The Three Rules
I just finished reading the book “The Three Rules“. This academic team attempted to find “rules” of biz that are ALWAYS true. They found three: Rule #1: Better before Cheaper Rule #2: Revenue before Cost Rule #3: There are no other rules. “Better before Cheaper” means that if you are faced with a choice between making your product better, or making it cheaper, always choose better.
Apple did not focus on finding ways to design and manufacture for less cost, they were focused like a laser beam on how to design and manufacture a great product. “Revenue before Cost” means if you are faced with a choice between making more revenue or lowering your cost, choose more revenue. Apple did not focus on re-engineering, right-sizing, or doing more with less. They focused on selling more great products – ever been in one of their stores – amazing.
I do not think their stores were the result of any cost-cutting initiative. Instead, they focused on finding ways to sell more. Keep in mind, they are not saying spend money like there is no tomorrow – this is about choices, and where you spend your time, money, and energy.
If I had to re-write their three rules in terms of product development: Rule #1: Find really good engineers with a really good product development process and culture (better before cheaper) Rule #2: Design your product to be best in class (you can charge more and will appeal to a larger customer base) Rule #3: Don’t worry too much about anything else. Spend most of your time with great engineers and make sure they know what a great product looks like.
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