The 5 strategy rules of Bill Gates, Andy Grove and Steve Jobs

David Yoffie and Michael Cusumano find common lessons from leading technology titans from Microsoft, Intel and Apple in the new book Strategy Rules.

by Michael Blanding

If there were a Mount Rushmore for technological innovation, Bill Gates, Andy Grove, and Steve Jobs would be the faces out. Long-time Microsoft, Intel, and Apple leaders, more than anyone else, have helped popularize the modern personal computer and create three of the world’s most popular companies.

But how can they guide their companies through the ups and downs of decades of technological change? What did they have in common? And what can we learn from them about successful strategy?

David B. Yoffie and Michael A. Cusumano address these issues in their new book, Bill Gates’ Strategy Rules: Five Timeless Lessons, Andy Grove, and Steve Jobs. “I knew these three people,” said Yoffie, a professor of International Affairs Management at Harvard Business School. “When you looked at what they had in common, I thought there was a great opportunity to understand what sets a very good strategist apart from his average CEO.”

Yoffie had access to the three men – he sat on Intel’s board since 1989 and wrote numerous cases on Apple and Microsoft. He began talking about the idea of ​​the book more than six years ago with Cusumano, the respected management professor of Sloan Management Review at the MIT Sloan School of Management. But, Yoffie said, they wanted to wait until all three had finished their term. “The idea was to wait for Steve to leave, which unfortunately happened with his death.” Literally a week after Steve died, we had lunch and agreed that we would do the book. ”

The result is a look at the heads of three technology pioneers who, apart from their appearance, do not have much in common.

“When I mention that I’ve written the book, the first answer is,” I can not imagine three other people, “says Yoffie, apart from her opposing personalities, Gates is the pragmatic technocrat, disciplined and Jobs, the visionary perfectionist: Their companies had unique business models and filled very different niches in the technology value chain.

5 key strategies

Yoffie and Cusumano have looked at the five key strategies that any manager, entrepreneur or CEO can learn, what the three CEOs had in common. Each lesson reads like a Zen Paradox or Koan, which requires intelligence and exercise to unpack. “Look Forward, Reason Back,” for example, has its roots in game theory, where a great chess master can simultaneously see the path to mastering and the best way to get there.

Gates, Grove and the keys to job success

Rejoice, talk back
Make big bets without betting the company
Building platforms and ecosystems – not just products
Harness Leverage and Power – Play Judo and Sumo
Organization of the organization around your personal anchorage

“Where many CEOs fail, they can marry those great ideas of what the world will look like in five years, but they can not see what they need to do today to achieve that result.” Said Yoffie.

Bill Gates could imagine a world in which there was a computer on every desk at a time when there was no personal computer. But he also realized that the way to capitalize on this future was to focus on software control, not hardware.

Andy Grove anticipated the eventual dismantling of the vertically integrated computer industry and specialized in creating the main component of computing, the microprocessor. And then he defended this part of silicon with the famous marketing campaign “Intel Inside”. “The idea of ​​being able to market a product that no one has seen and no one understood what it does was great,” says Yoffie. “This has changed the structure of the semiconductor industry forever.”

“They were all very flawed in many ways WE DO NOT WANT TO IDEALIZE OR SUGAR COATER”
Steve Jobs saw a future in which consumers go beyond the computer and use a range of electronic devices for entertainment and communication and then systematically roll them out step by step: iPod, iPhone and iPad.

Build an ecosystem

Gates was the first of three to demonstrate another lesson from Yoffie and Cusumano: “Building platforms and ecosystems – not just products.” Early Gates recognizes that no product can provide a sustainable competitive advantage. However, when consumers become dependent on a particular platform, such as the Microsoft operating system, you can deploy new products such as Word, Internet Explorer. and Windows Media Player. More importantly, such platforms would allow creative developers outside your organization to add their unique value.

Grove had to make a decision about Intel’s own platform, but in the late 1980’s his engineers found a way to develop a more efficient processor that would not be compatible with Intel. previous architecture from Intel. After thinking about that decision for a year, Grove decided to keep the platform he developed, even if it meant abandoning a potentially better product. “It was the moment of truth, whether it was a product company or a platform company,” says Yoffie. “After all, the ability to build an ecosystem was more important.”

It is interesting to note that Jobs has maintained its vision of the product as the most sustainable, making the Mac owner the central hub of the Apple product line, despite declining market share. Finally, he was persuaded to concentrate and allow the use of the iTunes music platform on PCs, Apple iPods and iPhones. Of course, this decision changed the situation and made Apple the leading provider of mobile computing. “If iTunes was only available for Mac, it would still be a niche product and nothing more,” says Yoffie.

As this example shows, even brilliant CEOs sometimes make mistakes. But Gates, Grove, and Jobs have recognized their own strengths and weaknesses and are able to cut baits like jobs, and change course at the right time.

Yoffie and Cusumano put it in their last lesson: “Form the organization around your personal anchorage”, use the image of “anchor” in a double sense, both what drives you and what weighs you. “These guys were not supermen,” Yoffie said. “They were all very poor leaders in many ways, we did not want to romanticize or annoy them.”

However, the three CEOs and strategists were aware enough to surround themselves with executives who helped offset their own weaknesses. For example, Gates knew his forces were not in the operations, so he turned to an outside COO who took over the day-to-day operations. In the same way, Jobs almost destroyed Apple in the early ’80s and tried to do too much. Upon his return in 1997, Tim Cook was one of his first people to run the business, which allowed Jobs to focus on the overall strategy and design.

“They each have very different abilities that they brought to the table,” says Yoffie, “but they were also successful because they understood what they did not know well and that they could fill these gaps in recruiting. Individuals and form teams to do things they do not or can not or can not do. ”

This kind of conscious recognition of weakness is not often seen in the qualities of a great strategic leader. By the example of the success of these three men, this may be the most important lesson of all.

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