1. “Growth is the goal and growth comes through having innovation. Innovation comes through having great engineers, not great product-marketing guys.” “Empowered engineers are the single most important thing that you can have in a company.” “[An innovative culture is] where the crazy guys have stature, where engineers really are important…The Campbell School is that engineers need to have clout.” I’ve seen businesses dominated by a single discipline many times. Sometimes it is sales, sometimes it is engineering, sometimes it is scientists, sometimes it is finance, sometimes it is operations and sometimes it is marketing. The background of the CEO obviously makes a huge difference in what discipline dominates. It is clear which discipline Bill Campbell thinks should dominate.
One of the most interesting things about Bill Campbell is how many business executives have turned to him for coaching on operations. Steve Jobs, Jeff Bezos, Eric Schmidt, Larry Page, Ben Horowitz and Marc Andreessen have all been coached by Bill Campbell at one point. I suspect that Campbell’s success is an example of positive feedback- the more CEOs worked with him as a coach, found success, and discovered how effective and loyal he was, the more executives wanted to work with him. Effective, insightful, hardworking, humble, trusted and loyal are five important magic words. They are not the only five magic words, but they sure are important.
Benchmark Capital’s Bill Gurley points out: “When you have Bill coaching the entrepreneurs, it’s like having extra wildcards in a game of five-card draw.” Marc Andreessen adds: “This view that engineering should dominate was extremely unusual in Silicon Valley in the 90’s and early-mid 2000’s when it really mattered for the companies Bill worked with (Apple and Google in particular). And particularly extremely unusual for people with sales and marketing backgrounds like Bill himself has. It’s become much more common in Silicon Valley today, but I can’t tell you how unusual it was for Bill to have that view all along.”
2. “I first came out here, everybody wanted to hire the IBM sales guys to be their CEO. Blue suit, white shirt, red tie. Unfortunately, these guys were all sales guys. I mean, that’s all they did. And those guys all failed miserably because they didn’t know the product, they didn’t understand the technology; all they could do was sell.” It is no longer enough to look good in a suit, have great hair and teeth, and be a fantastic salesperson to succeed as a CEO. If you don’t understand your own products and services, the competition will eat you alive. Great CEOs today have a big bag of many skills and are learning machines. In an interview Campbell said: “I was very devoted to learning the businesses…. I never felt I was behind technology wise. I could learn just like everybody else. I have a reasonable bias for technical stuff and it’s not been that hard to learn.” Marc Andreessen has pointed out that while Bill Campbell is respectful of engineers, he is not threatened by them. Campbell has cracked the code about to have a productive partnership with tech visionaries.
Marc Andreessen also makes the important point that “Bill himself came up in sales & marketing (at Kodak and then at Apple). 99.99% of guys with his background never reach the conclusions he has even after years in the Valley.”
3. “I am a big bully about the sales process where you’re the CEO and I want you to buy something, so I take you … for drinks or buy your wife a gold chain. People think these guys, they’re killers, they’re machines, they know how to do this stuff. They make sales this mysterious process. The jet pilot swoops in, bombs everybody up and down, and then everyone else is ready to go and clean up. I don’t believe it. I want to come in there with a quantitative process and say, ‘Let me tell you what our stuff does and let me tell you based on our work what this can do for you in terms of your productivity.'” The sales profession has evolved significantly over the years, and it is certainly much harder now to be a salesperson and not understand the product or service. Bill Campbell believes that sales is an essential profession. What he is saying is that sales is a different game now than during the days when people were effectively selling IBM typewriters based on old-school sales processes.
There isn’t enough slack in the system to make the “schmooze the CEO, buy a gold chain” sales process effective any more. People who sell effectively today know that much of the sales process is about providing a solution and helping customers with the internal processes related to the approving the sale. Marc Andreessen agrees: “Great salespeople in the modern era are consultants to the customer to help the customer first justify the purchase of, and then succeed with, the product.”
4. “We have to be careful about the customer. I learned this from Steve Jobs years ago. When I came to Apple, I brought my Kodak research mentality, and Steve’s view was, ‘Stuff your research. Nobody’s ever going to give you feedback on something that they can’t conceive of.’ And so we would argue those points. And I [would] joke with him and say, ‘A marketing person would never have conceived of a Macintosh. But a marketing person could have made it better.’” There are certain people who are savants about new products and services. They just seem to know instinctively what the customer wants. In my own life, the best product savant I have seen is Craig McCaw. He has an amazing way of putting himself in the shoes of the customer. Watching him with a new product in his hands is fascinating. Having people who have brilliant product or service insight is a rare thing for a business, so processes like Lean Startup have been created to produce something similar. A core Lean Startup principle is that the process of product or service discovery can be systemized. Businesses have learned that “predicting the future” is vastly inferior to discovering what customers really want, using experiments with real customers that are based on the scientific method.
Getting valuable products and services to market is far too easy for offerings which are not driven by genuine customer need. The traditional process, where product managers collect data from focus groups and then a process kicks in that results in products or services arriving months or years later, is walking dead. The Bill Campbell quote immediately above is from a McKinsey interview and it is highly probable that Steve Jobs did not use the word “stuff”, given his tendency to use colorful language. Bill Campbell may have changed it to “stuff” to be polite to Steve and/or to McKinsey. But Bill Campbell himself is no a slouch in the salty language department and maybe McKinsey made the edit with Bill’s permission.
5. “Brilliance can’t be taught, but the operational stuff can be. Do you have operational instincts? Who cares? If you work with me for six months, I can give you enough prowess and process to be able to go run something, and really do something with it.” “That operating shit — believe me, I fucked it up so many times. I’m an old guy; I’ve made many mistakes.” It is encouraging to hear that operational excellence can be taught, but I would argue that some people are more suited for it than others. For example, managers like John Stanton, Sheryl Sandberg and Jim Barksdale seem like natural operators who also received the right coaching and mentoring early in life. That is not to say that Bill Campbell isn’t right that most everyone can get better at being an operator. Regarding Bill Campbell’s point on making mistakes and learning, being a good at most anything is furthered by experience, and experience often comes from making bad decisions. The difference between great and not-great executives is that the former learn from mistakes and make more new ones than old ones. Executives who don’t pay attention to their mistakes and learn, don’t last as long as they once did.
6. “People like Mark Zuckerberg, they see an application of science that hasn’t been done before, and they run with it. They’re founders. They’re product creators.” “I don’t really take the company unless the founder is passionate and really wants to create something durable.” There’s a reason why so many great companies are formed in cities near great research universities. Breakthrough applied science means products and services that are far more likely to be 10X or more better than what is being offered today – or even something that is fundamentally new. Just a little bit or even somewhat better than what came before is rarely enough to achieve success in a way that a venture capital-backed startup needs. Breakthroughs are best if they create barriers to entry, which allows a business to be durable.
7. “You need a leader. You have to go out and recruit the best person you can who knows how to create an innovation culture. He or she doesn’t need to be personally the most innovative person, but he or she needs to know how to foster innovation. Then give that person license to hire. Go get yourself some teams. Recruit people who have the ‘DNA’ that you want.” An often repeated theme of this Dozen Things blog series is how much effort leaders must put into recruiting the right people. Everyone pitches in to help recruiting in a well-run business. Great people attract great people, and if you get the recruiting process right the benefits grow in a nonlinear way. Campbell talks about how the right team, people, and the right systems can create “multiplier” effects to help scale a company and drive greater profits.
8. “If you don’t have the right product and you don’t time it right… you are going to fail.” “Great product and great people is the whole answer.” “It is all about people. If you have the right people you will end up with the right culture.” “I’ve fired more people for attitude and behavior than I ever have for performance.” The number of people focused on creating a company without a product is, well, a surprisingly large number. Even if these people do somehow manage to create a valuable product, without great people, the result will be a disaster. The other point Bill Campbell makes is that being too early in a market is indistinguishable from being wrong.
9. “When I work with startups, the last thing I work with them on is marketing. I don’t want to overestimate marketing. Apple’s marketing is having great products.” Too many marketers believe advertising (e.g., television commercials) create brands. Michael Mauboussin astutely points out: “Brands do not confer competitive advantage in and of themselves. Customers hire them to do a specific job. Brands that do those jobs reliably and cost effectively thrive.” Trying to create a brand via marketing without great products is like trying to make an ice cream sundae with just a glass bowl and no ice cream.
10. “I can’t do HTML, come on. I’m just coaching them on how to run their company better.” “[I’m] a third-party Jiminy Cricket. There is nothing transformative that I do. I don’t have the vision of a Marc Andreessen. I am an operating guy, so I help them think about what their company should look like, how they should organize it, how to think about data center management.” “I believe in management. If you give people the things you want them to do. Judge them on what they accomplish. Make sure that you are really bottom line about everything. They recognize that you’ve got a heart. And that you’re trying to help them by giving them all of that rigor. Then they are going to call you a leader.” There is a lot of modesty in the way Bill Campbell presets himself. Humility is a lost art. Bill Campbell proves that you don’t need to be a great engineer to be an enabler of managers and engineers. Having that, it is clear that Bill Campbell is a person who works hard to understand technology. Ben Horowitz has written about the methodology Campbell has developed for measuring executives in a balanced way.
11.“…the big brand names–Kleiner Perkins, Sequoia, Benchmark, plus Accel, Andreessen Horowitz now–the companies have partners that care about growing the company, that’s the most important. They can call the right people and ask them to help get things done. It’s not about the exit. I sit in board meetings and fend off the antibodies–board members who only care about the exit, or the ‘sales pipeline.’” There’s a reason why the same firms persistently deliver the lion’s share of venture capital industry financial returns. They have the best network of people who can help a startup and a brand – which can help attract talent, money, distribution, and customers – which all feedback on themselves in a mutually beneficial manner. Most of the time the startup process fails to produce a massive winner, but when it succeeds it is a marvel to behold. The key to success is the ability of a group to establish positive feedback loops. Creating both the kernel from which positive feedback loops grows to massive scale and the supporting systems that enable that to happen is a rare but incredibly valuable thing. Only approximately 15 startups accomplish this it at significant scale each year.
12. “My dad was a tough bastard. We had one car when I was a kid, and my mom used to drive us down to the mill to pick him up. He had worked the midnight-to-8 shift, and would come out in a jacket and tie, and we would drive him to school, where he would teach all day. He would go home after teaching and sleep for a few hours and then go back to the mill.” “I had a nice time for a long time being under the radar. Instead of being an anonymous guy who wandered around in the Valley, I became someone people focused on.” Some of the best coaches don’t need to be in the spotlight. Some of the best coaches also know that a great way to get things done is to let other people take the credit. I’m am not saying all coaches are this way or even most, but there are great ones like Campbell who do this. Unlike when he was at Columbia, Campbell is not coaching college age students. His “students” are successful executives who need help, often in new domains. Being humble makes Bill Campbell a better coach. Not being threatened by technology and technology visionaries makes him a great manager. When I asked someone I know who knows Bill Campbell well, he said: “Make sure you talk about his loyalty. Don’t leave that out.” When you look at all the good things he has done for his home town of Homestead, Pennsylvania or Columbia University, you definitely see the loyalty.
“People have asked me in Silicon Valley, ‘Why are you in high-tech?’ I ask them, ‘Have you seen my football record?’ ” The crowd laughs. Then he says that football taught him about teamwork and supporting others. But most of all, he says, he learned that he had a responsibility to “give something back.”
Here’s a closing story from Marc Andreessen about how humble and giving Bill Campbell can be: “When he worked with us at Opsware, he refused to take stock options (or any other form of compensation). I got upset about it because he was helping us so much and I felt like it was wrong that he wasn’t getting compensated. I went to talk to him about it and he shot me down as he had before, told me he didn’t want any stock options. So I threatened him: “I’m going to find out which political party you belong to and I’m going to donate the stock options to the other one.” That finally did the trick. (And I never found out what political party he belongs to.)”
The Coach of Silicon Valley https://www.youtube.com/watch?v=GSO-deGYhkA
We are biased toward People Who Never Give up. http://www.gsb.stanford.edu/news/headlines/marc-andreessen-we-are-biased-toward-people-who-never-give-up