Build A Board That Cannot Operate Independently of the CEO:
During his transition into the leadership of Apple, Steve Jobs hired Larry Ellison, and other board members who were all loyal to Jobs. This would allow Jobs to take complete control over the company, and give him the breath of control needed to execute the long list of chances that were needed to fix Apple. Once the board was set, Steve Jobs become the CEO of Apple, and he took a salary of $1. The next step would be to rebuild the company. Instead of building Apple off of the divisions in a product line model used originally, with Jobs, there were to be no divisions with independent bottom-lines. Jobs wanted to have a cohesive structure so that he could directly control the company from the top down. He would be able to interact with smaller teams, who were in constant dialogue with each other rather than in painful competition against each other. Instead of a competitive bureaucratic structure where teams competed against eachother, Apple was now a heavily top-down organisation.
This is an analysis based on Steve Jobs by Walter Isaacson and other sources of research. Enjoy.
Gain Financial Control Against Your Business Partners:
Pixar needed to challenge Disney’s dominance in animation. Toy Story’s success was heavily associated with Disney which was frustrating to Jobs because Pixar created Toy Story. Jobs felt that Pixar was helping Disney roll out their movies and taking all of the credit for Toy Story. Pixar ran and created the movie, and Disney was the distributing channel. There was a need to go public with the Pixar considering that Toy Story was the top grossing film in 1995.
When Pixar was in trouble in 1988, Jobs needed to fire people which he did with a complete lack of empathy. The company was failing partly because their mass market animation hardware did not sell well. He gave these redundant employees a notice of two weeks, but this was retroactive from two weeks before the date of termination! Fast forward to 1995, Pixar was worth $39 per share on the first day of the IPO, Steve Jobs made $1.2 billion dollars in the initial IPO stage (a huge portion of its value). With the success of the IPO, Pixar wanted to assert a co-branding relationship with Disney, rather then being just a studio. Steve Jobs fought to make sure Pixar was every bit as valuable as Disney which later resulted in a Disney take over at a huge valuation.
Art Reflects Reality
Jobs bought Pixar from Lucas films and became a majority stakeholder in 1986. Pixar was technology meeting art which was perfect for Jobs who wanted to live on the intersection of the humanities and technology. He looked into the finance, and strategy in the late 80s to familiarize himself more with the bean counting elements of business. Jobs spewed out all kinds of crazy and good ideas at Pixar meetings. He even tried to sell hardware, and software design via a digital animation product called Renderman but this did not sell well. In the early 1990s, John Lasseter came up with Toy Story. Originally, Woody was a nasty character (who acted like Steve Jobs) but finally they decided to change the story so that Woody was no longer a mean character, and the film was very successful after much difficulty with Disney. A Bug’s Life tells the story of an Ant with all kinds of crazy and good ideas, but he gets in trouble with the colony and he is then expelled from the colony. He goes out to find a solution to the colony’s grasshopper problem, and ends up saving the colony. It basically follows the same life pattern as Steve Jobs who was fired from Apple, only to triumphantly return.
This is an analysis based on Steve Jobs by Walter Isaacson and other sources of research. Enjoy.
Scully thought that Jobs was a perfectionist, while Scully didn’t care about products at all. Scully did not learn quickly in his new role but was instead focused on marketing and management rather than the products according to Steve Jobs’ recollection. In addition, Scully seemed to be clueless that Jobs was manipulating him with flattery, while Scully believed in keeping people happy and worrying about relationships. Outside of Apple, the market responded negatively to Macintosh and by mid-84 into 85 a crisis was growing. By early 1985, the managers had told John Scully that he was supposed to run the company and be less eager to please Jobs. Also, Steve Jobs was told to stop criticizing other departments in Apple which was becoming difficult to stomach. Sales in the first quarter of 1985 were only 10% of their projections. Management changes were on the horizon.
Steve Jobs’ abuse of others increased through character assassinations and intense and direct criticism but this was also coupled with a quickly declining market share. Many middle managers rose up against Jobs. Noting the increased tension, Steve Jobs asked Scully if Jobs could create a Macintosh in a book-like format while also heading an “Apple Labs” project as a new R&D off-shoot of Apple Computers. From Scully’s perspective, if Jobs agreed to leave Macintosh, this solution would solve the management issues and get rid of Jobs’ presence at Apple’s head office. Jean-Louis Gassee would move in to take over the Macintosh only if he could avoid working under Jobs. The problem was that Jobs did not want to quit MacIntosh but wanted more responsibility by running both Macintosh and the new R&D project. Finally, Scully had a meeting with Mike Murray. By mid-1985, Apple executives started to blame Jobs for the miscalculated forecasting of Mac sales and resentment built up due to Job’s management style. Mike Murray, Jobs’ lieutenant in marketing, wrote a memo summarizing the problems that Apple had. Murray laid a lot of blame on Steve Jobs which was a coup considering his closeness to Jobs. Murray pointed out that Jobs had a controlled power-base within the company which created a strategic alliance amongst high value employees. When Scully confronted Jobs, he said that it wasn’t going to work with Jobs’ approach at the Macintosh division. Jobs said that Scully did not spend enough time teaching Jobs as an excuse for the demotion that Scully was proposing ie start an R&D division outside of Apple. Jobs was erratic, he would reach out to Scully, and then lash-out at him behind his back. Jobs would phone one manager at 9pm to discuss Scully’s poor performance, and then he would phone Scully at 11pm to say that he loved working with Scully. The end of the line for Jobs was approaching quickly.
Being Vindictive Is Part Of Leadership:
In 1985, Jobs refused a $50,000 bonus for Macintosh engineers who went on vacation during the bonus awarding period. Andy Hurtzfeld quit because he didn’t like Macintosh’s team, or Jobs. Woz and Jobs were no longer friends. As an expression of that, Jobs also shot down Wozniak’s universal remote control company ‘Cloud 9’ by arguing that the design agency should not be allowed to work with 3rd party companies such a Woz’s. Steve Wozniak left Apple saying that the company was not being run properly for the past 5 years. Jobs was vindictive, and convinced himself that Woz’s remote control designs was a problem because it resembled other of Frog’s designs which were used to design Apple products. In 1999, Adobe refused to write programs for the iMac, so when the iPhone was released, Steve Jobs refused to allow flash on its products arguing that these products ate too much battery power, when in reality the core problem was that Adobe had screwed Apple in the past. In other words, being vindictive is part of business leadership as far as Steve Jobs is concerned.
This is an analysis based on Steve Jobs by Walter Isaacson and other sources of research. Enjoy.
Jobs required perfection. When Adam Osborne produced a messy portable computer that was sufficient , Jobs would cry that “Osborne just doesn’t get it!” as he would frequently storm around the Macintosh office. Steve Jobs refused to compromise on perfection in the name of price, and deadlines. If someone didn’t care to be perfect they were a bozo in Steve Jobs view. There were many bozos at Apple. Jobs did not hand trade offs well. Steve Jobs wanted a smooth looking Macintosh computer, and underwent many adjustments in the design of the Macintosh system.
He pushed to have rectangles with rounded corners included in a basic Mac program. Jobs learned to love type-faced fonts for the Macintosh. Since the computer could allow such fonts, they developed different one named after streets in New York. The Macintosh fonts would help launch deskstop publishing, and allow people outside of publishing houses to learn about the value of font styles. Steve Jobs went through 20 different title bars on the Macintosh OS screen before he was satisfied. When his colleagues claimed that the title bars were not that important, Jobs went crazy, title bars were going to be viewed every day by millions of people!
This is an analysis based on Steve Jobs by Walter Isaacson and other sources of research. Enjoy.
A Clean Factory Is Insanely Great But The Product Has To Sell:
Freemont, California was the location of Apples new automated factory overlooking the Ford manufacturing facility. Apple was more profitable in its early years of existence relative to Ford. Apple was indeed a miraculous company. Jobs spent time going over the machines in the new factory in 1984, at one point, he demanded that the Apple team repaint the machines for aesthetics. This repainting actually screwed up their machines, however, and corrections proved costly. The Apple factory had white walls, and beautiful machines. Jobs believed the factory was a way to establish a passion for Apple amongst employees. Jobs was influenced by the Japanese manufacturing which had a sense of team and discipline. Debby Coleman, a Stanford MBA, was the operations manager. By the end of 1984, the Macintosh’s performance in sales was very low. They had an expensive factory but a failed product.
This is an analysis based on Steve Jobs by Walter Isaacson and other sources of research. Enjoy.