Watch stocks you care about
The single, easiest way to keep track of all the stocks that matter...
Your own personalized stock watchlist!
It's a 100% FREE Motley Fool service...
Alan Deutschman is a best-selling business author whose books include The Second Coming of Steve Jobs and Change or Die. His newest book is Walk the Walk: The No. 1 Rule for Real Leaders. I recently talked with him about some of those leaders and got his perspective on Steve Jobs. The transcript below has been edited for clarity.
Mac Greer: What has most surprised you about Steve Jobs since you wrote the book back in 2000?
Alan Deutschman: I think you have to be impressed by Jobs' ability to reinvent himself and reinvent his company, when you see that Apple (Nasdaq: AAPL ) is really now this mobile devices company. Even though the success of the iPod, the iPhone, and the iPad has boomeranged to help promote sales of Macs in the old-fashioned computer world, they have really reinvented the company in these areas that it wasn't involved in a decade ago.
There's also his ability to cannibalize his own products; now you basically get an iPod for free as part of your iPhone. They took an extraordinarily successful product and kind of superseded it with a new product that has become even more successful.
Jobs' ability to reinvent the company and to put it on this course of continual reinvention, growth, and innovation has really been impressive and kind of fits into the story of his whole life and career, but you have really seen it in the past decade.
Greer: I want to present you with a few business leaders that you wrote about in Walk the Walk, and get your thoughts on how they walk the walk. Let's begin with Berkshire (NYSE: BRK-B ) CEO Warren Buffett.
Deutschman: In most industries, you will find one company or one leader who really does things differently than everyone else; Buffett is a great example of this. So many other investors on Wall Street would talk about the importance of the long-term focus, and Buffett really did it.
Through all the phases in the market where everyone was trying to cash in and go for short-term profits, Buffett really has maintained this incredible long-term focus over the course of his career. I find so often that leaders are the rare individuals who actually do what everyone else gives lip service to, so I think Buffet is a great example of that.
Mac Greer: How about Wal-Mart (NYSE: WMT ) founder Sam Walton? I know one of the things you wrote about is how he stayed in budget hotels, so this is not a guy who lived high on the hog.
Deutschman: That is right. Walton held frugality and efficiency as the highest values for this company. There is a scene in my book where some of Sam Walton's colleagues were driving kind of a mid-range rental car, and he made them bring it back and get the cheapest rental car they could get. That is what Walton would drive, and he expected his people to be extremely tight with the company's money, as he was.
Greer: And Ray Kroc built McDonald's (NYSE: MCD ) .
Deutschman: In Walk the Walk, I talk about leaders having to show by their actions which value they hold highest for their company. Ray Kroc had several values, but really the top one was cleanliness; the man was a neat freak.
When he was several blocks from a McDonald's, he would pick up any trash he found on the sidewalk or street, and as he was coming through the parking lot, he would pick up discarded bags, wrappers, and gum. He would walk into a McDonald's with his arms filled with garbage, and the people who worked there would see the head of the company coming, having essentially worked as the clean-up guy.
It really drove the point home about how it was everyone's job to be vigilant about cleanliness. By valuing that most, it enabled them to achieve their other goals: having restaurants for families and convincing people that very inexpensive food could still be healthy because it was made in a very clean environment. It is hard to imagine today how many CEOs would be picking up trash in the parking lots of their companies or restaurants.
Greer: And finally, Amazon (Nasdaq: AMZN ) CEO Jeff Bezos. You wrote about his decision to forego short-term profits.
Deutschman: Yeah. Jeff Bezos, from the start with Amazon, would say Amazon was going to be the world's most customer-centric company and that they were running it for the long term. So when Jeff actually did things that would be good for customers in the long run, he would subject it to fierce criticism by Wall Street stock analysts.
Amazon would give these really great deals on shipping, and the analysts would be like, "Jeff, you are leaving all this money on the table. Alan Deutschman would pay hundreds of dollars more a year for shipping, and you are giving him this great deal." Or Amazon would do things like allow customers to publish critical reviews of the products they were trying to sell.
Or they would give customers a notification if they were buying the same product that they had already bought from Amazon because of people like me; I have thousands of books and sometimes wind up buying the same book that I bought a couple years ago.
So Amazon would do things it perceived were good for customers and the company would benefit in the long run by creating customer loyalty, but probably losing a lot of money in the short run. In the early years, people said that Bezos had no idea how to run a company. Analysts called for the board of directors to remove him.
I think at this point, it has been proven over the long run that Bezos knew what he was doing. The flipside of that is if you put customers first, you are going to anger and alienate your other constituents, including business partners and investors. As one of Amazon's business partners, as the author of several books that it sells, sometimes I am not very happy about them allowing people to publish critical reviews of my books.
Greer: Is there an up and coming leader that is on your radar? Maybe a name that most people may not be familiar with, but someone that really intrigues you?
Deutschman: Someone who everyone is familiar with and who intrigues me is Mark Zuckerberg at Facebook. I see him as one of these people who seems to truly be driven by a vision rather than by making money or doing what a lot of people would think of as smart for business in the short run.
He is starting to distinguish himself as one of these people in the Steve Jobs, Bill Gates, Jeff Bezos mold who we are going to have with us for the course of his career, who going to work relentlessly toward this kind of bigger vision rather than worrying about racing to the point when he can take his company public or cash out. So I am intrigued by how Zuckerberg will turn out as a leader.
Greer: Do you think Facebook will go public, or do you think they will remain private -- or potentially even get acquired?
Deutschman: I really don't know. Zuckerberg has said that he is open to the idea of going public eventually, but he has also made moves to help provide financial rewards to employees, and I believe investors, without having to have a public stock.
On the one hand, he has reportedly kind of stacked the board where he has maintained a very high level of personal control over it. It is hard to tell. He clearly is someone who wants to maintain control of the company to help pursue his own long-term vision, and he has taken some moves that would allow him to do that, even if they were public. I can see it going either way.
I think with a company that is building on the scale Facebook is, it is hard to resist the IPO inevitably. But I do think that whether or not Facebook goes public, Zuckerberg will structure it so he can maintain control and be in a position of a founder/owner rather than just the CEO.
Read part 1 of the interview with Alan Deutschman and find out why "Steve Jobs Wants It Both Ways."
Amazon.com, Apple, and Berkshire Hathaway are Motley Fool Stock Advisor recommendations. Berkshire Hathaway and Wal-Mart are Motley Fool Inside Value recommendations. The Fool owns shares of Berkshire Hathaway.