Apple's Jobs takes medical leave, remains CEO; Succession planning in focus

Apple said Monday that CEO Steve Jobs is taking a medical leave to focus on his health. He will remain CEO.

As Jobs takes his leave, Tim Cook, chief operating officer will take over Apple's day-to-day operations. In early 2009, Jobs went on a medical leave for six months in early 2009 to have a liver transplant. During that time, Cook filled in and Apple didn’t miss a beat. Jobs is a pancreatic cancer survivor.

Here's what Jobs sent to Apple employees:

Team,

At my request, the board of directors has granted me a medical leave of absence so I can focus on my health. I will continue as CEO and be involved in major strategic decisions for the company.

I have asked Tim Cook to be responsible for all of Apple’s day to day operations. I have great confidence that Tim and the rest of the executive management team will do a terrific job executing the exciting plans we have in place for 2011.

I love Apple so much and hope to be back as soon as I can. In the meantime, my family and I would deeply appreciate respect for our privacy.

Steve

The news is likely to put Apple succession planning back on the front burner. Earlier this month, a pension fund proposed that Apple become more forthcoming about its succession planing for Jobs, who is a pancreatic cancer survivor. Details of Jobs' latest medical leave were disclosed.

In that proposal, which was detailed in Apple's proxy statement, the Central Laborers Pension Fund in Jacksonville, Ill. argued that Apple do the following:

• Apple’s board will review the succession plan each year;
• Develop criteria for the CEO position and a process to evaluate candidates;
• Identify internal candidates;
• Begin a “non-emergency CEO succession planning” process, three years before a transition;
• Report the succession plan to shareholders each year.

Apple urged a vote against the proposal.

Jobs' latest medical leave is likely to put the succession planning on the front burner again. Here are a few thoughts since Jobs' health will be a key issue again.

• The medical leave hand-off at Apple has been well established from the first time Jobs took time off. Cook has proven that he can run Apple on a day-to-day basis.
• There will be more probing about Jobs' health and what exactly he's doing. Obviously, Jobs wants his privacy, but shareholders are going to want more details.
• The succession planning proposal in Apple's proxy statement may get more serious consideration as Jobs take leave.
• Details of the duration of Jobs' medical leave are likely to impact Apple shares. If it's a short leave---quite possible since Jobs is still CEO---then the damage will be minimal.
• Now it's clear why Cook is one well-paid operating chief. Cook made $59 million in Apple's fiscal year.

Related: Pondering Apple in a post-Jobs world