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How Hands-On Should CEOs Be With Product Development?

Some Apple employees say Tim Cook is less hands-on in developing products than his immortal predecessor. It shouldn't matter.
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The recent New York Times profile of Apple CEO Tim Cook points out several differences between Cook and his immortal predecessor. Apple employees say Cook is less hands-on about product development than Steve Jobs was: 

Lower-level employees praise Mr. Cook's approachability and intellect. But some say he is less hands-on in developing products than his predecessor. They point to the development of the so-called iWatch--the "smartwatch" that Apple observers are eagerly awaiting as the next world-beating gadget. Mr. Cook is less involved in the minutiae of product engineering for the watch, and has instead delegated those duties to members of his executive cabinet, including [Jonathan Ive, Apple's head of design], according to people involved in the project, who spoke on condition of anonymity because they were not authorized to speak to press.

The implication, of course, is that it's a bad thing that Cook is less involved. That if only Apple were once again helmed by its legendary founder, then investors would be happy. "Investors have clamored for Apple wizardry--a much-anticipated iWatch or iTV, perhaps," writes the Times. "To these critics, Mr. Cook is uninspiring, his social views window dressing, when what they want is magic."

The Truth About Product Development

One problem with this perspective is it simplifies the complex world of product development into an anachronistic Great Man theory. As if Jobs were solely responsible for Apple's great products. In reality, it's an entire team, including Ive, Cook, and the countless nameless factory workers who actually assemble the phones, tablets, and laptops. 

Another problem is that founder/CEO involvement with product development is generally a mixed bag. For every creative leader (including Jobs) whose strong hand in product development has led to fruitful outcomes, you can find another brilliant leader whose involvement has led to failures, mistakes, or alternating highs and lows.

For example, there was a time when Michael Dell was revered as much as, if not more than, Jobs was. In 1989, Inc. profiled Dell as an innovation upstart. Any way you slice it, Dell is a legendary hands-on entrepreneur. He built a dorm-room startup into a business that was worth $100 billion as recently as March 2012. But by the summer of 2013, the company had dropped to about $24 billion in value. And by the time the company celebrated its 30th birthday, in May 2014, the company had gone private. Frailty, thy name is the marketplace.

This rise and fall (which will undoubtedly be followed by another rise) all occurred with Dell as CEO, with the exception of a three-year period (2004-2007). Tempting as it can be to venerate Jobs, the truth is that a founder's involvement--even when the founder is a product-development guru--is no assurance of perpetual success. 

Lessons for Entrepreneurs

All of which brings us back to the essential question: If you're a founder/CEO, how involved should you be--or should you remain--in product development? 

It depends on what's best for the company. It also depends, obviously, on your particular talents--and your ability to learn from your customers. For example, Honest Tea CEO Seth Goldman had a strong hand in developing the company's first drink. But as he explained to Inc. a few years ago, he made the mistake of selling what he wanted to drink instead of what his customers wanted.

Specifically, he created a drink called Harlem Honeybush, named after the South African village, Harlem, in which he'd found the tea leaves. But the product tanked. It was unsweetened and had a caustic taste. Goldman had failed to understand his customers in a really basic way. They simply wanted a drink that was conventionally delicious. Eventually, the company pulled Harlem Honeybush and developed it into a new formula, adding pomegranate and goji berry. It became a hit. 

The obvious lesson here is to keep your customers in mind. But the subtler lesson is that Goldman recognized the importance of course-correcting his product-development efforts in midstream. He didn't stubbornly adhere to a Great Man belief that he knew better than his customers. 

Designing Products for Yourself

But here, too, it's inaccurate to simplify. For there are numerous examples of successful CEO/founders who believe--in contrast to what Goldman learned--that a smart first step in product development is to initially design the product with your own desires in mind. 

Garrett Camp, the co-founder of Uber and StumbleUpon, counts himself as a fan of this approach. He started Uber because he had trouble finding a cab. Likewise, Zappos's founder, Nick Swinmurn, started the company out of frustration that he couldn't find a pair of brown Airwalks at his local mall. Lawyer-turned-entrepreneur Sahar Hashemi co-founded Coffee Republic, the U.K.'s first U.S.-style coffee bar, and Skinny Candy, a brand of sugar-free sweets, because she couldn't find what she was looking for as a consumer. 

Perhaps the only universal takeaway, then, is one we've shared before: That initial inspiration gets you only so far. Eventually, you'll need sales skills and leadership. (In Zappos's case, for example, Tony Hsieh came aboard in 2000, having already built and sold LinkExchange to Microsoft for $265 million.)

In all cases, you'll need to monitor the boundary between your customers' needs and your personal tastes. In some cases, as with Uber, these two concepts will overlap. The product you initially design for yourself becomes a reasonable demo of the one you'll eventually sell. In others, however, you'll have to make major modifications. Your own private taste may not translate to the masses.

Last updated: Jun 17, 2014




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