Steve Jobs @ Apple: The Master & Commander moves on. Why all the fuss?

Within minutes of Steve Jobs resigning last week I received my first text message asking me what I thought about it. Not from an ex-colleague, employee or student but from my Mother. My Mother is hardly what one might call a tech-savvy socially networked beacon for hot business trends. Email and text messaging are about as far as she dares to venture into the digital world. Yet the resignation of Steve Jobs immediately captured her attention, as it did millions of other non-tech, non-business people around the world. It is a truly rare thing to see so much media coverage on the resignation of a CEO. Why has Steve Jobs captured peoples imagination like it has? And what does it really mean for Apple Inc., now that he has passed the reins to Tim Cook? There is no doubt that Apple has become a wildly successful company. Briefly surpassing Exxon Mobil as the most valuable company in America some weeks ago (Apples Market Cap hit an astonishing $346.7 billion on August 9th of this year) Jobs steered Apple from an almost-bankrupt disaster to an industry icon in just over a decade. They produce cool products everybody wants, uses or at least know about. But so do lots of other companies, and most people in the street would be hard pressed to name the CEO of many other well known brands - try asking any of your Mother to name the CEO of HP, Blackberry, Nokia, Google (or Exxon for that matter) and see how far you get! It is hard to fathom now, but when Jobs returned to Apple in 1997 he was far from being a proven force. After being forcibly ejected from Apple in the 80s his next venture, NeXT computer, was hardly a raging success. Pixar was yet to become one of the most successful movie companies of all time, eventually selling to Disney for $7.4 billion. It was if anything, viewed as a minor hobby investment of Jobs (his capital investment in Pixar was a mere $10m - an amount that racked up returns most professional investors barely dream of). When Jobs first spoke to us as employees at Apple in 1997 we were tired, fed-up and for the most part running on empty. Years of poor management decisions left us rudderless and confused; Apple was in free-fall. Press articles were damning; clichs such as the worm in the Apple, the rotten Apple, fall of an icon did little to inspire motivation. Michael Dells now infamous comment that Apple should simply close up shop and return any leftover cash to its investors didnt seem like such a bad idea at time. Enter Steve. With a mixture of logic, vision and venom for the misdeeds of his more recent predecessors poor decisions, he spoke to us directly, yes sometimes rudely, but always with unshakable determination. A bunch of guys in suits had messed up his company, and now he was taking it back. In one of his opening talks he quipped how upon returning to Apple he found people doing a lot of things, and how some of them are even the right things. Clear goals, myopic focus and ruthless prioritization would become core tenets of his success at Apple. He set a crystal clear vision - the battle for PC supremacy was over Apple would be a niche, design-led, profitable company.

Jobs recognized the lack of investment made in the Apple brand, and immediately reversed the trend by investing what little cash we had in the think different campaign, the first Apple campaign in years that made zero reference to products. Apple would go on to make great products, but drawing on examples such as the Nike just do it campaign, and the American Milk Associations hugely successful got milk? approach, Jobs refocused Apples advertising on pure brand-marketing. He played to peoples emotions, arguing nobody would purchase an Apple computer based on how many bits & bytes it had; they bought it based on emotional attachment to the brand and the feelings it evoked (creativity, being different, being cool). Cool was something Apple had lost in its products, before Jobs returned to Apple its products looked pretty much like any other PC. Despite this Apple had a unique team of industrial designers whose full-time job was to make prototypes of future computers to show off at trade shows. Jobs saw the massive potential of this team and took them from being concept dreamers to being the production engine of Apples amazing designs. He told us how these guys were designing amazing future products - so lets go make some of them now! And so ended an era of boring, beige, boxy computers and, starting with the iMac, we were ushered along a luscious journey of colorful, sleek, sexy products that made people feel like they held the future in their hands. At this point it would be easy to get lost reminiscing and drooling over the endless list of Apple product successes. From iMacs to iPods to iEverything the winning streak is indisputable. But products alone are not responsible for his success, and by extension Apples success. If all Jobs did was create great products Apples success would not be what it is today, his departure would not attract quite so much attention and this article would be a far shorter endeavor. Jobs is not a product designer. Jobs is (or was until last week) a CEO; and not just a good CEO, a great CEO. Possibly one of the greatest CEOs of all time. What made Jobs a great CEO was his ability to understand, direct and manage all the component parts of the company. While media attention naturally focuses on his product successes there are far more elements to a successful company if they are to consistently and profitably get those products into the hands of customers. Other companies also make great products. Subjective as it may be for every product Apple has introduced there has always been, arguably, just as beautiful an alternative. Jobs success stems from being about a lot more than just the product. The overall steps he took on returning are a textbook guide to successful business strategy. First he looked at his available resources and clearly established the value of the company (brand and design). Then he clearly set the vision in a manner everyone could understand (we would be a profitable design-led computer company). Then he lined up his people to execute against that vision with a clear strategy and goals in every area. In one of his most telling early actions Jobs entirely jettisoned the Apple Printing business. A multi-billion dollar business that was at the time the only profitable part of the company. Why burn such a bridge when you are cash-strapped? - it did not fit with the overall vision. Few CEOs would have resisted the temptation to keep a business like that tipping along. For Jobs however it was a simple decision - we would live or die by putting our collective energy towards making ourselves a profitable design-led computer company. The word printer did not fit in that vision - so the business was dismantled. Burning bridges keeps the team focused on moving forward with the core strategy.

Operational execution of that strategy demonstrated Jobs true leadership capability. Whereas his public image probably left most people believing he sat around whiteboarding future concepts and devising the branding strategy, in reality he dived into an astounding level of detail on every aspect of the company. That attention to detail has become a cultural facet within Apple that demands even its most senior executives to be on top of every aspect of their business. Jobs simultaneously reengineered every constituent part of Apple to make the whole work with breath-taking efficiency. The result is that you can study almost any part of Apple and find yourself hard-pressed to identify an alternative industry example of how to do it better. Stitch these industry-leading individual components together into one entity, clearly going in one direction, and you have a company that is almost an unstoppable force. Their operations and supply chain strategy (led by Tim Cook) had Apple counting its inventory ownership in hours versus days 10 years ago already, when Dell was the posterchild for supply chain efficiency. Their channel strategy allows them to manage pricing to within cents across vast geographies. Marketing, HR management, Finance, Customer Service.... where many companies are strong in one area, Jobs has ensured that every area of Apple is cutting-edge and perfectly aligned to the effective delivery of product into the hands of customers. Designers are already thinking of how many units will fit efficiently in a shipping container while in parallel ensuring the product can be easily fixed to reduce warranty costs. Product marketing teams do not devise 50 different versions of a new device - you want an iPhone? Black or white? Other than one or two memory sizes that is as far as your choice goes. Log on to Nokia and see how many models, with various forgettable product names, are available. Chaos. Imagine by comparison how much margin Apple can drive with its unified approach. So Jobs departure is global news on the face of it because he has put an endless stream of gorgeous gadgets into our hands and has grown Apple into one of the most powerful, influential and valuable companies in the world while doing so. The real genius however lies not just in what he puts into our hands but the conscious decisions and actions he has driven to make us want it (while paying a premium for it) consistently and profitably over a prolonged period of time. That is what a great CEO does. How will Tim Cook measure up? He has been at Jobs side for 14 years. None of those products would ever have been made if Cook did not devise a strategy to produce them profitably. His attention to detail and understanding of every part of the machine that Apple has become is unquestionable. In his early days running Operations at Apple I was once in a meeting room in an Apple factory producing Macintosh computers. When Cook dialed in for a daily update on production (sometimes more than daily) he did not get a number and sign off the call so he could go do more important things. He went through every number imaginable, every production line, and every quota. He knew by name the key production line operators and even commented on differences in their outputs. Its a pretty good bet that the tradition of detailed focused management will live on. He has run Apple as acting CEO for many months, and who knows behind the curtains how much and for how long the daily operational reins have really been in his hands. Jobs and the board have not thought lightly about the decision to give him the role. In seeing Apple as one efficient machine where no one area (even product design) is an island, then with the right people in each area Cook can safely run that machine for quite some time to come. Perhaps he is a caretaker CEO (forgive the papal analogy) and a future Jobs-type CEO is waiting in the wings to step in within 5-10 years with a fresh injection of the overall vision

Jobs used to kick-start a dying Apple. Either way the machine is not likely to slow down any time soon, and they have more than enough credit in the bank to make a few mistakes and still recover. While the shadow of Steve will remain for a long time to come, if not forever, there remains plenty of bright spots ahead for Apple thanks to the fire he ignited.
About the Author: Feargal Mac Conuladh worked in Apple Operations from 1992 until 1999 in both Europe and Cupertino; he then served as Vice-President of Operations at Seiko Epson in Europe and thereafter as Vice-President of Services at Lenovo. He currently works for La Salle University in Barcelona, Spain, where he is Director of Technology running their leading Tech start-up incubation park. In addition he is responsible for La Salle R&D market activity & Executive Education programs. He serves as CEO for Securiforest S.L., a cloud startup, and is involved in several other start-up ventures. Follow on twitter @feargalmac or contact by email feargal@peopleforest.com