Steve Jobs: How did he change Apple?

When Steve Jobs died on 5 October 2011, the technology industry lost one of its leading innovators and leaders. But the biggest effect was always going to be felt at Apple, and impact of Jobs still weighs heavily on the company.

To a certain extent that will be true for any founder. What made Jobs unique, though, was the second act of his Apple story. His return to the company in 1996 – initially as a “special advisor”, then as interim CEO and then full-time CEO – wasn’t simply a “return to the old Apple” as it’s sometimes characterised. It was a root-and-branch transformation of Apple into a different company – one true to the spirit of the startup he founded but much more besides.

So to mark the anniversary of Steve’s passing, I thought it would be good to look at the five ways that Jobs rebuilt Apple, and how those changes are still being felt today.

A new approach to industrial design

It’s fair to say that when Jobs returned, Apple’s industrial design was stale. And yet the key designers and engineers who would go on to create iconic products such as the iMac and iPod were all in place. So what did Jobs change to make things better?

The answer lies in the way that design was viewed at the company. Like many manufacturers, design was the last thing in the chain of creating a product: the engineers would create, then design would be required to “skin it” at the end. The result was products that had become mediocre. 

Jobs turned this on its head, making the industrial design group the place where new products are conceived and created. Industrial design also does some fundamental research and development, for example into new materials, which feed into the engineers. Effectively, industrial design invents and defines the product, and has final say over it. 

The group is also small and tightly knit. Despite the fact that it’s at the heart of everything Apple does, the industrial design team is only around 20 people. Companies of Apple’s size usually have hundreds of products designers, rather than tens. 

Minimum viable product line

Almost the first thing that Jobs did on his return to the CEO job was to dramatically hack back the Apple product lines. He introduced a very simple matrix, consisting of desktop/laptop and consumer/professional, and allowed only a single product line in each. Instead of a confusing mess of sub-brands such as Performa, Quadra, and LC we got iMac, Power Mac, PowerBook and eventually iBook. You knew, within seconds, which product was right for you.

Despite Apple’s massively expanded product range, this simplicity persists. The matrix is bigger, but it’s still pretty simple choosing which Apple product is right for you. Where complexity has crept in – for example in Apple’s current laptop line-up – it tends to be because of the introduction of new product lines that will ultimately replace an existing one. For example, the new MacBook is the direction Apple is taking for its ultraportable Mac, but the MacBook Air has remained in the line until the point where the company can bring the price point of the MacBook down further. 

Owning the whole thing

Since Michael Dell first started assembling PCs in his college dorm room and selling them online, most technology products have minimised the amount of custom components in favour of using off-the-shelf parts. It was one of the core tenets of the PC era: generic parts were the way to go.

Jobs, though, always had other ideas. Although you could bootstrap new products using existing parts (as Apple largely did with the iPod), he realised that if you wanted to be different in the long term, you needed to “own the whole stack” – software, hardware, and key components as well.

The best example of this is the 2008 acquisition of PA Semi, a chip company that specialised in a power-efficient version of the PowerPC processor. However, Apple didn’t want that chip: instead, what it wanted was the engineering and design talent that would allow it to make its own processor for future iPhones and ultimately the iPad too. 

The A-series processors that came out of this acquisition have been a key element in allowing Apple to push forward the performance of the iPhone. And having processor designers in-house has also meant the company could create pioneering products such as the Apple Watch (which uses the S1 processor) and AirPods (the W1 wireless chip). 

One P&L

Companies beyond a certain size always effectively split the way they work internally into profit-and-loss groups around products or product lines. Each P&L group will have its own marketing, PR, design, development and other teams, making them more like mini-companies in their own right than a single team. 

The benefits of this are mostly around providing clear management at scale. Each group stands or falls on its own merit, as it has all the resources required to make the product a success, with clear lines of responsibility. 

However, there’s a big catch: companies often become slaves to a single product line, with political in-fighting occurring where different product lines potentially compete. The classic example of this is Microsoft Courier, an advanced tablet project which, had it been launched, would have reignited the market. However, it was ultimately killed off prior to launch because it didn’t use Windows – and the Windows group within Microsoft was all-powerful. 

Jobs’ approach was different, and it meant treating Apple as a single team with the same goals. Rather than having competing product fiefdoms, Apple has a single P&L for the whole company. This means it can take strategic bets that cannibalise existing products in favour of new ones – in the way, for example, the iPhone became the de facto iPod replacement. 

Stopping the leaks (mostly)

In the early 1990s, Apple was a very leaky company. It wasn’t leaking money, or water, or staff: it leaked information about upcoming products. 

In the mid-1990s, I worked on MacUser magazine, which had a reputation for breaking news stories about Apple and its upcoming devices. Quite often, Apple sources would leak not only little snippets of information, but entire documents – including the all-important “product introduction plan” (or PiP), which detailed everything about a new product. This would happen months in advance of the official announcement, and (of course) we were happy to run stories about it.

Almost immediately on Jobs’ return, the leaks started to dry up. Apple became not just a much tighter and less leaky ship, but somewhere that exuded an atmosphere of secrecy. There were rumours that product documents sent around internally would have deliberate errors put in them on an individual basis, to make it easier to track down who might have leaked information. Although I was never able to confirm these rumours, the fact they existed gives an indication of how tight security became. 

The nadir of this was probably the “Apple vs Does” and “Apple vs DePlume” court cases. Filed in 2004, “Apple vs Does” was an attempt by Apple to force several news sites to reveal their sources for leaked product plans. “Apple vs DePlume”, filed around the same time, accused the publisher of Think Secret (a site run by then-18-year-old Nick Ciarelli) of harming Apple’s trade secret interests by publishing stories about a future version of iWork and a “headless iMac” (which was later released as the Mac mini).

Apple lost the case vs “Does”, and settled the case with dePlume, but the important thing was the message that bringing the cases sent internally: that the company was prepared to go to court to protect its secrets. While the company isn’t quite as obsessive now, it remains true that it regards secrecy as incredibly important. 

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