Maggie Jones 1

Donna Dubinsky and Apple Computer, Inc.

Executive Summary
Apple Computer was founded in 1976 and, a year later, released the Apple II computer which
remained the major-selling product through 1985 In 1983, the company and cofounder Steve Jobs hired
John Sculley as president. The Macintosh computer was introduced in early 1984 with impressive first
year sales, although it was Apple II sales that carried the firm through the fourth quarter. By 1985, sales
failed to reach projected planning levels causing profitability problems for the company and tension
between the Apple II Division and Macintosh Division, led by Jobs. The relationship between Jobs and
Scully was also beginning to strain.
Donna Dubinsky joined Apple as customer support liaison in 1981, reporting to Roy Weaver, the
head of the distribution, service, and support group. In January 1984 she was made U.S. distribution
manager for all of Apple, with dotted-line responsibility for the six field warehouses and direct
responsibility for sales administration, inventory control, and customer relations. Nine months later, she
and Weaver presented the distribution, service, and support groups 1984 business plan to the executive
staff for review. Jobs challenged the plan much to the surprise of Dubinsky and Weaver who were
confident in their groups competence. While Weaver had previously reported directly to Scully, shortly
after this meeting, his group was moved under the responsibility of Bill Campbell, vice president for
sales and marketing.
A few weeks later, following a dinner with founder and CEO of Federal Express and discussion
of competitor IBMs just-in-time (JIT) distribution process, Jobs enlisted Macintoshs director of
manufacturing, Debi Coleman, to investigate JIT for their division, convinced that their plant could
efficiently incorporate the distribution function. The possible cost savings were especially attractive

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because Macintosh sales were down. It was rumored that Scully and the rest of the executive staff were
also interested in Jobs idea.
Dubinsky, however, strongly believed that the radical changes they proposed were a mistake and
Weaver agreed. Initially, they didnt take the JIT proposal seriously. However, in response to Jobs
challenges, Campbell and Scully called for a distribution strategy review and recommended
improvements by the end of the quarter. Dubinsky worked with Dave Kinser, controller for the
distribution, service, and support group on a research project intended to defend the existing distribution
system. Although she was unable to devote significant time and resources to the report, she was
convinced that her experience, judgment and past record of effectiveness would carry more weight than
Colemans radical JIT proposal. Nevertheless, intimidated by rumors of the sophisticated presentation
being prepared by Coleman Dubinsky requested an extension as the deadline for her report grew near.
In January, Dubinsky learned that Colemans proposal would be presented at an executive retreat
and was confused as to why she, as distribution manager, was not the one to address the topic. She
rushed to prepare a counter-proposal for Weaver to present at the retreat. Campbell found the counterproposal embarrassing and felt that the group hadnt performed a thorough reexamination of the
distribution process. Some members of the executive staff shared Dubinskys concerns over failing to
involve her and, after much debate, it was resolved to entrust the distribution problem to a task force
including Dubinsky, Kinser, Weaver, Coleman, and other manufacturing and neutral members. It was
agreed the task force would report to Campbell and the executive staff would accept its
recommendations.
The task force met over the next four months and met stalemate after stalemate as Dubinsky
objected to Colemans proposals and morale sunk. In April 1985, Dubinsky was asked to attend a
leadership experience intended to break down barriers, to encourage communication and creativity, and

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to challenge participants to find new perspectives and new solutions to old problems. During the
seminar, Dubinsky recognized that everyone felt confused, demoralized, and critical of the company and
believed this was a result of the rivalry between the Macintosh and Apple II divisions. On the second
day of the workshop, Dubinsky directly challenged Scully during a presentation to which he responded
angrily. During a discussion later in the day, Dubinsky came to realize the true importance of the
distribution debate and that it could affect the fate of the entire company. She knew she had to take
action.
Immediately following the workshop Friday afternoon, Dubinsky met with Campbell for an
intense two hours during which time she acknowledged her previous blind spots and requested an
additional 30 days to prepare her distribution strategy. She insisted that, because distribution was her
area, she evaluate the strategy herself without interference of the task force. If Campbell did not agree to
her terms, Dubinsky would leave Apple. Campbell agreed to talk with Scully and give her an answer
Monday.i

Analysis
Dubinskys primary mistake was relying on her position and reputation rather than mounting an
effective, persuasive, and fact-based argument. As noted by Jay Conger in The Necessary Art of
Persuasion, todays employees are not content to accept a decree from above and seek to understand the
reasons behind a decision.ii She should have taken Jobs JIT proposal seriously from the beginning and,
as soon as she heard of it, worked to make her case affirmatively using comparative data.
Additionally, she should have engaged Coleman as soon as she heard the rumors of the proposal.
While it was wrong for Dubinsky to have been left out of the initial distribution discussion, she should
not have sat back and waited to be pulled in but should have made her expertise available and

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convictions known from the beginning. There are other instances where Dubinsky could have managed
corporate politics better and worked to gain allies rather than antagonizing management by acting
churlish in the task force and then reversing herself, embarrassing Scully at the Leadership Retreat, and
embarrassing Campbell by giving him slapdash, unimpressive work to present at the Executive Retreat.
Dubinsky was certainly not the only party who contributed to the unfortunate situation. Jobs,
Scully, Coleman, Campbell, and Weaver could all have handled themselves differently. Like Dubinsky,
Jobs also should have exercised his persuasive skills to sell the JIT proposal to Campbell, Weaver, and
Dubinsky rather than trying to force a top-down decision. Jobs recruited Scully specifically to organize
the company, but simultaneously undermined him. Putting distribution back under each product group
would undo the combined corporate structure Scully established when he was hired. Jobs should allow
Scully to do his job and rationally consider the evidence for the JIT proposal.
Scully also could have improved the situation by acting forcefully to assert his organizational
structure and independence from Jobs. Scully choice to hear Colemans presentation without involving
Campbell was a surrender to Jobs and his disdain for middle managers and Scullys own organizational
structure. Most specifically, Scully should not have given Dubinsky an extension to make her proposal
in December 1985 and then heard Colemans proposal without warning Dubinsky. This contributed
significantly to the resentment within Campbells group that ultimately led to Dubinskys outburst at the
leadership retreat and subsequent ultimatum.
Colemans role in the tension was obvious but possibly less easy to avoid. Although she couldnt
control the fact that she was tasked with the distribution proposal instead of Dubinsky, she should have
involved Dubinsky early on and, over the course of the project, focused on finding the best solution to
Apples distribution needs rather than working to prove Jobs preconceived conclusion. The fact that she

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never sought data from Campbells group shows that her analysis was incomplete and her argument
overly dependent on salesmanship at the expense of data.
Campbell himself missed several opportunities to ameliorate the distribution situation. He should
have acted on his recognition that Dubinsky lacked persuasive skills and assumed the role of advancing
her ideas to upper management. Similarly, he should have managed her more closely to ensure that her
original proposal contained the necessary rigor and analysis. Although he had personally granted
Dubinskys request for an extension, he didnt prevent Scully from hearing Colemans presentation at
the Executive Retreat.
Although Weaver is very passive in the debate, his passivity itself was a contributing factor to
the escalation of tension. Weaver should not have let Campbell dissuade him from objecting to the JIT
proposal to Scully, since that early intervention could have helped properly frame the issue. He should
have pushed Campbell to fight for the group, or done it himself. He was responsible for supervising
Dubinsky, and should have recognized her weakness at selling her ideas and acted as her manager to
help her improve in this area.

Evaluation of Alternatives
Campbell has three main alternatives for responding to Dubinskys ultimatum. First, he can let
Dubinsky quit. She was not successful in persuading the executives and task force that the JIT proposal
would damage the company. Moreover, fighting to endorse Dubinskys ultimatum requires disbanding
the task force, which would create resentment among all its members for the several months of time that
they had wasted on it. However, Dubinsky has a strong record of performance and holds many of the
key dealer relationships. Campbell describes Dubinsky as a unique asset and having her quit would have
an overall negative impact on Apple.

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Another option would be to acquiesce to Dubinskys demands and approach Scully with the
ultimatum endorsing Dubinskys terms. Advantages of this option are that Dubinsky would stay with the
company and have a chance to redeem herself and her ideas. This approach will give Dubinsky
ownership of the decision which should have been hers to begin with given her position in the company.
The disadvantage of this alternative is that must fight to undo the executives previous decision to form
the task force which he personally endorsed. This option would also require Campbell to engage Scully
in defense of Dubinsky which may be difficult given her recent public criticism of Scully.
Finally, Campbell can attempt a compromise such as temporarily disbanding the task force and
delaying a decision to give Dubinsky more time for further analysis. This approach would acknowledge
Dubinskys expertise and authority in the area of distribution without completely disarming the task
force. The facts of her analysis may convince Dubinsky to accept the JIT proposal or give her the
material she needs to mount a persuasive rebuttal.

Recommendation
I would recommend the third alternative and that Campbell give Dubinsky the time she
needs to develop a thorough analysis and proposal before reconvening the task force and making a final
decision. Distribution is Dubinskys wheelhouse and she should have been involved in any discussions
related this this area originally. While this solution only partially addresses the mistake of excluding her
early on, Dubinskys implied request that the task force be disbanded to too extreme. The group has
already invested several months of Apples key resources time and is important to the credibility of
many in the company.
Campbells question to Dubinsky about why she cannot prove her results hits one of the core
problems; both Dubinsky and Coleman must present an affirmative case based on evidence, rather than

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just criticizing each others work or relying on reputation to carry the argument. I would recommend
that Campbell take a more active role in the debate. He recognizes that Dubinsky is poor at selling her
ideas beyond using her presence and reputation, and should instruct Weaver, as her manager, to assist
her in developing her persuasive skills. Distribution is clearly in his purview, but he handed over power
to Jobs and Coleman rather than defending the expertise of his staff. Dubinskys conduct should serve as
a wake-up call to Campbell who may have to work very cautiously to ensure that Jobs does not
somehow force the company to accept the JIT proposal in the interim while Dubinsky I working on her
proposal, as he has been pressuring Scully to do. Similarly, Campbell will likely need to work to gain
Scullys approval of putting the task force on hiatus given the time that has been spent on it and the
pressure from Jobs. However, Campbell has the advantage that the senior managers entrusted the task
force with the decision, and Campbell is in charge of the task force. This should give him adequate
authority and leverage to force a compromise if he can get Dubinsky to agree.

Case Update
Campbell gave Dubinsky a month to complete her analysis after which period the
executive staff would hear her recommendations. Dubinsky hired a consultant and focused all her efforts
on the analysis working as if they were starting distribution all over from scratch. They learned that
Apple should have more warehouses rather than fewer, despite Jobs and Colemans assertions. Because
she knew that expansion wasnt possible, Dubinskys team recommended that the company consolidate
the administrative activities of six customer support centers into three, while retaining all the existing
warehouses. Her proposal allowed Apple to maintain its distribution service while reducing costs
through layoffs.

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While she was preparing the analysis, Campbell sought her option on Apples organizational
structure and ultimately made changes similar to her recommendations. The new structure eliminated
20% of the workforce and made Dubinsky Director of Sales Support, reporting directly to Campbell.
Although many saw this as a promotion, Dubinsky viewed it as a lateral move. Apple adopted her
recommended distribution plan but, because of her new position, Dubinsky would not implement it.iii
In 1991 Dubinsky left Apple and the following year cofounded Palm, Inc. which she later sold to
U.S. Robotics. In 1998 she became CEO of Handspring while they were developing the Visor PDA.iv

Gentile, Mary and Jick, Todd D. Donna Dubinsky and Apple Computer,Inc. (A). Boston: Harvard Business Publishing, 27
June 1988.

ii

Conger, Jay A. The Necessary Art of Persuasion. Harvard Business Review. Boston: Harvard Business Publishing, 27 June
1998.

iii

Gentile, Mary and Jick, Todd D. Donna Dubinsky and Apple Computer,Inc. (B). Boston: Harvard Business Publishing, 27
June 1988.

iv

Donna Dubinsky. Who Made America? PBS. n.d. Retrieved 31 October 2011 from
http://www.pbs.org/wgbh/theymadeamerica/whomade/dubinsky_hi.html.