Woolard was able to coax Jobs to agree that his role as an advisor would be a very active one. Jobs approved a statement saying that he had “agreed to step up my involvement with Apple for up to 90 days, helping them until they hire a new CEO.” The clever formulation that Woolard used in his statement was that Jobs was coming back “as an advisor leading the team.”
Jobs took a small office next to the boardroom on the executive floor, conspicuously eschewing Amelio’s big corner office. He got involved in all aspects of the business: product design, where to cut, supplier negotiations, and advertising agency review. He believed that he had to stop the hemorrhaging of top Apple employees, and to do so he wanted to reprice their stock options. Apple stock had dropped so low that the options had become worthless. Jobs wanted to lower the exercise price, so they would be valuable again. At the time, that was legally permissible, but it was not considered good corporate practice. On his first Thursday back at Apple, Jobs called for a telephonic board meeting and outlined the problem. The directors balked. They asked for time to do a legal and financial study of what the change would mean. “It has to be done fast,” Jobs told them. “We’re losing good people.”
Even his supporter Ed Woolard, who headed the compensation committee, objected. “At DuPont we never did such a thing,” he said.
“You brought me here to fix this thing, and people are the key,” Jobs argued. When the board proposed a study that could take two months, Jobs exploded: “Are you nuts?!?” He paused for a long moment of silence, then continued. “Guys, if you don’t want to do this, I’m not coming back on Monday. Because I’ve got thousands of key decisions to make that are far more difficult than this, and if you can’t throw your support behind this kind of decision, I will fail. So if you can’t do this, I’m out of here, and you can blame it on me, you can say, ‘Steve wasn’t up for the job.’”
The next day, after consulting with the board, Woolard called Jobs back. “We’re going to approve this,” he said. “But some of the board members don’t like it. We feel like you’ve put a gun to our head.” The options for the top team (Jobs had none) were reset at $13.25, which was the price of the stock the day Amelio was ousted.
Instead of declaring victory and thanking the board, Jobs continued to seethe at having to answer to a board he didn’t respect. “Stop the train, this isn’t going to work,” he told Woolard. “This company is in shambles, and I don’t have time to wet-nurse the board. So I need all of you to resign. Or else I’m going to resign and not come back on Monday.” The one person who could stay, he said, was Woolard.
Most members of the board were aghast. Jobs was still refusing to commit himself to coming back full-time or being anything more than an advisor, yet he felt he had the power to force them to leave. The hard truth, however, was that he did have that power over them. They could not afford for him to storm off in a fury, nor was the prospect of remaining an Apple board member very enticing by then. “After all they’d been through, most were glad to be let off,” Woolard recalled.
Once again the board acquiesced. It made only one request: Would he permit one other director to stay, in addition to Woolard? It would help the optics. Jobs assented. “They were an awful board, a terrible board,” he later said. “I agreed they could keep Ed Woolard and a guy named Gareth Chang, who turned out to be a zero. He wasn’t terrible, just a zero. Woolard, on the other hand, was one of the best board members I’ve ever seen. He was a prince, one of the most supportive and wise people I’ve ever met.”
Among those being asked to resign was Mike Markkula, who in 1976, as a young venture capitalist, had visited the Jobs garage, fallen in love with the nascent computer on the workbench, guaranteed a $250,000 line of credit, and become the third partner and one-third owner of the new company. Over the subsequent two decades, he was the one constant on the board, ushering in and out a variety of CEOs. He had supported Jobs at times but also clashed with him, most notably when he sided with Sculley in the showdowns of 1985. With Jobs returning, he knew that it was time for him to leave.
Jobs could be cutting and cold, especially toward people who crossed him, but he could also be sentimental about those who had been with him from the early days. Wozniak fell into that favored category, of course, even though they had drifted apart; so did Andy Hertzfeld and a few others from the Macintosh team. In the end, Mike Markkula did as well. “I felt deeply betrayed by him, but he was like a father and I always cared about him,” Jobs later recalled. So when the time came to ask him to resign from the Apple board, Jobs drove to Markkula’s chateau-like mansion in the Woodside hills to do it personally. As usual, he asked to take a walk, and they strolled the grounds to a redwood grove with a picnic table. “He told me he wanted a new board because he wanted to start fresh,” Markkula said. “He was worried that I might take it poorly, and he was relieved when I didn’t.”
They spent the rest of the time talking about where Apple should focus in the future. Jobs’s ambition was to build a company that would endure, and he asked Markkula what the formula for that would be. Markkula replied that lasting companies know how to reinvent themselves. Hewlett-Packard had done that repeatedly; it started as an instrument company, then became a calculator company, then a computer company. “Apple has been sidelined by Microsoft in the PC business,” Markkula said. “You’ve got to reinvent the company to do some other thing, like other consumer products or devices. You’ve got to be like a butterfly and have a metamorphosis.” Jobs didn’t say much, but he agreed.
The old board met in late July to ratify the transition. Woolard, who was as genteel as Jobs was prickly, was mildly taken aback when Jobs appeared dressed in jeans and sneakers, and he worried that Jobs might start berating the veteran board members for screwing up. But Jobs merely offered a pleasant “Hi, everyone.” They got down to the business of voting to accept the resignations, elect Jobs to the board, and empower Woolard and Jobs to find new board members.
Jobs’s first recruit was, not surprisingly, Larry Ellison. He said he would be pleased to join, but he hated attending meetings. Jobs said it would be fine if he came to only half of them. (After a while Ellison was coming to only a third of the meetings. Jobs took a picture of him that had appeared on the cover of Business Week and had it blown up to life size and pasted on a cardboard cutout to put in his chair.)