How Steve Jobs Succeeded By Failing

Before achieving astounding success, Steve Jobs had to experience disappointment and failure.

Over at NRO, Nick Schulz points out that before the world knew Steve Jobs the astronomically successful businessman, there was Steve Jobs the business failure:

Everyone today thinks of Jobs as the genius who gave us the iPod, MacBooks, the iTunes store, the iPhone, the iPad, and so on. Yes, he transformed personal computing and multimedia. But let’s not forget what else Jobs did.

Jobs (along with Steve Wozniak) brought us the Apple I and Apple II computers, early iterations of which sold in the mere hundreds and were complete failures. Not until the floppy disk was introduced and sufficient RAM added did the Apple II take off as a successful product.

Jobs was the architect of Lisa, introduced in the early 1980s. You remember Lisa, don’t you? Of course you don’t. But this computer — which cost tens of millions of dollars to develop — was another epic fail. Shortly after Lisa, Apple had a success with its Macintosh computer. But Jobs was out of a job by then, having been tossed aside thanks to the Lisa fiasco.

Jobs went on to found NeXT Computer, which was a big nothing-burger of a company. Its greatest success was that it was purchased by Apple — paving the way for the serial failure Jobs to return to his natural home. Jobs’s greatest successes were to come later — iPod, iTunes, iPhone, iPad, and more.

For those who were paying attention to the computer industry at the time, the unceremonious dismissal of Jobs from Apple (which was preceded a few years earlier by the departure of his friend and co-founder Steve Wozniak from day-to-day operations at the company) was something of a shock, and was taken by some as the sign of a sea change in Silicon Valley. The days of the geeks and the entrepenuers were over, it was said, and it was time for the businessmen to take control. The Dot-com boom in the 90s, combined with the fact that the new, more corporate leadership at Apple was largely letting the company sit still while Microsoft, Intel, and Dell had the field virtually to themselves, sort of put the lie to that. However, it wasn’t until Jobs returned to Apple and, borrowing an idea from the guys at Napster, came up with a revolutionary new way to sell and listen to music. And the rest was history.

Before that happened, though, Jobs had failed. He didn’t seek a government bailout. He didn’t whine and complain, He just moved on, and bided his time. The one thing that Schulz leaves out of his history is Jobs’ role at Pixar, which started as a company that Jobs purchased from George Lucas after he left Apple. That company revolutionized animation in the movies, and on television, and it probably wouldn’t have existed but for the failure of Lisa and Jobs’ departure from the company he founded.

Schulz concludes:

There’s a moral here for a Washington culture that fears failure too much. In today’s Washington, large banks aren’t permitted to fail; nor are large auto firms. Next up will be too-big-to-fail hospital systems. Steve Jobs is a reminder that failure is a good and necessary thing. And that sometimes the greatest glories are born of catastrophe.

This isn’t a new concept, of course, Joseph Schumpeter came up with the idea of

“The opening up of new markets, foreign or domestic, and the organizational development from the craft shop and factory to such concerns as U.S. Steel illustrate the same process of industrial mutation-if I may use that biological term-that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of Creative Destruction is the essential fact about capitalism. It is what capitalism consists in and what every capitalist concern has got to live in. destruction” long ago, and stated it thusly:

Failure in the market breeds success, and policies that tend to shield businesses from the consequences of failure are harmful because they prevent the economy from adjusting properly. Business failure means pain, loss, and humiliation, but its also a signal from the market that what you tried to do didn’t work and that it’s time to try something new. Whether he understood it consciously or not, Jobs acted throughout his career in recognition of this basic fact of life. Rather than allowing a business failure to discourage him, he kept trying to reach for something new and, in doing so, he’s enhanced the lives of countless numbers of people.

Washington would do well to recognize the lesson that Jobs’ career teaches us. Failure isn’t a bad thing. In fact, it’s absolutely necessary to success.

FILED UNDER: Economics and Business, Science & Technology, ,
Doug Mataconis
About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010 and contributed a staggering 16,483 posts before his retirement in January 2020.

Comments

  1. Ben Wolf says:

    Yes, Jobs learned the way to success in the modern business environment was whole-sale rent seeking through economic and political manipulation. What an inspiring figure.

  2. Dave says:

    IMPORTanT TO NOTE: Jobs was only able to recover from those early failures because he had a multimillion dollar social safety net (in the form of a big stinking hefty severance package.)

    History is filled with stories of men and women failing and never recovering because they lacked basic support. Those stories just aren’t written by Walter Isaacson.

  3. mattb says:

    I need to run to a dinner, but I have to point out that Schulz is playing abit with history in order to make his points. For example the Apple I and II’s early interations were released in the late 70’s — at a time when selling hundreds of personal computers was not as big a “failure” as it sounds. Likewise the Apple II went on to be one of the company’s best sellers and what secured the early company.
    (http://en.wikipedia.org/wiki/Apple_II_series)

    Likewise, while NEXT didn’t set the world on fire, it’s important to note that much of that development team and the Object Oriented structure of NEXT became critical components of successof the iOS.

    In this way, much of Jobs early career (like Lisa) and supposed “failures” can be seen a R&D investments. The entire firing of Jobs (and the mismanagement of the company by Scully) is the type of “at the time” failure (and in retrospect huge mistake) that deserves this sort of attention. It also serves as a prime example of how persuit of short term profits (especially driven by Wall Street/Analyst expectation) often run directly against long term innnovation and profitability.

  4. mattb says:

    BTW — the Apple III … now that was a failure.

  5. mattb says:

    Another points with Sultz’s history is that while Job’s was involved with “lisa” he was off that project in 1982 and concetrated his efforts on the first Macintosh. Calling “Lisa” his failure is a bit of a stretch.

    The real reason for his firing was an internal battle of the egos between Jobs and John Scully (who he had brought to Apple in ’83). Scully use “Lisa’s failure” (and a industry wide sales slump) as a pretense for a hostile ouster.

    Shultz really should have spent a bit more time on the Wikipedia page (or reading a few of the many histories of apple) before crafting his particular narrative.
    http://en.wikipedia.org/wiki/Steve_Jobs#Beginnings_of_Apple_Computer
    http://en.wikipedia.org/wiki/History_of_Apple#Apple_III

    Oh, and I got my history slightly wrong… NEXTStep — the OS from Next — was the basis first for OSX and architects from that team then went onto iOS.

  6. john personna says:

    I don’t think people who knew Apple and who knew Steve in 1985 were “shocked.” It was a tumultuous time, and Steve was even more “mercurial(*)” in his youth. I think I can say he was a brilliant and driven guy, but emotional and emotionally manipulative(*).

    He did amazing things though, and I wish him (and Apple) well.

    * – I won’t repeat as hearsay what were to me both 1st and 2nd hand accounts.

  7. @mattb: I don’t think Schultz was as interested in an accurate history as was trying to make a political point (that could then be extrapolated tot he current economy and government policy I guess).

    And while I agree with the general proposition that failure is often necessary on the road to success, I am not so sure that Jobs is as good an example as he is being made out to be. Yes, being fired from a company you founded sucks, but leaving that company and founding another one is hardly failure (Lisa or no),

    (And, I do remember the Lisa and the Apple III. The first computer I ever owned was an Apple IIc, in fact).

  8. Trumwill says:

    As an aside, NeXT had a front-end shell for Windows 3.1 (a replacement for Program Manager). I’m not a big Steve Jobs or Apple fan, but the man’s company’s product made Windows 3.1 far, far more user-friendly.

  9. Ron Beasley says:

    @Trumwill: Right on! Although IBM stuck us with Microsoft Apple forced Microsoft to provide a GUI. The reality is they did a really bad job but they didn’t have to do a good job because the had a monopoly. Yes,they had a monopoly because IBM chose their OS but in addition Apple’s closed system contributed – nobody but Apple can create a computer with the Apple OS. After all these years we finally have a decent MS product, Windows 7.

  10. OzarkHillbilly says:

    Schulz concludes:

    There’s a moral here for a Washington culture that fears failure too much. In today’s Washington, large banks aren’t permitted to fail; nor are large auto firms. Next up will be too-big-to-fail hospital systems. Steve Jobs is a reminder that failure is a good and necessary thing. And that sometimes the greatest glories are born of catastrophe.

    I really wonder why you insist on qouting idiots Doug. If Schulz can’t tell the difference between firing Steve Jobs and letting the entire finacial industry (and yes it would have been the whole of it, they were and are way too incestuous) collapse, then he is just plain and simply a complete idiot. But of course, he is probably one of the idiots who thinks putting in regulations that would avoid such a situation or prevent a bank from getting too big to fail to begin with is “anti-capitalism”.

    Oh. Wait a minute, he is from NRO. Yes he is such an idiot.

  11. OzarkHillbilly says:

    I don’t think Schultz was as interested in an accurate history as was trying to make a political point

    There is a word for people who do that Steven. They are called “liars”.

  12. mattb says:

    @Steven L. Taylor:

    @mattb: I don’t think Schultz was as interested in an accurate history as was trying to make a political point (that could then be extrapolated tot he current economy and government policy I guess).

    You don’t say

    That’s definitely the case. And I didn’t think that needed to be noted. What was striking to me is how — in order to make that case — he just made up the facts he wanted.

    The entire “Steve Jobs is a lesson in how governments and companies should b run” is frustrating in the extereme… in part because we could easily argue that Job’s demonstrates how extreme micromanagement is a good thing and something that should be repeated. But the large problem is that there’s a real chance that Apple will cease being Apple without Jobs (or rather when his 5 year plan runs out).

    In the end, Job’s tangable legacy may bare a lot in common with those of Ozymandias (Look on my works ye mighty and despair).