Apple named best managed company of 2024

Apple again overtook Microsoft in the race for best management of the year, coming in first in the Drucker Institute's 2024 rankings of companies.

Microsoft, unseated after four years at the top, came in third. Nvidia came in second and Intel Corp, just shy of the podium, in fourth. In addition to these top spots, the technology sector also figures in the top 10 with Alphabet (eighth) and Adobe (ninth). The conclusion seems obvious: tech companies are "doing the right things well."

So summed up Michael Kelly, executive director of the Drucker Institute, replicating the words of the institute's renowned professor, consultant and inspiration Peter Drucker, who said that "effectiveness is simply defined as doing the right things well."

"Companies like Apple, Nvidia, and Microsoft have established a virtuous cycle that fuels their ability to innovate, attract top talent, and expand their markets," Kelly said in a post from the institute's host university, Claremont Graduate University. "This cycle is key to their sustained success."

The ranking rates more than 800 companies on five key dimensions: customer satisfaction, employee engagement and development, innovation, social responsibility and financial strength. For this, it uses information supplied by third parties.

Apple: AI, internal collaboration and sales growth

iPhone sales faltered at the start of the year, and Chinese rivals stormed in, The Wall Street Journal explained in a special collaboration with the institute. But Apple righted the ship. The services unit, which encompasses streaming and the App Store, generated revenue that cushioned falling phone sales and boosted sales of other products, such as tablets and computers. iPhones later followed suit.

Likewise, the company headed by Tim Cook struggled to gain ground in artificial intelligence. It even canceled the launch of its electric vehicle to focus on A.I. This year alone, it announced an alliance with OpenAI, introduced its artificial intelligence model Apple Intelligence, released its first iPhone with generative intelligence.

Another pillar of Apple's success, according to the study, is its commitment to security. One of Cook's flagships, it takes relevance as the security of electronic devices gains weight among consumer concerns. In October, for example, the company invited hackers to try to break into its servers. As a reward for whoever succeeds, it offered up to $1 million.

According to a Jeffrey Sonnenfeld, senior associate dean for leadership studies at the Yale School of Management, consulted in the same study, Cook is responsible for another key to contemporary Apple: "Steve Jobs would often have a fair bit of internecine warfare and Tim Cook had none of that. He got these folks to work together collaboratively. Employees feel really engaged. They feel really valued."

2024 surprises

It's not the first time tech has topped the list, so these companies' performance this year didn't strike Kelly as a surprise either. What was a revelation, however, was the progress of companies such as Mastercard, which advanced 14 points due to its "customer-centric approach and innovation investments," or Philip Morris International, which is in the top 10 in part for adopting a "bold" strategy to promote smokeless products, such as Iqos.

The companies that made big jumps come from varied sectors. The same is true of John Deere, which climbed 22 positions thanks in large part to its customer service, Salesforce, Delta Airlines, which improved 185 positions, helped by its investments in innovation, and Allstate Insurance, which jumped 355 positions due mainly to its improvements with its employees, including greater engagement and internal development.

The tail end of the ranking

2024 was not the best year for healthcare. The sector had to weather several "headwinds," Claremont explains. Major industry leaders suffered declines in customer satisfaction and saw their financial situation deteriorate, is the case of Pfizer, Merck and Eli Lilly.

"Rising costs, shifting consumer spending, and global pricing pressures have challenged their standing in the rankings," they develop. However, the only one in the sector (in a broad sense) at the bottom of the rankings this year is Exelixis Inc (418th place), a biotech company focused on oncology.

The bottom of the barrel is occupied by telecommunications, transportation and video games with, respectively: Liberty Formula One-C, Lucid Group Inc, Rivian Automotive, Inc, Roblox Corporation, Corebridge Financial, Inc, Frontier Communications Parent Inc, Dollar General Corp, Ubiquiti Inc, GameStop Corp.