On the day of his death I was
facilitating a senior management Leadership Offsite for Indonesia’s leading
medical glove maker, Medan based Medisafe Technologies, in Bangkok Thailand.
The participants found the module
developed around Jobs’ unmatched ability to innovate very inspiring especially
regarding the mindset required to drive innovation in a competitive sector.
The fact that half way around the
globe an emerging markets company in an entirely different sector was trying to
apply best practices in its own business model is in itself a tribute to the
legacy that will endure beyond simply the gadgets produced by Apple.
In this installment we will focus
on the customer oriented strategic brilliance achieved by Apple under his
leadership. This was built around three key dimensions.
The first was simplicity. The yin
and yang of product differentiation is simplicity versus complexity. Many
companies believe stuffing in a large number of features is the way to
demonstrate value to customers. Steve Jobs took the opposite view believing
‘Less is More’ as long as it produced delight on the core needs of the
customers and wowed them with the elegance and style only simplicity can
demonstrate.
And yet complexity was not
abandoned it just receded into the interiors of the products to achieve new
highs in speed, convergence, connectivity and quality. Complex inside, Simple
outside — he had hit on the pulse of a winning product formula that earned
Apple millions of new customers beyond the techno geeks — from school children
to grandmas, casual tourists to bureaucrats, nurses to chefs.
He figured that many customers
struggled with post purchase disappointment when bulky manuals and unfriendly
packaging turned product installation and activation into a challenge. Thus
Apple packaging and product activation set new standards in user friendliness.
The iTunes universe was created
for seamless navigation, delightful surprises and ease of purchase. While it is
still early days for iCloud Apple has a great opportunity for meeting the needs
of hundreds of millions of SMEs across the world who want the benefits of
technology, access, data security and multiple functionality at reasonable
cost. It could be the blockbuster revenue driver of the future for the company
and the company’s millions of loyal fans would certainly give a viable platform
a try.
The second was a clear product
focus. Upon his return to Apple at the turn of the century he scrapped several
products and projects determined to focus only on a compact suite of products
where Apple had its best chance of standing out in a crowded marketplace.
This singular focus helped ensure
the ‘zing’ factor in the iMAC, iPod, iPhone and iPad. Unlike other gadget
makers whose product portfolios resembled those of FMCG makers, Apple had a
sharper focus. Importantly instead of resting on past laurels like many rivals
Apple kept on improving existing products and has made an art of getting loyal
customers to upgrade.
In this it has cracked a critical
mantra of marketing — rich returns come not just from converting new customers
but more importantly from deepening profitable relationships with existing
ones.
Many companies, including several
in Indonesia, waste far too much organizational energy and promotional expense
on ‘poaching’ external customers. A classic case in this regard is the
telecommunications sector in which cellular operators have been chasing new
customers based on price while paying little attention to deepening the wallet
share from existing customers who remain prone to swift brand switching.
As a consequence bottom lines of
almost all players are adversely impacted and overall industry standards are
down as also seen from the recent controversies surrounding non transparent
gimmicky sales of add on services.
Steve Jobs often stressed that it
was impossible for companies to know exactly what customers wanted. Even
customers themselves were confused about what they wanted. So he placed great
emphasis on intuition, gut feel, curiosity, imagination, exploring future
scenarios and spotting trends that were still in the formative stage.
While research, focus groups and
market feel are valuable Apple has showed that to stay ahead companies must
encourage the ability to imagine how industries and consumers are shaping. It can throw up exciting ideas for
innovation and keep the marketer in pace with customers who have little time or
patience for yesterday’s ideas. At the same time the products need to be
functional and grounded in core needs. As Jobs counseled his innovation teams —
“Design is not just what it looks like and feels like. Design is how it works.”
The third was the ability to
correctly read the buoyancy in emerging markets at the turn of the century. While
rivals like Research in Motion have been slow to properly service prospective
markets like Indonesia, Apple matched the excitement and buzz created by
product launches in America by ensuring strong distribution and coverage in
fast growing emerging markets.
Despite its premium pricing it
won acceptance because of the universality of its features, ease of use and
appeal to millions of young brand conscious customers. It was seen as the
technological enabler of fast catching trends in social networking, lifestyle
and creativity. Again the company did not over-complicate by trying to
customize for different markets, build multiple supply chains or send confusing
promotional messages.
A winning stable of products,
constant rejuvenation and sales through trained staff in smart outlets was
enough to maintain the momentum which shows no sign of slowing down.
This holistic customer
orientation set up the foundation for the next two aspects of Steve Job’s
leadership legacy — creating a culture of serial innovation and inspiring high
performance winning teams — which will be examined in the concluding part of
this series. (Amol Titus*)
The Jakarta Post, October 15, 2011
*The writer is CEO is leading strategic advisory firm, IndonesiaWISE
which along with its sister EmergingWISE subsidiaries guides companies and
managements through various key facets of business transformation. He can be
contacted at amoltitus@indonesiawise.com
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