Steve Jobs, founder and current Chief Executive of Apple Computers, is a phenomenon. He has no doubt assured his place in business history by being fired from his own company in 1985 (well actually he resigned to avoid being fired). The business was started from his garage in 1976. In 1996 he returned to rescue the company from bankruptcy, and in ten years made the company bigger and better than it’s ever been. “He’s tripled Apple’s annual sales, doubled the Mac’s market share, and increased Apple’s stock 1300 percent. Apple is making more money and shipping more computers than ever before, thanks to a string of hit products – and one giant blockbuster”. This “blockbuster” is the iPod, introduced in October 2001. In the years since then, “Jobs quickly turned the iPod from an expensive Mac-only music player that many people dismissed, into a global, multibillion-dollar industry that supports hundreds of accessory companies and supporting players”.
He is a true child of the sixties generation. “A Buddhist and a pescadarian (a vegetarian who eats fish), he often walks barefoot to the local Whole Foods for fruit or a smoothie… Jobs is a control freak extraordinaire. He’s also a perfectionist, an elist, and a taskmaster to employees. By most accounts, Jobs is a borderline loony.
It appears therefore that this book is a bit more constructive than many others that have been written about Jobs. In fact, at the end of each chapter there is a summary entitled “Lessons from Steve”. Some of these “lessons” from the very first chapter are as follows: * Get busy. Roll up your sleeves and get to work straight away. * Face hard decisions head-on. Jobs has to make some hard, painful decisions, but faces the situation head-on. * Don’t get emotional. Assess your company’s problems with a cool, clear head.
This is hardly the business philosophy of a “sociopath”(someone with no emotions or conscience). However, let’s take a look at some more advanced “Lessons from Steve”: * Be a despot. Someone’s got to make the call. Jobs is Apple’s one-man focus group. It’s not how other companies do it, but it works. * Don’t shit on your own doorstep. Apple’s engineers hated the old Mac OS, but Jobs ordered a positive spin on it. * Don’t listen to your customers. They don’t know what they want. * It’s OK to be an asshole, as long as you’re passionate about it. Jobs screams and shouts, but it comes from his drive to change the world. * Put boot to ass to get things done. * Become a great intimidator. Inspire through fear and a desire to please.
And so on and so on. Each chapter of the book discusses one of the key elements of the Apple business. So the final product is a quite engaging business philosophy for high technology companies, from design, engineering and manufacturing right through to marketing and retail sales. And all of it is totally unusual. Apple is one of the few high-tech companies left with complete vertical integration from beginning to end. This alone makes it one of the most remarkable companies of our time.
One of the most distinctive features of company marketing is total secrecy about new product development. Employees are as secretive about their work as CIA operatives planning a military coup-d’etat of a neighbouring third-world country. New consultants use fictional names when checking into hotels. Leaking news is a fireable offense. But with
20 000 employees, such leaks are inevitable, and then the hunt is on for Deep Throat, just like Watergate.
So when the time comes for a new product release, which is always done at a media conference presented by Steve Jobs himself, the hype is so great that the company gets millions of dollars of free advertising. And tradition has it that the actual new product is always unveiled right at the end of Jobs’ presentation, and is introduced by the words “And there’s one more thing…” almost as though it were an afterthought. And that’s when all the covers come off the massive advertising banners and other product displays. Amazing stuff! This man deserves an Oscar.
Perhaps the introduction of Apple’s retail stores demonstrates the genius of the man, and of the company under his leadership. In fact, how any company could succeed in shopping mall consumer retailing as well as in engineering, design, software development etc is a mystery because it defies all the standard business rules about “sticking to your core competence”. For a college dropout (like competitor Bill Gates) Jobs has a quite remarkable number of “core competencies”.
The whole concept of the Apple retail stores is different to any other retailing. For a start, most computer consumer retailers would cover the shop floor with hundreds of products. But Apple at the time only had four products – a business desktop computer, an individual’s home desktop computer, a business laptop and an individual’s “home” laptop. So what’s there to retail?
Jobs started off by doing his usual trick of recruiting the best person he could find, who turned out to be Mickey Drexler, previously CEO of The Gap, who were apparently the most successful retailing operation in the USA under his direction. When Apple opened its first retail store in May 2001, Gateway, the only other computer company with its own retail stores, was closing them down. Consumers wanted “big box” stores where they could compare offerings from different manufacturers. Industry experts were holding their breaths, waiting for the biggest meltdown in retailing history.
The prototype store was divided into four sections, each divided into “solution zones”. One quarter at the front of the store was devoted to products, another quarter to music and photos, the third quarter to the “Genius Bar” (see below) and movies, and the fourth quarter to accessories and other products at the back of the store. The idea was to create a place where customers could find entire “solutions” to lifestyle problems they wanted solved – like taking and sharing digital pictures, or editing and making DVD’s.
The stores were to be a public place, like a library. There would be unlimited access to Internet computers and arranging lots of in-store events. Every week, there are free workshops, classes, and at the bigger stores, talks by creative professionals and performances by bands. The stores are supplemented by Apple Camps in the summer, which attract thousands of school kids to take computer lessons. The bigger flagship stores would have staircases made of glass, to encourage customers to climb to the second floor, traditionally more lightly trafficked.
The most important innovation was offering hands-on training and support at the Genius Bar. This was also where computers could be brought for repairs, with a turnaround on repairs in days (rivalling service at the neighbourhood dry cleaner). These Genius Bars became the most distinctive and popular features of Apple’s stores. Customers really appreciate that they’re able to troubleshoot problems face to face, or drop off malfunctioning equipment at the local mall. Apple estimated that in 2006, one million people visited the Genius Bars during an average week. They became oversubscribed, and some have implemented appointment schedules to cope with the demand.