COMMENTARY You may have heard that a lost hour-long interview of Steve Jobs -- the full one he did with Robert Cringely in 1995 for Triumph of the Nerds -- would run as a documentary at Landmark Theaters starting November 16. Associated Press, which viewed a copy yesterday, said that there "doesn't appear to be much new" in Steve Jobs: The Lost Interview. And there isn't, in the sense of no major revelations (though additional context sometimes gives his answers new meanings). And yet, if you're in business, or just have a curiosity about Jobs, this movie is a must see.
Forget gossip and the cult of personality, though there is some good stuff you may not have seen before on the Web. (For example, Jobs talked about retired Intel executive Mike Markkula joining him and Steve Wozniak: "Mike said, 'OK, I'll invest,' after a few weeks and I said, 'No. We don't want your money. We want you.'") More importantly, Jobs drops one brilliant observation about business after another. Whatever you pay to see it, you'll get many times your money's worth if you pay attention and think about what he says. This is an interview worth owning because you'll learn more important things than in most business book collections. Here are a few highlights -- and we won't even call them the "best," because there's so much that's great fodder for thought.
Learning to challenge the conventional wisdom
Jobs explained how he learned to do business:
I always asked why you do things. And the answers you invariably get are, oh, that's just the way it's done. Nobody knows why they do what they do. Nobody thinks about things very deeply in business.
Jobs talked of learning about the accounting notion of standard cost to build an Apple II. Accountants took a fixed number and then reconciled it with reality through using a variance account. After knowing to the penny what it used to cost to build an Apple II, he kept asking why anyone would use this method. "And the answer was, that's just the way it's done," he said.
Eventually, Jobs realized that companies didn't have information systems that could track actual costs at that time. (It's trickier than it sounds when components constantly shift in price and the cost to build a device today can be different from what it was yesterday.) So when Apple set up its factory for the Macintosh, it automated everything and started from the ground up with a system that would provide better control.
"In business, a lot of things are ... I call it folklore," Jobs said. "They're done because they were done yesterday and the day before." If you're willing to ask questions and think and work hard, you can learn business quickly. "It's not the hardest thing in the world." What he didn't say was that you can then turn business upside down.
How Xerox became a has-been
Xerox notoriously invented many of the technologies that Apple so successfully employed and yet made comparatively little. "They grabbed defeat from the greatest victory in the computer industry," Jobs says. "Xerox could have owned the entire computer industry." What happened? Monopoly.
Xerox had a practical monopoly on the copier industry. Product people could do little to change the company. It was sales and marketing that could make a difference.
Therefore, they were the ones that got promoted and they were the ones that ran the company. ... The product genius that brought them to that monopolistic position gets rotted out by people running these companies that have no conception of a good product versus a bad product. They have no conception of the craftsmanship that's required to take a good idea and turn it into a good product. And they really have no feeling in their hearts usually about wanting to really help the customers.
IBM had a similar problem and, in Jobs's opinion, the company's first personal computer was terrible. And yet it ultimately succeeded. His big mistake was in not taking into account how many people had a vested interest in IBM succeeding and so who helped.
Content matters more than process
Companies get confused as they get larger, Jobs thought. They want to replicate their initial success and so they concentrate on the processes that got them there.
Before very long, people get very confused that the process is the content. That's ultimately the downfall of IBM. IBM has the best process people in the world. They just forgot about the content.
In retrospect, there is an enormous irony in the observation. When Lou Gerstner turned Apple around, he focused on consulting and services. In other words, he took the process genius IBM had and turned it into a product.
A great idea isn't enough
John Sculley's tenure as CEO of Apple was a textbook example of management causing a company to implode. Although the Jobs quote about hiring the wrong guy has received much play over the years, his explanation of what went wrong applies to virtually any business.
John Sculley got a very serious disease. And that disease -- I've seen other people get it, too -- it's the disease of thinking that a really great idea is 90 percent of the work, and that if you just tell all these other people, here's this great idea, then of course they can go off and make it happen. And the problem with that is is that there's just a tremendous amount of craftsmanship between a great idea and a great product.
He went on to say that the process of creating a product requires a lot of work to juggle trade-offs and find a way to fit concepts together into something that will work. Products never come out the way you first thought they would, so having the idea isn't enough.
Designing a product is keeping 5,000 things in your brain, these concepts, fitting them all together and continuing to push to fit them together in new and different ways to get what you want. Every day you discover something new, that is a new problem or new opportunity to fit these things together a little differently. It's that process that is the magic. ... It's through the team bumping up against each other: having arguments, having fights sometimes, making some noise. Working together, they polish each other.In other words, the idea is just the beginning. Then the hard work starts.
What Microsoft did right
Jobs is known for saying that Microsoft has no taste. But many miss where he thinks that the company has been strong. He said that Microsoft had two major strengths: "They're very strong opportunists, and I don't mean that in a bad way, and they're like the Japanese: they keep on coming."
Even though he thought that Windows stood on the shoulders of the Mac and that Microsoft rode the funding from the deal with IBM, he gave them credit for making the most of the opportunity. And Microsoft kept pushing into applications, doing poorly at first, but never giving up and eventually dominating on both the Mac and Windows platforms.
There's far more than this worth hearing, by the way. Go see the full presentation if you have a chance.