Geoffrey Cain’s “Steve Jobs in Exile” examines the period when Steve Jobs was building NeXT after leaving Apple in 1985.
As I read it, I kept coming back to one lesson for hardware companies: bold vision and excellent marketing can create momentum, but they cannot compensate for a product that is too expensive, difficult to manufacture, or not ready to scale.
What NeXT Got Right
Jobs clearly understood the value of hiring excellent people.
Rather than building a very large team, he focused on bringing in people who were among the best in their respective fields. He also surrounded NeXT with respected figures from the technology industry, which helped the company build credibility and create strong market anticipation before its products were widely available.
He also made decisions with the long term in mind. NeXT selected a software architecture that supported object-oriented programming, making it more convenient for developers to build applications over time. It may not have been the simplest approach for the first release, but it gave the platform a stronger foundation for the future.
Another interesting decision was to start shipping computers before the software had reached a stable version 1.0. NeXT later offered to upgrade the first computers it had sold, but shipping early allowed the company to collect feedback from real users. That feedback exposed a wider range of issues and helped the team decide what needed to be fixed first. (This approach is somewhat similar to the ‘soft launch’ of the much more recent Pulse Mindfulness Ring).
Jobs was also a master salesman. He raised tens of millions of dollars before NeXT had a product, making very effective use of his track record and natural charisma. Most hardware founders are not Steve Jobs, of course. However, the importance of raising enough investment to develop and launch a hardware product should not be underestimated.
Key learning: A hardware product does not need to be perfect before you start gathering feedback. However, you do need a controlled process for testing assumptions, identifying problems, and improving the product before moving into high-volume production.
Where Ambition Created Avoidable Problems
NeXT also burned through millions of dollars on details that made little or no difference to its customers.
The company reportedly paid $100,000 for a logo in the 1980s. It also selected expensive materials, including a magnesium enclosure, that pushed the computer beyond the price its target market was prepared to pay.
Some of its technology choices were also ahead of what could be manufactured reliably at the time. Surface-mount technology for PCB assembly was still relatively immature, and many aspects of the computer had not been designed for efficient manufacturing and assembly.
The result was high defect rates and an extremely slow production ramp-up during the first few months.
Key learning: This remains a common risk for hardware companies. A material, manufacturing process, or design feature may be technically impressive without being commercially sensible or ready for production. A thorough DfX review and NPI process should examine manufacturability, assembly, quality, reliability, testing, cost, and scalability before these decisions become expensive to reverse.
NeXT made matters worse by hiring a sales force before the product was ready and failing to plan properly for the slow ramp-up into mass production.
The company also signed major distribution agreements without demonstrating sufficient commitment to its distributors. IBM devoted a lot of resources to making its partnership with NeXT work, only to be let down in a very visible way. That effectively killed the deal.
My Takeaway from ‘Steve Jobs in Exile’
Jobs was exceptionally good at attracting talent, investors, partners, and attention.
However, the NeXT story shows that market anticipation must be matched by production preparation.
For companies developing or transferring an innovative hardware product, a strong launch plan needs to connect product architecture, customer validation, cost targets, manufacturing design, pilot production, and commercial commitments.
We are strong proponents of a structured path from design handover to mass production. The objective is to bring these decisions together early, before a company makes promises that its production system is not yet ready to keep.
