Strategies from Three Great CEO's

Steve Jobs, Andy Grove and Bill Gates are probably the three best CEO’s of all time. So it was with great interest that I read the book “Strategy Rules” by David Yoffie and Michael Cusumano. It was a wonderful read and getting into the minds of the three greatest strategists was enormously helpful
The five rules they identified to describe the framework were
  1. Look forward, Reason Back
  2. Make Big Bets, Without Betting the Company
  3. Build Platforms and Ecosystems – Not just Products
  4. Exploit Leverage and Power – Play Judo and Sumo
  5. Shape the Organization Around Your Personal Anchor
 To understand the impact of three please read the following. Bill Gates was Microsoft’s CEO from 1975 to 2000. Over that span the company’s annual profit grew from practically zero to $11 billion. Andy Grove became Intel’s CEO in 1987 and the prior year Intel had lost $135 million. In 1997 Grove’s last year on the job, Intel earned nearly $10 billion. In 1997, when Steve Jobs returned to Apple, the company lost more than $400 million: in 2011, when he resigned Apple earned almost $34 billion.
 Rule 1:  Look Forward, Reason Back
  1. Look forward to develop a vision of the future; reason back to set boundaries and priorities.
  2. Look forward to anticipate customer needs; reason back to match with capabilities.
  3. Look forward to anticipate competitor’s moves; reason back to build barriers to entry and lock in customers.
  4. Look forward to anticipate industry inflection points; reason back to commit to change and stay the course.
Rule 2: Make Big Bets, Without Betting the Company
  1. Bet big to change the game.
  2. Don’t bet the company
  3. Cannibalize your own business
  4. Cut your losses
One of the examples I liked from this chapter is Steve Jobs who in 2005 insisted on killing iPod Mini before launching its successor, the Nano. Although demand for the Mini was still huge, Jobs wanted to move to the next device before it had been market tested.
Rule 3: Build Platforms and Ecosystems – Not just products
  1. Think platforms, not just products.
  2. Think ecosystems, not just platforms.
  3. Create some of your own complements.
  4. Evolve and invent new platforms to avoid obsolescence.
I like this quote from Steve Jobs “We are the only company that owns the whole widget – the hardware, the software and the operating system. We can take full responsibility for the user experience. If you have an extreme passion for producing great products, it pushes you to be integrated, to connect your hardware and your software and content management. You want to break new ground, so you have to do it yourself. If you want to allow your products to be open to other hardware or software, you have to give up some of your vision.”
Another great one from Bill Gates “Microsoft is the company that has worked with independent software developers more than any other company… Why did we beat other operating systems? Because we worked with independent software companies to get them to write applications.”
Rule 4: Exploit Leverage and Power – Play Judo and Sumo
  1. Stay under the radar.
  2. Keep your enemies close.
  3. Embrace and extend competitor’s strengths.
  4. Don’t be afraid to throw your weight around.
 The authors day that both Bill Gates and Steve Jobs became masters of “co-opetition” competing and cooperating with other companies at the same time. Knowing when to stay under the radar, when to work with your rivals, when to embrace and extend competitor’s strengths and when to throw your weight around can make the difference between failure and success.
Tactical judo requires mental flexibility, the ability to compromise, and the discipline necessary to put aside corporate pride and follow a competitor’s lead. Tactical sumo requires toughness above all.
Rule 5: Shape the Organization around Your Personal Anchor
  1. Know thyself – warts and all.
  2. Pay extraordinary attention to detail – selectively.
  3. Never lose sight of the big picture.
  4. Give power to people with “the knowledge.”
This Steve Jobs quote is awesome “Getting fired from Apple was the best thing that could have ever happened to me. The heaviness of being successful was replaced by the lightness of being a beginner again, less sure about everything. It freed me to enter one of the most creative periods of my life.”
I found this book to extremely engaging and had a lot of food for thought. It is a very well researched book based on solid evidence from the three greatest strategists of all time.

Comments

Post a Comment

Popular posts from this blog

10 Tips to Develop a Pleasing Personality

Image
A pleasing personality is very important to develop as we move forward in our career. It can also help us in our personal lives. In the book Believe and Achieve by W.Clement Stone he gives some great tips on developing a pleasing personality. Here are the 10 tips I liked with my take on each. Take an inventory – The first step in developing a pleasing personality is to first be happy in your own skin. Take an inventory of all the wonderful qualities you are bestowed with. Some of the qualities you may have are self-discipline, honesty, character, integrity and passion. Even if you don’t have some of these qualities you can put together a plan to be the person who has all the qualities you desire. By dreaming of your ideal self you will steadily move towards becoming that person in reality. Observe yourself  – All top athletes replay their performance to see where they have done well and where they can improve. Similarly after each major interaction you can evaluate what you di
Read more

12 Guidelines to Effective Communication

Image
The number one skill required to succeed in the current job environment is communication. All things being equal communication is what will distinguish you from others. The reason is with the explosion of outsourcing and project teams being in diverse locations the ability to communicate and collaborate are essential skills to have. The key to better collaboration is communication. Here are 12 guidelines to communicate better. Be Clear  - The first step in communication is to make your message short and crisp. Simplify your message. Clarity is an absolute must. Use Simple Words  - Be wary of using bombastic words and use simple words instead which relate with the audience or person. Simplicity connects people. Be other centered  - Make your interactions with people more about them and take the focus off yourself. A key to effective communication is having a genuine interest in other people. Pay attention to where you focus when you communicate. Think about other’s needs. Meet
Read more

The 5 P's of Ethical Power

The book “The Power of Ethical Management” by Ken Blanchard and Norman Vincent Peale was published in 1988. The principles laid out in this book are still relevant today. It consists of information which is of timeless value and serves as a worthy reminder on ethics and its importance. I particularly liked the 5 core principles of ethical decision making mentioned in the book. Here are the 5P’s of Ethical Power Purpose  – The authors define purpose as ongoing. It is something an individual lives by. A personal mission statement of an individual can serve as the purpose. It is the vision you have for yourself and what you would like to be known for. The authors mention something called the mirror test where you look at yourself in the mirror and ask yourself if everything you are doing is aligned to your purpose. If there is anything not aligned to your purpose ignore it. I like this line  “There is no pillow as soft as a clear conscience.” Pride  – A healthy self-esteem is a c
Read more

Life is like a Test Match in Cricket

Image
I love the game of cricket. I was an avid cricket follower at least till the time Rahul Dravid retired. The five-day test match is the true test of patience. Believe it or not even after 5 days you can have a game with no result which is perplexing to some. To me the 5 days that a cricketer goes through is the same all of us go through during our work. We all get usually five days in a week to perform at our best. The only difference is while cricketers may not play test matches throughout the year or even a life we all will get easily 40 years of playing test matches week after week. With the advent of Twenty Twenty the viewership for test matches are dwindling but the drama of a test match is something that can never be replaced. Imran Khan once said to succeed in 20-20 you need a lot of talent, a little technique and not much temperament. However, for test matches you need all the other T’s in abundance. The epitome of a test match player for me is Rahul Dravid. He had an abu
Read more

10 Qualities of a True Champion

Image
Champions are born but they are also made by relentless practice, clear goals, never say die attitude and a willingness to learn something new every day. I loved the book “The Way of the Champion” by Jerry Lynch. It has a lot of examples from sports but a lot of it can be applicable to us as well. Here are the lessons I gleaned. Self-acceptance : The first step in being a champion is being comfortable with who you are. Accept yourself unconditionally and remember all champions have weaknesses. Understand your strengths focusing on those while complementing your weakness are with the strengths of others. Self-definition : Define what you want to be known for. For example, you may want to be known for your discipline, passion, persistence and ask yourself every day if you are doing these things. Decide what message you want to send to your team or stakeholders. Modesty:   If you know you are a champion you don’t need to show off. You will be totally comfortable with yourself and y
Read more

7 Inspiring Lessons from Elon Musk

Image
Elon Musk is one of the greatest business icons of the 21st century. With the passing of Steve Jobs he has rightly taken the pole position in the realm of business leaders who are considered visionaries. I read the book on Elon Musk by Ashlee Vance and it is a wonderful inspiring read. Here are the lessons I gleaned.  Be in it for the long haul – Irrespective of what our aim is unless we have decided to be in it for the long haul it is very difficult for us to scale the heights that we are capable of. Elon Musk in 2008 was in dire straits. Space X and Tesla were both running out of money but the man was in it for the long haul. He didn’t care about short term setbacks. He always looked to the future with hope and was over optimistic in most cases. He set unrealistic deadlines as that’s the way he thinks.  Everything he does is fast and he is always in a hurry. He pays an obsessive attention to detail and for SpaceX he wants to reduce the cost of launches. For years Tesla l
Read more

Mastery by Robert Greene - An Inspirational Book

Image
Biographies can really inspire us. Imagine reading around 15 mini biographies at the same time. This is what Robert Greene has done with Mastery. This is one of the best books I have ever read and goes deep into what it takes to reach mastery in your field. I have read this book multiple times and it is a worthy addition to your library. This summary is only an appetizer and you really need to read this book in its entirety to get the full satisfaction. Yes it is not an easy read but well worth your effort. Here is a very high level review on what the book contains. Don’t separate your work from your personal life it is a sad separation since most of our time is spent at work so we can’t be miserable there. He also says masters felt a sense of destiny. For example Albert Einstein was immediately moved when his father gave him a compass when he was just 5 years old. Discover your calling. Each of us has a purpose to fulfill so discovering that is the first step towards mastery.
Read more

Never ending journey of Success and Goals

The first step to understand about success is that it is not a destination but a wonderful journey that never ends. The best definition of success I have come across is by Earl Nightingale "Success is the progressive realization of a worthy ideal/goal." It is the process that’s actually exciting. Most of the times once we reach goals like getting the promotion or losing the weight we can’t keep up momentum but it is the process that actually keeps us energized. Once we achieve our goals we feel good for that moment but in order to keep that feeling ongoing we need to keep setting new goals. The important thing to remember is that goal setting is a lifelong activity and it does energize our lives. People talk a lot about dreams but there has to be a distinction between outrageous dreams and dreams that ignite. I can have a dream to be the greatest tennis player that ever lived but that dream is surely not going to be realized and it is very much outrageous. I think when we s
Read more

The Dream is Free but the Journey Isn't

Image
I was discussing with my daughter some time back about dreams and it got me thinking that we always encourage our kids to dream big while encouraging them that they can achieve anything they want. However is that really good solid advice. I thought deeply about what do dreams signify and how can I explain to kids that you cannot achieve anything you want but you must think big while working towards your dreams. It also got me thinking that some of the adults have stopped dreaming so I really wanted to write this piece addressing what it takes to do your dreams. The word dreams project an excitement that no other word can. Dreams are a vision for your future which pulls you to wake up every morning with a smile and look forward to each day with excitement. In my opinion get excited about your life first and then you can truly wake up with a smile. Just read this wonderful article from Larsen Jensen  Positive Psychology Lessons from an Olympic Medalist and Navy SEAL . He says he wo
Read more

Talent is Never Enough - 13 Factors to Maximise your Talent

Image
Talent is not something that is gifted at birth. Of course there are a few exceptions that make things look so easy and we tend to believe that they are born with a certain gift. However if we go deeper they reached their Everest by harnessing their talent and get the best out of themselves. Talent is never enough by John Maxwell is one of the best books I have read. It is quite motivational and inspirational. He identifies thirteen factors that can help maximise your talent. Here is brief overview of them with my take on each. Belief lifts your talent    – The first step is to believe in yourself. You can’t go far without believing in your talent. We can all agree that we have enormous untapped potential and we have to believe first before we get the most out of ourselves. Have a personal mission statement that is exciting. My mission statement is to maximise my potential and help others maximise theirs. Passion energizes your talent – Obviously if you want to make the mos
Read more