Checks and balances / by heathrowkennedy

This week I spent a few days learning in the countryside outside York, the course was about communication - specifically that which must occur in the context of sudden crisis - and it reminded me that brushing up on skills and fresh environments are critical for professional growth. And so it is for Angela Ahrendts and Christopher Bailey.

Ahrendts move from CEO of Burberry to heading up Apple retail appears bold and from left field but it really isn't. Firstly, it's time for her to move on and if it had not been Apple it would have been something else, secondly Apple has to fix it's retail strategy. It's working less well, the environments are stale and in the context of the sums of money customers handover it increasingly feels like a student bar during Freshers' Week. She will fix this. She'll bring new energy and an elevated experience - remaining true to the Apple proposition but preparing the ground for further product premiumization.

I've said it before in this blog and I will say it again Apple WILL continue to expand their price ladder. There will be a smartphone variant that breaks the $1000 barrier. This is essential if the brand is to monetize the customer pool and create differentiation. The 5C and the 5S are a toe-dipping exercise. Early numbers suggest that 5C is under-performing with people happy to pay the 5S premium. The only way is up.

Apple are also succession planning and in Ahrendts they have a successor to Tim Cook in the medium term and a strong and effective number two in the immediate term.

So that's Apple all dandy, what of Burberry ?

I'll put my neck on the line and say I do not believe the dual role that has been announced for Christopher Bailey as CEO as well as remaining as Chief Creative Officer is credible beyond the short term.

My take is you can be a CEO who is creative, and I've worked with some excellent examples of this, but you cannot be a Creative who is a CEO. It's unfair on the creative, the business and investors. Ahrendts and Bailey worked well because they had a skill overlap of, say, 20%. Remove her from the equation, especially when Burberry has so much to lose commercially, and there is too much doubt.

I think this is a holding position and the CEO search is ongoing right now.

A fashion brand that has embraced technology and a technology brand that has embraced fashion. There is a lesson there.