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Apple’s Retail Chief Calls it Quits – Will Her Shocking Departure Throw Tim Cook’s Successsion Race Wide Open?

Last Updated October 5, 2020 12:24 PM
Mark Emem
Last Updated October 5, 2020 12:24 PM

Apple’s senior vice president of retail, Angela Ahrendts, will be leaving the company in the next two months. Ahrendts has been serving as the iPhone maker’s retail chief since 2014. She was the highest-ranked female executive at Apple and a top candidate to succeed Tim Cook as CEO.

Before joining Apple, Ahrendts was the CEO of British luxury fashion house Burberry Group PLC. Ahrendts will be succeeded by Deirdre O’Brien, who has been an Apple insider for about three decades.

Apple to Combine Human Resources and Retail Head Roles

Currently, O’Brien is the human resources vice president. Her new title will be senior vice president of Retail + People, according to a statement  from Apple.

As if to put to bed any questions regarding O’Brien’s suitability for the role, the CEO of Apple, Tim Cook, pointed out that she has extensive retail experience:

For more than three decades, she has helped keep Apple focused on serving customers and enriching lives. She’s an exceptional leader and she’s been a vital partner to our retail teams around the world since the very beginning. I am thrilled to work alongside Deirdre in her new role, and I know our 70,000 retail employees will be, too.

The exit of Ahrendts comes at a time when the tech giant is experiencing reduced sales of its best-selling product, the iPhone. Most of the blame has been laid on the softening of the Chinese economy.

Time for Something New at Apple?

The departure of Ahrendts could be an indication that the tech giant is keen to try new pricing strategies. Reportedly, Ahrendts avoided promotional pricing tactics. Rather than run deals during blockbuster shopping events such as Black Friday, Ahrendts preferred offering gift cards tied to purchases.

But as demand for the iPhone fell, Apple has somewhat relaxed the strict pricing policy. For instance, during the last holiday shopping season, Apple’s homepage featured lower iPhone prices for trade-ins.

Per SEC  filings, Ahrendts was also an expensive hire. Since 2016 Ahrendts has bested Cook in total compensation, though this is excluding the stock the CEO has been awarded over time.

Apple senior executive compensation. Source: SEC

With Ahrendts having been one of the senior executives tipped to be a likely successor to Cook owing to her wide external leadership experience, her departure will be a blow to advocates of diversity in Silicon Valley. Still, the iPhone maker has a deep bench of executives capable of filling Cook’s shoes when his time to leave comes.

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While Ahrendts was indeed a leading contender, she had many equals, per Bloomberg . This includes Apple’s chief operating officer, Jeff Williams who rose to the position in 2015. Prior to this, the iPhone maker didn’t have anyone bearing the COO title since Cook succeeded Steve Jobs. Cook was Apple’s COO from 2005 to 2011.

Another executive who has been rumored as a possible Cook successor is chief financial officer Luca Maestri. The iPhone maker’s senior vice president of hardware engineering, Dan Riccio, has also been mentioned in the same breath. Phil Schiller, the senior vice president of worldwide marketing and senior vice president of internet software and services Eddy Cue are other likely contenders.

Tim Cook Image from Shutterstock