Certain Habits

I’ve seen several links to this video clip from Fast Company’s “Innovation Uncensored” conference. In case you didn’t see it, Nike’s Mark Parker describes the advice he received from Steve Jobs upon becoming CEO:

“Get rid of the crappy stuff.” Classic.

And right, too. Production is becoming less capital intensive. Increasingly it makes more sense to rent a factory than to build one. Media is becoming less capital intensive. A teenager armed with a Flip and YouTube could reach a million people with the right idea. We’re living in an age of abundance.

Under conditions of abundance, there are three ways to make money. First, you can save people time. Second, you can help people express themselves. And third, you can entertain people.

For Nike, getting rid of the crappy stuff saves people time. They no longer have to sort through the dreck. And it helps people express themselves (including in community). Removing the crappy stuff leaves more room for truly great shoes … that can help people express their taste and become even better, cooler versions of themselves. And really great shoes are aesthetically pleasing. A trifecta of consumer surplus.

Editor in Chief?

Assume that more businesses are becoming like media companies. The pace of change is fast enough, and barriers to entry are low enough, that the time we have to extract profits from blockbuster products is shrinking. Like a book publisher, a consumer products company must surf the wave of product and market development to maintain high levels of profitability.

Should the role of the CEO be more like an “Editor in Chief,” “Executive Producer” or “Studio Boss” than corporate titan? Are the traditional levers of management—finance, operations, logistics, accounting, and human resources—becoming less important relative to product development and consumer needs in shaping the future of the firm?

If Steve Jobs and Mark Parker are right, the answer to that question may very well be “yes”.