The Product Leader
Do you know what kind of person should lead a company? Many people think it should be the finance-oriented guy, who keeps track of the numbers, doesn’t spend wildly, has a level-headed approach to everything. Others think it should be the sales-type guy, because he knows the markets, has a certain charisma, and can sell ice to eskimos. For my money, the guy in charge needs to be the product guy, the engineer.
I know you’re thinking, ‘Wait a minute – an engineer? They’re nerds! They don’t deal that well with people and they don’t have the best communication skills. What do they know about finance?’ On the whole, you’re right. But, then there’s the exception. And in life, there is always an exception. There are engineers who have great social skills, are excellent communicators and motivators. You know, leaders who are willing to take calculated risks. They know numbers, so finance isn’t a big leap for them. Most of all, they know product and how to build it.
In a business it’s very easy to lose sight of the core point of being in business – building and selling products. Without a product, there is no business. Engineers know how to do that, and Leadership-type Engineers are the enterprising blokes who keep a company relevant in the marketplace. They’re visionary and creative. They drive change and innovation. They demand process discipline and quality.
When you have a finance guy in charge, you get risk-averse concerns about spending too much on product development, about giving investors their dividend or share price every quarter. You’re focused on the numbers, not on what it is you have to build to stay competitive. These days in particular, they are looking short-term for investor return rather than playing the long game and ensuring market position and company security by taking calculated risks.
When you have a sales guy in charge, you get blue sky predictions, a reticence to raise prices when needed, and a general lack of attention to responsibly financing product development or an approach that anticipates mitigating risk. They want to say yes to every customer. They possess a generally reactive rather than proactive approach to business because, after all, they are trained to seek and react to customer needs, not anticipate them. They generally want to pair a customer with a product the company already has. They prefer gratification today rather than having to think about developing something that will help tomorrow.
Still, why an Engineer? The world is full of examples – Elon Musk, Steve Jobs, Alan Mulally, William Boeing, Henry Ford. Every company with a long and consistent track record of success has had a product-focused leader. Engineers drive process and discipline more than any other personality. What good does that do? Isn’t that restrictive to creativity and flexibility? It certainly can be. But, if it’s implemented and executed with an ‘only do what’s needed’ philosophy, it brings consistency, organization, rationality and quality to every product while avoiding too much bureaucracy and thereby encouraging creativity. With process everyone knows what the expectations and disciplines are that will lead to success. We are not reinventing the wheel or learning again what we have already experienced. It produces reliable data while aiding efficiency and lowering investment and production costs. See how an Engineer’s disciplined creative mindset eventually moves across all the other important aspects of business? Finance, marketing, sales, production.
I’ve said this before, but to my mind Alan Mulally is one of the finest business leaders of our time. His turnaround of Ford was monumental, a foundational change of a huge corporate juggernaut. It is mind-blowingly difficult to rapidly change the course of an aircraft carrier – that’s what all large corporations are. Elon Musk is incredibly product-oriented and driven by a steadfast vision of delivering game-changing products. Steven Jobs was a product fanatic, one who saw the value of linking product lines together. He drove quality and packaging obsessively and fanatically, with fantastic results. Henry Ford is probably the godfather of manufacturing process. These people all had design and development experience, whether they were degreed engineers or not.
So, when you start looking for a company to work for, or a stock to invest in, look at who’s leading that company. Product guys are the ones you want to put your money on.
