Robber Barons to Cyber Barons
7 Leadership lessons from past and present business leaders.
During last month’s antitrust hearing, the CEOs of Facebook, Google, Amazon and Apple were questioned over the tremendous power that these companies wielded and the market monopolies that they arguably enjoy. Bar a few hiccups, the four leaders handled most of the questions deftly. While the hearing itself mostly stuck to script, one of the more interesting moments was when one of the congressmen referred to the quartet as the ‘cyber barons of the 21st century‘ and compared them to the robber barons of the 19th century.
To the uninitiated, the robber barons of the 19th century refer to past industry giants who founded hugely successful companies during America’s golden age of economic growth. The term ‘robber barons’ was used as a slur to suggest that these leaders had become rich on the backs of the poor. Through creating monopolies and stifling competition. Cut to the 21st century and the tech titans of today are accused of doing much the same if not more. Hence the term — cyber barons of the 21st century.
Through this article, I do not intend to scrutinize the business processes or stand in judgement of these business luminaries. There has been plenty of commentary on that. Rather, I would like to look at the broad leadership lessons that can be drawn from the lives of these entrepreneurs who have come to define the times that they live(d) in.
Robber Barons of the 19th Century
The late 19th and early 20th centuries was a time of great business upheaval in the United States. Captains of Industry such as Andrew Carnegie, Henry Ford and John Rockefeller laid the foundation of extremely successful companies across sectors such as steel, automobile and oil. They also led the establishment of charitable foundations and academic institutions such as the Carnegie Mellon University and the University of Chicago.
Andrew Carnegie
Carnegie, who became one of the richest Americans in history through his steel trade, was a firm believer in the creation and pursuit of wealth as being essential for the betterment of humankind. In his essay titled, ‘The Gospel of Wealth’, Carnegie wrote –
The contrast between the palace of the millionaire and the cottage of the laborer with us to-day measures the change which has come with civilization. This change, however, is not to be deplored, but welcomed as highly beneficial. It is well, nay, essential for the progress of the race, that the houses of some should be homes for all that is highest and best in literature and the arts, and for all the refinements of civilization, rather than that none should be so. Much better this great irregularity than universal squalor.
However, to imagine Carnegie to be a rapacious, money-chasing businessman, would be to do him a great disservice. For Carnegie was one of the leading philanthropists of his time, giving away as much as 90% of his fortune to charities and universities. His attitude towards business also reflected his firm belief in taking everyone along. Napolean Hill captured Carnegie’s leadership philosophy in his book Think Your Way to Wealth’. Carnegie believed that great leaders are always working toward an overarching goal. “Nothing great is ever achieved without a definitive motive,” Carnegie told Hill.
Lesson #1: Spend time carefully thinking about the Objectives and Key Results that you want to achieve as a product or business leader. Use them to guide your product roadmap and feature prioritization. Keeping an eye on the chosen metric will allow you to measure if you are on track towards achieving your OKRs or pivot if necessary.
Henry Ford
The founder of the Ford Motor Company, Henry Ford adopted innovative product methods to reduce the cost of the iconic Model-T to $260, thus making it a car for the mass market. His empathy towards his employees was manifest in his policy of increasing worker wages to $5 a day from the then $2 a day.
Ford did not subscribe to the philosophy of asking customers what they wanted, in order to build successful products. He is famously quoted as saying, “If I had asked people what they wanted, they would have said faster horses.” To be sure, Ford neither invented the automobile nor the assembly line method of mass production. Rather, what helped him create an empire was his ability to identify what people wanted and to serve that market.
Lesson #2: To create breakthrough products, its not sufficient to merely ask your customers what they want. It’s as important to empathize with their lives, their aspirations and challenges they face. Understand what role does your product play in the lives of your customers, how do they employ it and for what job? These insights will help you build products and features that fulfill the unmet needs of your customers.
John Rockefeller
Founder of the Standard Oil Company, Rockefeller became America’s first billionaire in 1916. At the time, Rockefeller was worth nearly 2 percent of the national economy. To add some perspective on just how rich Rockefeller was, his wealth adjusted for 2020 would be more than the net worth of the five richest people today.
Often criticized for its monopolistic methods, Standard Oil captured as much as 90% of the American market. As ruthless a businessman he was, Rockefeller understood the importance of balancing his work and personal life. He regularly took a nap after lunch. He also installed a telegraph wire between his work and home. That way, he could spend three or four afternoons during the week at home, gardening and enjoying the outdoors. An early proponent of WFH! By scheduling downtime, he was able to pace himself and improve productivity in his working life.
Lesson #3: Your career is a marathon and not a 100m dash. Relax, take a break. Unclutter your mind and let it wander. Freeing up mental space can stimulate idea generation.
Cyber Barons of the 21st Century
Having spent some time with the Robber Barons, let’s move on to the so called Cyber Barons of today. For the purpose of this article, I will only consider the four CEOs who were summoned to the anti trust hearing. Conspicuous by their absence would be leaders such as Satya Nadella, Bill Gates, Steve Jobs, the Google founders and Elon Musk.
Jeff Bezos
In 1994, while he was working at the quantitative hedge fund D.E. Shaw, Jeff Bezos read that internet usage was growing 2,300% per year, and he wanted to get involved. This led to the creation of the most customer-centric company on the planet. Bezos saw that everything would be sold online in the future and set out to patiently execute on his long-term vision.
“We’ve had three big ideas at Amazon that we’ve stuck with for 18 years, and they’re the reason we’re successful: Put the customer first. Invent. And be patient”
While Amazon has 14 leadership principles that help guide its business decisions and strategy, Bezos credits an obsessive focus on the customer as the secret sauce behind the success of Amazon. A look at Amazon’s 2019 letter to shareholders gives a peek into how customer-obsessed Bezos and Amazon truly is.
Lesson #4: Focus on the customer problem rather than the solution. Customer obsession will help create a comprehensive picture of the customer’s needs and wants. This will help you build products and features that customers might not even know or articulate they need, but be ready to pay for.
Mark Zuckerberg
At the anti-trust hearing, Zuckerberg faced the maximum number of questions — 62. This might be a measure of the tremendous reach of the portfolio of social media apps owned or controlled by Zuckerberg such as Facebook, Instagram and WhatsApp. As a founder and CEO, Zuckerberg has succeeded on all counts. Amazingly however, Facebook wasn’t the first social media product.
Orkut and MySpace both preceded Facebook. MySpace peaked at a valuation of $12B. Its last known value was $35M. In contrast, Facebook is today valued close to a trillion dollars. Where Facebook won over MySpace is in product execution. It identified its target market as that of college students and designed a product for them.
Lesson #5: To the victor go the spoils. Product design and execution are as important if not more than being first to market. Identify your core audience and build the right product for them instead of trying to build something for everyone.
Sundar Pichai
In this list of business leaders, Pichai along with Tim Cook, stand apart as not having founded the company they are now leading. Pichai has often focused on his journey from relatively humble origins as the key to his success. But what truly propelled him to the top job at Google was his synergy seeking leadership. Larry Page explaining the rationale behind choosing Sundar said, “there were times when important product decisions could not be made until Sundar was in the room, because he was the only person who could get everyone to agree on the way forward.”
Sundar’s leadership style is that of an empowering motivator. His colleagues describe him as “self-deprecating, empathetic, supportive and graceful at navigating political minefields.”
Lesson #6: As a leader focus more on the success of others than your own. Stay humble and focus on building consensus for your decisions.
Tim Cook
When Tim Cook took over from Steve Jobs, no one backed him to provide the leadership that would help Apple maintain its pre-eminent position. Tech pundits even suggested that Apple may never again come out with iconic products. With Apple Watch and AirPods, Cook proved his doubters wrong. In fact, Cook himself is now referred to as Apple’s most exciting new product. Life does come full circle.
In his book, ‘Tim Cook: The Genius Who Took Apple to the Next Level’, Leander Kahney argues that Cook is actually a better CEO than Jobs. Nine years after the death of Jobs, Apple’s revenue and profits have more than doubled and the company’s market cap is higher than the GDP of wealthy countries like Canada and Spain. Tim Cook did not try to become the next Steve Jobs. Rather he became the best version of himself. He is incredibly self aware and comfortable with his values. This helped him in coming out as gay — the first for a CEO of a Fortune 500 company.
Lesson #7: I found it toughest to draw out one defining leadership principle from Tim Cook. Don’t get me wrong. He embodies so many of them that it is hard to choose. But if I were to pick one it would be his incredible sense of self-awareness. Being a self aware leader helps you remain passionately true to yourself and your beliefs. Being your most authentic self helps you empathize better with your colleagues and customers. And that is what separates the great leaders from the good ones.
Whether it was the robber barons of the 19th century or the cyber barons of today, it is undeniable that these business magnates have created tremendous value for society. The incredible benefits that they have brought to society through innovative products that help connect people, democratize information and delight users means that these titans should be celebrated rather than vilified. Perhaps an apt way to end this, would be to quote Rockefeller who described his life thus:
I was early taught to work as well as play,
My life has been one long, happy holiday;
Full of work and full of play —
I dropped the worry on the way —
And God was good to me everyday.
I hope this article was helpful. If it was, feel free to follow me on Twitter where I share thoughts and articles on product management and leadership. You can also check out my startup https://komenco.in, which is dedicated to helping products scale from zero to one.
