Steve Jobs

Steve Jobs is the Co-founder and up until last week, the CEO of Apple Inc. He has achieved insurmountable success in founding Apple, then being booted out and starting NeXT Computer and Pixar, then returning to Apple when it was failing and building it to the company it is today.

How has he been able to do it? What are his belief systems that have allowed him to be so successful and change the tech industry forever? Read on to find out.

Let’s characterise his beliefs and ideals into 6 categories:

Visionary

  • All along he wanted to create the ‘Black Porsche of computers” he didn’t want to create ‘another beige box’
  • When he enticed the then CEO of Pepsi over to Apple he highlighted his vision by saying – “Do you want to keep selling sugared water for the rest of your life, or come with me and change the world?”
  • He wanted his computers to be on display much like a stereo is part of the furniture, not just another ugly tool, much like a calculator.

Product Focus

  • While other Silicon Valley entrepreneur’s went for a software focus, Jobs went for the products. He has always been obsessed with creating sleek, stylish products.
  • He had strict criteria, all products must be: sleek, stylish, classy, elegant, attractive, cool as a stereo, not an ugly beige box.

Brand Image

  • The value of the Apple brand today is somewhat invaluable. The place it commands in the consumers mind is a very unique one, a very valuable one. People love Apple products, they go nuts for them. This allows Apple to charge a premium, increasing the profitability.
  • Apple has achieved this by continually striving to be placed within strict parameters in the consumers mind. People have to associate Apple with being; cool, classy, rich, wealthy, easy to use, good quality, that it just works.
  • Apple has made the most of Product Placement in blockbuster movies – take a look at the next movie you watch and look for the characters who are; wealthy, stylish, cool – they will be using Mac computers. On the contrary, the lower-class characters, dorky, uncool will never use Mac’s. This has allowed the Apple brand to command strict emotional desires in the majority of consumers minds.

Ultimate Salesman

  • He is able to motivate staff to work extreme hours and to impossible dead lines. Business leaders who work with Apple to sign up to ridiculous terms. And intrigued on-lookers at MacWorld Expo’s to give standing ovations. This he has been able to do by being a superb salesman.
  • For example, when the iPhone came out he told the 800-pound gorilla in the telecommunications market, AT&T, that their logo would not be on Apple’s phone. They were shocked, every phone they released had their logo and who was this computer nerd who thought he would remove our logo? Mr Jobs was that guy and as history tells us he was able to convince them to sign up to his terms.

Life Outlook

  • As he said during his Stanford Commencement Speech, “It’s only when you look back on life that you can connect the dots”
  • He used the example when he dropped out of University, he bummed around and attended the courses he desired to, one being a calligraphy course.
  • At the time it seemed like a silly decision, where was that going to lead him. Though when he started Apple Computer, some years later, he used what he learnt in that very calligraphy course to allow computers to change fonts and typeface.
  • As he looks back on life he can see how valuable some of his decisions were. Often at the time they seem like silly decisions. His point, live day-to-day through your heart and desires as its only when you look back that you can connect the dots.

Focus

  • Jobs is superbly focused. Hence, he often appears blunt, stubborn and rude. He knows what he wants, he has the vision, and when people don’t do or create what he sees in his mind he gets extremely frustrated.
  • For example, he created the iPhone as he saw an opening in the phone market due to the other phones being ugly, having small screens, small buttons, were difficult to use etc. He had a vision for a stylish phone to have a built-in iPod, camera, be able to email, text, surf the internet, have a big screen etc. though there was one catch… it was to have one control button. ONE.
  • Every one of the 150 engineers complained that it couldn’t be done. Jobs was relentless. One button. Eventually they discovered the touch screen which solved their problems. Hence the iPhone was created with only one control button.
Steve Jobs has achieved insurmountable success. By studying him we too can mimic his results.

Warren Buffett

Warren Buffett, majority shareholder, Chairman and CEO of Berkshire Hathaway – a holding company which owns and invests in various other companies – is currently the 3rd richest man in the world. What is it that separates him from all others? What does he believe that has allowed him to be so successful? How does he differ from the masses? How can the everyday man adopt his belief systems to prosper similar to him?

In this blog we will look at the aforementioned.

In general Buffett is a down-to-earth, no-nonsense investor who takes a contrarian stance by “going against the trend”, this has proved very successful over his extended career.

What are his key distinctive belief systems?

Focus

  • Bill Gates father asked both Gates and Buffett at a lunch what the one thing they could agree was the main contributor to their success, at the time they were the two richest men in the world, the answer they both agreed unanimously was focus. Focus on where you are headed and what you want and not letting anyone deter you from what you want.
  • Buffett’s children have been quoted as saying he was so focused when he read that they struggled to get more than a murmur or grumble out of him.
  • He has always lived in Omaha, Nebraska and steered well clear of Wall Street. He said this has allowed him to think independently and not follow others. Going with the masses he has found to be detrimental.
  • Lives, eats and breathes investing 24/7.
Independent Thinker
  • He is an avid contrarian and is quoted famously as saying “be fearful when others are greedy and greedy when others are fearful”.
  • His results over the years have shown that he performs better in bear markets than bull markets.
  • The main example was during the Dot Com bubble when he shied away from all tech stocks saying that he couldn’t understand how they made money or their longevity. Many would accuse him of being “out of touch” or “not understanding the internet”. He wasn’t dissuaded by their remarks. He stuck to what he knew and understood and bought the companies and stocks that most were selling to buy the high tech stocks. As we now know, he had the last laugh.
  • He drove a VW beetle even after he became a millionaire. Reasoning that he could compound money at 20% p.a. so over 20 years he could compound say $35,000 to over $1.3million and “that’s just too much to spend on a car” he would say!
Positive Beliefs
  • He loves what he does. He often says he “tap dances to work each day”.
  • He is grateful for the world he was born into saying he “won the Ovarian Lottery” by being born male, white, with a high IQ, into a middle class family and early in the 20th Century.
  • He is a billionaire and so could do whatever he wants in life, he says there is nothing he would rather be doing. He has his dream job.
Common Sense
  • He has vowed to give his fortune to charity with the majority (83%) going to the Bill and Melinda Gates Foundation. He chose to give it to them purely from a common sense stand point – they are already dealing with such large sums and so would not squander and waste it due to them already being set up to such a degree. It would cost him a significant amount of his capital to set up a foundation of the magnitude to handle his fortune that would be wasteful and so society wouldn’t get the full benefit.
  • In valuing a company he moves away from financial jargon and more to the general performance and capabilities of management and the company’s brand value.
  • He considers shares a part ownership in a company not just a ticker symbol on a screen.
Dale Carnegie
  • He attended a Dale Carnegie public speaking course when he was younger and such teachings found in Carnegie’s book ‘How To Win Friends and Influence People’ can be discovered when studying Buffett.
  • He praises the managers of his various company’s in his annual letters to shareholders
  • He instills confidence in his managers so they will do their best to never let him down
  • Gives managers freedom
  • Rewards his employees with good working conditions and the freedom of running their own show as opposed to cash bonuses and stock options.
Berkshire Hathaway Key Subsidiaries:
  • Geico Insurance
  • See’s Candy
  • Borshiem’s Fine Jewelry
  • Burlington Northern Santa Fe Railway
  • Nebraska Furniture Mart
  • Net Jets
  • and many more
Berkshire Hathaway Significant Shareholdings:
  • The Coca Cola Company
  • American Express
  • Wells Fargo
  • Gillette
  • H & R Block
  • Moody’s Corporation
  • The Washington Post
  • and many more
Any questions or comments feel free to post.