October 23, 2008

· IT · orgtheory · Sociology · Apple

Via John Gruber comes news that Apple has hired Joel Podolny away from his position as Dean of Yale’s Business School to lead a project called “Apple University”. The Wall Street Journal says:

The Cupertino, Calif., computer maker said Joel Podolny, the dean of the Yale School of Management, will join Apple as vice president and dean of Apple University. The company declined to provide details about the university or the position. Mr. Podolny will be stepping down as dean on Nov. 1, but will stay at Yale until year end, a spokeswoman for Yale said. She said Mr. Podolny will take up his new position in early 2009.

I wonder what the backstory is here. Maybe some of our OrgTheory readers (or contributors, ahem) know more about Apple’s plans. But it’s interesting to see Podolny get hired by a company that knows a great deal about the importance of status in establishing and maintaining a good position in the market. Consider just the back-cover summary of Podolny’s excellent Status Signals in light of Apple’s position in the market:

Why are elite jewelers reluctant to sell turquoise, despite strong demand? Why did leading investment bankers shun junk bonds for years, despite potential profits? Status Signals is the first major sociological examination of how concerns about status affect market competition. Starting from the basic premise that status pervades the ties producers form in the marketplace, Joel Podolny shows how anxieties about status influence whom a producer does (or does not) accept as a partner, the price a producer can charge, the ease with which a producer enters a market, how the producer’s inventions are received, and, ultimately, the market segments the producer can (and should) enter. To achieve desired status, firms must offer more than strong past performance and product quality—they must also send out and manage social and cultural signals. Through detailed analyses of market competition across a broad array of industries—including investment banking, wine, semiconductors, shipping, and venture capital—Podolny demonstrates the pervasive impact of status. Along the way, he shows how corporate strategists, tempted by the profits of a market that would negatively affect their status, consider not only whether to enter the market but also whether they can alter the public’s perception of the market.

Of course, I don’t know what Joel will be doing in his new job, but it’s hard to think of someone better-positioned intellectually to understand what Apple’s strategy in the market is all about. You can’t follow developments in the computer industry at all closely without being surprised by the persistently boneheaded advice that analysts and commentators push about Apple, almost all of which involves recommendations that the company do things that would eliminate its ability to differentiate itself from its competitors, or compete in segments of the market that would preclude it from being seen as distinctive in any way.

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I am Professor of Sociology at Duke University. I’m also affiliated with the Kenan Institute for Ethics. Read a brief overview of my work or my Curriculum Vitae.



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