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Steve Jobs, BMW & eBay

There have been so many articles posted on Steve Jobs in the past week, I really thought I wasn’t going to add one here on my blog.

However, yesterday, John Lilly wrote a great piece on Steve Jobs yesterday, and I realized I might have a story worth telling after all.  I find myself fortunate, in retrospect, to have joined Apple in 1996 as an intern, and then full time in 1997 just weeks before Steve Jobs took the helm as interim CEO.

A Tale of Two Meetings

As an outgoing intern of the Advanced Technology Group, I actually did attend the meeting that John describes in his blog post.  However, as a full time engineer on WebObjects, I also had the opportunity to attend a different all hands that Steve Jobs called for the entire Rhapsody team (the codename of the project that became Mac OS X).

If you haven’t read John’s post, it’s definitely worth reading in tandem with this one.  He does a great job capturing the insights from the ATG meeting.  Instead, let me add to the story with my recollection of the Rhapsody meeting that happened the same week.

(Note: It has been over fourteen years since the meeting, so don’t take this as a literal play-by-play.  I have no notes, so all quotes are from memory.  But this is how I remember it.)

The “Michael Dell” Meeting

The mood of the Rhapsody team meeting was energetic, but mixed.  More than any other group at Apple, the Rhapsody team required a combination of talent from both long time Apple engineers and newly merged NeXT engineers.  There was a palpable sense of excitement in the room, as particularly the NeXT team had a huge amount of respect for the “incoming administration”.  At the same time, there was an element of discontent around suddenly finding themselves part of a large company, and even some skepticism that Apple was salvageable.

Steve got on stage at the front of the room in Infinite Loop 4, and put a huge, larger than life picture of Michael Dell on the wall.  He repeated the news fodder that Michael Dell had been asked recently what he would do if he was running Apple Computer.  (At the time, Dell was the ultimate success story in the PC industry.)  Dell said that he would liquidate the company and return the cash to shareholders.

A few gasps, a few jeers and some general murmuring in the audience.  But I don’t think they expected what he said next.

And you know what? He’s right.

The world doesn’t need another Dell or HP.  It doesn’t need another manufacturer of plain, beige, boring PCs.  If that’s all we’re going to do, then we should really pack up now.

But we’re lucky, because Apple has a purpose.  Unlike anyone in the industry, people want us to make products that they love.  In fact, more than love.  Our job is to make products that people lust for.  That’s what Apple is meant to be.

What’s BMW’s market share of the auto market?  Does anyone know?  Well, it’s less than 2%, but no one cares.  Why?  Because either you drive a BMW or you stare at the new one driving by.  If we do our job, we’ll make products that people lust after, and no one will care about our market share.

Apple is a start-up.  Granted, it’s a startup with $6B in revenue, but that can and will go in an instant.  If you are here for a cushy 9-to-5 job, then that’s OK, but you should go.  We’re going to make sure everyone has stock options, and that they are oriented towards the long term.  If you need a big salary and bonus, then that’s OK, but you should go.  This isn’t going to be that place.  There are plenty of companies like that in the Valley.  This is going to be hard work, possibly the hardest you’ve ever done.  But if we do it right, it’s going to be worth it.

He then clicked through to a giant bullseye overlayed on Michael Dell’s face.

I don’t care what Michael Dell thinks.  If we do our job, he’ll be wrong.  Let’s prove him wrong.

All I can remember is thinking: “Wow. Now that’s how you regroup, refocus and set a company in motion.”  I had seen speeches by Gil Amelio in 1996, and there was nothing comparable.  Please remember, at this point in time it wasn’t at all obvious that Steve or Apple would actually succeed. But I felt like I’d witnessed a little piece of history.

Fast Forward: eBay 2006

That meeting left a huge impression on me that extended well beyond Apple.  Steve’s actions and words at Apple in 1997 represented the absolute best in leadership for a turnaround situation.

It wasn’t until 2006, however, that I found myself at another large technology company looking to rediscover itself.  In the summer of 2006, I was one of a relatively small number of product leaders to tour a draft of a new initiative at eBay called “eBay 3.0″.  Led by the marketing team, a small, strong team had done a lot of research on what made eBay different, and what people wanted from the eBay brand.  The answer was that eBay was fun, full of serendipity, emotion, thrill.  The competition of auctions, the surprise at discovering something you didn’t know existed.  This reduced into a strong pitch for eBay as “colorful commerce”.

I was excited about the research and the work, because it echoed some of the things I remembered about Steve & Apple, and the simple vision he had for a company that made products that people lusted for.  But I also remember voicing a strong concern to several members of the team.  I told them about Steve’s speech to the Rhapsody team, and asked: “Does eBay want BMW market share, or Toyota market share?”  At the time, eBay was more than 20% of all e-commerce, and all plans oriented towards growing that market share.

Unfortunately, eBay tried to do both with the same product.

It’s not typical for a large, successful public company to basically say market share doesn’t matter, and to drive a company purely around a simple focus and vision.  When things are the toughest, unfortunately, that’s when leadership and vision matter the most.

Final Thoughts

Who would have imagined that Apple would have the largest market capitalization in the world?  Who would have thought that in the year 2011 that Apple – not Microsoft, not Dell, not Sony – would be defining the market for so many digital devices and services?

Most importantly, who would have thought that a leadership mandate that eschewed market share would achieve such dramatic gains?

Apple so easily could have gone the way of SGI, the way of Sun.  Instead, it literally shapes the future of the industry.  All because in 1997 Steve was able to offer a simple and compelling reason for Apple to exist.  A purpose.  And it’s a purpose that managed to aggregate some of the most talented people in the world to do some of their best work.  Again and again.

So I will add here a simple thank you to Steve Jobs for that meeting, and for changing the way that I think about every company’s purpose – their reason to exist.  Rest in Peace, Steve.

33 Comments Post a comment
  1. Nicely written… Inspiring.

    October 10, 2011
  2. James Cham #

    That was a great post, Adam, and it deserves to be repeated often.

    October 10, 2011
  3. frank #

    This sounds so much like the St. Crispin’s Day speech in Henry V. NeXTSTep came with all the works of Shakespeare so Steve was probably familiar with it. It would also be a great example of where the liberal arts can inform everything one does.

    October 11, 2011
  4. drew #

    who’s Steve Jobs?

    October 11, 2011
  5. Great post, I would say it also clearly shows how good tactics win over all.

    October 11, 2011
  6. I’m an eBay alum also.

    Unfortunately, colorful commerce focused on the bright and shiny, when what was really needed was a focus on making the basics perfect: A spoon made of gold and layered with diamonds is nice form, but without the concaved portion of the spoon, there is no function.

    That is where eBay eventually found itself, where fun and color were the focus, but it ignored the convenience and reliability factors that were just as (or even more so) important to customers.

    October 11, 2011
  7. Awesome post Adam!

    Question for ya – Do you know if there is any truth to the Ipod / fish tank story

    October 11, 2011
  8. Thanks Adam. I have encountered some awful articles about SJ and after reading your post I felt redeemed. I have realized again that SJ is not perfect, no one is in this world is. Why don’t we just think of how marvelous he had done to the new face of mobility. Perhaps it will ease the feeling a bit and help us continue our work with a smirk on our faces.

    October 11, 2011
  9. Awesome Steve Jobs story. When I get around to it, I’ll write up my own, which shows that Steve still hadn’t quite forgiven Michael Dell for his crack….

    October 11, 2011
  10. Apple, BMW and eBay.

    Three of my favourite companies.

    I have bought Apple’s products and BMW’s through eBay.

    Steve Jobs really turned things around in Apple.

    October 11, 2011
  11. Proved him wrong he did!!!

    Who would be able to do a fundraiser like this for Michael Dell

    http://www.nhwellnesscenters.com/stevejobs/

    I wish the stories on this page were more specific but the email is well written and it sure is a unique way to honor Steve.

    Well written.

    October 11, 2011
  12. aaa #

    Doesn’t the IPhone have a significant market share? I also think its a product that people lust for? I dont know why you cant build a great product and achieve a significant market share like you seem to indicate?

    October 11, 2011
    • The situation in 1997 is very different than the situation was in 2007 when Apple launched the iPhone. In many ways, the iPhone built on the cumulative success of the iPod (2000) and the iTunes Store (2003). I don’t believe Apple could have succeeded with that product in 1997.

      That being said, it’s worth noting that the iPhone may be the number one phone in the world, but in terms of aggregate marketshare, Apple may never rise above third in terms of handset marketshare. This is a direct reflection of their focus on the quality of the product and experience, which leads them to avoid the high volume, low-to-negative margin end of the market.

      However, you make a very good point. For example, the iPod is truly a business mystery. Everyone understands the entry of a luxury item ($300 MP3 Player) into a commoditized market where the average price of an MP3 player was under $80. But how did a market entry like that lead to 70%+ market share? That incredible fact led to a market dominance that then allowed the iTunes Store to grow & thrive, the iPhone, etc. Amazing set of wins, largely built on top of a very improbable (on the surface) success.

      October 11, 2011
  13. Steve Jobs’ contribution of course was far beyond making Apple the BMW of the computer industry. He invented fundamentally new categories of products that people wondered how they’d managed before they had these products.

    October 11, 2011
  14. I too was in eBay in the days of the Colorful Commerce and the many other catch phrases like “the shazam in the cha-ching”. I completely agree with the picture you paint here, there was no appetite for any risk and therefore no reward!

    October 12, 2011
  15. Steve Jobs will be alive forever alive in our hearts and hands :-)

    October 15, 2011
  16. This is a great story, and very inspirational speech by Steve Jobs. Thanks for sharing! BTW- He’s right about the BMW’s.

    December 16, 2011
  17. Steve jobs is Great man for ever

    December 31, 2011

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