Creative Destruction?

By Brad Thomason, CPA


Steve Jobs died yesterday and the flow of adjectives today – which under most circumstances would seem so clichéd – from my perspective seem in fact quite fitting.  Superlative?  Sure; but really not exaggerated.  Steve Jobs really was a rare guy.

In addition to the many labels that have been associated with him (Innovative, Visionary, Brilliant) there are also a handful of core themes that define his work.  His products were both hallmarks of usability and simplicity of design, and the way in which he rolled them out came to be synonymous with the concept of creative destruction.

Creative destruction is essentially the idea of out-with-the-old-and-in-with-the-new, writ large.  The theory goes that the supremacy of the old thing is destroyed by the new thing, and Jobs was known for creating great innovations that ended up overshadowing past innovations.  His famous ouster as the head of Apple was tied to an early round of this very behavior: he wanted to push the new Mac while a contingent of the old guard wanted to protect the legacy cash cow product (the Apple II line).  The old guys won the battle.  Jobs left.  But of course we know who won the war.

In hearing the various news stories today and thinking about the examples that Jobs the Executive left for those of us who care about such things, it strikes me that maybe the genius of Steve Jobs was tied to an understanding of the creative destruction process that was different than the garden-variety understanding that most of us have been taught.

There’s a line in the Bible that refers to the fact that eventually all things of this world are consumed by “rust and moths.”  In the current day, with the economic troubles we’ve encountered, examples of things that once had value but no longer do, are not hard to find.  Not hard at all.  Perhaps it was a keen focus on this tendency that lead to his drive for the next new thing.

It’s a subtle difference, but I think an important one.  John Sculley and the old-school Board members took the position that it was reckless to endanger the current product by throwing focus behind something new.  How foolish would they look if they brought about the end of their own annuity?

But I think Jobs saw it from the reverse angle.  I think he realized that the annuity was on its way to being dead anyway, irrespective of what they did.  If it wasn’t going to last, they had better be about the business of getting the next one prepped and ready.

Or maybe it wasn’t quite that clinical.  Maybe instead he was just bull-headed and took the view that if his creation had to die, he would be the one to determine on what terms.

Or maybe, as a designer, he figured that if he could invent something better, it was just a matter of time before the competition thought of it too.  The idea of beating the other guy to market is not a very complicated thing to think about (although it is probably fair to say in Jobs’ case he may have been giving the competition more credit for out-creating him than they were due, but that’s another story).

Via any of those paths though you get to the same conclusion:  If the world is a place where the new replaces the old, then the new is where the focus should be.  The new doesn’t kill the old, so much as it takes over when the old inevitably dies.

Maybe Steve Jobs just got that better than the competition…and the rest of us, for that matter.

If you look at Newton and Einstein and Edison and the rare few others of that tribe of peers, the realization of a subtle difference, followed by vigorous expression of that knowledge, are the things which gained them membership in the elite circle.  Many today have nominated Jobs for inclusion, and I’ll cast my vote in his favor if anyone shows up to ask.  To my way of thinking he earned his way in by following exactly the same path.

Meantime, I’m going to spend some more time thinking about this whole idea of creative destruction, its implications for the changing landscape that we face amidst this economic slowdown, and the possibility that just maybe we’ve all been looking at it a bit wrong.  All of us, that is, except Steve Jobs.


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