Frank Slootman: Doing Less, Doing Better

0:00 I rarely use the word proud or pride because that that signals, you know, a uh profound happiness with the status quo. And I don't have that, you know, because I'm always at odds with the status quo. That's sort of the the natural malcontent posture that we have. Yeah, we're here, but we could be there. So what gives? How do we get there? Right. So we're always envisioning a future that is different than the one that we're that we're currently experiencing. Welcome to the Knowledge Project, a podcast about mastering the best of what other people have already figured out, so you can apply their insights. to your life.

0:51 I'm your host. Shame Parish. If you're listening to this, you're missing it. If you'd like access to the podcast before public release, special episodes that don't appear anywhere else. hand edited transcripts, or you just want to support the show you love. You can join at fs.blog slash membership.

1:09 Check out the show notes for link. Today my guest is Frank Slootman, one of the most incredible operators that Silicon Valley has ever seen. Frank is the chairman and CEO of Snowflake. Before that he was the CEO of ServiceNow, taking the organization from 100 million in revenue to 1.4 billion. Prior to that. He was the CEO of Data Domain.

1:32 leading to an acquisition by EMC for over two billion. I've been trying to get Frank on the show for nearly a year, but luckily I don't give up very easily. I wanted to talk to Frank because his no nonsense, results based approach really resonates with me. In this episode we talk about the first 90 days taking over a company, and while there's no bluprint and each situation is different, there are common methods of thinking and principles that work and you can apply. We also discuss one of my favorite ideas, doing less and doing better.

2:04 The difference between a good sales organization and a great one is How to get the best out of people, positioning yourself for future success. Artificial intelligence and so much more. It's time. To listen.

2:18 And learn. I think when I was thinking about where to start, I wanna start with going into a new company and the playbook that you use for the first ninety days. Can you walk me through what's done before What's done on day one? And give me some detail over

2:40 how you look at the next ninety days,'cause that's really the time when you can transform a company. Yeah, I uh I I tend to uh take a little bit of exception to the term playbook like it's a cookie cutter thing and and it's not it's also not a football game. or there's you know, there's very precise rules on on on on how to play the game. Um it's very situational, very much first principles. I mean you you come into a new situation And you just start processing on what your

3:08 what you're seeing. But that said, yes, there are things that um, you know, you zero in on, uh, each and every time, and that is, you know Are there right people on the bus? Or there. People that need to get off the bus. you know, we're inspecting the functions. Are they working? Are they not working? Do people think they work? You know, what what can we see very, very quickly? And then you start prioritizing, okay, you know, some things, you know, are obvious. They need to be dealt with A S A P

3:35 then everything starts to sort itself. So, you know, there's usually a number of things that happen incredibly fast, like week one. And then there are things that happen slower, you know, and maybe, you know Thirty, sixty, ninety days. But in in in ninety days, you know, I tend to be through sort of the initial, you know, triage of, okay, you know, what let's get ourselves on a on a solid footing here where we can function and operate and and understand and and then we can

4:06 you know, much more incrementally, iteratively, you know, progress from there. So that's that's sort of the You know, if if if you're asking for a framework, that that that would be it. Um, but I will tell you that you know, every place I've been They're all different. Gotta be very careful, uh that that you don't

4:22 get into a rinse and repeat mode where, you know, you just think you have a formula or an algorithm. And you can just apply it over and over again. That's just really simplistic thinking and it it will lead you astray because you kinda try to observe things. in a way, you know, like a five year old would. They've never seen it before and and how are you r reacting to it, you know? So I understand there's no repeatable framework that you can just apply, but I would imagine there's there's sort of repeatable principles and methods of thinking that you use. What are the ones that you find the most helpful? Well, I'm I I look very hard uh at what's working, what's not working. And in other words, you know, some things are uh not working at all.

5:00 uh something seem to be working reasonably well and then there are sort of the stuff that you're sort of humming and hawing on Um, so obviously you you prioritize the I mean I've I've sort of separated with people very, very quickly because I think the the function the functions that they were responsible for. We're barely breathing. And at that point, you know, I I don't hesitate, you know, I move on quickly, immediately. You know, I go after cultural issues, you know, people that are are just, you know egregious violators of just

5:30 things that we d we all generally find normal and acceptable. Um, you know we we very quickly separate on behavior. You know, performance is something that we will give more time. Behavior we won't. And that's because behavior is a choice, not a skill set. You know when you come in as a new leader, everybody's watching, not just what you're doing, but what you're not doing. So if you're not moving on things that people that everybody is seeing.

5:53 your leadership brand is already in question because you know apparently you're blind and apparently you're hesitating. uh or you're tolerant of of behavior that you shouldn't be tolerant of. So yeah, there's pressure because you know, it's not just what you wanna do, it's the whole world's watching. You said behavior's a choice, not a skill set I've never heard of. quite framed that way. I think that's a very um

6:16 That's a really interesting way to look at it. But you also said that you sort of you'll give time for performance, but not for behavior. How much time? How do you learn uh like when do you pull the plug? When do you reinvest? And how do you think about that? Well, look, you know, behavior is uh it's it'll it'll smack you in the face, uh, usually, but I've also seen things happen underground where, you know, I wasn't aware of it and I wasn't seeing it.

6:43 But it was happening because it would happen on calls that I wasn't on. You know, one one time I uh I got tipped off by uh an employee of my former company that said, Look, you know, that office over there is a complete you know, disaster and uh because they knew people there. And you know how salespeople are, right? Everybody talks doesn't matter what company you're in.

7:03 And then, you know, we started, you know, basically peeling away the layers and all of a sudden, you know, you come across, you know really bad situations. abusive situations No, harassment, all these kinds of things. Um, because sometimes it's just not visible. It's happening. People don't like to talk about it. It they they're worried that they're ratting on people and they don't wanna go to their manager because they don't trust their manager.

7:28 you know, they don't they don't trust HR, you know, which is usually, you know, your your second choice or maybe your first choice to go when you have, you know, real behavioral cultural problems. And then it's just it just keeps going on. So um I'm I've been surprised before about how much, you know, wasn't visible uh to us, not just to me, but also the people that were that I have brought in that were close to me, they were not seeing it either. Eventually, you know, believe me, it it we will we will find it and we will get to it. And then we will we will move at lightning speed. Um Because you you want to get bad behavior, you know, out of an organization.

8:02 fast. That that is your leadership brand. You you start tolerating that There is there's no end in sight to what you're gonna have. Trust is key to to moving quickly, I would imagine, with velocity in organizations. How do you go about establishing trust in a performance based culture? Well you know, pe people need to believe that you're that you're fair, that you that it's not just personal preference, right? That you're not doing things because, oh, I don't like your haircut or whatever. It has nothing to do with that. It has to do with, you know How do we come together? How do we behave as a group? And you know, if if if you have you know people behaving in in huge

8:37 conflict with that, then it's like, yeah, we are gonna move on it. Um sometimes, you know, I I I've had situations, especially with young people, where Hey, we need to do a reboot, reset. come back tomorrow, I'm sure your parents didn't teach you, you know, to behave this way and you can do better. And I've seen people come back literally over the weekend and be a different person because for whatever reason they were led astray by managers that just you know, we're inspiring that kind of behavior. That happens, right? People learn behaviors from what they see around them with a behavior that gets encouraged.

9:08 And they don't realize that they are just getting a drift, you know, from from their own upbringing and their own, you know, personal principles because that's sort of the environment starts to, you know, really It's a slippery slope that they get on and all of a sudden they're in a place where they don't even recognize themselves anymore. And that's that's where a reset can really work, you know, because basically you're re grounding them to, you know, normal behaviors and then things can work out really nicely. uh from there on. But most of the time, unfortunately, it's like look, you know, you're not a fit here. You know, this is this is not

9:40 Who we are, who we want to be. You know, it's choosing, you know, it's it's it's just look, we want you to be this way, not that way. And you know, for some people it's like hey they learn behaviors in other companies, it's part of who they are, it's their culture. This is not this is not for you, man. Alan Malale put it to me this way, he said, Uh, when you're you're choosing a behavior that's not the organizational behavior that's desired, you're choosing not to be a part of the organization. I thought that was a powerful way to think about it. Yeah. You're uh you're you're separating and you're in you're in violation of the the culture. Driving culture is really important because if you don't

10:15 you know, other people will will fill that void, right? And you get subcultures in a in a city or a division. Because strong personalities can do that. So unless you are you are filling that void, right? Um it will get fill by something or somebody else. And then before you know it, you know, you're just a grab bag of stuff. And it's just a bunch of thieves that's running a company. Well, that's you don't want that. The company needs to stand for something. This is who we are. Seems like there's a lot of organizations that um are more family based. I mean, they take a very similar approach to a family and they they don't necessarily think in terms of performance. What are your thoughts on that?

10:52 Well, you know, we we we've talked about this quite a bit in uh in recent years. You know, I don't think a business is a family. Unfortunately in a family you can't fire your family even though you sometimes want to. You have to tolerate'em and deal with them. And of sometimes in the most egregious way. That is just the nature of families. I mean the all the dysfunction that comes with it, um but in in business it's more like being a professional sports franchise, right? You're You're assembling the best players and uh you know, we may be friends, but we don't have to be friends because we're not coming together on the basis of friendship. We're coming together on the basis of mission, you know, in other words, share purpose.

11:30 You know, we're we're very demanding of each other and it's really about You know. our our respective contributions to the to the mission. That's the basis of our relationship. So it this much more akin to uh to professional sports. I think that's the correct analogy. Now some companies don't wanna be that way. Companies like Salesforce and and even Google come to uh to mind, but you know, in the end they're laying people off too by the thousands. Okay. So I guess it it's not family after all.

11:58 Do you think most organizations try to do too much? There seems to be a natural entropy entropy that sort of builds up, right? You start with one thing, it becomes successful, and then you sort of expand your footprint. And before you know it, you have, you know, before Steve Jobs came back to Apple, they have Uh. I don't know, what was it, like twenty or thirty different products? The first thing he did was narrow the focus down to four key products. How do you think about that? Yeah, well the the interesting thing about about Steve was that uh he had a he had a standard called uh Insanely Great, which, you know, I I remember at the time that it was kind of a thing in Silicon Valley.

12:32 So if it didn't meet that standard, you know, it it would get scratched really, really quickly. If it wasn't, you know, incredibly exciting and world changing and all that. We just couldn't be bothered to, you know, even have that on the pallet and and and work on that. So I think that's a great way to be, by the way, to just demand to be inspired and be in awe, you know, um, of of the nature of the mission and what we're trying to do. 'Cause that's that gives energy, that gives life, that creates excitement, that creates focus, uh, creates urgency and people come to work, you know, with with a with a sense of mission rather than well, I have to be here, you know, for my paycheck.

13:11 So it's it's really a applying that filter rather than I got too many things going on. There just aren't too many insanely great things. So it will it will naturally sort itself to a small set, you know? W when you come in, uh, you also believe in sort of um doing less but doing better and narrowing the focus. How does that manifest itself in an organization? Like how do you go through and decide where to focus and what to cut on? We constantly have conversations, you know, around prioritization, you know, w w What is we we can't do everything, so we have to choose.

13:45 Not choosing is the worst thing you can do because now you're compromising everything. Um, so the question is, you know, we we use I use all kinds of different ways of trying to figure out what is most critical and then by the way, and we we revisit that conversation constantly, and it has to be sort of you know uh reaffirming, but it's like hey If you can only do one thing. Which one would you pick and and and and why and what would be the consequences of not doing, you know, the other things. So we start sort of strapping it.

14:14 strapping it on for size and like can I live with that? Or what would happen if if if If that was the scenario here. The problem is, you know, we you over time people create you know they're they're they're a mile wide and an inch deep, right? They we we create just more, more, more, more and and pretty soon we're swimming in glue. You know, we're lethargic, you know, we're moving like like molasses and uh

14:36 That saps the energy you know, out of the people and and the organization. So what I go through is okay, let's let's just Let's just take things out. Let's just uh you know do things in sequence rather than parallel, um, because you know, we we just want to be lightning fast. on the things that really matter and really, you know, make sure that we're appropriately provisioned, right? Because oftentimes Yeah, everybody gets, you know, w one hundredth of the resources as opposed to getting, you know

15:04 fifty percent of the resources, things all of a sudden go a lot faster when you have the focus and the and the resources and the provisioning. Things really move. Right. Uh, whereas if you have to share with fifty other things, and nothing moves now. being very aware of it. Now you you can create focus in different groups, right? When you get bigger as a as a company, right? It's really about you you will be multifocus and you will be multi purpose. but you have now way more resources. You can you can and we often have done that by creating um you know product teams with general managers on them.

15:34 uh that that were measured, you know, on the progress, you know, against their targets, right? So they they could really go after their targets for their vertical industry or their product type or their channel. They could own it. They could they could declare victory at the end of the month. So you can create focus in in a in a in a in a multi mission organization. You absolutely can. I mean certainly Google was actually quite legendary for doing a lot of that stuff. 'Cause they had a lot of successful things that they did. And I I think there's many other companies that have done that as well. But you don't do it do it through a large, you know, monolithic functional organization. Because now everybody's a small cock in a giant wheel and that's uh That doesn't create the you know, the momentum that you want.

16:15 I in your experience is is there a number of priorities that people can focus on and deliver really exceptional results? Is it like one or two or three? Uh obviously it's probably not ten. Is there a number that seems to be key? obviously greatly depends on on on what it is. You know, I I don't uh start off saying it has to be this number or that number. I just want to see what it is because These things are not created equal. It might just be one thing because it's just so big that it's gonna consume us. Which is then fine. You know, sometimes it's not. And then we can we can address more obviously more than one thing. Most product organizations obviously have uh you know have lists of projects and uh you know, maintaining moving all these things along, you know, with with the focus and and and and velocity.

17:01 And momentum. Yeah, that's the art of management, you know? You will know, you know, when things are grinding down to a halt and things are too slow. Momentum is not happening. revisiting prioritization over and over again is really important. You sort of want to convince yourself again and again, this is correct. This is correct. Or no, it's not. It's not working, you know, based on the on on what we're seeing.

17:22 That's okay. You know, you don't know everything ahead of time, right? So you you you learn day by day. Um and you calibrate and and and and adjust, you know, from there. It seems like bureaucracy naturally creeps into organizations if it's not fought. How do you go about fighting bureaucracy? Yeah. What's your role in that? Yeah, that's that's that's uh a really important observation because you know larger companies, they they tend to become their own worst enemies. It's not what the world does to them, it's what they do to themselves. And introducing bureaucracy, uh in other words

17:55 undue process, you know, a lot of friction in terms of getting things done. So I often talk about this in in my communications, you know, to the company is like, hey, you know, we we have to Hang on to our youth. our innovative muscle our audacity our daring And um, you know, I always say, look, you know, hierarchy or charge mean nothing to us, you know, we operate through influence. If you can convince people, great. And if you can't, well then you just can't. It doesn't matter what your title is or what organization you come from or who your boss is.

18:26 So it it's it's really uh it's an it's an extreme meritocracy. It's really your ideas are are judged on their merit, you know, not on you know where they're coming from. You fight it. I always say, Let's be like Peter Pan, you know, we never grow up, you know, at least not entirely. You know? So uh we we we maintain that chip on our shoulder. That attitude, um and you know

18:48 back to the insanely great thing, right? If if we're not inspired what we're working on That's a problem in and of itself. We we gotta go get that back. Fast. I think I remember from one of the interviews I was listening to to prepare for this that you look for maladjusted people. Um I'm probably one of those people myself, but um you know

19:07 Yes, I mean look, you know, what where does drive come from? Where does ambition come from? You know, it it is a lack of adjustment because if you were a perfectly balanced person, you wouldn't have any ambition. You're so happy with where things are You barely have a reason to get up in the morning, you know? Um but you know, maladjusted people, they they just have to s this disparity between where they are and what they wanna do and what they wanna prove. I mean, all of us wanna prove things either to our parents if they're still around or our siblings or our friends or People that didn't believe in us all this stuff.

19:40 And uh that's very powerful, you know. I I remember, you know, I I had a we had a great exit with data domain back in two thousand um nine. And uh we were very proud of the work we did because it was a start up. It was just, you know We didn't have product market fit for the longest time and it became uh you know we we were a bigger exit than than than the ten next the next ten competitors combined, all this kind of stuff.

20:03 But then people started saying, Oh, you're just lucky, you know, you know how that goes, right? Well, you know, that that just puts on the afterburners, uh, you know, for me. It's like oh I'll show you luck, you know? And um that's that's attitudes and attitude is something I like in people. I like people that have attitude that have a chip on their shoulder. that have a burning, you know, need and desire to prove something. Over the years that will wear off a little bit. That that is just the nature of things. I mean you d you when you're eighteen you have a very different

20:32 life experience than when you're forty years older, you know, depending on what happened in between. But I I I generally uh you know Uh like people who sort of constantly are very, very strongly aware of where they are versus where they could be.

20:49 I I I rarely use the word proud or pride because that that signals, you know, a uh profound happiness with the status quo. And I don't have that, you know, because I'm always at odds with the status quo. That's sort of the the natural malcontent posture that we have. Yeah, we're here, but we could be there. So what gives? How do we get there? Right. So we're always envisioning a future that is different than the one that we're that we're currently experiencing. If we could do it all over again, what would we do? Right? Those those kinds of conversations. So it's very refreshing. It's you're you're constantly sort of reinventing, you know. what's going on and uh also keeps you safe.

21:28 Because there's people out there who don't have legacy. They don't have nothing existing. They start from scratch. Well They're gonna get the better of you unless, you know, you you develop that attitude, you know, in your own company, your own business as well. It seems like the natural state for most people is to get reasonably good at something, like driving a car, and then there's a bit of a complacency that sort of sets in. It's like I get to average or slightly above average in my job, and then I sort of like let off the pedal. How do you prevent that? Obviously, you know, the relationship you know, what the people around you, your team and and your managers like, you know, are are people driving you to higher standards or are they not? You know, are they accepting

22:06 you know, of of the way things are. But you know, one way we do this, um, this is throughout the organization, uh all our employees rel uh that are not in sales because salespeople are on on on commission plans. But you know, every quarter you know, the company has to, you know, earn the bonus pool. In other words, the money that we're gonna use for bonus, we have to earn it. And then we tell people how how how we earn it, exactly what the metrics are, and we share all of that so they know, hey,

22:32 We none of us are gonna get bonuses unless the company gets paid. But once once we earn once the company earns it, Now we're starting to allocate the the uh the the bonus money. to managers and departments. And we just say, look.

22:46 You use this money, you know, to send messages to all your people. there needs to be a bell curve. We wanna know who who was, you know, deserving of two X, three X. versus who is deserving of zero. Um, so that we we see the full spectrum. the bell curve, if you will, uh of people that are Yeah.

23:06 performing, you know, incredibly well and uh and and the ones who are not in good standing. This is not so much about oh, I don't want to give money to to people who aren't doing well. It's more, are we giving enough to the ones who are doing great, right? I don't want the great ones feel like they're treated the same way as people that are obviously not in good standing. That that just that just you know that creates a that's not a performance culture. So Um, we do this every quarter and um in the beginning when when when p people have not lived this life before, and it it's very challenging for them. It's like, Oh my god, I gotta have a

23:39 conversation like this about money and performance every single quarter with every single person. How do I do that? Well, people get used to it because during the quarter they now start to have a different, you know, a much sharper lens on the work and how the work's getting done and they keep notes and they make notes And then they can really give a credible message back and Employees will also ask

24:01 Hey. Um w if I want to have a hundred and fifty percent bonus or whatever number Um, what do I have to do? And by the way, this is exactly the conversation you want to have. What do we have to do? Damn, good question.

24:15 Let's go have that conversation. What do you have to do? Right? Everybody wants to aspire to something. They want to be better. But you gotta force that conversation to happen in in such a way that it has consequences, right? In terms of compensation and recognition and celebration and all of that. Um, so I'm big on recognizing, you know, uh great work. I I think great people need to be and need to be celebrated and rewarded and single out in in every way. possible. Again, that's a that's a merit.

24:43 performance uh culture you know these days that is being frowned upon and in in in popular culture, but in in enterprises this is really important. People need to become the best version of themselves. And this is This is part of how we go about doing that, you know. Aside from money, what other sort of mechanisms do you use internally to reward people? It's it's recognition and and and celebration. You know, um you know, we for example we we have uh equity awards in in sales for people that are landing designated

25:14 customers that we desperately want. And uh You know, we we they're often surprised because they may have forgotten about it because it's not uh you know, it's just something that only happens when you, you know, you you land certain customers. And uh, you know, we all get on it, you know, to Send notes.

25:33 you know, have conversations, uh, references and other conversation. All of a sudden everybody knows in the whole company like wow, this guy, this this team did this and they're like, Wow, you know, they they're bathing in c in glory, you know what I mean? And uh You know, salespeople live for that. I mean you have they live for money, I know. You know, they're m they're they're core and operated, but they also live for for recognition because that is just uh Yeah, it it's it's very, very rewarding. It's in a d very deep, you know, psychological way. It's very rewarding. So you want to bring that. Don't take it for granted.

26:05 You know? It's not like all this just doing your job. Yes, it is, but at the same time, man, this is this is this is amazing, okay? Especially when it comes from me as a CEO and they're like, My God, you take me time out of your day to to tell me this? I'm like, Yes. We are. Well, most organizations are sales organizations. Uh and I guess I'm wondering

26:24 Uh, we we all sort of recognize a bad sales organization because that business will go to business. But what's the difference between a good sales organization and a great sales organization? you you get much better sales organization when you have full alignment in in the entire company so that everybody works, you know, for sales effectively. We always say that we're all working for sales here. because they're the tip of the spear and the rest of us are really the wood behind the arrowhead. You know, that's sort of the way I characterized the relationships between sales and and the rest of the company. And sales needs to feel that wood behind the arrowhead. Like everybody is, you know, is is killing themselves to help me uh succeed. And It's not so much the the

27:07 it's it's all about selling stuff and transactions and deals and all of that. It's just that sales experiences the reality of the marketplace. The first and the most profound uh in the most profound way, right? The rest of the organization sits f much farther away from the the the cold winds of competition. and and some of the ugliness that happens and the uncertainties and the anxieties and all these kinds of things. So yeah, sales is harder. Which is why the rest of our organization needs to be in alignment and in support, uh, you know, of them.

27:37 So the alignment is really important, right? That we really provision the whole company behind that because they are experiencing reality in the marketplace. And we the rest of us have to adjust to that. We gotta help them, we gotta we gotta change things. Uh it's a constant process of of basically living their experience and what does it mean and how often are we seeing this and what are we gonna do about it. But in terms of your your your question, I mean one thing that's really important to me, I'm I'm I'm a stickler for consistent execution in sales organization, meaning that every quarter Everybody shows up. You know, what what what we can't have is like, well, yeah, the back quarter, but I'm gonna do better next quarter. I don't want that.

28:17 Okay, we we need to run ourselves and our organization In such a way that we show up All of us every single period, you know, every single line of business, channel, geography. And and and so on, right? And if if if that becomes the culture, uh the expectation and the reality, uh, you're gonna do way better than the rest of'em because You know, sales tends to be uh, you know, a very uh unevenly distributed thing.

28:42 And you you wanna work on that. And um so the expectation is, you know, I don't care how far ahead of plan you are, you have a shitty quarter. That's not a problem with me. I can't build on you. I can't trust you. I can't expect that you're going to deliver. You work on that all the time, right? People that are that are not uh consistent. You better you better find a way to get there. Not overnight, but you're gonna make moves. What moves are you gonna make? What are the reasons that this is

29:08 inconsistent. What are you doing differently? Right? Because we always say a good quarter is one where you exceed your numbers. But also one where you set yourself up for the next one. You gotta do both. It's not just about making the quarter. You also have to lay the foundation for the next one. And the rest of the year. So you've got to think much more long term, much more strategic, you know, about your business rather than I'm just trying to hit a number for the quarter, you know?

29:30 I think of that sort of like running a billiards table, right? Like where you leave the ball matters for the next shot. It's a good idea. Exactly. There's a natural tension between sales and product. And at the start of an organization's life cycle, you can sort of get away with customizing the product per sale. But when you start getting into enterprise, you can't do those things. How do you think about the relationship between sales and product and who's driving the bus and who's not and how that looks? Yeah, you know, there's there's there's tension there, uh sometimes healthy, sometimes you know, not as healthy and uh You know, it it it's it's a relationship that has to be

30:11 manage very aggressively, certainly one of product organization that really views the reality of sales as their problem. Okay, as opposed to, well, You guys are just not smart enough or whatever. um and they're interested in all kinds of things that have nothing to do, you know, with the sales organization succeeding. the the alignment again is is number one. But you have situations where, you know, sales goes I This is not working.

30:34 Okay. And we have enough data points to say that it's not working. Okay, what are we going to do? So that dialogue goes on all the time. Um, you know, we make mistakes, you know, we we prioritize incorrectly, uh, we're too slow on certain things. I mean, all these things happen, right? But that's a that's a continuous force field that we're we're working on. Um, you know, the the the the thing about sales is that You know, great salespeople

31:02 Can't sell a bad product. Right. But Lousy salespeople can sell a great product. Okay.

31:09 And that's that's very important because, you know, oftentimes in Silicon Valley they think that sales is the problem. And I'm like No, because if you had a great product, you know, even an average or a below average salesperson will be able To sell it. Right. And uh typically sales problems are are product problems, but

31:28 Typically that's not the the initial assessment because Yeah, you don't want your baby to be called ugly and you know, the investors around the table have invested in your technology, so you don't want to openly face your demons and and really confront things the way they really are. And uh that then leads to a focus and and solutions that don't work. Like well let's hire another VP of sales. Well I won't work.

31:50 'Cause your product is a problem. You know, so So I I do hold the the product people to a very high standard because we have to make very average uh salespeople productive in a very predictable manner. That's hard. And that's exactly right. That is where the focus should be.

32:05 Because if I have to hire brilliant salespeople, even though even brilliant salespeople can't sell a lousy product There aren't that many of them. So that's not a scalable model. Would you go as far as saying a great product sells itself? Almost Um, I've certainly seen that um, you know, with my own eyes, uh in in in in various companies.

32:24 You know, I used to say about Snowflake it's like a two year old golden retriever, all I gotta do is uh you separate'em around and everybody's gonna want one. And uh it it it sometimes wasn't that far off because it was the the the the benefits uh were amazing. I mean you benchmark these products and sometimes they were an order of magnitude faster, you know, because of all the the architectural breakthroughs and the the provisioning of the workloads. Um so people were like, Wow, this I mean that that wow experience is just is just priceless, right? So all you have to do is get people to try it. And they go like yeah, this is a no brainer. And so in that sense it almost sells itself.

33:03 I mean we used to see that with with companies like VMware as well. I mean w you know, once people were sold on virtualization, I mean all they were doing is picking up orders, right? This is this is actually, you know, a bit of a problem because You know, you hire people from a very successful company. um they've never really sold because they were just riding the momentum. You know what I mean? And then they get into a company where they do have to really sell and they do have to campaign and they do have to fight. And they have no idea because

33:30 We didn't we never had to do that before, right? So I I like to hire salespeople who have really been in shit fights because that breeds, you know, the type of skills and focus that you really want to have, right? Or people that are good at uh you know quoting and picking up orders. That's an incredibly valuable point. I don't think I've ever heard anybody mention that before. Uh w what are the methods of thinking that you would use sort of in the first ninety days

33:56 To assess the degree to which The problem Is not sales or or product. Like how would you go about determining where that problem lies. Do we have the wrong sales organization or the wrong culture? Do we have the wrong product? And and obviously it's probably a little bit of both, but how do you go about thinking about that?

34:13 Yeah, and and and by the way, uh it is often a little bit of both, which is what creates the confusion, uh, you know, around these topics. But look, you know, I'm I can't tell you how many customers slash prospect calls I've already been in this week. It's Friday, you know, and there were numerous when I must have talked to seven or eight banks this week, you know, the CIOs, CEOs. I experienced reality the way the salespeople are, obviously a little bit differently because I talk to higher level people in organizations. But you know. I experience things firsthand. What you don't want to do is sort of, you know, rely on information, you know, because

34:49 You just get second hand, third hand, fourth hand. And you don't know whether you're dealing with a feeble person that has no fortitude or whether you're dealing with a real issue. So there's no substitute. you know, for in inspecting things at the front lines and really be part of it. I always tell salespeople if I can't sell it, I'm not expecting you to sell it, okay? So if I if you're gonna get your nose bloodied, I'm gonna get my nose bloodied, right? And um so you need to get to reality. In other words, but you need to see things as they really are. So you gotta be very, very careful with with second and third hand, you know, uh information.

35:24 And sometimes you know, I I gotta whip people up the hill. It's like look, you know, you guys you guys are basically you're intimidated by the marketplace. You know, you're your own worst enemy because you just lack fortitude and confidence and you can't, you know, articulate things. And that's you know, that's all under the header of sales enablement, right? And uh You know, I personally get after this. I'm very aggressive in terms of uh, you know, really uh pressing our case in front of you know the customers in the marketplace

35:55 Because I need my organization to do the same thing. If I'm not doing it, you know, then then you know, they're not either, or they're not gonna go at it with the same confidence and fortitude. So leadership is important there. You want to set an e an example that people go like, Oh, I guess that's the way it is then, then you know, I should be too So you you bring forward but you know People see me talk in front of a customer, they go

36:19 And they see the customer react and they see the customer ask questions, they're like, Hey, I can do that too. Okay. Uh there there's no better learning than right. in front of where the action uh happened. So um you you wanna bring that to if you just wanna

36:33 post some data sheets and some videos and what what have you and sit back and wait for things to happen. You're gonna get killed. So you you want to press all the way into the end zone and then people go like okay, I think I can do it, you know? I've seen it. The results are there. It works.

36:49 We we talked about positioning yourself for future success and we sort of used the the analogy of running the billiards table. Wha what are the ways that an organization positions themselves for success tomorrow that it is hard to do today, that's hard to compete with. But makes tomorrow easier. I I've always told told other CEOs, especially people that are sort of first time CEOs and and and new Um

37:16 that you can count on the fact that you will be confronted with a need for transformation because it happens to all of us. And the question is Will you recognize it? Will you recognize it in time?

37:31 And will you be able to execute on it? Those are all super big questions. Um, because you walk into a situation it works and then one day you wake up it's not working as well anymore. The world has changed. And the world does change. The technology changes and we see a lot of that right now with AI, obviously. people's perspectives and and the narratives they're they're all up for grabs. I mean it's one of the most disruptive things I've ever seen happening, uh in in in the world of software in all my years. um you know of doing things. But you also

38:03 Yeah, the early adopters, you know, in in Jeffrey Moore style of of of thinking, um, are very, very different than, you know, when you get across the chasm and you're dealing with a more mainstream customer. Um,'cause they they buy differently. You know, I peop people ask me, you know, why why do you think this is sort of a late adopter? I'm like, Well, because he hasn't bought yet. That's why. He would have bought already if he was an earlier adopter, okay? So by definition he didn't. Why didn't he? Okay. So he has different ways of assessing and thinking, you know, about the value, about the risk. all these kinds of things. And um these things are are are difficult to observe. Sometimes, you know, you just wake up and you're like, you know what?

38:44 Things are different now. They have changed just in in the aggregate, you just sense the change that is that is that is happening. Um, and then it becomes a question, okay, we have to adjust, we have to change, we gotta do all these uh you know, all these things. But the need for transformation people don't expect uh because we have a we have a very you know, humans have a very linear attitude about the world. In other words, it's just gonna continue as it is, and we rinse and repeat and it will never change. No, it will change. And it's just a matter of, you know, can you recognize it? And can you do it in time?

39:15 And then will you know you know, how to successfully deal with that and a lot of People can't. they'll they'll fail on recognizing it or they fail on the timing of it or they fail on the on the execution of it. And We've had a lot of great enterprises obviously that we all know. I mean you look at uh you know the

39:33 The Fourteen Hundred, the Fourteen Five Hundred, I mean how many companies are still there that were there? twenty years ago and thirty years ago and fifty years ago, right? Um So you you gotta as as a as a as a leader, as a CEO, you gotta be extremely open minded about

39:48 what is happening, right, and not assume the linearity of the of the business. It takes many forms. Some things are incredibly disruptive, you know, some things are um you know are marginal. Um So that's you know by the way, the rest of your organization will not have this posture because they're you got their heads down. They're very much in a pattern in the mode. So that means that you really d you you don't wanna have that.

40:13 that mode about you as the CEO, as the leader. You wanna be basically you make everybody else work. You got your head up when they have their head down. You s you mentioned AI as the most transformative thing y you've seen. Talk to me a little bit about About AI. I've not always been the world data, but I started out very early, uh, in in my career in the world of of data and I've gotten back to it again and again and again. So I've I've seen the challenges from the early days.

40:39 you know, just being able to take transactional records and And being able to put them into a format where it was sort of human readable and and and sensible, uh, you know, for humans to consume and I mean, it's just going all the way back to the to the late eighties. you know, when we have what we back then called decision support systems. We didn't I mean we didn't even have the term of business intelligence or none of those terms even existed back then.

41:03 But you know especially and then by the way, there was only certain verticals that did this. Like retail was really big on it, you know, they would be able to sort of to break the SKUs down by you know by by location and channel and store and all these things. Very, very granular detailed data. These are massive mainframe processes that would that would run, usually on a monthly basis, you know, let alone on the twenty-four hour cycle. So every month you would get data. That was already a big deal back then. So things have have have progressed. Our relationship with data has progressed, you know, very uh very slowly. painfully difficult and uh obviously the the biggest change we had un until now was really the introduction of search, right? I mean that's not twenty five years ago.

41:46 I mean, I became a search junkie, I still am to this day because I find it so empowering in terms of your relationship with data, but search now feels old because you know it matches on strings, uh it's it's stateless. I mean it doesn't remember a damn thing from one search to uh to the next. And it has no context. You know, if you search on snowflake, you might get the weather, you might get you know, you might get the the the social phenomenon or you might get the company'cause it doesn't know, it just knows the word. Um

42:11 So We now have opportunities to to to massively enrich and contextualize you know, search, you know, uh searches for data. So I really see what data is gonna just get catapult into the future here. Just just unbelievable. We'll be able to ask harder and harder and harder questions. um of our own proprietary data and and get better and better and and and more valuable answers. I mean it it's it's fairly easy, you know, to use natural language interfaces now the whole text to sequel has become table stakes.

42:47 I mean you you you can you can interrogate, you know, uh you know saleforce data on Snowflake, you know, what just just text a SQL. And it's really nice, by the way. I mean hell it's a hell of a lot better than the than using dashboards uh for for for the most part. Not not all of it, but for the most part. So fine, you know, that's a step forward, but you know, I wanna ask very business specific questions. You know, yeah, an insurance company. may say hey you know I have disproportionate you know bodily injury claims in the state uh compared to the surrounding states, you know, A, what's going on? B, uh I'm I'm gonna have it again next quarter. C, what might I do about it, right? Should we just stop, you know, underwriting in this geography altogether, which is what's happening in California right now. And uh or or you know, we we obviously it's a pricing issue because how do we price risk, you know, uh is it a policy issue.

43:36 Those are questions that, you know, God, analysts would be launched on, right? Because people would do the reasoning, not the system. That the system becomes like a a an an advisor to you in in in in literally in damn near real time. So This is this is this our our relationship with data is is gonna get amped up here to use a term. in ways that we just can't even uh imagine. Obviously content generation is is what everybody's looking at and they find it very cool and it is, you know. Um but how is it gonna work in medicine? How's it gonna work in education? I mean it's just uh it it just It's going to be a renaissance, you know, in in in intelligence and computing and and and the uh how we mobilize data for for purposes.

44:19 Yeah, it's uh it's a great time to be uh be alive and I think uh the innovation will drive a lot of um a new employment. we will also you know have a lot of uh you know obsolescence, you know, in in jobs and even But that's the nature of um you know of of uh of of a capitalist, you know, free economy. Uh creative destruction is is just the nature of stuff and uh we do pretty well with that, even though it can be disruptive.

44:48 I mean we u we used to learn one profession and that would last us for our lifetime. Now now you need to shift gears more than once a year lifetime because it's moving so much faster, right, than uh anything we've ever seen. So the acceleration is going to be dizzying. There's no no two ways about it. Is is there anything that gives you hesitation about AI? Yes, of course. And then people talk about this, you know, all the time. I mean social media created the the fake news phenomenon because, you know, so many people use social media to inform their reality, which I don't I don't recommend that, by the way. Always tell people turn that shit off, man, because you know, you're you're distorting

45:24 what you how you really should be interpreting uh things and and I don't I don't like that, uh, but social media had a lot of good things, uh, you know, obviously, but it also had you know the the the flip side. you know, is that you know, people uh it it became very, very powerful influencing people in terms of how they experience the world. Uh obviously the this can take that to the nth degree. You know, uh I mean it can change the realities. How's that gonna go? Right? You you can see the uh the opportunities for

45:54 for abuse uh becoming extraordinary. Yeah, we're gonna have to deal with that, you know, but uh we have to still count on the goodwill of men and women because, you know, that's all we have at the end of the day, right? One of the things we talked about earlier I want to come back to just before we end the interview is you you talked about we all make mistakes. How do you handle a mistake? At the moment you how do you recognize that you've made a mistake? And then w what do you do when you've made a mistake? You personally. I use mistakes uh as

46:23 And it's a cultural moment and a teaching moment. Because uh it's actually good for me to go Oh, I really screwed this up because it's sort of I Y y you can do really well in the world by being a fast course corrector. What is devastating in organizations is when people defend bad decisions, okay?

46:41 But if if if you can fail fast, that was that was Scott McNeely used to say that fail fast. If you can fail fast and correct You can do really well. So mistakes can become a real cultural moment, like, hey, you know, I really screwed this up. Let's let's unpack this. and understand what were we thinking, you know, what were the assumptions that were wrong? Right.

47:00 And then you know, that's a good culture because now everybody goes like look, I I can revisit my dumb positions now. Right? Another Fail fast, you know, have urgency around your bone hat. you know, decisions that you made and the things that are not working. That's really what you want. And uh when I do it, you know, it's basically now it gives permission to everybody else to do it. I I'm I'm basically

47:23 politically neutralizing, you know, the idea of making mistakes, because making mistakes everybody who makes decisions will make mistakes. You know, people always ask me what are your biggest mistakes? Well, my my biggest mistakes are always around hiring, you know. It's like you know, I I've hired a lot of great people over the years, but I've also made my share of mistakes because that's just the nature of things, right? But if you're willing to confront it, I I sometimes I I talked about this in the book as well. I may make mistakes again and again on the same topic, you know, but the one thing I will tell you is I won't stop until I get it right. Okay. And I will in other words, I'm I'm willing to say again and again that I screwed it up, but I won't stop, you know, until we're in the in the place that we um that we need to be. So that that's

48:07 very powerful message to people to say, look, this is the behavior we want. Confront your demons. basically uh you know go after the things that didn't work that were wrong. Um God, if you can get people to because most people you know, they're afraid they're gonna defend their decisions and uh

48:24 And especially when it's a gray zone, right? In other words, it's you know, some people are, you know, not good enough to keep, not bad enough to fire, you know, the the the those are the worst cases because like, well, you know person looks nice, speaks speaks well, articulate, you know, but they but they're the ultimate passenger. They never move a dial, right? And and you know, those are the ones that always survive, you know, way too long, you know, until we have mass layouts and all this kinda crap going on. But you can get people to say no, you know, when there's doubt, there's no doubt. You know, have a higher bar, you know, have high conviction.

48:56 That's hard, you know, trying to get your organization to get to that level, you know, of of you know, uh basically very unyielding, uncompromising. That's hard because most people wanna lay the bar lower and, you know, not rock the boat, not be confrontational because all that stuff is hard, hard, hard, you know. Those passengers are probably the easiest ones to hire too because they get to the interview, they say the right things, they check all the right boxes. And then they come in. Interviews are notoriously like difficult to to hire with, I would imagine, because you just really want to see on the job performance. How do you how do you assess that? Well, uh you you're you're exactly right. Uh interviews are uh far less valuable uh n not for all roles. I mean there's roles where where interviews like for example in engineering, I mean if they're like

49:41 to put'em in front of a whiteboard and say, Here here here's you know right coat that does this. So it's so you you you can You can very much, you know. test people's skills uh you know that way. But you know, in in in in in the other roles where, you know, um you know people become good at selling themselves, right? Because they've learned that over the years and they they they talk well, they look well and they're very pleasant and they're getting along and all these things. But the way to find out anything about people is to fully surround where that person has been, okay? Uh you know, if they've been at Company A, you know, you go find out who in my company was at company A wh while this person was there. And let's go I'm gonna go ask inside the company first.

50:24 Who knows this person because they you were a contemporary and you know, what was that person's reputation and and so on. You'll learn a you learn a whole bunch of things very quickly. You don't even have to go outside of your own company to uh you know to find out. And then you you see if if if consistency, you know, or of of of information is is manifesting or it's still confusing and contradicting and all this kind of stuff. And then we go outside, you know, we we go call people that we know or have known and say, Hey, um You really and you you really wanna hear from people that have directly worked with them and said, What was the experience like? It doesn't have to be an indictment type of conversation. It's like look, I just wanna know more about this person.

51:03 How did this go? You know, tell me some stories, you know. 'Cause now now you start to really get color and texture around a person as opposed to the SNF test, which is what an interview uh really is. And the the the thing is you you're gonna learn You you're gonna get great conviction now because you're like, you know what? I'm I I think we're really on to a great person.

51:22 Or you're like, wow, you know, I I'm glad I made these calls because you know, we were we were this this was not trending, you know, correctly at all. And I find that people uh rush, especially in fast growing companies, you know, we have hiring targets. And they're just slamming bodies and it's it's the it's the worst thing ever. I'd rather hire, you know, more slowly but better than faster, and I have to do a lot of, you know, course corrections along the way. And people are lazy. They're like, Oh yeah, it's probably okay.

51:52 No. Prob probably okay is not the standard. You need to know and have conviction. And you need to take the time and do the work to to develop that conviction and especially in places like Europe where So difficult to separate and so expensive and so time consuming. The opportunity cost is enormous. you really, you know, need to do the work, right? So uh you've got to bring that into your recruiting culture. It's like it's not like a check a box

52:17 See you on Monday. No. It it sounds like you just hit on something that I I think is one reason that your cultures are always so successful, which is you just elevate the standard. I mean, um having eye standards goes back to the insanely great uh Steve Jobs I mean he he he he had a really hard time dealing with with mediocrity in in any you know, in any realm and uh Yeah, it's very hard to live with, by the way. Ga Steve was super hard to live with. I mean, uh everybody was a shithead and didn't know people's names and all that. Yes, I know it's hard to live with. And I'm personally I'm not that way, by the way. I don't I don't treat people that way at all.

52:54 Uh but at the same time, you know the leadership needs to uh really reinforce. We have very high standards and then Other people will want. to follow that. Okay, they will they will do it because they feel like that

53:07 That is the way. That is the right way. Leadership sets tone. Sets expectations. And if you don't do that, yeah, you you become the California DM V, the worst goddamn place in the world to try and get something done, you know? The the lack of leadership, you know, people go slow, they go substandard. I mean it's just a hellish world, you know, it's like

53:27 Um I I feel sorry for the people will have to be there. So as leaders Let's create an environment where great people feel like, yeah, this is a good place. This is a great place. They have urgency, they have high standards, they move fast. You know, all That that's what you want. That creates energy. It gives energy. It it just lets people the the the right people will love it. And some of the wrong people will go like, you know what, this this place is too intense for me. I can't handle it. You know, I need the kids from school at four eight four PM I get that, right? But it's like culture.

53:55 It doesn't mean that people are bad, you know, when they don't like their culture. It just means that they are not a fit. They're just Different. You know? Totally. Uh we we always end on the same question, Frank, which is what is success for you? You know, um, it's just not a word that

54:11 you know, I'm constantly thinking about or you thinking about that, you know, at all. Um, you know, I'm I'm And and by the way, I'm your thinking gets sometimes poisoned by the type of words that you use and the concepts. That you're preoccupied with I mean. people sometimes ask me, what's your legacy? Legacy is not a word that I use, okay? Um it's not i I I find that very sort of s a lot of self absorption around that stuff. Like You know, I I I need to live beyond the grave. I I really don't need to and I don't wanna be, you know, feel so important that that's even a question.

54:44 You know? My enterprises that I'm in charge of must succeed, you know, they must succeed because that is the contract that I have with all my stakeholders, you know, they're not just investors. Obviously I want them to succeed because the investors succeed with us My employees are going to succeed as well. I mean, I'm trying to give my employees, you know, an incredible shot at changing their

55:05 their station in life, advancing their careers where, you know, ten years from now they still feel like well this is the best thing I I I ever did. And I get a lot of that from from from people that uh work with us in our prior companies and it's it very personally rewarding to hear that that they still, you know, have you know sort of this warm feelings about the experience that they that they had. Not just the money they made, but just the people they were with, the things they did, and they became better than they ever thought they were, right?

55:33 That's success to me is is is is achieving that in my my my partner ecosystem. I want them to be wildly excited about being our partner. They're succeeding with us, right? So So we we we try to make all parties uh you know succeed in their own worlds, you know, with us. Employees have their own agenda, they're families, they have circumstances, they have issues. Um so you know, we help them and and and everybody else that's that's part of our uh our our universe. I guess that's the best way I can answer that question. Yeah, you bet. Any time. Thank you.

56:25 Thanks for listening and learning with us. For complete list of episodes, show notes. Transcripts and more. Go to fs dot blog slash podcast. Or just Google the Knowledge Project.

56:40 Until next time.

What you see above is a preview of the first minutes. One unlock costs 10 credits and covers this episode forever: full segment and word-level timestamps on this page, plus .txt, .srt, .vtt and word-level JSON downloads, as many times as you like.