Great businesses are built by great leaders—not prophets (part 3 of 3): Steve Jobs
On the evening of Friday, 24 May 1985, the Board fired the Company founder. Steve Jobs left the Apple campus weeping and wealthy.
He was done. He had been thrown under the vehicle he believed would deliver his twin ambitions:
- To make brilliant, beautiful products and
- To emulate his heroes Bill Hewlett and David Packard, and “build a great company with a great legacy.”
But Jobs wasn’t fired because his Vision was diminishing nor were his marketing powers waning or his communication skills no longer potent. In fact, according to his 2011 authorised biography, his colleagues complained that these talents were so vigorous and overwhelming that they often hindered the surfacing of other critical business issues.
Jobs was sacked because he couldn’t lead a business operation.
Whether consciously or not, Jobs redressed this deficiency. In the intervening 10 years between leaving Apple and returning, Jobs’ improvement in leadership was nothing short of spectacular. He provides outstanding proof that:
- Every individual’s ability to lead others can be improved and
- An individual who manages a diverse range of problem-solving resources well is now able to solve a wide range of problems well.
After the burst of excitement that accompanied the release of Macintosh in January 1984, its sales began to taper off in the second half. But Jobs, who was heading both the Macintosh and Lisa Division, failed to manage the consequences. Clearly, there was no shortage of promise in the Apple technology, but no spin or reality distortion field could mask its shortcomings. The Macintosh was woefully underpowered compared to its competitors and thus incapable of delivering the promise hinted at by the revolutionary user-interface.
Underemployed and unable to lead the life he wished to, Jobs dabbled in a number of ventures. Nevertheless, he always returned to the locus of his fascination: the intersection of technology and liberal arts. With his immense personal wealth, he could indulge in ’safe-to-fail’ experimentation on a huge scale. And, while his NeXT venture into high-end personal computing drained his bank balance and his ego, his net worth and self confidence were restored when he was allocated $3bn of Disney stock on their purchase of Pixar.
Based on his evolving track record of successfully running creative technology companies, Jobs was invited back to Apple in 1997 to rescue a business in crisis. The company had 90 days worth of cash reserves and poor operational management. As an example, the business held nearly $500m of inventory on hand, or the equivalent of nearly two months of sales.
Desperate for the company to survive, the Board gave Jobs the latitude to act swiftly.
Jobs applied the three lessons he had learnt since his previous tenure.
- Be clear on what you want, and focus.
- “Operations (is the life blood that) gives you the oxygen to do amazing things.”
- “No bozo’s. You need to recruit the best to deliver the best. I only want people who ‘get it.’”
Jobs acted immediately by addressing operations. This was previously the location of his erstwhile Achilles heel—but no longer. As observed by Fortune magazine a year after his return, “When you consider the changes in sum, they testify to a fact most observers have never noticed: Jobs is a savvy manager.”
This revelation is a reinforced by Walter Isaacson in his official autobiography of Jobs.
“When Steve Job’s returned to Apple and produced the Think Different Ad, and the iMac in the first year, it confirmed what most people already knew; he could be a creative and a visionary. He had shown that during his first round at Apple. What was less clear was whether he could run a company. He had definitely not shown that during his first round.”
So the wonder of this story is not about Jobs the Visionary. That came easily. The real insight is about Jobs the Business Leader who exploited his hard learnt skills of how to work with others. It is this successful management of problem solving diversity that eventually allowed Jobs the Visionary to bloom.
What did Jobs do to broaden and then exploit problem solving diversity?
Jobs excelled in the Complex and Chaotic domain. He was never short of ideas (at his death he held 323 patents), but he failed to make these ideas deliverable. In 1984, both the Macintosh and the Lisa computer teams were set stretching technical aspirations, but crucial aspects of each computer fell beyond the grasp of the Apple engineers—but this did not prevent the product launch.
In 1997, Jobs was thinking differently. He promoted Jony Ives, an Apple design engineer on the verge of leaving. Though Ives has been assigned the reputation of being a ‘creative’, he is, in fact, a very-detailed, very-precise engineer, gifted with the ability to interpret Jobs’ Vision and convert it into reality. In Cynefin terms, Ives bridged the Complex Jobs with the Complicated Engineers.
As Jobs said of him,” He (Jony) gets the big picture as well as the most infinitesimal details about each product. And he understands that Apple is a product company. He’s not just a designer.”
During his first tenure at Apple, Jobs shrugged off the importance of the link between Vision and Operations. He avoided that mistake the second time around by recruiting Tim Cook as his Senior VP of Operations in early 1998.
Jobs said of Cook, “ Tim Cook came out of procurement, which is just the right background for what we needed. I realised that he and I saw things exactly the same way. I knew what I wanted, and I met Tim, and he wanted the same thing. So we started to work together, and before long I trusted him to know exactly what to do. He had the same vision I did, and we could interact at a high strategic level, and I could just forget about a lot of things unless he came and pinged me.”
Based on achieving a common agreed goal, Jobs delegated the resolution of operational problems in the Complicated/Simple domain to Cook. And it worked. Inventory on hand, previously held at a 2 month level, was reduced to 6 days within 6 months of Cook’s recruitment. By the following September, inventory on hand was at 2 days. In addition, Cook lowered production times for making an Apple computer from 4 months to 2. All of this not only saved money, it also allowed each new computer to have the very latest components available.
So what can you learn from Steve Jobs?
- Are you clear on the Problem A goal and vision that motivates you?
- Are you are aware of your problem-solving strengths and weaknesses?
- Are you recruiting the best problem-solving resources to balance your weaknesses?
- Are you working with those resources to maximum mutual benefit whilst minimising the Problem B cost of diversity?
Like the former Apple top team, do you have Cynefin covered?