The 5 Strategy Rules of Bill Gates, Andy Grove, and
Steve Jobs
David Yoffie and
Michael Cusumano find common leadership lessons from the tech titans of
Microsoft, Intel, and Apple in the new book, Strategy Rules.
If there were a Mount Rushmore for
technological innovation, Bill Gates, Andy Grove, and Steve Jobs would be the
faces looking outward. The longtime CEOs of Microsoft, Intel, and Apple have
done more than anyone to popularize the modern-day personal computer, and in
doing so, also created three of the most highly valued companies in the world.
But how were
they able to steer their companies through the volatile ups and downs of
decades of changing technologies? What did they have in common? And what can we
learn from them about successful strategy?
Those
are the questions David B. Yoffie and Michael A. Cusumano address in
their new book, Strategy Rules: Five Timeless Lessons
from Bill Gates, Andy Grove, and Steve Jobs. "I have known all three of these
individuals," says Yoffie, the Max and Doris Starr Professor of
International Business Administration at Harvard Business School. "By
looking at what they had in common, I thought there was a great opportunity to
understand what distinguishes a really great strategist from your average
CEO."
Yoffie has had access
to all three men—having served on Intel's board since 1989 and written numerous
business cases on Apple and Microsoft. He first started talking about the idea
for the book more than six years ago with Cusumano, the Sloan Management Review
Distinguished Professor of Management at MIT Sloan School of Management. But,
Yoffie says, they wanted to wait until all three had finished their tenures.
"The idea was to wait until Steve's departure, which unfortunately came
with his death. Literally a week after Steve's death, we had lunch and agreed we
would do the book."
The result is a look
into the minds of three tech pioneers who, to outside appearances, don't share
much in common.
"When I mention I
wrote the book, the first response I get is, 'I can't imagine three more
different people,'" says Yoffie. Besides their contrasting
personalities—Gates the pragmatic technocrat; Grove the disciplined engineer;
and Jobs the visionary perfectionist—their companies had unique business models
and filled very different niches in the technology value chain.
As they examined what
the three CEOs had in common, however, Yoffie and Cusumano homed in on five key
strategies that any manager, entrepreneur, or CEO can learn. Each of the
lessons reads like a paradox or Zen koan that takes intelligence and practice
to unpack. "Look Forward, Reason Back," for example, takes its lead
from game theory, in which a great chess master will simultaneously be able to
see the eventual path to checkmate and the best next move to get there.
Gates, Grove, and Jobs's Keys to Success
1.
Look Forward, Reason Back
2.
Make Big Bets, Without Betting the Company
3.
Build Platforms and Ecosystems—Not
Just Products
4.
Exploit Leverage and Power—Play
Judo and Sumo
5.
Shape the Organization around Your Personal
Anchor
"Where many CEOs
fail is they can espouse these great ideas about what the world is going to
look like in five years, but they aren't able to look at what they need to do
today to achieve that result," says Yoffie.
Bill Gates was able to
envision a world in which there was a computer on every desk at a time when
personal computers didn't exist. But he also realized that the way to
capitalize on that future was to focus his energies on controlling software,
not hardware.
Andy Grove foresaw the
eventual break up of the vertically integrated computer industry, and was able
to specialize in creating the core component of computing—the microprocessor.
And then he championed that silicon part with the famous "Intel
Inside" marketing campaign. "The notion that you could brand a
product that no one had ever seen and that no one understood what it did was
brilliant," says Yoffie. "That changed the entire structure of the
semiconductor industry forever."
“Steve Jobs saw a future in which consumers
would move beyond the computer to use a range of electronic devices for
entertainment and communication and then systematically rolled them out one
step at a time—the iPod, iPhone, and iPad.
BUILDING
AN ECOSYSTEM
Gates was the first of
the three to demonstrate another of Yoffie and Cusumano's lessons: "Build
Platforms and Ecosystems—Not Just Products." Early on Gates realized that
no one product could provide a lasting competitive advantage, but if consumers
became hooked on a particular platform, such as the Microsoft operating system,
then you could roll out new products that they would adopt, such as Word,
Internet Explorer, and Windows Media Player. Even more importantly, such
platforms would allow creative developers outside your organization to add
their unique value.
Grove faced a crucial
decision regarding Intel's own platform when in the late 1980s his engineers
figured out a way to make a more efficient processor that nevertheless wouldn't
be compatible with Intel's previous architecture. After agonizing about the
decision for a year, Grove chose to stick to the platform Intel had already
developed, even if it meant jettisoning a potentially better product.
"That was the moment of truth whether he was going to be a product company
or a platform company," says Yoffie. "In the end, the opportunity to
build an ecosystem was more important."
Interestingly, Jobs
stubbornly held out the longest in his vision of the product as supreme—pushing
the proprietary Mac as the central hub of Apple's product line despite falling
market share. Eventually he was persuaded to shift focus and allow the iTunes
music platform to be used on PCs as well as on Apple iPods and iPhones. That
decision, of course, was a game-changer, establishing Apple as the dominant
player in mobile computing. "If iTunes had been available for the Mac
only, it would have always remained a niche product and nothing more,"
says Yoffie.
As that example
illustrates, even brilliant CEOs make mistakes sometimes. But Gates, Grove, and
Jobs recognized their own strengths and weaknesses and had the ability to cut
bait, as Jobs did, and change course when it mattered.
Yoffie and Cusumano
express this in their last lesson, "Shape the Organization around Your
Personal Anchor," using the image of the "anchor" in a
double-sense, both what grounds you and what can weigh you down. "These
guys were not supermen," says Yoffie. "They were all in many ways
highly imperfect leaders. We didn't want to idealize them or sugarcoat
them."
All three
CEO-strategists, however, were self-aware enough to surround themselves with
executives who helped compensate for their own weaknesses. Gates, for example,
knew his strength was not in operations, so he brought in an outside COO to run
the day-to-day operations. In the same vein, Jobs nearly destroyed Apple in the
early 1980s by trying to do too much himself. When he returned in 1997, Tim
Cook was one of his first hires to run operations, which allowed Jobs to focus
on overall strategy and design.
"These guys each
had very different skills they brought to the table," says Yoffie,
"but they also became successful in part because they were able to figure
out what they were not good at, and they were able to fill those gaps by
recruiting individuals and forming teams to do the things they couldn't do or
wouldn't do or shouldn't do."
That kind of
self-aware recognition of weakness is not something you often see listed in the
traits of a great strategic leader. Based on the example of these three men's
success, it may be the most important lesson of all. 
Michael
Blanding is a senior writer for Harvard Business School Working
Knowledge.
http://hbswk.hbs.edu/item/7704.html
No comments:
Post a Comment