For a number of years I've been fortunate to get an inside look at a very unusual company evolution. Very few startups make it to an IPO. Even fewer are then acquired by a larger company... and not all of those acquisitions turn out to be success stories.
This is one that has.
Approximately sixteen years ago the founders of ExactTarget used a napkin to sketch out a company. Four year ago the digital marketing automation and analytics software and services company went public at a market cap of over $1 billion, and I wrote about a company founder's mental and emotional journey from start-up to IPO.
Then in 2013 ExactTarget was acquired by Salesforce.com for approximately $2.5 billion and was transformed into the Salesforce Marketing Cloud; then-CEO Scott Dorsey shared what he had learned along the way.
And now the company has announced it will invest over $40 million to create a new regional headquarters, Salesforce Tower Indianapolis, and add 800 new jobs over the next five years.
That makes this the perfect time to catch up with Scott McCorkle, the Salesforce Marketing Cloud CEO.
Blending cultures is a tricky thing to do. ExactTarget was a startup with its own vibe, having like most startups an "us against the world" mindset... and now it's "us against the world, with someone else." That's a tough transition.
Whatever the cultures might be, any cultural difference requiring assimilation is a process.
You can't will culture. You can't create it. Culture is a by-product of working together.
So as we work together, as teams come together, as we accomplish things, as we feel great about the things we accomplished together... that identity naturally changes and you become part of the new thing.
Accomplishing things together has a huge impact. In the whole story that is ExactTarget/Salesforce, I love the whole story, but right now is my favorite part of that story. We're creating this great environment for people to be successful and we're innovating in exciting ways.
And I really like the connection to Silicon Valley. It's fun to be in Indianapolis but I love our connection to Silicon Valley.
A lot of acquisitions don't work. This one has, because our people made it work.
Success helps blend cultures. Like in sports: winning teams always have great chemistry. So you could have focused solely on business success, but you also have to balance the need for cultural assimilation...
Let's think about that in terms of priorities.
Growing companies are fun places to work. Growing companies create opportunities for employees. Growing companies are vibrant and energetic and exciting to be a part of.
If we're growing that creates a completely different foundation from which to solve problems and address things we need to change. If we worry too much about every single problem, then we don't grow.
Not all problems need to be solved. Some do, and they need to be solved right away. Problems have a way of presenting themselves to you with equal urgency, so it's important to be able to say, "Yes, we're going to solve you..." and some other things may have to wait.
Striking that balance is really important, and you see it in our results. Since joining Salesforce we've grown even faster, and at the same time we were placed in the top 10 for Best Places to Work in Indiana. Being able to accomplish both of those things is awesome.
So when you think about culture, give me an example of an outcome of culture.
One way is to think about delegation. Every leader delegates, but delegation only works when you as a leader commit to the successful outcome and to being part of the process. When people see their boss bringing lots of energy and contributing and working to make things happen, and being committed to the outcome, that attitude spreads.
I've always felt that if this company was a furnace, our efficiency rating would be 97%. We do what a furnace should do - there's very little wasted energy.
That's what culture does: it perpetuates values that are important. People fixing things, building product, having ideas, it's what we all focus on.... and when people see that you trust them but are also personally committed to the outcome... that makes a huge difference.
Speaking of problem solving, the water of your job means lots of people come to you with problems. How do you decide which problems to focus on?
Coming into Salesforce, I like the attention to core values. To be in meetings with Marc Benioff and the executive team, week after week, when discussions happen and decisions get made... to see how we look back to values in our planning documents and to see the influence that actually has on how the company is run has been really impressive. I've learned a lot from that.
That makes some decisions easy. We've taken actions on gender pay. When something happens that is counter to our core values, like RIFRA (Religious Freedom Restoration Act), those things definitely take priority.
Innovation is also a core value. Innovation is in some ways the curse of software companies: you get a few minutes to enjoy the new release... and then there's a huge list of things to work on for the next release. I say "curse" of software but it's also a fun rush, too.
I have never seen a company as restless or unsatisfied with current state of innovation as Salesforce. There's always that drive to push forward. If you love action, it's a great place to be.
So, our core values is one answer for how to prioritize, but so is growth. I made the decision that we need to really grow. We go through our planning process called V2MOM, for Vision, Values, Methods, Obstacles, and Measures. As a business unit we then overlay the three to five big bets we want to make. Since we were a company that was autonomous and now we're a business unit with functional areas aligned and reporting through a matrix organization, focusing on those big bets creates a glue to tie everyone's individual functional plans together. That really helps.
When you know who you are, and you know where you're going, choosing the problems to solve becomes a lot easier.
You grew up as a product person and now you're a CEO. Some people are one, some are the other, relatively few people do well at both... how did you make that transition?
Early in my career, when I was much more of a pure engineer, I always wanted to know how our software was used.
We would have meetings to discuss what the product should do, and it became clear to me that if I could actually represent the customer's need that would create the ability to influence and change and actually drive decisions. People would listen.
In one meeting we were having a big discussion about changes to make to our software, and I had gotten to know a customer really well, so I said, "Let's ask." I used the speakerphone to call the customer. I said, "I'm sorry that I just called you from a room full of people, but the other day you and I were talking... would you mind repeating what you said?" And he did.
At that moment I decided that even though I'm a tech guy, I would still find find a way to talk to a customer every day, and I have talked to a customer basically every day for the last eighteen years. That way the things you say about customer needs aren't arbitrary. You can actually say things that are very tangible and provide real value to the discussion.
You're in charge yet you don't have all the answers. No one does.
One way to approach that involves RIFRA. Our employees came to us and said, "Here's what's about to happen." An amazing grass roots from our employees really helped us understand what was happening and that we needed to engage and help.
But I had no idea what to do. And one day I find myself sitting around the table with legislative leadership, trying to fix things, and that was one of those moments where I thought, "Whatever you do, don't break stride, don't stop, and just try to figure this out."
The same is true with operational issues. We're adding 800 people. Immediately we get asked, "Where will you find those 800 people?" Well, we're going to hire them.
We have tremendous confidence in our team. The recruiters will do their thing, HR and our employee success group will do their thing... we have great people, and if we support them, we can do big things.
You talk about being willing to fail, but if I'm an employee failure is a double-edgedsword: I want to take risks but if I fail I get blamed... so I need people around me who support intelligent risks.
Some years ago we went through a period of huge growth. We were doing everything we could to keep the software infrastructure going. The company in general felt anxious about how well the technology was working.
One of our top technical people was doing heroic work, both planning for the future while keeping things going... and he made a mistake that really created a major disruption. There was this huge outcry, like from sales, of people saying, "We need to show we're taking action, I need to be able to go back to my customer and say we took care of this..."
Kind of like a losing sports team that says, "We fired the coach."
Exactly. So we had an all-hands call, approximately 300 employees on it, and we said no. That's crazy. Think what it would be like to work here if that's what we did.
If someone needs to get fired, maybe it's me, because this employee hasn't slept in three days and his life's all out of balance... and that's my fault, not his.
I've been very lucky to have great bosses who treated me that way, and I try to do the same, and that helps build a culture that makes people feel comfortable taking risks.
You also talk about not letting "great" get in the way of "good," and about pushing things until they break.
If something breaks, fine, you'll fix it. You will always stop short of what you can achieve if you don't find the boundaries, and that sometimes means breaking things.
It's also important to accept that big, intractable technology problems never get solved unless you start, and build things, and grow from smaller pieces.
I've never been able to figure out how to get to a perfect design. By the time you get there it's all changed. You have to be incremental.
So how do you decide what is "good enough"?
Your customers help. You're either in a comfortable resting place or you're not. A comfortable resting place is one where whatever your product does or doesn't do, a customer can start and finish and say, "That is a complete unit of work or value."
The product may not do five other things, and that's a problem... but in its current state it works. When that isn't the case, when the customer says, "Oh, right in the middle of this I expected it to do this, and it doesn't..." then that customer gets no value.
That's not good. Forget great. That's not even good.
If you know your customers, you know when you are achieving a complete unit of work. Ultimately your customers help you define and build something that is good--and then you can use their feedback, and your own ideas, to make it great.
One last culture question. You announced a commitment to deliver 100,000 total employee volunteer hours to local Indianapolis nonprofits this year as part of the company's 1-1-1 corporate philanthropy model. That's a huge statement not just on company values but on the culture you want to maintain.
There are so many ways to reflect on that, but ultimately, i's just the right thing to do. We do it without expectation of benefit, but the benefits are so great.
For example, there's this whole question of whether millennials are loyal to companies or to causes. We can make the argument that a lot of millennials are loyal to causes, and being connected with something that makes the world better is important to them... so if an employer can help facilitate a connection to a cause, that's important.
But even if that wasn't true, it's still the right thing to do, We would still do it.
The right thing to do is the right thing to do on multiple levels.