Posted by: seanmalstrom | November 24, 2011

Steve Jobs was a salesman, not an engineer or designer

Many people are quoting from Steve Jobs’ biography his thoughts about why great firms die.

Steve Jobs has a theory about “why decline happens” at great companies: “The company does a great job, innovates and becomes a monopoly or close to it in some field, and then the quality of the product becomes less important. The company starts valuing the great salesman, because they’re the ones who can move the needle on revenues.” So salesmen are put in charge, and product engineers and designers feel demoted: Their efforts are no longer at the white-hot center of the company’s daily life. They “turn off.”

The salesmen who led the companies were smart and eloquent, but “they didn’t know anything about the product.” In the end this can doom a great company, because what consumers want is good products.

It’s not just the salesmen. It’s also the accountants and the money men who search the firm high and low to find new and ingenious ways to cut costs or even eliminate paying taxes. The activities of these people further dispirit the creators, the product engineers and designers, and also crimp the firm’s ability to add value to its customers. But because the accountants appear to be adding to the firm’s short-term profitability, as a class they are also celebrated and well-rewarded, even as their activities systematically kill the firm’s future.

In this mode, the firm is basically playing defense. Because it’s easier to milk the cash cow than to add new value, the firm not only stops playing offense: it even forgets how to play offense. The firm starts to die.

If the firm is in a quasi-monopoly position, this mode of running the company can sometimes keep on making money for extended periods of time. But basically, the firm is dying, as it continues to dispirit those doing the work and to frustrate its customers.

The problem is that I’m sure this passage is being passed around Silicon Valley and game companies (including inside Nintendo). “This is magnificence.” “This is wisdom.” “This is sublime.”

This is crap. Steve Jobs was never that good of an engineer or designer (which is why it was Woz who made the Apple computer where Steve Jobs was the salesman for it. Jobs also snuck Woz into Atari to help do Jobs’ work for him.)

Steve Jobs is the quintessential salesman. He even got that reputation of having a ‘reality distortion field’ and all. But the thing about great salesmen is they don’t see themselves as salesmen. Did you know that Miyamoto is also a salesman for Nintendo? “What!?” screams the reader. Oh yes. He is on stage at E3 or doing interviews selling Nintendo’s products. But people like him don’t look in the mirror and see ‘salesman’.

What Steve Jobs is referring is likely more about how he got kicked out of Apple for a salesman. I don’t think that event ever left him since he keeps mentioning in so many other places.

Disruption already explains why great firms fail. Great firms fail because they keep trying to focus on their best customers instead of their non-existing or worse customers. When you focus only on your best customers, you end up in a cycle of death because you keep improving the product to have it overshoot the general market. Its like a hardcore game that just keeps getting more hardcore.


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