StevveJobs

A Software Company

After leaving Apple, Jobs' new revolutionary ideas were not in hardware but in

software of the computer industry. In 1989 Jobs tried to do it all over again with a
new company called NextStep. He planned to build the next generation of personal
computers that would put Apple to shame. It did not happen. After eight long years of
struggle and after running through some $250 million, NextStep closed down its
hardware division in 1993. Jobs realized that he was not going to revolutionize the
hardware. He turned his attention to the software side of the computer industry.

In 1994, Jobs feels there is a lot of money in developing an object-oriented industry

that would fix the problems companies have in developing software. The corporate
developers are going to fuel the object revolution because they know they have a giant
problem that needs to be solved in software development, and PC makers are doing
less to serve the needs of software developers. [Goodell, 1994, p. 73] Jobs said, "Our
primary mission is to establish NextStep as a leading operating system in the
Nineties." Now, Jobs invisions NextStep will revolutionize the computer industry by its
operating system software which incorporates a hot technology. It's called
object-oriented programming (OOP), and OOP lets programmers write software in a
fraction of the usual time. [Goodell, 1994, p. 77] Jobs feels OOP is the solution to
corporations problems of wasting money to develop software because OOP serves as a
blue print to develop programs like blue prints for constructing a building. Jobs thinks
the OOP paradigm will have a great effect on the production of software like the effect
the industrial revolution had on manufactured goods. "In my 20 years in the industry,
I have never seen a revolution as profound as this. You can build software literally five
to ten times faster, and that software is more reliable, easier to maintain, and more
powerful," says Jobs. [Goodell, 1994, p. 77]

Jobs feels software programs have gotten bigger, more complicated, and much more

expensive to produce. Object-oriented programming changes that by allowing gigantic,
complex programs to be assembled like Tinker toys. Programmers will use
pre-assembled chunks of code to build 80 percent of their program thus saving an
enormous amount of time and money.

The criticizim Jobs received from building the NextStep comupter was that he failed in

trying to build a second computer empire. Jobs's goal was to produce a NextStep
computer for $3,000 that would land on the desk of every college student. In
designing the NextStep computer, he ignored the demands of thecomputer market.
Even his own experts were saying: "Keep in touch with the intended customers and
avoid the pitfall of anerobic isolation; do not assume that the customers will pay any
price to secure the lastest computer technology; ease the way for customers to adopt a
new standard by providing software and hardware bridges that help connect older
machines to the new ones." According to developers, he disregarded every one of these
lessons when he launched NextStep computer. [Peterson, 1994, p. 73]

In mid 1989, after long delays which Jobs was never blamed for, NextStep finally

introduced a $7,000 monochrome system. The system had no floppy disk, virtually no
useful software applications, and a slow magneto-optical disk. When the NextStep
computer was introduced, the academic world and corporate America rejected it. In
the end, only about 50,000 NextStep machines were ever built, and in February
1993 Jobs announced that NextStep would stop producing hardware and focus all its
enery on the NextStep operating system. The operating system was promised to run
on a wide variety of platforms. [Peterson, 1994, p. 73]

Jobs recurited an Englishman, Peter van Cuylenburg, age forty-four as his number two

person in NextStep to help promote the NextStep computer and organize the
company's management. The company's management had decimated. In the past few
months virtually all of NextStep's vice presidents had quit. Van Cuylenburg said the
quitting of vice's presidents was due to his own toughness. He said, "I've put pressure
on the company, and not everyone was willing or able to accept it. NextStep had too
many vice presidents when I arrived, so Jobs and I decided to eliminate some."
[Deutschman, 1993, p. 100]

Jobs and Cuylenburg planned on releasing NextStep software to run on other

companies computers by the fall of 1993. NextStep did release a version of
NextStep's operating system for PC's equipped with Intel's 486 microprocessor. Still,
the market did not fully accept NextStep's operating system over OS/2 or Microsoft
DOS.

NextStep had also talked with Hewlett-Packard, Sun, and others about licensing

NextStep to run on their machines. But these companies thought it was a ridiculous
idea, because NextStep is trying to acrimoniously compete against them in hardware.
Cuylenburg admits that the scenario makes sense only if NextStep's hardware business
is small enough that the major players do not see NextStep's computers as a threat.
[Deutschman, 1993, p. 100]

Jobs feels NextStep is moving slowly but surely to being a software company that

makes great reference hardware. That is NextStep will have a machine that provides a
benchmark of quality. The NextStep operating system will be in a three-way race for
the object-oriented operating system of the Nineties against Microsoft's Cairo project
and Apple's and IBM's joint venture. [Deutschman, 1993, p. 102]

Considering that object-oriented software has become the key to NextStep's future, it

is ironic the Jobs committed the company to it almost by accident. When
NextStepintroduced its first machine, the Cube, in 1988, it was incompatible with
existing computers. These computers had virtually no software to run on them. Jobs
urgently needed outside software developers to write programs for the Cube. He found
the basis for his operating system in Carnegie Mellon University software called Mach,
which happened to use object-oriented programming. Jobs' goal was not to ease
programmers' lives; he just wanted to get some programs written and shrink-wrapped
pronto so he could sell his NextStep computers. [Deutschman, 1993, p. 102]

NextStep squeezed its way into the field of being a good platform for companies to

build object oriented programming through a review done by CKS Partners. CKS
Partners is a San Francisco advertising agency founded by a bunch of old Apple
colleagues. Jobs NextStep advertising agency needed help in promoting the NextStep,
because it boasted about the computers hardware disk storage and processing chip
technology, but gave no compelling reason for businesses to buy a NextStation. Jobs
called on his old friends at CKS Partners to help his advertising agency out. CKS
conducted focus groups of Fortune 500 managers in charge of information systems.
They can up with the report there was little perception in the marketplace about
NextStep. But important information came from a number of hard-core information
systems geeks. They had discovered NextStep made it much easier and faster for
companies' in-house programmers to customize software to handle important parts of
their businesses. Rather than start from scratch, programmers using object oriented
programming can do much of the job by looking in a library of preexisting software
modules. [Deutschman, 1993, p. 102]

This was a good report to have about the qualities and benefits of using a NextStep

computer, because if companies where to read analysist report on NextStep computers
in a computer magazine. The companies could reduce the time in developing software
packages by having a preexisting library full of code all ready written to handle specific
operations. And NextStep provides an easy platform to create libraries, maintain, and
integrate the code in a object oriented programing environment. The companies would
see a solution to the problem of spending to much time and money in building
software applications. Software developers could reduce their time in finding errors
and maintaining its software, because object oriented design allows a nice encapsulated
structure, information hiding, and communication between modules through
messages.

A company O'Connor & Associates, a Chicago options and futures firm, claims its

engineers can write a complex trading program in three months with NextStep versus
over two years on a Sun workstation. Corporate mangers who ventured into using
NextStep computers told NextStep, "You guys have one of the best products ever, but
you do not even know it and you're not trying to sell it to us." Jobs recalls himself,
"Companies came to us and said, "You're idiots, you just do not get it." Now that
NextStep knew companies in the real world could solve problems faster with NextStep
computers. NextStep needed to advertise better how their computer's performance
and benefits could make companies more productive. So Next went to compare their
system against their number one competitor Sun computer. The Company
commissioned a study by management consultants Booz Allen & Hamilton that showed
that corporate programmers worked two to nine times faster on NextStep machines,
than on Suns and others. When Sun World magazine gave its highest rating not to a
Sun machine but to the NextStation Turbo machine, a NextStep advertisement
proclaimed: NEXTSTEP CAST SHADOW OVER SUN.

From the review reports the company's sales have gone up, but NextStep has been

forced to turn to its Japanese partner for cash infusions. Canon originally invested
$100 million in 1989 and added another $10 million to $20 million in 1991 before
extending that $55 million credit line last July in 1992. Canon holds an 18% equity
stake Industry analysts say that the Japanese are increasingly scrutinizing their
investment. The heat is on for NextStep to start producing high marginal returns from
selling their NextStep products. [Deutschman, 1993, p. 104]

Jobs thinks Next can survive as a software company when he attacks his old enemy

Apple and IBM. He does not think the Apple-IBM linkup will work: "Apple has a
thousand software engineers, who have realized that Taligent is their enemy." If apple
adopts IBM's Taligent software, Jobs explains their out of a job. Instead, he argued, if
Apple will stick with its System 8, under development in-house, leaving IBM as
Taligent's primary advocate in the marketplace. This would leave IBM in a bad
position. Jobs admits that Microsoft has "market power" and sees Cairo as his main
competitor.

Jobs feels his NextStep machines are going to be in high demand, because once

businesses figure out how to use object oriented programming to solve most of their
design problems. Business are going to buy NextStep computers to run the object
oriented platform, because the businesses have money and will pay big money for
things that will save them money or give them new capabilities. [Goodell, 1994, p.
78]

Jobs thinks the advantages of NextStep software compared to its rival Microsoft is its

ability to design programs in an object oriented design. Jobs perceives Microsoft
Windows as a bad development environment. And Microsoft does not have any interest
in making it better, because the fact that it's really hard to develop applications in
Windows plays to Microsoft's advantage. Microsoft developed their software so
companies cannot have small teams of programmers writing word processors and
spreadsheets, because it might upset their competitive advantage. Jobs states that
NextStep will become the preferred platform for businesses to develop software.
Therefore NextStep software will out compete Microsoft in programming languages
used to develop applications. [Goodell, 1994, p. 78]

Jobs thinks object oriented programming will allow small company's to build libraries

containing already built coded modules. These libraries will allow programmers to
incorporate pre-existing modules to perform specific operations in their code. This type
of programming technique will reduce time a programmer has to spend on writing
code. Therefore less time spent on a project the company saves money. Since the
library code has already been tested, programmers using the pre-existing code in their
programs have fewer errors. Less errors to fix in a program means less time spent on
the program which saves the company money. Jobs says NextStep software will
literally let three people in a small business out perform what 200 people at
Microsoft can do. Corporate America has a need to find a solution to their problems.
Jobs feels NextStep software can save companies a lot of much money or make them a
lot much money. If companies do not presently invest into object oriented
programming, their developing technique will cost them large amounts of money.
Later, when they try to re-organized their software system they fuel the object
revolution. [Goodell, 1994, p. 78]

Jobs believes Microsoft has not transformed itself into an agent for improving things

or a company that will lead the next revolution in software development. Jobs has
become very concerned because he sees Microsoft competing very fiercely to put a lot
of companies out of business. This is hurting innovation in the computer industry. Jobs
feels the computer industry needs an alternative to Microsoft's software in computer
systems. He hopes people will turn to NextStep software. [Goodell, 1994, p. 78]

Steve Jobs

How did the creation of Apple and NextStep develop Steve Jobs's managing skills?

Jobs has been criticized as America's roughest, toughest, most intimidating bosses.
Ever since Steve Jobs founded Apple Computer when he was 21, the meditating
computer mogul was known as the terrible infant of Silicon Valley. Now, as head of
NextStep, the 38-year-old Jobs is no longer an infant, but according to those who have
worked with him, he still is terrible. [Dumaine, 1993, p. 40]

Many colleagues describe Jobs as a brilliant man who can be a great motivater and

positively charming. At the same time his drive for perfection is so strong that
employees who do not meet his demands are faced with blistering verbal attacks that
can eventually burn out even the most motivated of people. Jobs pushed his workers to
the heights of unethical work conditions. In the late 1980's, two NextStep engineers
had been slaving nights and weekends for 15 months to meet an important and
impossible deadline for a new state-of-the-art chip. No one had ever designed such a
thing before, and the strain was incredible. At a weekend off-site meeting Jobs publicly
and viciously berated them before the entire company for not working faster, even
after all their effort they put into building the chip. Out of pride they finished the
project, but one of them quit soon thereafter. A NextStep employee describes his
attitude: "You've been on it a week, and you're supposed to be brilliant. So what have
you done? That's why so many people are afraid of him." [Dumaine, 1993, p. 40]

Jobs's drive for perfection often lead him to be ignorant to other people's ideas. One

ex-employee recalls how Jobs was demanding that, on principle, he would often reject
anyone's work the first time it was shown to him. To cope with this unreasonableness,
workers deliberately presented their worst work first, saving their best for a
subsequent presentation, when it could have a better chance of satisfying the boss's
expectations. Several employees felt Jobs is going through a major personality change
and becoming much more of a consensus manager and team player. [Dumaine, 1993,
p. 41]

Steve Jobs, a college dropout who experimented with drugs and Eastern religions

before turning to computer design was an unlikely candidate to have become the
prototype of America's computer industry entrepreneur. The accomplishments Steve
Jobs had on the computer industry while at Apple was introducing the personal
computer. Jobs was bona fide visionary, who created the personal computer, Apple, in
his garage. The Apple changed people's view on operations a computer could perform.
From computers performing bean counter operations and federal taxes to executing
individual's personal business operations. Jobs lead a hardware revolution by reducing
the size of computers to small boxes.

His development of the Macintosh re-introduced Xerox's innovative idea of

user-friendly interface using a mouse. The Macintosh used a windows interface which
contained picture-like icons representing a function or a program to be executed. The
user would use a mouse to move a cursor onto the icon and press a mouse button to
execute the function or program. Companies witness the success of the Macintosh's
user-friendly interface and copied its style to develop their software. Jobs, in the
nineties, will try to lead another revolution in software development for corporate
developers to use the OOP paradigm to solve the massive time and money problems it
takes to develop software.