What Would Steve Jobs Do? How the Steve Jobs Way Can Inspire Anyone to Think Differently and Win (4 page)

Sculley refused at first, feeling uncomfortable about going to a relatively new and less stable company and being inexperienced with technology. Jobs convinced him with the now-famous line: “Do you want to spend the rest of your life selling sugared water, or do you want a chance to change the world?”

Sculley joined the team, and at first he and Jobs got along famously. Sculley managed the enterprise, the “go-to-market maze,” and put the external face on Apple, the company. Steve brought the Mac project to life. The two
managed together and went to meetings together; they were “joined at the hip.”

At the time, Apple had about 4,000 employees—3,000 of them working on the Apple II, and, of the remaining 1,000, about 900 working on Lisa and 100 working on Macintosh. The Mac team worked more or less like a start-up, with 80- to 90-hour weeks not being uncommon, while the rest of the company had become quite corporate in nature.

Steve’s involvement was deep and wide, and he sweated every detail. When a software glitch was found, he would not let the product ship with downsized software labeled “demo.” He was a perfectionist, and he held the team to that standard.

The Mac was a unitized machine, meaning that it was sold as a complete package with no add-ons. It was simple, and it was smaller than anything on the market. It used Sony’s new 3.5-inch floppy drive. Unlike any computer before it, it was fully graphical and GUI-driven, with icons and pull-down menus, and with a mouse as its main controlling device. It was, like Steve himself, consumer-friendly, visionary, and somewhat countercultural for the time.

T
HE
A
D
 

The Mac was ready for launch in 1984. It was a big product, and Apple wanted to communicate a big
vision, delivered in a big ad, for the big game—the 1984 Super Bowl. The IBM PC had been introduced a couple of years earlier and had gained traction with users and developers, especially in the business space, and, well, IBM was IBM. So Apple’s long-time ad agency Chiat/Day came up with a radical antidote. The theme was taken from George Orwell’s
1984
, and the ad featured dronelike workers staring at a screen, which was eventually shattered by an energetic young woman to a voiceover: “On January 24, Apple Computer will introduce Macintosh. And you’ll see why 1984 won’t be like
1984
.”

Sculley was uncomfortable with the ad. The board of directors hated it. Steve Jobs, of course, loved it. Steve Wozniak said, “This ad is us.” The marketing VP, faced with running a less inspiring ad, decided to run it.

Today, the ad is considered a masterpiece and one of the most effective advertising efforts of all time. But it illuminated the differences between Steve, Mike Sculley, and the rest of the company’s leadership.

F
IRST
D
EPARTURE
 

Mac sales were good at first, but then sagged because of a flagging economy and the exhaustion of the early-adopter crowd. At $2,000, the Mac was still expensive, and there wasn’t that much software to run on it. That
changed in 1985, with the introduction of the LaserWriter and the Aldus PageMaker software package.

The LaserWriter, one of the first commercially successful laser printers, was part of Jobs’s grander vision to make the Macintosh, and computers in general, “do useful things.” Not only did it create the new desktop publishing market that Raskin had conceived in the first place, but its visual and graphic strengths established Apple at the forefront for creative and graphics types for years to come.

But still all was not well with the company, given the differences in vision and style between Jobs and Sculley and others, who were seeking a more mature business model. Jobs and Sculley could not agree on how to market the Mac. Sculley wanted to market it to businesses and hired a large sales force to do just that. He wanted to control shelf space at distributors, mimicking the soft-drink distribution model. Jobs saw the Mac as a consumer product, and wanted to set up direct distribution from FedEx facilities to speed service, reduce distribution channel investment, and provide better customer touch—a precursor to the successful Dell direct business model.

Jobs and Sculley couldn’t agree on this or a lot of other things. The company was becoming more organization-and sales channel–driven, and less product-driven. It drove Steve nuts, and, unfortunately, many company
notables, including Mike Markkula, sided against him. Sculley told Steve that the Mac group was no longer his to run; he would be sidelined to chief technology officer. Wanting no part of this, what did Steve do? He got in his car and drove off—for what would turn out to be 11 years.

In later testimony for the 1995 Smithsonian Awards Program oral history, Steve discussed the problem—which wasn’t the company’s rapid growth or the sidetracking of his career, but a fundamental shift in values from a product-driven organization to a money-driven one. Steve, quite correctly, saw money as an effect and product as the cause—if you stayed focused on the product, the cash registers would ring. The management team was applying too much MBA stuff (standard business practices), taking the focus off the product and diluting the vision. It wouldn’t work for a product-driven company that thrived on innovation.

In a scathing comment during that same interview, Jobs claimed, “John Sculley ruined Apple, and he ruined it by bringing a set of values to the top of Apple which were corrupt and corrupted some of the top people who were there, drove out some of the ones who were not corruptible, and brought in more corrupt ones and paid themselves collectively tens of millions of dollars and cared more about their own glory and wealth than they did about what built Apple in the first place—which was making great computers for people to use.”

Sculley, for his side of the matter, wrote in his memoir
Odyssey
that Jobs “was a zealot; his vision so pure that he couldn’t accommodate that vision to the imperfections of the world.” He went on to discredit Jobs’s vision as a “lunatic plan,” as “high tech could not be designed and sold as a consumer product.”

Sculley and Jobs were clearly like oil and water, although they may have given some balance to each other for a while. It was definitely a learning experience for Steve, and it probably strengthened his resolve to take a different path, for instance, in setting up his own retail store channel instead of vying for shelf space in the existing channels.

Despite their differences, Sculley and Jobs eventually began to recognize each other’s contributions to Apple’s legacy. They occasionally exchanged e-mails. When Jobs resigned, Sculley sent a note: “Steve, I owe you a lot. Because you cared so much, the universe is a little bit different. You did it with taste, design, addictive user experience, and no compromise products that make us all smile…. John.”

John Sculley and the rest of the world may not have felt this way when Jobs left in 1985. But after gaining two more business experiences and returning to Apple in 1996, Jobs started down a path that would make Sculley’s sentiment speak for most of us.

CHAPTER 2
BORN AGAIN
 

I think if you do something and it turns out pretty good, then you should go do something else wonderful, not dwell on it for too long. Just figure out what’s next.

—Steve Jobs
, NBC Nightly News,
2006

 

 

According to most accounts, Steve initially didn’t handle his departure from Apple very well. But, as we’ll soon see, it was a maturing experience. Never one to give up, Steve soon started another company, NeXT Computer, sort of a high-end Apple, with the idea of producing a sort of high-end Macintosh. He used a considerable amount of his own personal fortune to launch NeXT, which largely turned out to be a flop. He also got the chance to buy the computer animation and graphics arm of Lucasfilm, which became Pixar. But instead of selling expensive graphics workstations, it serendipitously morphed into a full-length feature film producer through a surprise arrangement with Disney.

With both companies, but especially with Pixar and Disney, Steve got a chance to work with the big boys and to match his creative energies with some powerful business and market forces. In the case of NeXT, he mostly failed, but he took away some good experiences and learned a lot about interconnectivity, software, and other building blocks that would ultimately shape the next generation of Apple products. At Pixar, he learned a lot about managing large technical teams in a creative environment, and about “big business” dealings from working with Disney.

When Steve made his “Cinderella” return to Apple in 1996, he found a total mess. The company was losing
money and had largely resigned itself to occupying a very specialized and slowly shrinking market niche. He was now prepared to almost single-handedly transform the company from a backwater computer maker to the digital powerhouse we now know today. Most observers don’t think this would have happened without Steve’s 11-year hiatus. Steve would have agreed.

In these years, his leadership style carried forward with its intense customer sense, vision, and product sense, but also added a degree of maturity needed to work in a large corporate environment. He also developed a stage presence and a product face that hasn’t been matched in the history of business.

W
HAT
C
AME
N
E
XT
 

Although he was worth $200 million at the time, Steve Jobs wasn’t about to stop creating products or chasing his vision after he left Apple. What would Steve do? Easy—he’d start another company.

He started the appropriately named NeXT Computer, Inc., with a lot of his own money. The goal was to design the “next-generation Macintosh,” a more powerful dream machine targeted toward high-powered end users and the higher education market. While NeXT did become the first true Internet Web server, it was too expensive and too fancy, with not enough software to really succeed,
but the core operating system developed for it became the model for the highly successful OS X (“OS Ten”) operating system. The OS elements became the main ticket for Steve’s late 1996 return to Apple and brought success back to the company.

NeXT also gave us another breakthrough in the form of NeXTMail, an early manifestation of Steve’s vision that computers should be interpersonal, that is, networked. NeXTMail was the first graphics-based e-mail system, allowing embedded, visible, clickable graphics. After selling 50,000 machines, NeXT was slimmed down to emphasize software design, then was sold back to Apple in November 1996.

Although by most traditional business measures, NeXT was a failure, it did allow Steve Jobs to refine and mature his leadership style, not to mention nourish his creative side. NeXT was a great place to work for both Steve and his employees, and it served as a valuable step and a new beginning in Steve’s path forward.

He pretty much said that himself in his 2005 Stanford commencement address, in the now-famous quote: “I didn’t see it then, but it turned out that getting fired from Apple was the best thing that could have ever happened to me. The heaviness of being successful was replaced by the lightness of being a beginner again, less sure about everything. It freed me to enter one of the most creative periods of my life.”

M
ORE
T
HAN A
T
OY
S
TORY
 

It wasn’t part of Steve’s grand plan, but because of a divorce settlement, the graphics group in George Lucas’s successful Lucasfilm company came up for sale in 1986 for $10 million. Jobs bought it with the vision of developing high-end graphics hardware. The graphics hardware never really took off as a salable product, but then the company got a huge break.

Pixar had been making some well-regarded shorts, like “Luxo Jr.,” the familiar short starring two emotional Luxo lamps. It was mainly a demo for the Pixar Image Computer, which hadn’t been doing very well. But Steve felt that Pixar was never really going to gain traction as it was and looked for something bigger. John Lasseter, a former Disney animator working for Pixar, had come up with some storyboards for a longer animated film called
Tin Toy
. He made a short that Jobs really liked and took a chance on, funding it out of his own pocket. Jobs and Lasseter went to Disney to sell Disney on a one-hour TV show based on this and similar animations, and were surprised to find that Disney saw it instead as a full-length feature film.

From that eventually came the blockbuster hit
Toy Story
. There were some production glitches and some contentious moments with Disney, but the film, released in 1995 after five years of development, was a huge hit. It
redefined Pixar as a movie producer, not just a hardware producer. Pixar has released more than a dozen feature-length films since then, and the studio has never lost money. In 2006, Jobs sold his interest in Pixar to Disney for $7.4
billion
in Disney stock, making him the company’s largest shareholder.

In his Pixar role, Steve was more the business leader than the creative leader, handling the negotiations and dealings with Disney. He pretty much left the creative people alone to do their thing, something he didn’t normally do when it came to a hardware product. Although many pundits question his trust of his workers, Steve hired good people and put a lot of faith in their talent and decision-making abilities, especially when he was dealing with topics he didn’t know so much about.

B
ACK TO THE
F
UTURE
: S
TEVE
R
ETURNS TO
A
PPLE
 

Apple went through sort of a “dark ages” period from the time Steve left in 1985 until his return in late 1996. The company tried to leverage the Macintosh platform into several flavors, sizes, and shapes. The only success among these launches was the PowerBook, a powerful but still heavy laptop version of the Mac. The product provided portability, networking capabilities, and color
to the still-being-defined laptop space, and served as a model for others to emulate.

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