Inside Apple: How America's Most Admired--and Secretive--Company Really Works
272
Inside Apple: How America's Most Admired--and Secretive--Company Really Works
272eBook
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Overview
If Apple is Silicon Valley's answer to Willy Wonka's Chocolate Factory, then author Adam Lashinsky provides readers with a golden ticket to step inside. In this primer on leadership and innovation, the author will introduce readers to concepts like the "DRI" (Apple's practice of assigning a Directly Responsible Individual to every task) and the Top 100 (an annual ritual in which 100 up-and-coming executives are tapped a la Skull & Bones for a secret retreat with company founder Steve Jobs).
Based on numerous interviews, the book offers exclusive new information about how Apple innovates, deals with its suppliers and is handling the transition into the Post Jobs Era. Lashinsky, a Senior Editor at Large for Fortune, knows the subject cold: In a 2008 cover story for the magazine entitled The Genius Behind Steve: Could Operations Whiz Tim Cook Run The Company Someday he predicted that Tim Cook, then an unknown, would eventually succeed Steve Jobs as CEO.
While Inside Apple is ostensibly a deep dive into one, unique company (and its ecosystem of suppliers, investors, employees and competitors), the lessons about Jobs, leadership, product design and marketing are universal. They should appeal to anyone hoping to bring some of that Apple magic to their own company, career, or creative endeavor.
Product Details
| ISBN-13: | 9781455512171 |
|---|---|
| Publisher: | Grand Central Publishing |
| Publication date: | 01/25/2012 |
| Sold by: | Hachette Digital, Inc. |
| Format: | eBook |
| Pages: | 272 |
| File size: | 655 KB |
About the Author
Read an Excerpt
Inside Apple
How America's Most Admired--and Secretive--Company Really WorksBy Lashinsky, Adam
Business Plus
Copyright © 2012 Lashinsky, AdamAll right reserved.
ISBN: 9781455512157
1
Rethink Leadership
On August 24, 2011, the day Steve Jobs resigned as chief executive officer of Apple, he attended a meeting of the company’s board of directors. He was gravely ill and had reached the conclusion that it was time to relinquish his post. He became chairman of the board that day, giving some hope to Apple’s employees, customers, and investors alike that he’d continue to exert influence on the company and be around for a while longer.
What Jobs loved most was products. Though he came that day to tell his directors in person that he was stepping down, he also knew he’d be able to see Apple’s latest offerings. Indeed, Apple was weeks away from introducing its newest iPhone, which would for the first time include the artificial intelligence–powered personal assistant software called Siri. Like the HAL computer in Stanley Kubrick’s 2001: A Space Odyssey, Siri answered questions. It talked back to its owner. It began to fulfill one of the promises of the computer revolution that Steve Jobs had helped start twenty-five years earlier, to harness the power of computers to improve human life.
Scott Forstall, Apple’s top executive for mobile software, was demonstrating Siri to the board when Jobs interrupted him. “Let me have the phone,” Jobs said, indicating that he wanted to try the personal assistant technology for himself. Forstall, who had worked for Jobs his entire career, first at NeXT and then at Apple, hesitated. He was an engineer with the theatrical flair, ambition, charisma, and raw intelligence of Jobs. Yet Forstall’s hesitation was warranted: The whole allure of Siri was that it learned its master’s voice over time by adapting to quirks and absorbing personal details. The machine was like a baseball glove molded to its owner’s hand, and this particular unit knew Forstall. For all sorts of reasons—Jobs’s notorious short temper, this being an emotional day to begin with, the stress of handing over an unfinished product so close to its launch date—Forstall was reluctant to give the phone to Jobs. “Be careful now,” he said to a man who had never been careful in his life. “I have it pretty much attuned to my voice.”
Jobs, typically, wasn’t taking no for an answer. “Give me the phone,” he barked, prompting Forstall to walk around the table and hand over the device. The ailing Jobs, who had overseen the purchase of the start-up company that invented Siri’s technology, tossed the computer a couple of softballs. Then he turned existential, asking, “Are you a man or are you a woman?” Responded Siri: “I have not been assigned a gender, sir.” Laughter ensued, and with it some relief.
Siri’s gender-identification issues might have been a lighthearted moment during a difficult meeting for the board, but when Jobs grabbed the iPhone prototype a jolt of anxiety undoubtedly coursed through Forstall. The scene illustrates many of the principles that make Apple great—but also different from most companies that are held up as models of good management. A giant company had concentrated its best manpower on a single product. The product had been developed in extreme secrecy, and the phone’s mechanics and design reflected an obsessive focus on detail. Also on display, for the last time, was a different breed of CEO, one who exhibited personality traits—narcissism, whimsy, disregard for the feelings of others—that society normally dismisses as negatives. But are they? For the way Apple does business and the way its executives manage the company fly in the face of years of business school teaching, begging the question: Is Apple’s success unique, or is Apple on to something the rest of the business world ought to be emulating?
It is fitting that Jobs’s last official act was reviewing an iPhone, given that Apple’s reinvention and domination of the smartphone category four years earlier had demonstrated the company’s and Jobs’s singular strengths. When it launched the iPhone in 2007, Jobs had turned Apple upside down to make it happen. He envisioned the iPhone as a revolutionary device combining the convenience of a smartphone with the music storage and listening capability of an iPod. If marrying these two inventions wasn’t enough of a challenge, there was the additional pressure that the resulting device needed to have a design-snob-worthy look, a user-friendly software interface, and a wow factor (touch-sensitive glass screen, anyone?).
The iPhone team at the time already was stretched thin. Its very existence was putting strains on the rest of the company. Raids on other Apple groups, Macintosh software development in particular, had ground other projects to a halt; the latest version of the Mac’s operating system was delayed because the engineers writing the code had been switched to iPhone work. Resentment simmered among employees who were not chosen for the project because suddenly their electronic ID badges stopped working in areas that had been cordoned off and reserved for iPhone development. All Apple products are created equally; some are more equal than others.
An elite within an elite had been created, and the push to finish the iPhone was like an all-out mobilization for war. Engineers used macabre military terminology at Apple to describe the phase of product development when a launch approaches: the death march.
It is not every CEO who could ask and expect his most talented employees to work through the holidays, as Jobs did for years when the annual Macworld trade show was held shortly after New Year’s Day. But Jobs loomed larger than life for Apple employees. He had founded the company in 1976 with his chum Stephen Wozniak. He spearheaded the development of the Mac in the early 1980s, quit in disgust in 1985 when the CEO he’d selected to run the company reduced his authority, and returned triumphantly in 1997 to rescue a beleaguered company. Nearly a decade later, Apple reigned as the brightest light in the constellation of personal-technology companies, and its lodestar unquestionably was Steve Jobs.
Even when he wasn’t walking through the hallways of Apple, Jobs was a visible CEO. Sure, his office in the 1 Infinite Loop building was off limits to most of the company. Yet Jobs was supremely present in the life of Apple. Employees of all stripes saw him in the company cafeteria, usually chatting with his design chief and alter ego, Jonathan Ive. They would spot him walking around campus, and they would see his car parked in front of IL-1. They watched his keynote presentations as eagerly as the public did so they could understand where their company was headed. Jobs may well have been unapproachable, and odds were that typical employees would never attend a meeting with him. But they believed that whatever they were working on would be seen, eventually, by “Steve.” For all flowed up to him, and his fingerprints were on everything important that Apple did.
On the eve of the original iPhone launch, Jobs was at the peak of his faculties and the top of his game. He had seemingly beaten cancer, having survived the removal of a malignant tumor from his pancreas two years earlier. He had disclosed little about his illness, other than that it wasn’t the predominant kind of pancreatic cancer, which kills quickly. In his unvarying outfit of black mock turtleneck, Levi’s blue jeans, dark socks, New Balance sneakers, and 1960s-style round spectacles, Jobs was fit and robust, his salt-and-pepper beard full and just a tiny bit bushy. Having turned 50 two years earlier, Jobs was on a tear. Apple had remade the music industry with the iPod and the iTunes music store. That year Jobs had sold his side project, Pixar, to Disney for $7.5 billion, making him the famed entertainment company’s largest shareholder, a member of Disney’s board of directors, and a billionaire several times over.
Jobs could see into the future better than anyone else in the technology industry. But four years later, after all Apple accomplished between the first iPhone and the new model Jobs held in his hand, he refrained from asking Siri the existential question he knew was beyond its artificial intelligence yet of paramount importance: “What kind of company will Apple be after I’m gone?”
The death march that led to the iPhone was textbook Apple—favorites were played, key resources were diverted to a product that had captured the CEO’s interest, the hours were brutal, yet the work felt important. Could another company with annual sales of $108 billion have achieved a similar feat in the same time frame? Probably not unless it had a CEO who believed that he could change the world and his company could put a “dent in the universe.”
After his death at age fifty-six on October 5, 2011, Steve Jobs was rightly celebrated for his extraordinary contributions to the reordering of multiple industries. He revolutionized no fewer than four: computers, music (through the iTunes Store and the iPod), film (through Pixar, which pioneered computer animation), and communications (with the iPhone). Having helped define the computer industry as a young man, he was well on his way to ushering in its successor. Months before his death, at the triumphant debut of Apple’s second iPad, Jobs declared the beginning of the “post-PC era”—meaning computing would no longer be confined to a desktop or laptop. In Apple, he oversaw a company whose products were world famous but whose methods were top secret.
Were Apple better understood, its fans and foes alike would see it as a giant jumble of contradictions, a company whose methods go against decades of well-established management maxims. It’s as if Apple weren’t paying attention to what they’re teaching in business schools. In fact, it is not.
Apple is secretive at a time when the prevailing trend in business is toward transparency. Far from being empowered, its people operate within a narrow band of responsibility. Jobs famously encouraged the 2005 graduation class of Stanford not to “let the noise of others’ opinions drown out your own inner voice, heart, and intuition.” Yet Apple’s own employees are expected to follow orders, not offer opinions. Good managers, we have been taught, delegate. Yet Apple’s CEO was a micromanager in every sense of the word, from approving every ad his company created to deciding who would and wouldn’t attend top-secret off-site meetings.
Apple flouts yet another piece of modern management’s love of efficiency: It consistently leaves money on the table at a moment when profits are king and quarterly earnings exert a tyrannical sway over its fellow publicly traded companies. Apple, in fact, shows relatively little interest in Wall Street, seemingly viewing investors as an irritant at worst, a necessary evil at best. It aims to retain the vibrancy of a start-up at a time when many once-nimble tech companies (Microsoft, Yahoo!, AOL, and even Cisco come to mind) find ossification an inevitable side effect of growth.
Apple isn’t even a particularly nice place to work in an era when legions of companies compete to be listed on Fortune magazine’s annual ranking of most desirable workplaces. (Apple opts out of the competition altogether, choosing not to apply.) Then again, Apple clearly is doing something right. In fact, it has done little wrong since Steve Jobs returned to Cupertino in 1997. In the latter half of 2011, Apple and ExxonMobil jockeyed for position as the world’s largest company by market capitalization.
If Apple is so good at what it does, just how does it do it anyway? Google’s work environment has found its way into the popular culture. Hey, I can go to work in my pajamas, eat Cap’n Crunch, and joust with the other engineers while atop my Razor scooter—wheeee! Precious few have a clue what goes on at Apple when the camera isn’t pointed at whichever executive is conducting a carefully rehearsed demo at an Apple product launch.
This is just how Apple wants it. As far as Apple is concerned, the subject of how it really works is taboo. Privately, executives refer to its playbook as the recipe for Apple’s “secret sauce.” Tim Cook, the longtime operations chief who became CEO in August 2011, six weeks before Steve Jobs died, once addressed the matter publicly. “That’s a part of the magic of Apple,” he said, when asked by a Wall Street analyst to comment on Apple’s planning process. “And I don’t want to let anybody know our magic because I don’t want anybody copying it.”
As for Apple’s gadgets, as much as the world loves and admires them, few understand how Apple makes and markets them. It’s a topic best grasped through an understanding of the nitty-gritty processes of working at Apple: how its leaders function, the way the company pits competing technology teams against one another, and its unique approach—or lack of an approach—to career development. While many members of Apple’s middle ranks toil for years in the same exact role—yet another difference from the rest of the upward-and-onward corporate world—a handful of trusted lieutenants have bubbled up to become next-generation company leaders.
This book is an attempt to hack into Apple’s closed world and to decode its secret systems so that aspiring entrepreneurs, curious middle managers, envious rival CEOs, and creatives who dream of turning insights into inventions can understand the company’s processes and customs. If—and it’s not a given—it were possible to imitate Apple, who wouldn’t want to try? To confront that complicated task, the most logical place to start would be with Jobs. Jobs died at his Palo Alto home in 2011, but his spirit will inhabit Apple Inc. for years to come. To understand how Apple works is to know how his style was a refutation of the conventional wisdom of what a CEO should be.
Steven Paul Jobs changed the world, but he was the epitome of the hometown boy. In a paradox not unlike the many paradoxes of his company, Jobs was an urbane aesthete who nevertheless lived the life of a dyed-in-the-wool suburbanite. He professed a disdain for shopping malls, yet he put his company’s first retail store in one. He drove to work every day of his adult life, the prototypical commuter more at home on the freeway than in a city center.
He was born in San Francisco in 1955. His adoptive parents moved the family first to Mountain View, and then Los Altos, both small towns in what was known at the time as the Santa Clara Valley. He attended high school in nearby Cupertino, and in some ways he never left. For brief periods he strayed from the sunny, arid strip between San Francisco and San Jose, an area where a collection of nascent defense-technology companies were replacing the apricot and prune orchards that dotted the landscape when Jobs was a boy. He briefly attended Reed College in Oregon, a liberal campus where the 1960s lingered well into the 1970s. Jobs camped out for a time on a friend’s farm in Oregon, but when he needed money he came home to work for Atari. In these early years, he embraced strict vegetarianism, sampled a course on calligraphy—early evidence of a lifelong obsession with design—and sought to find himself in India. Again, he returned home. Years later, Jobs bought an apartment in the exclusive San Remo apartment building overlooking New York’s Central Park. But the pull of lean-to buildings and the entrepreneurs who were creating companies in them proved strong: He never took up residence on the Upper West Side.
A cheerleader for what became known as Silicon Valley, Jobs would question the judgment of entrepreneurially minded people who advocated starting companies or furthering their careers anywhere else. Toward the beginning of his rejuvenation of Apple, in 1999, he belittled the former Disney executive Jeff Jordan for having graduated from Stanford University, “in the epicenter of entrepreneurship,” and then leaving town for various positions. A decade later, Andy Miller, CEO and co-founder of Quattro Wireless, a mobile advertising company that Apple bought and whose technology became Apple’s iAd, discussed geography with Jobs when the two met to hash out their deal. “Your company is in Waltham,” Jobs said, mispronouncing the name of the Massachusetts town where Quattro was located. Miller tried correcting Jobs on the pronunciation, but Jobs cut him off. “I don’t care,” Jobs said. “You know what’s in Waltham?” he asked, still mispronouncing the name. “Absolutely nothing.”
The other titans of the tech industry immigrated to a place where Jobs was a native. Andy Grove of Intel was born in Hungary, Oracle co-founder Larry Ellison, in Chicago. Google’s Larry Page and Sergey Brin hailed from Michigan and Russia, respectively. Mark Zuckerberg, the newest superstar of Silicon Valley when Jobs died, was born in suburban New York and founded Facebook in a Harvard dorm room. They all sought out the Silicon Valley that Jobs wove into his personal fabric at a young age. He loved to tell the story of phoning his neighbor, William Hewlett, to ask for spare parts for a device Jobs was building called a “frequency counter.” He was thirteen years old. Hewlett, the co-founder of Hewlett-Packard, the original Silicon Valley company to start in a garage, gave Jobs the parts—and a summer job.
Jobs may have been of Silicon Valley, but he didn’t always fit its stereotypes. He was savvy and knowledgeable about technology, but lacked formal training as an engineer. He was enough of a nerd to hang out at the Homebrew Computer Club with his friend Steve Wozniak, the personification of a 1970s propeller head. But Jobs was precocious: confident around women, a sharp dresser once he acquired some wealth (and before he began wearing the same clothes day in and day out), and a shrewd and demanding marketer and businessman. He was everything the engineers were not, yet he understood their technology well enough to tell them what products he wanted them to build for the consumers who would be his customers.
Apple began when Wozniak created the Apple I in 1976. Jobs had the gumption to realize that there was a broader market for the device, which “Woz” built mostly to impress his computer-club pals. The Apple II, released in 1977, sold so rapidly that Apple listed its shares on the Nasdaq stock exchange in 1980, making millionaires of the two young founders. As Apple grew, Woz quickly lost interest and Jobs dominated the company. He hired older men, including experienced Valley hands Mike Markkula and Mike Scott, and in 1983 the Pepsi executive John Sculley, to provide what Silicon Valley investors have long called “adult supervision.”
Jobs oversaw the development of the Macintosh, a revolutionary computer in its time because it implemented the breakthrough technology Jobs had observed at nearby Xerox PARC, the photocopier company’s Palo Alto research lab. With a computer “mouse” and a “graphical user interface” that allowed ordinary users to change sizes, fonts, and colors on their screens, the Mac changed the computer industry. When business faltered, however, Sculley kicked Jobs upstairs to the post of vice chairman. Jobs chose exile over sinecure, leaving Apple altogether in 1985.
Jobs’s wilderness years were also some of his most important in terms of growth, professionally and personally. He founded NeXT, a high-end computer company initially targeted at education markets. It never gelled, but it gave him his first experience as a CEO. He’d gone from a mercurial screamer to a more nuanced developer of talent: Several of his top managers at NeXT formed the core of his eventual resuscitation of Apple. In 1986, he invested $10 million in a computer graphics company the filmmaker George Lucas owned that later would be called Pixar. After a decade of tinkering with different business models—Pixar for a time sold expensive workstation computers—the company would settle on computer-aided animation as its niche. Pixar was an “overnight” success when Toy Story debuted in 1995 and the company quickly went public, earning Jobs his second fortune.
It was also during his time away from Apple that Jobs transformed himself from a glamorous, if ascetic, bachelor—for a while he dated the singer Joan Baez and the writer Jennifer Egan—to a family man. After addressing a business school class at Stanford in 1990, he introduced himself to a student who had caught his eye, Laurene Powell. They married the next year and ultimately raised their three children on a quiet street in Palo Alto, not far from the Stanford campus. Once again, Jobs led a paradoxical life. A world-famous businessman at work, he lived in a home with no security, no gates, and no lawn: The grounds outside the Tudor house were covered with California poppies and apple trees. The neighbors all knew when Jobs was home, because his silver Mercedes SL55 AMG coupe would be parked in the driveway. Jobs succeeded in keeping his children, and his wife, for that matter, out of the public eye. Laurene Powell Jobs ran an education-oriented philanthropic organization and served on the board of Teach for America (with her husband’s biographer, Walter Isaacson). A former investment banker, she spoke only occasionally in public. At the time of Jobs’s death, their son, Reed, a Stanford undergraduate, lived next door with some friends in a house his parents bought after persuading a longtime neighbor to move down the block. That way Reed could be close to his ailing father, as well as his younger sisters, Erin and Eve.
Known for being alternately bullying and charming at work, Jobs showed his neighbors the same combo package. Evelyn Richards, who lived around the block from Jobs, once sent her Girl Scout daughter to the Jobs household to sell cookies. “Jobs answered the door himself,” Richards recalled. “But he told her he wouldn’t buy any because cookies are sugary and bad for you.” At the same time, his neighbors frequently spotted Jobs strolling around the neighborhood, either with his wife or, often, with his close friend and Apple board member Bill Campbell. Jobs also showed up at local gatherings just like everyone else. Richards recalled the Fourth of July block party in 2007, days after Apple began selling the iPhone, when Jobs showed off the phone to all who were interested. A poignant snapshot from that day shows Jobs out of uniform: He wore a baseball cap, a long-sleeved white shirt, and blue jeans, with a flannel shirt wrapped around his waist. In it, he stands next to another man, demonstrating the iPhone, looking like just any other Palo Alto dad displaying a new gizmo.
If power corrupts, then success enhances: It makes the qualities of a leader appear in sharp relief. As Jobs entered the last and mind-bogglingly productive phase of his career, the many paradoxes of his personality became the management systems of the company. This Jobs-ian transformation began in earnest in 1997.
The previous December, a floundering Apple had purchased NeXT. The prodigal co-founder returned as a “technical adviser,” and NeXT’s software became the foundation of a new operating system for Macintosh computers. The following July, Apple fired its CEO, Gil Amelio, a former chip executive from National Semiconductor who had failed to halt the hemorrhaging of cash that had begun under Apple’s two previous CEOs, John Sculley and Michael Spindler.
Even good news at Apple highlighted the fallen icon’s weaknesses. On August 6, 1997, Apple announced a $150 million investment from Microsoft. The cash certainly helped, but the real value to Apple was Microsoft’s commitment to continue developing its Office productivity software for the Macintosh for at least five years. Apple was so diminished that summer that many software programs didn’t come in a version for the Mac. The online publication CNET at the time opined that Microsoft’s move “amounts to little more than good public relations.” Microsoft, after all, didn’t want Apple to die. The elimination of Apple would hurt Microsoft in the eyes of antitrust regulators. This same observer, a newsletter writer focused on Windows products, noted: “The investment still doesn’t give Apple a coherent strategy for turning things around.”
Behind the scenes, though, Jobs’s turnaround plan was well under way. The next month, Apple announced that Jobs would become interim CEO of Apple until a suitable replacement could be found. It would be three years before Apple made Jobs the permanent CEO. Until then he was known around the company’s headquarters as Apple’s “iCEO,” foreshadowing the i-nomenclature that would permeate Apple’s branding. Interim or not, Jobs was busy putting the pieces into place for the company’s rebirth. He recognized the importance of work Jonathan Ive was doing in Apple’s design laboratory, and Jobs set Ive to work on what would become Apple’s candy-colored iMacs—translucent, all-in-one computers that looked like clear TVs connected to a keyboard. He hired Tim Cook—an operations whiz from Compaq, and IBM before that—to revamp Apple’s bloated and broken supply chain.
Then, with the company back on its feet thanks to the success of the iMac and the jettisoning of numerous unprofitable and non-core products, such as the handheld Newton and printers that were indistinguishable from the competition, Jobs set Apple on the course that would transform it from niche pioneer to global champion. Apple opened its first retail stores in 2001, initially to sell Macs. Then it started stocking the stores: with the first iPods that year, followed by a succession of follow-on iPods, including the Mini, the Nano, the Shuffle, and the Touch. Consumers used the iTunes Store, first introduced in 2003, to fill their devices with music, and later movies and TV shows. The stores were stuffed with Apple products and scores of third-party accessories by 2010, when Apple released the groundbreaking iPad.
It was during this burst of creative energy that Apple’s CEO first became ill. He learned in 2003 that he had a rare, initially treatable form of pancreatic cancer but didn’t have the tumor removed until 2004, when he took his first leave of absence. A healthy period followed—this is when the iPhone was born and the iPad took shape—but Apple-watchers knew something was amiss when Jobs showed up for an Apple developers’ conference in June 2008 looking gaunt. The next year he announced a second leave, this time so he could have a liver transplant performed. He returned to work in mid-2009 but never regained the weight he’d lost the previous year.
The last time Jobs presented to the public, on June 7, 2011, it was before the Cupertino City Council. He had come to show the city Apple’s plans for a new, twelve-thousand-person headquarters and campus in Cupertino to be built partly on land purchased from a shrinking Hewlett-Packard. The hometown boy played to an awed audience, expressing his desire for his company to continue paying taxes in Cupertino and mindful of the history of the land in question. (Apple was Cupertino’s largest taxpayer, he noted, and it would be a shame if the company were forced to move to Mountain View.) The presentation contained all the usual Jobs flourishes: clean slides, persuasive points to convince the council his plan was sound, and a dash of heartstring-pulling emotion. He noted that apricot trees had once covered the 150 acres where Hewlett-Packard had built its computer systems division. He knew this, of course, because he had grown up nearby. Now landscaping covered only 20 percent of the site, and too much of the rest was covered with asphalt. Apple’s plans called for increasing the landscaping dramatically, including providing a home for six thousand trees where thirty-seven hundred now stood. “We’ve hired a senior arborist from Stanford,” Jobs told the council—an expert in indigenous trees. Said the indigenous executive, who knew full well he wouldn’t live to see the new headquarters built: “We’ll want to plant some apricot trees.”
When he died, much was made of how singular Steve Jobs had been. For comparisons, observers needed to reach back to the mythic inventors and showmen of earlier eras, particularly Thomas Edison and Walt Disney. Jobs was singular, to be sure. But he also was of a type. He was what psychotherapist and business coach Michael Maccoby called a “productive narcissist.”
In 2000, Maccoby published an insightful article in the Harvard Business Review that applies Freudian terminology to three categories of executives Maccoby had observed in corporate life. “Erotics” feel a need to be loved, value consensus, and as a result are not natural leaders. These are the people to whom a manager should assign tasks—and then heap praise for a job well done. “Obsessives” are by-the-books tacticians with a knack for making the trains run on time. An efficient head of logistics or bottom-line-oriented spreadsheet jockey is the classic obsessive. The greats of business history, however, are “productive narcissists,” visionary risk takers with a burning desire to “change the world.” Corporate narcissists are charismatic leaders willing to do whatever it takes to win and who couldn’t give a fig about being liked.
Steve Jobs was the textbook example of a productive narcissist. An unimpressed Jobs was famous for calling other companies “bozos.” His own executives endured their rides on what one called the “bozo/hero rollercoaster,” often within the same marathon meeting. Jobs brought an artist’s eye to the scientific world of computers. His paranoia built a company that is as secretive as the Central Intelligence Agency. Jobs, perhaps more than any other businessperson of the last century, created the future others couldn’t see.
The way Jobs led is merely the first example (of many) of how Apple’s ways depart from decades of received wisdom on corporate life. In his most recent book, Great by Choice, management expert Jim Collins and his co-author Morten T. Hansen hold up Microsoft rather than Apple as the model of a company that delivers outstanding returns to shareholders. (It didn’t help their analysis that the data set for the companies they investigated ended in 2002—shortly after Microsoft’s star began to fade and just as Apple’s began to shine.) For years, the trend in business has been toward empowerment. Collins rhapsodizes in his earlier classic Good to Great about the humble “Level 5 leader” who shares credit with his or her subordinates and delegates responsibility. In Collins’s cosmology of corporate life, the reverse was supposed to be true as well. Great leaders weren’t supposed to be tyrants. They were supposed to empathize with the feelings of those below them.
Jobs did just the opposite. He micromanaged to a shockingly high degree and to an amazingly low level in the organization. One ex-employee recalled being responsible for an email that would be sent to Apple customers simultaneously with the launch of a new version of a product. Ahead of the launch, Jobs engaged this employee in a repeated back-and-forth by email over the punctuation in the message. “A first iteration of anything was never good enough for him,” said the former employee. At the height of his power Jobs personally ran marketing, oversaw product development, involved himself in the details of every acquisition, and met weekly with Apple’s advertising agency. Before illness slowed him, Jobs was the only Apple executive to play a significant role at any Apple public event, be it a product launch or a keynote speech. When Apple did grant interviews to the press to promote an upcoming product launch, Jobs was the primary—and sometimes only—Apple spokesman.
There are few companies where this sort of leadership style would fly. But should there be? CEOs aren’t supposed to be jerks. They’re not supposed to make their employees cry. They’re not supposed to hog all the credit for a team’s job well done. Yet accepting that the flame of one’s own public profile needed to be extinguished at the altar of Steve was a fact of life for even senior Apple executives. Avie Tevanian, one of Apple’s senior software executives in the late 1990s and early 2000s, recalled the time, in 2004, that he commented at a public event on the expected upgrade cycle for the Mac operating system. There was nothing controversial in what he said, in Tevanian’s opinion. He merely was confirming what already was well known, that the upgrade would take slightly longer than prior releases. “I got a scathing phone call from Steve,” Tevanian remembered. “He said: ‘Why would you say something like that? We have no news to report; you shouldn’t have said that.’ ” Up to that point, Tevanian hadn’t spoken much in public, even though he was one of the highest-ranking Apple executives. Afterward, he rarely did at all, which was just the way Jobs wanted it.
Hogging the spotlight created resentment, but it was also characteristic of the type of leader Jobs was. In his book The No Asshole Rule: Building a Civilized Workplace and Surviving One That Isn’t, Stanford business professor Robert Sutton calls Jobs “exhibit one” of chapter 6—titled “The Virtues of Assholes”—a chapter Sutton said he didn’t want to write: “It sometimes seems as if his full name is ‘Steve Jobs, that asshole.’ I put ‘Steve Jobs’ and ‘asshole’ in Google and got 89,400 matches.”
Joking aside, Sutton goes on to make a case consistent with Maccoby’s Freudian analysis. Perhaps, he argues, ignoring the very qualities that adherents of “empowerment” have been advocating is an acceptable model of leadership today. Jobs may have been an asshole, Sutton implies, but he was an effective asshole. People who worked for Jobs argue, Sutton writes, that
he is among the most imaginative, decisive and persuasive people they’ve ever met. They admit that he inspires astounding effort and creativity from his people. And all suggest—although his tantrums and nasty critiques have driven the people around him crazy and driven many away—they are a crucial part of his success, especially his pursuit of perfection and relentless desire to make beautiful things. Even those who despise him most ask me, “So, doesn’t Jobs prove that some assholes are worth the trouble?”
Jobs’s insistence on involving himself in the smallest of matters was as old as Apple itself. In his seminal book about Apple’s earliest days, The Little Kingdom, Michael Moritz describes the lengths to which Jobs would go to have things his way. “When an IBM salesman delivered a blue Selectric typewriter instead of the neutral color he had specified, Jobs erupted,” Moritz wrote in 1984. “When the phone company failed to install the ivory-colored telephones Jobs had ordered, he complained until they were changed.” In the early days Jobs haggled with the smallest of vendors, and typically in a less-than-congenial or -respectful way. “He was very obnoxious to them,” Gary Martin, an early Apple accountant, told Moritz. “He had to get the lowest price they had. He’d call them on the phone and say, ‘That’s not good enough. You better sharpen your pencil.’ We were all asking, ‘How can you treat another human being like that?’ ”
A narcissist to be sure, Jobs also had obsessive traits, and he made sure the people below him obsessed about details as much as he did. Indeed, Jobs’s requirement that things be done his way—and his persistence in verifying that his will be done—created Apple’s obsessive culture and called to mind a domineering orchestra conductor. “The leadership structure at Apple is what allows Apple to thrive,” recalled Michael Hailey, a former product marketing manager. “You had a visionary leader and people he trusted implicitly who had a knack for executing his vision. Jobs stayed involved from beginning to end to make sure everything matched his vision. He’d check off on the smallest things. That’s how you get discipline.”
Continues...
Excerpted from Inside Apple by Lashinsky, Adam Copyright © 2012 by Lashinsky, Adam. Excerpted by permission.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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Table of Contents
Chart: Apple's Core viii
1 Rethink Leadership 1
2 Embrace Secrecy 31
3 Focus Obsessively 49
4 Stay Start-Up Hungry 65
5 Hire Disciples 87
6 Own Your Message 113
7 Overwhelm Friends/Dominate Foes 139
8 Plan for After Your Successor 155
9 Inspire Imitators 177
10 One More Thing 189
Afterword 209
Acknowledgments 225
Author's Note 229
Index 231
About the Author 239
What People are Saying About This
Adam Lashinsky, one of America's best and most diligent technology reporters, has produced a fascinating glimpse inside Apple as it makes its transition into the post-Jobs era. It's filled with colorful reporting and smart analysis that offer lessons not just about Apple but about creative business leadership in general. (Walter Isaacson, author of Steve Jobs)
Lashinsky penetrates the legend of Steve Jobs and his company and breaks down the building blocks that make it all work.
-Dennis McCafferty, CIO Insight
Though the book will appeal to Apple fans wanting juicy details about Apple's corporate culture, Inside Apple is also meant to be a guide for business leaders looking to draw some leadership advice from a team many believe is the best in the business.
-Kelly Hodgkins, TUAW, The Unofficial Apple Weblog
If you haven't read Adam Lashinsky's awesome new book about Apple, you should. It takes on many of the lessons MBA programs and Corporate America have been teaching about business for the past 50+ years and questions whether lessons from Apple might be more applicable in thinking about the future.
-Mark Suster, venture capitalist, GRP Partners
Lashinsky takes us inside the walled garden at Apple's corporate headquarters compound, at One Infinite Loop, Cupertino, Calif., partially lifting the Kremlin-esque secrecy that shrouds the enigmatic company.
-Mark Veverka, Barron's
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