This week marks an upheaval in Apple’s upper management structure. Tony Fadell, who was the senior vice president of the iPod Division, and the fellow who is responsible for envisioning the iPod concept in the first place, has left the company after seven successful years. He will, however maintain ties with the company as a personal advisor to Steve Jobs.

Danielle Lambert, Fadell’s wife, and a vice president for Human Resources at Apple, has resigned as well, although she will not retain any unofficial capacity unlike her husband. Apple has told press that the two have left the company in order to "devote more time to their young family."

Fadell’s innovating strength was needed by Apple’s iPod division at a crucial moment when the company’s business shifted its core from iPod sales to the iPhone and computers (particularly Apple’s MacBook line). Even so, the iPods remain by far the best-selling music players on the market, and Tony Fadell would have certainly been the man who would know how to keep it that way.

His replacement, thankfully, is no greenhorn either. Mark Papermaster has been with IBM for over 25 years, and is now coming to Apple directly into the vice-president position (one which he held at IBM as well) in charge of the iPod and iPhone teams and will report directly to Mr. Jobs.

Only problem is that IBM is suing Apple for the acquisition, claiming it to be illegal due to a breach of a non-compete agreement between IBM and Papermaster. Even though it may take a while for the suit to reach its conclusion, Apple has already appointed him to the new position.

Steve Jobs was pleased with Papermaster’s acquisition, saying, "Mark is a seasoned leader and is going to be an excellent addition to our senior management team.  Tony and Dani have each made important contributions to Apple over the past eight years. We’re sorry to see Dani go, and are looking forward to working with Tony in his new capacity."

We cannot help but ask ourselves what negative impact the switch will have on the Cupertino company. We do not doubt that Mr. Papermaster is a competent manager, but the iPod (and in no small measure the iPhone) was Fadell’s brainchild, and his vision combined with his leadership skills made him essential to Apple’s success, despite his letting Steve Jobs perpetually grab the spotlight.

Although less publicized, Lambert’s departure could hurt Apple as well. The company’s success depends on it being able to develop the best applications, and for that you need the best developers, and you need to know how to keep them.

Aside from the paranoia-driven short-term drop in stock that Apple is going to have to (undeservingly) face, one cannot surely tell how far reaching the long term effects will be.