When Tim Cook took over Apple in 2011, many critics predicted Apple’s demise. One headline famously read: Why Apple is Doomed. The critics turned out to be wrong, and Cook navigated Apple to a one trillion dollar value.
Cook was underestimated because he replaced an iconic, visionary and charismatic entrepreneur. In addition, Cook is intensely private and reserved. I’ve written two books about Steve Jobs and one about the Apple Store. Although my focus wasn’t on Cook, I heard from many employees about the skills and habits that made Cook the right person to manage the company.
For example, Cook has an encyclopedic knowledge of Apple’s operations and supply chain, almost supernatural stamina, a rigorous and disciplined thought-process, keeps cool under intense pressure and he’s committed to the values that made Apple the most valuable company in the world.
These qualities have been on display as Cook has had to answer questions about Apple’s revenue shortfall in its iPhone business. In Tuesday’s 20-minute interview with CNBC’s Jim Cramer, Cook used three effective communication techniques to tell the Apple story, one that he says “isn’t well understood.”
1. Use a simple three-part story structure. Cramer asked Cook to make the case for Apple’s stock, which had fallen about 4% since the first of the year. Cook immediately took control of the narrative and shifted the story away from the stock price which, as he correctly points out, will fluctuate due to emotions and macro-economic factors outside of his control. Instead, he used a three-part structure to explain the business.
“Let me tell you the way I look at it,” Cook began. “We manage the company for the long term. The most important things in Apple are: one, a culture of innovation…Second, we have a very large active install base [of products]…Third, we have the highest customer satisfaction and loyalty in the industry.”
Cook then fleshed out each of the three aspects of the business to highlight how they all work together to create recurring revenue. Cook’s explanation took just 90 seconds to deliver. Clearly explaining the key parts of a complex business in under two minutes is an art that takes practice and discipline.
2. Keep the focus on the customer. As a consumer-centric company, Apple’s customer loyalty means everything. In an answer to another stock-related question, Cook brought the discussion back to the customer. He used specific examples to highlight the value of Apple’s products to people’s lives. As you read this explanation, also pay attention the parallel structure of Cook’s sentences which adds to the impact of his words.
“What I focus on is the customer. The customers speak every quarter. They speak every year. They speak every day. And the most important thing for us is that they’re satisfied. And so when I read the emails from customers, they’re telling me how the Apple Watch has changed their life. They’re telling me how it motivated them to be more fit, be more active. They’re telling me that they discovered that they had AFib. (Atrial fibrillation.) They’re telling me they found a problem with their heart that they didn’t know existed and if they wouldn’t have reached out to a doctor, they might’ve died.”
Keep your audience in mind when you answer questions. It also doesn’t hurt to add stylistic flair to make your words more pleasing to the ear.
3. Put events in perspective. Headlines often get shared in an instant with little or no perspective. Good communicators need to take every opportunity to add context that customers or investors might be missing.
For example, when Cramer asked Cook about the slowdown in iPhone sales in the first quarter. Cook said, “In our last fiscal year, we had $100 billion of revenue that was not iPhone. One hundred billion. And in this last quarter, if you take everything outside of iPhone, it grew at nineteen percent. Nineteen percent on a huge business.”
Cramer also asked Cook how he feels about analysts who are critical of Apple for its policy of not breaking down iPhone unit shipments per quarter. Cook took the opportunity to add context to the decision. Cook said, “This is far, far, far down my list. The point is, if somebody decides to buy an iPhone a little later, because of the battery, huge discount that we gave, they decide to hold on a little longer, I’m great with that…I want the customer to be happy. Because if they’re happy, they will eventually replace that product with another.”
Great leaders are often great communicators. Tim Cook’s strategy offers a lesson for any leader who wants to improve their speaking and communication skills.