Finance is Narrative Not Numbers

On May 24th, Steve Jobs attempted a beheading. 

In an ill-fated coup effort, Jobs tried to rally Apple insiders to depose the reigning CEO of Apple, John Sculley. The primary sin of this Pepsi marketing executive turned Macintosh monarch? Holding Jobs accountable for hitting only 10% of forecasted sales in his division and missing product deadlines. In an April board meeting, Sculley had pushed to strip Jobs of his power and, after some debate, the board consented. Beyond missing the financial forecast, the Apple founder had been a disaster as a manager, with his trademark coarseness of character causing rebellion among his peers. In short, Jobs was unable to get support from fellow Apple leaders.

Despite many in his inner circle advising against it, Jobs went for glory to try and kick Sculley out of the company. Planning to do the deed while Sculley was in China, Jobs convened an executive team meeting on May 24th. Unbeknownst to Jobs, one of the executives he confided in, a Frenchman, betrayed Jobs and told Monarch Sculley what was going to happen. He canceled his trip, appeared at the meeting, and confronted the issue head-on by calling for a vote for who the leader should be. 

Sculley won the tally unanimously and Jobs left Apple entirely within 6 months. 

This decision by the board is a controversial one in Silicon Valley. On one hand, Jobs’s behavior and poor performance were absolutely a fireable offense. On the other…this was Steve Jobs. Upon his return, he built the most valuable technology company of all time. He entirely altered the paradigm for how humanity interacts with computing devices. But still, his inability to deliver financial results and misunderstanding of his fellow executives’ emotions made his dismissal wholly justifiable. 

So, what happened? 

Jobs’s transcendent product sense blinded him to the language of power within technology companies: finance. If he had known to say to the board some version of “Q2 deliverables were only at 10% of forecast, but because of our LTV:CAC ratio and percentage of pipeline in mid-market, we should see full quota attainment by Q4,” maybe his problems wouldn’t have been so serious. And again, if he had known how to use finance to placate his peers, in particular with its relation to product roadmapping, he would be able to more directly connect his expenditures to profits. Now, these are just hypothetical numbers and scenarios, but, for better or worse, the ability to confidently discuss numbers lends credibility to an executive who would otherwise have to rely on charisma alone. 

You see, working in business without knowing the language of finance is like going to Paris without speaking French. Sure, you might be able to bumble around the city, but to truly navigate it successfully you need to speak the native tongue. It allows you to talk with the citizens (departments) across the city (company).