Apple Inc. almost collapsed in the early nineties. Steve Jobs returned to the company and grew it to stellar heights, from which it is still growing today. We explore how Apple has maintained its Affluence, and how you may do the same for your business.
The goal of every business is to achieve a condition of Affluence and hold it.
For our purposes here, by Affluence we mean an abundance of revenues or profits. When you have a line going steeply up on a graph, which represents money, for example, that’s Affluence. Whether it’s up steeply for one week or up steeply for longer, it’s Affluence.
Achieving a condition of Affluence is often not an easy task and maintaining it can be even more difficult. When a business takes off and the money pours in, any number of forces can seek to knock it “off its high horse,” so to speak.
So, the question becomes, once achieved, how does one maintain a condition of Affluence?
In an article written on September 23, 1967, called the “NEW POST FORMULA—THE CONDITIONS FORMULAS,” L. Ron Hubbard outlined the steps an individual or organization can take to help them maintain a condition of Affluence.*
“1. Economize. Now the first thing you must do in Affluence is economize and then make very, very sure that you don’t buy anything that has any future commitment to it. Don’t buy anything with any future commitments, don’t hire anybody with any future commitments—nothing. That is all part of that economy. Clamp it down.
“2. Pay every bill. Get every bill that you can possibly scrape up from anyplace, every penny you owe anywhere under the sun, moon and stars and pay them. Pull everything down in all directions until you have got it down to as close to zero as you can get or at zero.
“3. Invest the remainder in service facilities. Make it more possible to deliver.
“4. Discover what caused the Condition of Affluence and strengthen it.”
The first three steps of the Affluence Formula are self-explanatory. It’s step#4 that we want to focus on. Let’s use Apple Inc. as a case study.
From Rags to Riches to Rags
Steve Jobs and Steve Wozniak started Apple in 1976 out of Jobs’s parents’ garage as a side hustle. Their goal was to build their own brand of computer. At the time, little did they know that Apple would soon be one of the hottest tech companies in existence.
During their first five years of operations, revenues doubled about every four months. Between September 1977 and September 1980, annual sales grew from $775,000 to $118 million. During this period, the sole products of the company were Apple II and its peripherals, accessories and software.¹ Apple computers achieved Affluence.
Step #4. “Discover what caused the Condition of Affluence and strengthen it.”
Could one say that the Apple II was the cause of Apple’s affluence? If so, there was an inherent problem in strengthening such a cause. Competition flooded the marketplace with new and superior computers, offered at better prices. As good as Apple II was, it was soon knocked off its pedestal. (We’ll revisit this momentarily.)
By the mid-eighties there was trouble between Steve Jobs and some of the stockholders at Apple. Long story short, he was forced out of the company he started. Between 1985 and 1997 Apple experienced some successes but also quite a few failures. Apple went through three CEOs, who made many bad decisions that led Apple to the brink of disaster.
Back to Riches
In 1997 Jobs returned to run Apple. He was older and wiser and he made sure he was given the control he needed to win, something he didn’t have when he had left in the eighties. Jobs ushered in the newly designed iMac and the innovative iPod and iPhone. These products helped make the company what it is today, the first company ever valued at two trillion dollars.²‚³
Here’s the drill: Per Mr. Hubbard’s advice above, we are looking for the cause of Apple’s affluence, and once found, seeking to discover if Apple had strengthened that cause to maintain their Affluence.
The Key Question
What caused Apple’s affluence after Jobs returned? Was it the new iMac, iPod and iPhone, similar to how the Apple II computer apparently caused Apple’s affluence in the seventies?
Or . . .
Might Apple’s stellar advertising or public relations maneuvers have caused the Affluence?
Or . . .
Did Steve Jobs himself cause the Affluence? Jobs had an innate ability to know what the public wanted, and he got the right people to create the products in line with his vision.
What was the cause of Apple’s affluence?
1. Steve Jobs?
2. Apple’s advertising or PR (or some similar actions)?
3. Apple’s innovative products?
4. All the above?
The first three items can be broken down into Be, Do and Have. Steve Jobs (the being) was the “Be.” The advertising and PR were the “Do.” The products amounted to the “Have.”
This is what L. Ron Hubbard said about Be, Do, Have in an article he wrote on November 13, 1970, entitled “PLANNING BY PRODUCT.”†
“One of the cycles or correct sequences of action is:
“This sequence is often altered in organizations and even in individuals. Be is first in the physical universe, Do is second, Have is third.
“By getting it out of sequence a considerable confusion can be generated.”
Thus, Be, Do and Have is the correct sequence of action needed to get things done. When a true Affluence condition is achieved, rest assured there was a Be, a Do and a Have that resulted in action that accomplished the Affluence.
Look for the Be, Do, Have
When trying to determine the major cause of an Affluence, one would be smart to look for the Be, Do and Have that created the action that resulted in the Affluence. To only look at what was DONE as the cause is shortsighted. To only look at the HAVE (product) as the cause might be equally so. Broken down, successful actions include a Be, Do and Have.
Since Apple’s Affluence was attained only after Jobs returned to the company, we can assume that HE was the major CAUSE of the affluence. (Reversely, after he left Apple in ’85 it had crashed.)
That’s not to say the advertising and the making of the products, etc., weren’t important. Perhaps we could say they were secondary causes. When trying to strengthen the cause of the Affluence, these would obviously not be ignored.
The Problem with a Person as Cause
We are saying that Steve Jobs was the major cause of Apple’s Affluence. Yet we must recognize that there is an inherent problem when we acknowledge a person (Be) as the cause. What if the person leaves (as Jobs left Apple in 1985)? Or, what if he dies? (Jobs passed away in 2011.) Or, what if the person that caused the Affluence becomes a problem? Allegedly, Jobs was a problem when he left in ’85. He was pushy, belligerent and a source of aggravation to the shareholders. It could be said that the shareholders booted their source of Affluence out the door, which ultimately resulted in the company going downhill. However (this is the important part), after Jobs died in 2011 Apple’s Affluence continued. If Jobs had been the cause, how could that be? How could they have strengthened that cause when he was gone?
Preserving the Cause of Affluence
As with any organization, one person can only do so much. A CEO or owner depends on those around him or her to do the bulk of the work.
When Jobs took back control of Apple in 1997, he made sure he surrounded himself with executives that he could trust—those who had worked with him closely and understood his philosophy. Then, in 2008, they created Apple University in an attempt to codify the Steve Jobs product and business philosophy that has shaped today’s Apple.4
We could say that Apple University is a way to preserve the cause of their Affluence in the form of Steve Jobs so that Apple employees and executives could get trained by the man himself. They would get the full trio of Be, Do and Have.
The moral of the story is when you hit Affluence, you want to apply the Affluence Formula in full, which includes discovering the cause of the Affluence. The cause that you seek would likely not be limited to just what was done (Do), or what product was sold (Have), but would also include the Be that made it happen. To strengthen a cause, you may want to create your own “Apple University” to fully preserve it.
There is a reason Apple was the first company to reach $2 trillion in market value. Although, some of what is said here is speculation, there’s enough truth to make any businessperson desiring to achieve Affluence want to take a bite and swallow.
* “Condition of Affluence” can be found in HCA Reference Volume V, Statistical Management, page 37.
† “Planning by Product” can be found in HCA Reference Volume IV, Establishing & Organizing, page 39.
1. “Apple II.” Wikipedia. Wikimedia Foundation, 27 Nov. 2020.
2. Snell, Jason. “Life after Jobs: Why Apple Isn’t Doomed.” Macworld. IDG Communications, 24 Aug. 2011.
3. Vega, Nicolas. “Apple Becomes First US Company to Reach $2 Trillion Valuation.” NYPost. News Corp, 19 Aug. 2020.
4. Snell, Jason. “Life after Jobs: Why Apple Isn’t Doomed.” Macworld. IDG Communications, 24 Aug. 2011.