Case Study Analysis

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JobsCaseStudy-TransformationalLeadershipSteveJobs.pdf

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Case Learning Outcomes

By the end of this case study, students will:

• gain a better understanding of transformational leadership;

• better understand charismatic leadership;

• learn the four factors of transformational leadership as defined by Bass and Avolio (1994);

• gain a better understanding of Kouzes and Posner's (2012)five practices of exemplary leaders

and how they link to transformational leadership.

Introduction

Steve Jobs was an entrepreneur, visionary, businessman, CEO, father, husband, and inspiration

to millions of people. As a creative entrepreneur, his passion for perfection and ferocious drive

revolutionized six industries: personal computers, animated movies, music, phones, tablet computers,

and digital publishing (Isaacson, 2011). His brilliance in technology and design, and his attention to

detail, coupled with his often Jekyll and Hyde treatment of employees and associates make Steve Jobs

both a hero and villain for many of those who worked with him during his lifetime. The revolutionary

products he was credited with creating, the culture he established at Apple that remains to this day, and

the growth and profitability of the organizations he led would give credence to the belief that he was a

transformational leader. The stories of his harsh and often unfair treatment of certain employees

suggest that he was consistently not transformational, and that he instead used coercive power to

achieve goals.

Transformational Leadership and Charisma

Transformational leadership is extremely powerful and effective, but requires committed leaders with

the skills to create a deep sense of intrinsic motivation to achieve the shared vision and goals of the

leader and organization. Transformational leadership also takes time to achieve, usually many years.

According to Burns (1978), true transformational leadership creates a strong connection between a

leader’s and their follower’s values and vision. These common values and vision then create a strong

desire to achieve common goals. Leaders must also match their behavior to different follower styles to

ensure that each follower receives what is needed to create the intrinsic motivation required to

maximize their full potential and bring about true transformation.

According to Bass and Aviolio (1994) transformational leadership consists of four factors. Idealized

influence focuses on the emotional aspects of leadership and requires leaders to act as role models for

others. Inspirational motivation focuses on creating the intrinsic motivation needed to meet the

standards or expectations of the leader. Intellectual stimulation occurs when leaders allow and

encourage others to be creative and innovative. Individualized consideration focuses on leaders creating

a supportive environment for others and providing the coaching others need to fully actualize their

potential.

Kouzes and Posner (2012) define five practices of exemplary leaders that translate directly to

transformational leadership. Model the Way refers to a leader aligning actions with values. Inspire a

Shared Vision is probably the most difficult exemplary practice to achieve because a leader must first

create a clear vision of the future that everyone can understand, then effectively communicate that

vision, and finally inspire others to achieve that vision. In Challenge the Process a leader creates an

environment where followers are encouraged to think critically and creatively. In Enable Others to Act

leaders are required to give their power away and create a sense of ownership within those they are

leading. To Encourage the Heart a leader celebrates the small victories and finding meaningful ways to

say thank you and show appreciation for others.

The antithesis of transformational leadership is pseudotransformational leadership. The key aspect to

determine if a leader is pseudotransformational is the intent of the transformation: was it done for the

organization or the leader? The most famous examples of agenda pseudotransformational leaders

include Adolf Hitler, Benito Mussolini, and Saddam Hussein. All three of these examples initially

appeared to place the best interest of their countries at the center of their actions. Unfortunately, the

leaders either focused on their personal schemes and concealed this agenda effectively or became self-

absorbed after achieving influence and power; either way, the result was the same, and the focus was

on the leader. Pseudotransformational leaders also exploit others and situations for their benefit.

Weber (1947) first discussed charisma as a special gift that certain people use to create exceptional

influence over others. Yukl (2006) defined charismatic behavior as: (a) articulating an appealing vision,

(b) strongly communicating the vision, (c) taking risks and providing self-sacrifice for the vision, (d)

communicating high expectations, (e) showing confidence in others, (f) aligning leader behaviors with

the vision, (g) managing follower thoughts of the leader, (h) building an identification for the

organization, and (i) empowering others.

Background—Insight to Later Years

Steve Jobs was adopted, and this fact had significant influence on him throughout his life. Andy

Hertzfeld, who worked with Jobs at Apple in the early 1980s, believed that “the key question about

Steve is why he can’t control himself at times from being so reflexively cruel and harmful to some

people . . . That goes back to being abandoned at birth. The real underlying problem was the theme of

abandonment in Steve’s life” (Isaacson, 2011, p. 5); this feeling of abandonment was likely reinforced

when Steve was forced to leave Apple in 1985.

Steve Jobs was born on February 24, 1955. His biological parents were Joanna Simpson and Abdulfattah

John Jandali, the son of a wealthy Syrian national. Joanna and Abdulfattah were not married when Steve

was born and, because of the cultural issues at that time, they put him up for adoption. Paul and Clara

Jobs, a machinist and a housewife, eventually adopted Steve in August 1955.

When Jobs began school it became obvious he was exceptionally bright. He had learned to read before

starting the first grade; he skipped fifth grade after he tested out at a tenth grade level but, because he

was moved up among older students, he became the target of bullying in the seventh grade (Isaacson,

2011). This incident may be one reason he would, later in life, express sophisticated levels of emotional

and psychological bullying himself (Brennan, 2013). To protect him his parents moved to Los Altos, CA,

in the Cupertino school district. While at Homestead High School he began to explore and develop his

interests in music, creativity, literature, electronics, primal screaming, health and fitness, vegetarianism,

and even drugs.

After high school Jobs attended Reed College, where one incident, described by Chrisann Brennan

(2013), highlights his on-and-off personality: charming and friendly at one moment then instantly

turning dark and away from people. Steve and a friend decided to hitchhike to Mexico for a quick

vacation. The night before they left she observed Steve ignoring his friend. “I had a feeling that Steve, so

crippled that he needed to be the center of my focus, had actually blanked his friend right out of the

room.” She stated “In retrospect, it seems to me that there was a dark vortex next to Steve for as long

as I knew him. . . Through the years I’d see that buttoned-up look of shock and loss overcome people

when they went from inclusion to invisibility when they were with him” (Brennan, 2011, p. 68).

He dropped out of Reed after a semester, became one of the first employees at Atari, did a pilgrimage

to India, and then he began a collaboration with a friend, Steve Wozniak that would eventually lead to

the development in 1976 of the Apple I computer. This early partnership was the beginning of what

eventually would become, on January 3, 1977, the Apple Computer Corporation (Isaacson, 2011).

The Early Apple Years

Jobs and Wozniak’s first design was the Apple I, a crude, expensive machine. It was basically a circuit

board mounted on top of a monitor with a keyboard attached. Its development highlighted the

relationship between Wozniak and Jobs: “Woz” did all the design and coding, while Jobs guided the

design and sourced and cajoled people for some of the parts, such as memory chips he talked Intel into

providing for free. Jobs also created one of the first business plans for the fledgling company: he

convinced Wozniak to stop giving away his board schematics, and instead they would build and sell

completed circuit boards for a profit.

“Every time I designed something great, Jobs would find a way to make money for us,” said Wozniak

(Isaacson, 2011, p. 62). From this, Wozniak and Jobs pooled their money and formed Apple Computer.

The successor to the Apple I, the Apple II, was a more complete machine—competitive pressure meant

that it had to be a fully integrated consumer product, and Jobs' role made it so. He insisted on a sleek

case, fan-less power supply, and a straight line circuit board. The latter was due to the influence of Jobs’

father, a machinist who was extremely neat and organized, and these habits had become ingrained in

Jobs. Jobs’ passion for perfection on the Apple II led to his instinct to control, a pattern that would

remain with him throughout his life.

The development of the Apple II consumed Jobs and reinforced his penchant for perfection. During this

period he established his reputation for stubborn insistence for his vision to be realized. For example,

the Pantone Company, which produces color standards, had two thousand shades of beige, none of

which sufficed for Jobs as a case color. Jobs spent days “agonizing over just how rounded the [case]

corners should be” (Isaacson, 2011, p. 83). He wanted a one-year warranty for the Apple II instead of the

industry standard ninety days. And he began to be tough on people. Jobs became increasingly tyrannical

and critical. Early investors in Apple heard Jobs express his frustration at young programmers, Randy

Wigginton and Chris Espinosa. Both programmers stated that Jobs would openly criticize their designs

and work without thoroughly reviewing what they had created (Isaacson, 2011).

The Apple II was a huge success for the next sixteen years, with close to six million units sold. Wozniak

received the credit for its revolutionary circuit board design and related operating system software, but

it was Steve Jobs who integrated everything into a sleek, consumer-oriented package. Steve also is

credited for creating the company around it. As publicist Regis McKenna stated, “Woz designed a great

machine, but it would be sitting in hobby shops today were it not for Steve Jobs” (Isaacson, 2011, p. 84).

The Apple III and the Lisa followed: but neither product was well-received. However, the development

of the Macintosh was a huge success and the machine that set the standard for computers going

forward with its graphical interface and mouse. The Macintosh brought to full fruition Jobs’ intensity,

mood swings, and the contrasting generation of love–hate among his employees.

Ann Bowers, who joined Apple in 1980, became an expert in dealing with Jobs’ perfectionism,

petulance, and prickliness during the Macintosh development program. She realized that he could

barely contain himself: “He had these huge expectations, and if people didn’t deliver, he couldn’t stand

it. He couldn’t control himself. I could understand why Steve would get upset, and he was usually right,

but it had a hurtful effect. It created a fear factor” (Isaacson, 2011, p. 121); but there were upsides to his

demanding behavior. People who were not crushed ended up being stronger. They did better work, out

of both fear and an eagerness to please. The staff learned that if Jobs decided you knew what you were

doing, he would respect you. Over the years, his inner circle contained many more strong people than

toadies.

Jobs wanted perfection—insanely great machines, as he described them. He could not make trade-offs

with machine design or quality. One example illustrates this: the Macintosh boot-up time. Jobs believed

it was too slow, and he wanted to shave ten seconds from it. The design engineer, Larry Kenyon, tried to

object but Jobs then asked him “if it could save a person’s life, would you find a way to shave ten

seconds off the boot time?” (Isaacson, 2011, pp. 122–123); he then used a math example to explain his

point. Suitably impressed, Kenyon came back a few weeks later and it booted up twenty-eight seconds

faster; Jobs was able to motivate by looking at the bigger picture.

The result was that the Macintosh team came to share Jobs’ passion for making a great product, and not

just a profitable one. Jobs’ style could be demonizing but also inspiring. Over time it infused Apple

employees with a passion to create groundbreaking products and a belief that the impossible was

possible. The Macintosh project finished behind schedule and over budget mainly due to Jobs’ insistence

on perfection; it also had a cost in hurt feelings across the team. As Wozniak later stated, “Steve’s

contributions could have been made without so many stories about him terrorizing folks.” Wozniak

thought that the Macintosh project would have been even more successful if it had been a blend of both

he and Jobs, but Jobs would not concede being at the center of attention and pushing people to do

more. “I’ve learned over the years that when you have really good people you don’t have to baby

them,” Jobs later explained, “By expecting them to do great things, you can get them to do great things”

(Isaacson, 2011, p. 124).

Steve Jobs and Apple’s Corporate Culture

Steve Jobs is credited with creating a unique corporate culture at Apple, one formed around creativity,

attention to detail, and beautiful design. This culture emerged from Jobs making his imprint on the

company through his ideals, beliefs, personal strengths and weaknesses, and, particularly, his intense

drive to design perfection (at least his vision of perfection) in all of Apple’s products. While an in-depth

examination of how Jobs created this culture is beyond the scope of this paper, one story exemplifies

Jobs’ influence on the company’s culture. Vic Gundotra who headed Google+ (Google’s social media

site), in 2008 recalled a phone conversation he received from Jobs while at religious services one

Sunday:

Jobs left a message saying he had something "urgent to discuss." Gundotra returned his call almost

immediately:

"Hey Steve — this is Vic," I said. "I'm sorry I didn't answer your call earlier. I was in religious services, and

the caller ID said unknown, so I didn't pick up."

Steve laughed. He said, "Vic, unless the Caller ID said 'GOD', you should never pick up during services."

I laughed nervously. After all, while it was customary for Steve to call during the week upset about

something, it was unusual for him to call me on Sunday and ask me to call his home. I wondered what was

so important.

"So Vic, we have an urgent issue, one that I need addressed right away. I've already assigned someone

from my team to help you, and I hope you can fix this tomorrow," said Steve.

"I've been looking at the Google logo on the iPhone and I'm not happy with the icon. The second O in

Google doesn't have the right yellow gradient. It's just wrong and I'm going to have Greg fix it tomorrow.

Is that okay with you?"

The CEO of Apple — the tech visionary who revolutionized personal computers, the way we listen to

music and the way we think of mobile devices — was worried about the yellow in the second "O" in

Google. Needless to say the problem was fixed, and Gundotra says it taught him a lesson on leadership

and "passion and attention to detail."

"It was a lesson I'll never forget," wrote Gundotra. "CEOs should care about details. Even shades of

yellow. On a Sunday." (Peralta, 2011)

After the Macintosh

Jobs’ career had a number of highs and lows. The low point was his decision to leave Apple in 1985,

after he clashed repeatedly with John Sculley (Sculley had been Jobs’ choice for CEO in 1981). Jobs had

created what amounted to a company-within-a company by isolating the Mac team with him as its

leader. This tactic pitted the Mac team, a money loser for Apple in its early years, against other parts of

the company that actually made money (Siegel, 2011). Sculley believed the Macintosh was not a fully

developed platform, and for that reason the Apple II had to remain the company’s flagship computer

until the Mac’s problems were resolved. Jobs believed otherwise; he wanted Apple to lower the Mac’s

price and increase its advertising budget, and Sculley refused. He then demoted Jobs as head of the Mac

project, and five months later Jobs resigned from Apple (Coursey, 2012).

Jobs’ creativity and drive for perfection continued after he left Apple. Following his departure, Jobs and

several former Apple colleagues founded the NeXT computer company. The NeXT computer, a stark

black cube unlike anything on the market, was not a success, but its operating system became the basis

for the Mac OS X operating system years later, a version of which is still in use today on Mac computers.

NeXT led to Jobs purchasing Pixar from George Lucas; Pixar’s first feature produced, Toy Story, was the

first ever all-computer animated full length feature film. The success of Toy Story solidified Pixar and

helped make Jobs a billionaire. In 1996, a then struggling Apple purchased NeXT, and, in 1997, Jobs

became interim CEO of Apple. This began his most impressive period of innovation and design: the

iTunes software service, the iPod in 2001, the iPod mini in 2004, the iPhone in 2007, the App store for

the iPhone in 2008, and the iPad in 2010. Many of these were ground-breaking and first-of-a-kind

developments. All the new products featured beautiful designs and simple operation which were

hallmarks of Jobs’ insistence on consumer-focused products. Apple thrived during his second tenure at

the helm. While his behaviors were still intense, the “pause” in his career allowed Jobs to reflect on his

past behavior, and adjust to allow for more creativity while not being as demanding and caustic. Jobs did

take time to celebrate the small victories; an example that continues today are the Apple Events held

periodically to showcase new innovations. Today, Apple is the most valuable company in the U.S. valued

at 672 billion dollars (Kell, 2015). Unfortunately, Steve Jobs was diagnosed with pancreatic cancer and

after a long battle, died at his home in Palo Alto, California, on October 5, 2011.

Summary

Steve Jobs was a controversial leader, one who elicits a mix of both admiration and disdain from those

who knew and worked with him. He was the driving force and visionary behind some of the most

popular consumer products today. On the other hand he was, at times, a ruthless, insensitive egoist who

did whatever it took to have his way. But the results he achieved cannot be denied; he twice led Apple

to incredible success, and in between his tenures there he created a software system, and bought a

company—Pixar—that revolutionized animation and became highly successful. The fact that Apple

continues to realize financial success, four years after his death, is a tribute to the culture he instilled at

Apple, one that is dedicated to creating great products.

Steve Jobs was a true enigma: intelligent, creative, driven, visionary, and a person who could be both

encouraging and intimidating to those who worked for him. He both helped and hurt people, but in the

end his influence was positive. The proof of the success of his leadership style is Apple itself, as well as

the many employees who could look past his coarseness and appreciate that he made them better.

Questions for Discussion

1. According to Burns (1978), transformational leaders are linked to their followers and create

intrinsic motivation that drives followers to achieve their fullest potential. Describe how Jobs did

or did not maximize the full potential of those he led.

2. Was Steve Jobs charismatic? Is charisma necessary for transformational leadership?

3. Was Steve Jobs a transformational leader? Please discuss in terms of Bass and Avolio’s (1994)

four factors of transformational leadership (Idealized Influence, Inspirational Motivation,

Intellectual Stimulation, and Individualized Consideration).

4. Kouzes and Posner (2012) defined five practices of exemplary leaders that can guide a

transformational leader’s behavior (Model the Way, Inspire a Shared Vision, Challenge the

Process, Enable Others to Act, and Encourage the Heart). Briefly analyze Jobs’ behaviors in terms

of Kouzes and Posner’s five practices of exemplary leaders.

5. Was Steve Jobs a pseudotransformational leader? Please provide examples from the case study

to justify your answer.