is being reflected in its stagnant share price and investors are becoming increasingly concerned.
While the loss of Steve Jobs was undoubtedly a crippling blow for Apple, it’s more than 5 years since his death. The concern today is that nobody seems to know how Apple can regain its mojo. In times such as these, we often turn to the board for inspiration. However, can we really expect a board with an average age of 63 to transform Apple’s fortunes and restore its position as the most innovative company in the world? Probably not, and that’s a problem.
Why is Apple’s board so old and why is it a problem?
The main reason Apple’s board is so old is down to our infatuation with experience. Apple’s not alone here. The average age of board members for S&P companies is 63.1 years old. Sure experience is valuable, but how valuable is it in the fast moving technology space where the past is such a poor predictor of the future?
The average age of board members for S&P companies is 63.1 years old.
It’s not just the average age of the board itself that’s a problem for Apple, it’s also the range. The youngest board member is 54 years old, which makes it really difficult to connect with younger consumers that tend to be key early adopters for innovative products. A quick look at Apple’s sales numbers suggests this may be a real problem. The worst performing demographic is the 18–24 range for men and the 25–34 range for women. The best selling segment for Apple?…men 65 years and older (sounds like Apple board members, right?). Now I know why the font size on the last Apple Music release was so big!
The other big problem with the age of the board is that it just seems so safe. Many would argue that a mature company needs a mature board. Such advice may suit a more predictable business like manufacturing that focuses on delivery, but Apple is more about discovery. However, in order to discover we need to take risks and it’s well known that older people simply take less risks. In fact, a recent study by UCL suggested their may even be a biological cause for this pattern, a drop in dopamine levels. Risk-taking has been an essential component of Apple’s DNA and the board must reflect that.
The other big problem with the age of the board is that it just seems so safe.
What can they do to change it?
Like most boards, Apple needs to move away from the traditional male, pale and stale board selection criteria. It has certainly made some progress by adding women and minorities to the board, but they desperately need to address the stale issue. I’m not saying that they need to fill the board with kids, but they need to inject some youth to provide the diversity of thought that’s crucial to innovation.
Fortunately, the tech industry has no shortage of successful young innovators. Evan Spiegel co-founder of Snapchat is 26 years old. If I was on the board nominating committee at Apple and I had the choice of selecting Evan or yet another 60 year-old former CEO of a blue-chip company, I know what I would do.
Back to the Future
The irony here is that if any company should understand the value age diversity can bring to a board it’s Apple. After all, when Apple went public, Steve Jobs was on the board and he was only 25 years old. It’s time for Apple to innovate again, they should start with the age of their board.
Originally published at www.thelatlabs.com on November 18, 2016.
