Inside Steve's Brain (13 page)

“The products bubble up but there has to be a czar,” explained Geoffrey Moore, a venture capitalist and technology consultant. Moore is the author of
Crossing the Chasm
, the best-selling book about bringing high-tech products to the mainstream that is revered as Silicon Valley’s marketing bible. “The success or failure of a startup depends on its first product,” continued Moore. “It’s a hits business. Startups must have a hit or they’ll fail. If you pick the right product you win big.”
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Moore said Jobs is the consummate product picker. One of the key things Moore looks for in pitch meetings when startups are looking for venture capital is the fledgling company’s product picker. Picking products doesn’t work by committee— there has to be an individual who is able to act as a decision maker.

General Motor’s vice chairman Bob Lutz, the legendary “car czar,” is a good example. An ex-Chrysler, Ford, and BMW executive, Lutz is famous for a string of distinctive, design-driven hit cars like the Dodge Viper, Plymouth Prowler, and BMW 2002. He’s a quintessential “car guy” who knocks out distinctive vehicles rather than the designed-by-committee look-alikes of competitors. Ron Garriques, a former Motorola executive responsible for the hit Razr mobile phone, is another example. In 2007, Garriques was recruited by Michael Dell—newly returned to his troubled company—to run Dell’s consumer business, and pick hit products, no doubt.

“It’s a high-wire act,” said Moore. “It’s very clear when you fail. You have to risk everything every time you do it. It’s playing center court at Wimbledon. And you have to have a lot of power to do it. Not many have the power or the will to push it through [the] organization without being edited or compromised or watered down. It doesn’t work if you pick by committee.”

At Apple, Jobs has successfully picked and guided to development a hit product every two or three years—the iMac, the iPod, the Mac Book, the iPhone. “Apple is a hit-driven company,” said Moore. “It’s had one hit after another.”

For much of the last century, there were myriad companies run by similar strong-willed product czars, from Thomas Watson Jr. at IBM to Walt Disney. But the number of successful companies with product czars at the helm, like Sony under Akio Morita, has dwindled in recent years. Many contemporary companies are run by committee. “What’s missing today is that these kind of entrepreneurs are no longer there,” lamented Dieter Rams, the design genius who helped propel Braun to prominence for several decades. “Today there is only Apple and to a lesser extent Sony.”
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During product development, Jobs is involved in many major decisions, from whether there should be fans for cooling machines to the font used on the box. But although Jobs is king of the mountain, the decision making at Apple isn’t all top down. Argument and debate are central to Jobs’s creative thinking. Jobs wants partners who challenge his ideas, and whose ideas can be challenged by him, often forcefully. Jobs makes decisions by engaging in hand-to-hand intellectual combat. It’s demanding and pugnacious, but rigorous and creative.

Take the pricing of the first Mac in 1984. Jobs wrestled the pricing of the Mac with Sculley for several weeks. Not a couple of meetings. They argued about the issues night and day for
weeks.
The pricing of the Mac presented a big problem. Apple’s revenues were on the slide, and the Mac had been expensive to develop. Sculley wanted to recoup the R&D investment, and he wanted to raise enough money to strategically out-advertise the competition. But if the Mac was priced too high, it might scare off buyers and wouldn’t sell in volume. Both men took turns debating the opposing side of the argument—the thesis and antithesis—playing devil’s advocate to see where the arguments would lead. Sculley euphemistically called arguing with Jobs “jousting.” “Steve and I enjoyed taking one position, then turning it around and adopting another argument,” Sculley wrote. “We would constantly joust over what each of us thought about new ideas, projects and colleagues.”

There was likely similar “jousting” at Apple when the iPhone was launched in the summer of 2007. The iPhone initially cost $600, but within two months of its release, Jobs had dropped the price to $400. There were howls of protests from early adopters, who rightly felt ripped off. The outcry was so vociferous, Jobs issued a rare public apology and a $100 rebate.

Jobs dropped the iPhone’s price because the initial response had exceeded Apple’s expectations—it had sold more than one million units—and Jobs saw an opportunity to rapidly ramp up sales in the crucial holiday period. For a lot of consumer electronics, including the iPod, there are as many sales during the holiday period as there are the rest of the year. "iPhone is a breakthrough product, and we have the chance to ‘go for it’ this holiday season,” Jobs wrote in a note to customers on the Apple website. “iPhone is so far ahead of the competition, and now it will be affordable by even more customers. It benefits both Apple and every iPhone user to get as many new customers as possible in the iPhone ‘tent.’ ”

Day to day at Apple, meetings with Jobs can often be arguments—long, combative arguments. Jobs relishes intellectual combat. He wants a high-level discussion—even a fight— because it’s the most effective way to get to the bottom of a problem. And by hiring the best people he can find, he ensures the debate is at the highest possible level.

A meeting with Jobs can be a trial by fire. He’ll challenge everything that is said, sometimes extremely rudely. But it’s a test. He is forcing people to stick up for their ideas. If they feel strongly enough, they’ll defend their position. By raising the stakes, and people’s blood pressures, he’s testing to see if they know their facts and have a strong argument. The more firmly they stand, the more likely they’re right. “If you’re a yes-man you’re doomed with Steve because he’s pretty confident about what he knows, so he needs someone to challenge him,” ex-Apple programmer Peter Hoddie told me. “Sometimes he says, ‘I think we need to do this’—and it’s a test to see if anyone will challenge him. These are the kinds of people he’s looking for.”
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It’s extremely difficult to bullshit Jobs. “If you don’t know what you’re talking about, he’s going to find out,” said Hoddie. “He’s really bright. He’s extremely well informed. He has access to some of the best people on the planet. If you don’t know what you’re talking about, he’s gonna know.”

Hoddie described one occasion when he was arguing with Jobs about some new chip technology under development at Intel, the processor supplier. Occasionally, Hoddie would bullshit Jobs just to get him off his back. Later that day, Jobs cornered Hoddie and challenged him about his earlier statements about Intel. Jobs had phoned up Intel’s chairman, Andy Grove, and asked him about the technology Hoddie had been talking about. Luckily, Hoddie hadn’t been bullshitting. “You can’t bluff someone who can pick up the phone and talk to Andy,” Hoddie said, laughing.

During his thirty-year career, Jobs has maintained a string of creative partnerships, beginning with his high school buddy Steve Wozniak. The list includes the original Mac design team, from the hardware genius Burrell Smith to programming luminaries such as Alan Kay, Bill Atkinson, and Andy Hertzfeld. In the decade Jobs has been working with design genius Jonathan Ive, Apple has led the world in industrial design. His partners at Apple include Jon Rubinstein, who oversaw a string of hit hardware, from the iMac to the iPod; and Ron Johnson, who masterminded Apple’s retail stores, one of the most successful moneymaking chains ever (more on the stores later). And at Pixar, his teaming with Ed Catmull and John Lasseter created a moviemaking powerhouse.

One of Jobs’s most productive working partnerships has been with Lee Clow, a tall, bearded hippie adman and his agency, TBWA /Chiat/Day. Jobs’s partnership with Clow and his agency has spanned several decades and produced some of advertising’s most memorable and influential campaigns, from the 1984 TV spot that introduced the Macintosh, to the iPod silhouette ads plastered across billboards worldwide.

Headquartered in Los Angeles, TBWA/Chiat/Day is considered one of the most creative advertising companies in the world. Cofounded in 1968 by Guy Day, an L.A. ad veteran, and Jay Chiat, a hard-driving New Yorker who relocated to sunny Southern California in the mid-1960s, the company is now run by its longtime creative director Lee Clow. The company was once considered “gonzo” for its controversial, sometimes reckless, approach to advertising, but has matured and now boasts sober, blue-chip clients such as Nissan, Shell, and Visa.

For Apple the company has produced widely acclaimed, award-winning campaigns that are often regarded more as cultural events than mere advertising blitzes. Ads like “Think Different,” “Switchers,” and “I’m a Mac” have been widely discussed, critiqued, parodied, and copied. When a campaign spawns hundreds of parodies on YouTube and is turned into a sketch on late-night comedy shows, then the ads have graduated from the commercial to the cultural realm.

Jobs’s association with the ad company began in the early 1980s, when the agency—then known as Chiat/Day—was producing a series of popular ads for Apple’s computers. In 1983, the agency began work on what would become one of the most celebrated ads in advertising history: the TV commercial that introduced the Macintosh during the third quarter of the Super Bowl in January 1984.

The spot began with a tag line taken from another, discarded ad: “Why 1984 won’t be like ‘1984’ ”—a reference to George Orwell’s dystopian novel. It was too good a line to just throw away, so the agency pitched it to Apple. And, of course, it was perfectly suited for the launch of the Mac. The agency hired British director Ridley Scott, who’d just finished filming
Blade Runner
, to film the ad on a London soundstage. Using a cast of British skinheads, Scott portrayed a bleak Orwellian future, where a Big Brother squawking propaganda from a giant TV cows the masses into submission. Suddenly, in rushes an athletic woman in a Macintosh T-shirt, who smashes the screen with the toss of a sledgehammer. The sixty-second spot never showed the Mac, nor any computer, but the message was clear: the Mac would free downtrodden computer users from the hegemony of IBM.

Apple’s board of directors was shown the spot just a week before it was due to air and freaked out. They ordered the ad pulled from the Super Bowl, but Chiat/Day was unable to sell the slot in time and the ad ran.

It turned out to be fortuitous: the ad garnered more attention and more press than the game itself. Although it was shown only twice (during the Super Bowl and earlier, on an obscure TV station in the middle of the night to make it eligible for advertising awards), the ad was rebroadcast in countless news reports and on
Entertainment Tonight
. Apple estimated that more than 43 million people saw the ad, which was worth millions of dollars in free advertising, according to an estimate by then-CEO John Sculley.

“The commercial changed advertising; the product changed the ad business; the technology changed the world,” wrote
Advertising Age
columnist Bradley Johnson in a 1994 retrospective. “It turned the Super Bowl from a football game into advertising’s Super Event of the year and it ushered in the era of advertising as news.”
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The “1984” ad is typical of Jobs. It was bold and brash, and unlike any other commercial of its time. Instead of a straightforward product presentation, “1984” was a mini-movie with characters, a narrative, and high production values. Jobs didn’t think of it, write it, or direct it, but he was smart enough to team up with Lee Clow and Jay Chiat, and give them the room to be creative.

The “1984” ad went on to win at least thirty-five awards for Chiat/Day, including the Grand Prix at Cannes, and generated millions of dollars in new commissions and clients. It also ushered in an era of lifestyle advertising that downplayed a product’s features in favor of its appeal. No one else was thinking about advertising in the same way, especially in the computer industry; and very few companies were willing to communicate with the public in such an original, unorthodox way. Jobs left Apple in 1985 and the company switched agencies not long after his departure. But when Jobs returned in 1996, he brought back the agency to create a campaign that would “refocus” Apple.

Jobs was concerned about Apple’s lack of focus, and asked Chiat/Day to create a campaign that would speak to Apple’s core values. “They asked us to come in and talk about what Apple needed to do to get its focus back,” Clow said. “It really wasn’t hard; it was just to go back to Apple’s roots.”
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Clow, who’s habitually dressed in T-shirt, shorts, and sandals, said the idea for “Think Different” came from thinking about the Mac user base—the designers, artists, and creatives who remained loyal customers through the company’s darkest days. “Everybody immediately embraced the idea that this campaign should be about being creative and thinking out of the box,” Clow said. “It got bigger when we said why not celebrate anyone who’s ever thought about ways that they could change the world, and that’s when Gandhi and Edison started coming into the conversation.”
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The campaign came together very quickly and featured a series of black-and-white photos of about forty famous iconoclasts, including Muhammad Ali, Lucille Ball and Desi Arnaz, Maria Callas, Cesar Chavez, Bob Dylan, Miles Davis, Amelia Earhart, Thomas Edison, Albert Einstein, Jim Henson, Alfred Hitchcock, John Lennon and Yoko Ono, the Reverend Martin Luther King Jr., Rosa Parks, Picasso, Jackie Robinson, Jerry Seinfeld, Ted Turner, and Frank Lloyd Wright. Apple ran the ads in magazines and billboards, and aired a TV ad celebrating “the misfits, the rebels, the troublemakers . . . the crazy ones.”

“The people who are crazy enough to think they can change the world are the ones that do,” the ad proclaimed.

The commercial came at a critical time in Apple’s history. The company needed a public statement of its values and its mission: as much for its employees as for its customers. The “Think Different” campaign trumpeted Apple’s virtues: its creativity, its uniqueness, and its ambitions. Again, it was a big, bold statement—Apple was associating itself, and its users, with some of humankind’s most celebrated leaders, thinkers, and artists.