It has to be the greatest comeback story in the history of the digital world. I’m talking about when Steve Jobs returned from exile to transform Apple and lead it back on its journey to be the global powerhouse that it is today.
What did Jobs do when he first regained the reins back in 1997? What crucial decisions did he make that radically shook up the company and set a new course? What can we all learn from this unique human dynamo?
Let’s leave to one side the obvious revolutionary strategies and development of groundbreaking new products such as the iMac, OS X, and the iPod. (And later, of course, the iPhone and the opening of much-copied retail outlets).
What did Jobs implement administratively and operationally that made the Apple culture the force that it became? Here are some of the key, essential moves that he made and which are instructive for any tech business today.
Regaining lost focus
Before the return of Jobs Apple had become a multi-legged octopus spawning dozens of different products with dozens of variations. There were multiple desktops, laptops, and servers; printers, digital cameras, and a host of other things. Mostly unprofitable.
Jobs began wielding a big axe, chopping away at the dead wood. Eventually, he got rid of over 70 percent of the company’s hardware and software products including the Newton PDA on which it had invested $100 million.
Jobs’s tough action not only, of course, trimmed the product lines but trimmed the workforce. During his first year as iCEO more than 3,000 employees had to be let go. But the result was that the company could focus on creating and marketing just a few great products rather than a bunch of ordinary products.
Rebuilding the board
The attention of Apple’s Board of Directors before Jobs’s homecoming had been centered on ways to divide and sell the business. Jobs determined that the only way to move forward was with a new board that would be loyal to him and support the charismatic leader’s initiatives. He accomplished that goal in no short order. In a matter of weeks he secured the resignations of most of the board and brought in close friends like Oracle CEO Larry Ellison and the former VP of Marketing for Apple, Bill Campbell.
He also restructured the company as a whole eliminating feuding departments and installing over-arching departments to handle marketing, sales, manufacturing, and finance for all of the divisions. And he brought in trusted rock star executives whose loyalty he could count on.
Apple had been a leaking sieve. Executives often gave vital insider information to the media as a way of pushing their own agendas. Jobs quickly implemented a complete ban on employees talking to the media. It helped suppress dissent within the ranks but as the years went by it enabled Jobs to dramatically unveil new products. It turned out to be a phenomenal media bonanza and an Apple signature. It gave Jobs the power to have the tech press eating out of his hand.
Making up with Microsoft
During his years in exile Jobs had come to accept the reality that there was no point in feuding with Microsoft. The Redmond Goliath had won the battle of the desktops. Instead, as Jobs famously revealed at Boston Macworld in 1997, he negotiated a cross-licensing deal in which Microsoft agreed to develop Office and Internet Explorer for the Mac (for at least five years) and at the same time purchase $150 million in Apple stock. For his side, Jobs made Internet Explorer the default browser for Mac OS for five years.
Jobs’s point was that Apple and Microsoft could co-exist. The effect was to give Apple and its devotees freedom to move on to pioneer and benefit from new markets.
Killing the clones
Apple had been licensing Mac OS to a small group of vendors with the strategy of increasing the footprint of the Mac platform. But it had been a failed strategy as the lower cost clones simply cannibalized Apple’s number one profit center. Jobs decided not to license Mac OS 8 when it was released in 1997 thereby achieving another of his aims which was to control the total user experience from hardware to software. His decision also enabled him to maintain the secrecy and excitement of new product launches.
The Ive factor
Jonathan Ive, head of Apple’s design team, had been thinking about quitting; Jobs had been considering hiring an outsider for the position. But Jobs kept the designer on board and they hit if off both professionally and personally. Their mutual passion for design and similar philosophies was responsible for establishing the iconic Apple brand and spearheading creation of some of the most celebrated electronics designs of all time.
From the board room to the design room Jobs made vital decisions, and he made them quickly. He didn’t fool around. He was a man in a hurry who accomplished so much before his life was cut short. Lessons for all of us.
As Jobs once said, “We’re here to put a dent in the universe. Otherwise why else even be here?”
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