When Steve Jobs returned to Apple as interim CEO in the fall of 1997, the company was hemorrhaging cash and on the brink of bankruptcy. The company had been churning out multiple versions of each new product because of bureaucratic momentum and to satisfy the whims of retailers – not because the products were linked to a particular growth strategy.
For example, Apple had a dozen versions of their Mac computer. Job asked questions of his team like “Which version do I tell my friends to buy?” When he couldn’t get simple responses to his questions, he knew it was time to simplify the strategy.
Jobs had to take action. It’s said that at one big product strategy meeting, he grabbed a magic marker and a white board. On it, he drew a horizontal and vertical line to make a four-squared chart. “Here’s what we need,” he continued. Atop the two columns he wrote “Consumer” and “Pro”; he labeled the two rows “Desktop” and “Portable.” He soon cut 70% of the products the company was offering.
This was the first strategic key thrust/capability Jobs announced upon his return to Apple. Two laptops and two desktops – one each for both the commercial and consumer markets. This strategic focus proved to be a key to the Apple turnaround.
According to one observer, there was a stunned silence when Jobs presented the plan to senior leadership and the Apple board. “Jobs’ predecessor had been urging the board to approve more and more products every meeting,” one board member recalled. “Steve came in and said we needed to focus on fewer products. He drew a matrix with four quadrants and said that this was where we should focus.”*
Jobs bet that a laser-like focus on these two Key Thrusts/Capabilities would return Apple to relevance and profitability. That instinct turned out to be spot on. In 1997, the year Jobs returned to Apple, they lost $1.04 billion. However, in 1998, Apple would turn in a $309 million profit and they have not looked back since.
Apple stores, iPod, Digital Hub, iPhone and iPad were all Key Thrust/Capabilities that later became transformative products/capabilities which helped Apple dominate its industry and, at the time of this writing, become the most valuable company in the world.
Key Thrust/Capability Defined
A Key Thrust/Capability is a strategic priority. It is either a new product, service, or customer facing capability that will provide competitive advantage. Alternatively it can be an internal competency when optimized will help you win. Examples include:
One of Steve Jobs final Key Thrusts/Capability was Apple University. Rarely talked about, Jobs viewed this as an internal capability that would allow Apple to thrive long after he was gone.
What Key Thrusts/Capabilities do you need to lead your industry and achieve your goals?
5 Steps to Developing Your Key Thrusts/Capability
“The Riches are in the Niches”
~ Unknown
Download your copy of the Attribute Map Exercise Tool.
As the leader of your organization, you own strategy and are required to place strategic bets. Key Thrusts/Capability are the strategic bets you are placing to win your niche. This does not mean you have to do it alone. Seek plenty of advice inside and outside your organization. Let your team weigh in and offer their perspective. At the end of the discussion and debate the entrepreneur, founder or CEO, like Steve Jobs, needs to own the final decision.
Remember, the leader owns strategy.
If you’d like to learn more, the best next step is to schedule a consultation with Mark.
