Tuesday, January 17, 2012

Inside Apple: The Book is Out Now

Inside Apple reveals the secret systems, tactics and leadership strategies that allowed Steve Jobs and his company to churn out hit after hit and inspire a cult-like following for its products.

"Steve Jobs was a micro-manager, bully, made 'impossible' demands and took a non-excuses perspective, and made Apple a very secretive entity. Fortune magazine Lashinsky, however, manages to provide useful insights nonetheless. The secrecy about future products and its management methods was intended to make life more difficult for its competitors, avoid stealing thunder from existing products, milk additional free media coverage on product launch days, and avoid disappointments if the eventually released product failed to match the hype. 
Other snippets - Jobs demanded inter-group cooperation, 'fun' is never used to describe the working environment at Apple, and neither is 'high pay.' Product packaging receives strong emphasis (adds to its products' distinctiveness), the products themselves are considered works of art, vertical integration provides Apple complete control, focus groups and/or surveys don't guide product design at Apple, Apple has paid little attention to business sales until now - even so, it still emphasizes appealing to users over IT managers only the CFO has P&L responsibility, and simplicity of operation (for the consumer) reigns supreme. 
Upon Jobs' return to Apple in 1997, one of the steps he took was to kill off printer production - Apple provided no product differentiation in that area. He also eliminated 4,000 middle manager positions, and severely reduced both the number of existing products and planned new products. 
Apple's executive team meets each Monday to review all product plans; two Mondays are required to get through them all. Dates are important, and every agenda item has the name of the designated responsible individual (DRI). The company is organized around functions, not product divisions - thus, Ron Johnson, though in charge of Apple's retail stores, did not have control of retail inventory nor its website. 
Employee selection is one area that Jobs paid special attention. Whereas the performance variation between the best and worst cab driver in a city may be only 2:1, Jobs believed it was as much as 50:1 in the area of product engineering. 
Pre-orders for the iPhone4 topped 1 million, vs. 'only' 600,000 for its predecessor. The firm is very focused - eg. iPhone development starved efforts to update MacOS. Jobs' interests also played a role - hence its excellent 'Keynote' software for presentations, and so-so- "Numbers,' that he had little interest in. It has about $80 billion in cash and cash equivalents - harking back to the late 1990s when Apple nearly went broke. (Experts expect its new CEO, Cook, will pay some of that out Jobs reportedly told him, just before leaving, to not ask 'What would I do, rather What's right?'.) Apple's 'Apps store' was a response to learning of Google's plan to do so with its Android system. 
Jobs generally disliked MBAs and their emphasis on market research, preferring graduates with science or arts background. Yet, he hired Joel Podoling, Dean at the Yale School of Management, to create Apple University and later to head H.R. at Apple. Joel led a case-writing group that included Harvard business historian Richard Tedlow; cases included the creation of its retail strategy, establishing factories in China. 
In 2001, shortly after introducing the iPod, computers made up the bulk of Apple's business. In 2011, Iphones were 44%, iPads 19%, iPods 7%, and computers 20%.
Author Lishinsky sees Apple slowly devolving from being an 'insanely great company' over time, given Jobs' absence."

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