Work is with People

Few business relationships have been more dramatic and volatile than that of Apple’s Steve Jobs and John Sculley. What seems like ancient history now was a watershed moment in the computer industry of the 1980s. For the newest generation of Apple fanatics, who believe that the company’s legacy dates back only as far as the iPod, there was a time when Jobs, an acknowledged industry genius, was actually fired by the company he co-founded. And it is that story that organizational behaviorist Diana McLain Smith uses to kick off her timely new book, “The Elephant in the Room: How Relationships Make or Break the Success of Leaders and Organizations.”

Calling it a “cautionary tale,” Smith recounts the remarkable two-year bromance and breakup of Jobs and Sculley. It was January, 1983, and Apple, then a six-year old garage startup, was off and running. Prior to releasing the vaunted Macintosh computer, Jobs, just 28 years old, had visions of turning Apple into a dominant player in the computer industry and surpassing that great monolith, IBM. But he realized that the young, innovative company needed some professional leadership. When he met Sculley, a 44-year-old marketing wizard who was in line to become CEO of giant PepsiCo, the two hit it off immediately.

Pursuing him relentlessly, Jobs egged Sculley on by asking, “Do you want to sell sugar water for the rest of your life or change the world?” Sculley had all the right stuff from Jobs’ perspective and, after a couple of months of courtship and pressure, Sculley signed on. Smith provides a detailed and analytic account of the next two years as the relationship, built upon misplaced expectations and intense personality issues, deteriorated into chaos. By 1985, Sculley could no longer control the iconoclastic Jobs and gave Apple’s board the classic “him or me” ultimatum. Jobs was fired.

Smith suggests that had anyone involved in the process thought clearly about these two protagonists, they might have foreseen the inevitable conflict. “Though less noticeable at the outset, two other themes clashed rather than clicked: Job’s well-known disdain for institutional authority (You could say he built Apple and its products upon this disdain.) and Sculley’s corporately honed preference for institutional structure and control (to which his tenure at Pepsi was a tribute).”

Deconstructing a 26-year old corporate meltdown (which nearly sent Apple into bankruptcy and irrelevance) may seem like an odd vehicle upon which to build her case, but Smith does a masterful job of analyzing the actual signs and pressure points of the conflict to a useful end. (The irony is that it was Sculley who ultimately failed miserably and brought Apple to the brink of disaster, while Jobs returned 12 years later and transformed Apple into the bellwether innovation mega-success that is dominating the technology world today.)

As Smith makes clear, “Most leaders today can say a lot about organizations and individuals and about how best to manage and lead them. But we still know relatively little about relationships.” Despite the countless volumes on the self-help bookshelves about personal relationships, “very little of this work transfers easily or at all to the organizational world.”

One needn’t look further than the dysfunctional political relationships that have sent nations into paroxysms of economic and cultural chaos in recent years to realize how little leaders focus on these crucial and foundational elements of their organizations. “While many [leaders] believe relationships are important, few can tell you much about the patterns of interactions that define how their most important relationships work (or fail to work),” Smith writes. “Others view relationships in a purely transactional light, believing what one leader half-jokingly told me: `You hire employees, then people show up.’”

“The Elephant in the Room” is a primer in understanding and building strong organizational relationships. Smith offers a series of case studies in which leaders tango through difficult, often debilitating relationships without the slightest clue as to what might be done to improve the situation and turn troubled organizations into winners. She is clear that understanding relationships is no longer a soft skill.

“In our shrinking, shifting world of tighter interdependencies and tough competition, building strong relationships is no longer an elective; it’s a requirement,” she writes. “Leaders today must be able to forge relationships that can span divides, withstand constant pressure and uncertainty, help them learn and turn on a dime, inspire trust and confidence in a diverse set of constituents, and make the most of even the hottest conflicts.”

A partner at the Monitor Group, Smith is also a founding partner of Action Design, which dispenses advice about organizational learning. Her clear-eyed prescriptions are wrought from real-world consulting and her cases ring true. Most important, the “Taking Action” sidebars that populate the book offer real-world advice for the executive looking for a Monday morning take-back to the office after reading the book.

Aside from romantic connections, perhaps nothing can touch business relationships for volatility and irrationality. But quoting Woody Allen from “Annie Hall,” Smith recounts the joke: “A guy goes to a psychiatrist and says, ‘Doc, my brother’s crazy. He thinks he’s a chicken.’ Horrified, the doctor asks why he hasn’t committed him. ‘I would,’ the guy answers, ‘but I need the eggs.’” Difficult as relationships are, Smith points out, “we need what they give us, even if it’s all in our heads.”