Corporate world needs more generalists

I just finished a long call with an old buddy who just finished selecting a team for his new startup and it stirred a lot of thoughts in my mind that I thought I will share in this post .

Our experiences dictate our “gut” feelings , and it’s those feelings that help us interpret the data available to make a decision . When a decision is taken at the highest levels of an organization – it needs to be balanced against many dimensions .

Most executives grow up in one area for their entire career till they get to the top management . By that time they are totally set in their ways and would have learned to optimize heavily along one or two dimensions .

Let’s say hypothetically a “make or buy or partner” proposal comes up before the CEO and staff . Head of engineering firmly believes that no one can build with same quality as in house team . Head of BD believe it is cheaper and faster to get it done by a partner . Head of sales thinks he can sell better via direct sales than via indirect channels . Head of services doesn’t think it is wise to do this at all since her team does not have skills on that area . CFO just wants to know what is the cheapest way to do it . Head of HR is worried about burn out of developers if we do this in-house .

So how does a decision get made ? Usually one of the following happens

1. CEO listens to everyone and makes a decision since no one option has enough support from most of staff
2. A large degree of trust exists within exec team and a collective consensus decision gets made
3. A majority opinion forms and CEO agrees to it
4. No decision gets made and issue lingers for a long time

These are normal decisions and pretty much any option above works out ok . The key word here is “ok” – as opposed to “great”. Why doesn’t “great” happen ? Because individual executives very rarely have the breadth in proportion to the depth of their experience that aids a better decision .

Except in really large companies – or for a small time in the early days of a really small start up , people grow up as specialists . By the time they need generalist skills – they are set in their ways and they can’t afford to make mistakes and learn from it .

Individual brilliance can over come this to a large extent – but it has its obvious limitations . But I think there is a way to over come this problem – start rotating high potential employees really early in their careers .

I have seen IBM and GE do this effectively for upper management . Another company that I have seen do this effectively is Lam Research – where it is not just upper management employees that get this benefit . I think they all reap the benefits in spades .

This realization came rather late in life for me . I was fortunate to have had a relatively successful time fast tracking through the partner track in consulting . A mentor in IBM suggested to me that I should do some non SAP gigs in consulting and I did that kicking and screaming – and it opened my eyes to the world of possibilities that only happens when one sees a problem with fresh eyes .

From then on , I moved to presales and sales with a lot of ease . I grew up hating sales (cool developers hate sales peeps as a norm , And I definitely counted myself as a cool developer) – but I smashed my quota every year at IBM since the time I had a quota on my head . Why ? I think (in hindsight) because neither me nor my customers felt that I was “selling” – I was just “consulting” and to my luck , they saw value in my advice and usually agreed to invest in my ideas . It all worked out well for me – But it wasn’t some grand ore planned strategy , and that first step was REALLY hard !

Since then I have made it a point to gain more breadth in my career . I did a stint in engineering at SAP and now I run channels at MongoDB. It is a constant learning experience – and my own deficiency in marketing and product management skills dawn on me every day . On the other hand – my background in direct sales , presales, consulting and engineering help me a lot in being effective in my current job . And I have the best channels team working with me !

Bottom line – I should have started a lot sooner in my life to branch out and try other things , but I am glad I started it at some point even if it was late . I am also thankful that every time I have made a case to someone in my management to give me a shot at trying something new , they have been supportive .

With this realization , my outlook for my team changed quite a bit too . Over the last few years – I have actively sought out opportunities outside my team for my best performers , even if it meant my headcount and budget had to be sacrificed . It hasn’t always worked – but is has worked out well more times than not . When I hire – I do give due weightage to candidates with breadth of experience . I intend to carry on doing that for rest of my career .

One other learning was that not everyone likes to go broad – and some prefer to go deep . That should be respected by managers. Deep has its benefits too – especially in some jobs like finance and engineering . But even in those jobs , a little bit of variety won’t hurt .

For me – without my mentor pushing me into it – I would have never gone out of my comfort zone on my own . And the way he put it to me was to try it as an experiment for a while and to go back to SAP consulting if it didn’t work out . It is important for leaders to provide a little bit of a safety net before you push your team members into new things . Your network is your safety net – and the last best time to start was in college , and if you did not do that – the next best time is today .


SAP buys Concur and Oracle gets new CEOs – My 2 cents

Just as soon as I came back from lunch , I heard about both news items from SAP and Oracle . Here are my views – strictly personal opinions as always , and has nothing to do with present or past employers .

SAP buying Concur is a pretty good move in my opinion. As a frequent business traveler , the standard SAP solutions are not exactly the ones I think of as my “painkillers” . Concur fits the bill and I know there are millions like me who need their services . What is more – it is a growing business with plenty of scope for innovation given the options to travel are increasing .

For SAP – with Ariba already providing a pretty big network , this is a neat deal to add to their breadth and depth . Success factors fits in too pretty well from HR synergy . And of course there is the core FI and budgeting apps which their instal base already has in plenty . So from a portfolio synergy – it makes perfect sense to me .

I really hope that this does not start another “let’s replatform to Hana” initiative . I am sure hana fits some parts of concur really well – like maybe getting amazing insights across expenses and other corporate data like HR , risk and so on . But a blanket replatforming – especially from a transaction processing point of view , doesn’t look like high value for me .

After reading Den Howlett’s blog on the recent influencer meeting – there was only one question I asked . Was there any mention of M&A ? He said there wasn’t . And I was wondering how SAP plans to get all that top line money organically . Well today answers that question for the most part 🙂 Buying for top line improvement is something IBM, Oracle etc have done before too – so nothing new in that respect . Oracle market cap probably increased about $50B via acquisitions in last 5 years or so I think .

So now my big question is what companies will SAP acquire to bolster the platform side. ? Business Objects is good – but tired . Lumira did not exactly give tableau a run for its money . So maybe SAP can buy a modern company to boost the BI business – like Tableau or Alteryx . It probably won’t be cheap – but probably a good idea to retain BI market leadership .

Or maybe TIBCO – and have a shot at both EAI and BI in one go .

Another option might be to buy into the lower end of the stack like redhat . That could open all kinds of doors for SAP on platform side . In fact – I would rate such a purchase as way more strategic than even tableau.

No idea if any of these vendors – maybe except TIBCO – wants to be sold . And if they did – SAP will probably need $10B+ to buy a couple of them .

In any case – big congrats to Bill McDermott and SAP !

Moving on to Oracle . I am not sure what exactly changed there . Everyone seems to have moved one level up the ladder and Larry retains control of all technology aspects . And while he remains active – it is hard to imagine Oracle having two other CEOs .

There was a rumor throughout that Larry might become Chairman and buy and make Benioff the Oracle CEO . Clearly that did not happen . But it is not to say that can’t happen in future . The two new CEOs (best of luck and congrats to both) both deserved the job for sure . So the possibility that they move to the board in a couple of years and Benioff getting the CEO job long term is a possibility . We will see I guess 🙂

I think it makes sense for Oracle to make a big noise to divert attention from a rather lackluster financial quarter . Beyond that , I don’t see anything material about the CEO transition .

Scale and Culture , the ultimate conflict in startups

Ever since I left the big company career , I have been talking to and learning from folks who have a lot of experience in the scrappy startup way of life. I have had such conversation with engineers, founders, sales people, VCs , Angels , receptionists and pretty much anyone else who would talk to me about this . I am rather firmly convinced by now that what worries start ups is the idea of scale – or more precisely, how to scale the business without sacrificing their culture. 

Culture is a loosely defined term for me. It is contextual – some people consider the freedom to work on a pet project as culture, another looks at free beer and food as culture, yet another thinks a primarily engineering skilled work force is the hall mark of culture , some one else looks at a flat hierarchy as the best indication of culture and so on. And this is primarily the reason for the conflict between the need to scale and the urge to defend culture. 

Looking at some iconic new generation companies from the outside – like Google and Facebook, it looks like a lot of the startup culture can be saved. At least the easy ones like informal dress code, free food etc. But a few friends who work there have told me that when it comes to decision making and hierarchy, they tend to shift more to the large company way of doing things. 

I have never founded a company – but from observing people who have done so, it looks to me that the ideal way to do this is for an engineer with a great idea to go find a friend who has business savvy and get a company started. May be it works with the business guy being the starting point too – but to me it does not seem likely that a business person without tech chops can identify a good techie quite as easy as a techie can look for business skills in a partner. I may be wrong – but at least that is how it appears to me. Without a business oriented founder ( pretty cool if business person also is a techie) – I think there will always be a feeling in the company that the sellers who get recruited are a bunch of over paid losers. 

Same is the case for hierarchy . I hate hierarchies with a passion. But it is nearly impossible to manage more than 10 people effectively. So as a company grows, fighting hierarchy is futile – you will just invite chaos. It is a fine balance. When you are small – you can hire enough top notch talent who might not need much management. But there are only so many smart people available on the planet and not all of them are available to your company. So embrace the concept of structure to minimize growing pains. 

There is a certain paradox in engineers fighting hierarchy and structure in organizations. I am a perfect example. I am obsessive compulsive in organizing my code well, ensuring separation of concern , clear hierarchy of a stacks and so on. Yet when it comes to people management – I have fought my bosses tooth and nail on every bit of organizational discipline they had instituted. I can’t say I have fully embraced the idea – but I am a lot more understanding of the need for structure than I was in my younger days. My closest to ideal situation is a flat team that organizes itself to solve a problem, and use hierarchies needed to get things done. And then they go back to the flat team and re organize for next problem to be solved. 

Same deal with performance reviews and comp plans. I like giving and getting feedback at task level and periodically at big picture level. This works well when the organization is relatively small. But when a company grows to hundreds and thousands of people – all those things I don’t like – bell curve type things, come into play. A lot of this misery is caused by lack of flexibility in corporate budgeting. Budgeting is done for predictability – not for performance optimization. And it has extreme side effects that everyone knows but very few CFOs act on. To some extent, tools are to be blamed too. Even if a business wants to be flexible – the common enterprise tools for budgeting and planning have restrictions that minimize flexibility. 

When I left SAP and joined MongoDB – a lot of friends and my mentors told me that once you taste the startup world, there is no turning back to old world. To a large extent, I believe that is indeed true. The flexibility and freedom offered in a smaller and faster growing company is a big plus factor. But what happens when a start up gets too big ? I have seen some of my friends go back to the big company world, and some others just jump to an early stage company and help them grow. A handful who made a lot of money have moved on to be investors. 

I think some cross pollination is necessary in our industry. Even in the 5 months that I have been in this role – I realize how some stuff in my old world can benefit by making changes to how they operate. Similarly the younger companies can get a lot of benefit from people who bring in the perspectives from the big company world – especially about scaling. The latter happens a lot already. But the former – where big companies hire leaders from startup world – don’t happen to the same degree. 

I am very much a newbie to all of this – and am very curious what you think .