Markkula's Three Principles at Apple

In Walter Isaacson's terrific new Steve Jobs biography, we find a description of the simple principles Mike Markkula outlined at Apple's inception. As my students know all too well, I love the concept that strategy is all about making trade-offs. As Michael Porter has said, "The essence of strategy is choosing what NOT to do." Take a look at principle #2 at Apple. From the firm's inception, its leaders understood the criticality of making trade-offs to create competitive advantage and build barriers to imitation. Here is an excerpt from the Isaacson's biography:

Markkula wrote his principles in a one-page paper titled “The Apple Marketing Philosophy” that stressed three points. The first was empathy, an intimate connection with the feelings of the customer: “We will truly understand their needs better than any other company.” The second was focus: “In order to do a good job of those things that we decide to do, we must eliminate all of the unimportant opportunities.” The third and equally important principle, awkwardly named, was impute. It emphasized that people form an opinion about a company or product based on the signals that it conveys. “People DO judge a book by its cover,” he wrote. “We may have the best product, the highest quality, the most useful software etc.; if we present them in a slipshod manner, they will be perceived as slipshod; if we present them in a creative, professional manner, we will impute the desired qualities.

What an amazingly simple, but powerful statement of core principles. Every entrepreneur should take note!

Business is not evil: Lessons from the insanely great life of Steve Jobs

We live today in a world where many people consider business evil, corruptions corrupt, executives greedy.   It has become fashionable to bash Wall Street, lambast every move intended to boost profits, and even condemn capitalism itself.   Today, I reminded my students that business can indeed be a noble profession.  People can transform the world and make others' lives better through profit-making enterprises.  In society these days, we make heroes of those who work for non-profits and those who are great philanthropists. Surely, they are heroes. They do great work.  However, I believe business is also a noble profession, a deeply noble profession whereby you can create value, transform people’s lives, and create jobs that give people the opportunity to work and earn money to support their families.  Profit-making and social impact need not be mutually exclusive endeavors.  One can pursue profit and make the world a better place.  One need not only do that through an inherently "social enterprise." 

I mentioned this to students today as we reflected on the death of Steve Jobs.   He was more than just a successful CEO. He was a man who had a tremendous impact on society, who transformed the world. He did a great deal of good, as a business person who ran firms in pursuit of profit. Every day a doctor uses an iPad, a child with cancer watches a Pixar film and laughes, a person talks with their relative in a distant land via an iPhone, we see the transformational positive impact that he has had on the world.   Think about the incredible things that many people are doing to make others' lives better, using the technology that Jobs introduced to us.  

I also reminded students today that innovation, creativity, and entrepreneurship cannot happen without capital.   Steve Jobs persuaded investors to invest in him and his companies.  They believed in his vision.  They provided him the funds to pursue his dreams.  Many of those investors are now lambasted as "fat cats" from Wall Street.  Let's be careful before we paint with such a broad brush.   Access to capital is critical to those bold innovators who wish to change the world.   Business can indeed be a noble profession.