Steve Jobs President & CEO, NeXT Computer Corp and Apple. MIT Sloan Distinguished Speaker Series

Key ideas

Jobs explains how NeXT found its real market from customers, why it keeps hardware and a direct sales force, and how he tries to run teams by agreement.

From a machine transcript of the audio. Quotes link to the moment they are said.

1. 1

   Your advantage may appear after launch

   Jobs says Apple never anticipated desktop publishing, saw it starting 9 to 12 months after the Mac and rebuilt its strategy around it. He tells a matching NeXT story: the software was aimed at makers of shrink-wrapped apps until large companies said it was solving their in-house application problem, which he admits took NeXT about three months to hear. He says refocusing sales and marketing on those customers is what made the business take off.

2. 2

   New products need someone to create demand

   Jobs argues computer retail channels can fulfil demand but no longer create it, so the more revolutionary a product is, the more stuck it gets there. NeXT's answer is about 130 field salespeople showing the product against each customer's own problems. He says this is why NeXT stays in hardware, since a $5,000 average price can pay for that force and a $500 software package cannot.

3. 3

   Agree on decisions rather than demand buy-in

   Jobs rejects asking colleagues to buy into a decision they disagree with, because you are paying them to do what they think is right and the conflict eventually comes out; the room he wants is everyone involved who must execute the decision, not the whole company. NeXT's eight-person policy team tries to separate the few decisions that matter, perhaps 25 a year, and work on those until everyone agrees, which he admits does not always work. He says he can barely recall pulling rank, but has once or twice told someone who kept going a different way that they were off the team.

4. 4

   Think in years, not single problems

   Jobs tells business students that consulting gives a broad but thin view, because without owning results for a few years you never see recommendations through or collect the scar tissue. Separately, he names a longer-term view of people as probably the biggest change since Apple: when something is going wrong, he asks how the person can learn rather than fixing it himself. He says that is painful sometimes and that the instinct to fix remains.

5. 5

   Treat the factory as competitive advantage

   Crediting a five-stage scale from Stephen Wheelwright, Jobs argues manufacturing can be a source of speed, cost and quality rather than a necessary evil. He says his Mac factory's two biggest pieces of automation turned out to be high-tech warehouses that delay finding defects, so NeXT runs with no warehouses; it also treats the factory as a software problem. NeXT hired engineers at R&D pay and builds all prototypes in the factory, which he says involves manufacturing from day one.

In Steve’s words

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