This Friday "Jobs" the movie opens in theaters everywhere—and it's just in time. It's just in time because there is an important and vital management lesson in Steve Jobs approach to business that companies everywhere need to hear, learn from and adopt. I'm sure there's great entertainment value in the movie in and of itself, but the really impactful message for business is the most important part of Mr. Jobs management philosophy—
Value Creation Rocks!
Value creation is what REALLY matters.
Unfortunately, the last twenty years of business management theory and practice have focused on value redistribution. Anyone can, and anyone has outsourced, offshored, laid off, sold, bought, scaled, monopolized, duopolized, oligopolized, etc. etc. their way to corporate profitability. It's no surprise that in America when corporate profits are up, wages are down, and vice versa. Taking from Peter to reward Paul Inc. is a time honored and proven management tactic. Here's a recent blog post I did on this issue, with the data that backs it up.
Now don't get me wrong, doing things more productively is not something I'm against. Productivity gains, i.e., getting things done with less are an important and vital part of the overall equation. But they are only one part of the equation—and business leaders everywhere have been overly focused on this one dimension of business management, at the expense of it's counterpart, value creation. Why? Because, it's comparatively easy to do, it has short term impact and they are handsomely rewarded for it through stock based compensation.
Steve Jobs? He was obsessed with value creation. Steve played the long game. As far back as his iconic 1985 Playboy interview, he told us as much.
Larry Ellison just referred to Steve Jobs as "..our Edison. He was our Picasso." in his interview Tuesday with Charlie Rose. The world of business needs more Edison's, more Picasso's, more Steve Jobs. We need fewer Chainsaw Al Dunlap's. Remember that guy?
The Duality Of Economic Growth
Here's why. Economic growth only comes from an incessant focus on BOTH doing things with less, AND by doing things better. Economist Paul Romer explains this with a an effective metaphor from the kitchen that I particularly like:
What's passed as business management and leadership for much of the past few decades has been focused on the practice of redistributing value, not creating it—except for the few, like Steve Jobs. Mr. Jobs and the company he built have created new tools and techniques that have changed the world in many fascinating and unpredictable ways. These innovations will continue to wash over us, influence our lives and most importantly enable all of us to think of new ways to do things better, not just with less. Today's social technology is not just a productivity engine, it's an innovation engine for every company, everywhere.
The Future Of Business
The future of business belongs to those leaders and the companies who can create value, not just redistribute it—value creation has no boundaries, value redistribution does. Steve Jobs incessant focus on creating value, is his lasting legacy.
Fortunately, he's not only shown us the way, he's created some incredible tools that every company should be exploiting to rethink how they deliver an experience to their customers, employees, investors and suppliers. Today's social technology like the iPhone, software from other companies like Salesforce.com's Chatter, the entire cloud, the infrastructure of the internet and yes even tools likes Twitter and Facebook, are all pieces of an incredibly powerful new social technology landscape that is changing human behavior in foundational ways. When human behavior changes, business changes. These tools introduce new ways to engage with your markets, design your products and services, make money, save money, save time, etc. etc. These tools are competitive weapons for businesses that understand them, like Steve Jobs did.
Steve Jobs believed in himself and the power of value creation. More importantly, he believed in you. What are you waiting for? Let's get cooking and create some value.