067. MYR-CDG: Product Meets Sales

Microsoft was often viewed as a Borg-like structure though we’ve already seen when it came to product development it was decidedly of two cultures. The huge and growing global sales force so dominated by SteveB (now CEO) represented a third, one completely defined by the unique combination of massive global scale and local empowerment and respect for culture. What happens when a Redmond-based software engineer-turned product group executive meets this culture head-on? What about when that happens in front of his new boss who previously ran the field and created the process we’re about to see unfold? This is a story of culture. It is also a story of growing and maturing as an exec. Most of all it is a story of how a product leader is not really complete until they’ve lived and breathed the efforts of the sales people that connect with customers and bring in the money. Below is an early experience. A few years later I would pack up and live in China to experience firsthand on a daily basis what it was like to sell every day.Back to 066. Killing a Killer Feature (In Outlook, Again)In the classic book Flow: The Psychology of Optimal Experience, Mihaly Csikszentmihalyi demonstrates that a genuinely satisfying experience takes place in a state of consciousness called flow. During flow, people typically experience deep enjoyment, creativity, and a total involvement with life. While the book uses many examples, the concept of getting in a groove resonated with me. Flow is how programmers spend hours writing code and how our best customers spend hours creating satisfying documents with Office.Reading Flow helped me, but my job was changing. . .a lot. The demands to be present in the newly added building 34 executive suite overwhelmed me at times. The pressure to spend so much time ruminating with other executives ran counter to what I came to believe and what I experienced as flow. It didn’t used to be like that. I know because I used to see the execs I worked for most every day, casually.Flow was how I felt writing a vision or the interactions I had as I walked the halls. This was especially important at Microsoft where everyone had a door. The criticism of private offices was that people get shut out of collaboration and spontaneous discussions (in favor of concentration and quiet focused work, apparently). I never believed that to be the case, because we had a culture of door open/door closed that implied a willingness to chat spontaneously or a need to focus. Since my first days at work, the richness of hallway and drive-by discussions were most useful and memorable.The idea of connecting spontaneously and learning what was on the mind of a member of the team was something I viewed as my job—so much more than sitting in a conference room with other executives or reading slides presented by managers but prepared by people not even in the room. Making eye contact, not in a hurry, discussing someone’s work and seeing if I could put it either into context or simply offer perspective on something going on in a bigger picture—that was flow for me. Everyone was always wrestling with something—bugs, recruiting, implementation choices, and more—and while I didn’t want to walk around fixing things, I could support, learn, and connect. Most importantly, this was a way to connect with less senior members of the team 1:1. Even today, I can recount some of my favorite moments and best connections coming from people I was able to learn from by walking the halls, a phrase made famous at least in the tech world by Intel’s Andy Grove.Doing so was not the norm for many execs, especially outside Apps or the product groups. The vast majority kept to a Microsoft exec workflow of a reserved conference room across from their office and a steady stream of meetings all day. Even 1:1s were often held in bigger conference rooms.The 8 a.m. meetings, the meetings to prep for meetings, the emails written by staff to communicate the meetings, the rescheduling of the same, were all starting to pile up. I felt I was becoming detached from the team—I was losing flow. I was uncertain of whether I was a poor fit for the role or if my role was defined wrong. I struggled trying to understand what changed in the landscape that required such a change in how to manage. We weren’t facing new problems or new concerns—there were no new competitors or competing technologies. We had ideas to grow to new areas and were executing, and the enterprise sales process was yielding absurdly good numbers. What was I missing? Or, how could I convince people that managing 2,500 people was an investment in time that might be different from how a huge subsidiary GM or marketing VP ran things? Others in similar positions felt differently. They seemed to gravitate towards this new Microsoft culture. Perhaps I was wrong or underestimated what was needed to operate at scale and that was the driving force behind this perceived shift.The field’s annual Mid-Year Reviews (MYR), the process JeffR pioneered, were the most coveted meetings for field teams to attend. If there was a culture-defining element to the growing and incredibly successful enterprise field it was MYR, and it could not be more different than anything we did in the Redmond BGs (Business Groups, as we were called to imply we were separate businesses rather than mere product teams). BG was the new term for the teams in Redmond and everyone loved to say it as a differentiator to the field. Everything seemed to come down to the BG versus the field. It was as if Microsoft was a constant struggle between a BG brain and a field brain.To say MYR was a production would be like calling the Olympics “some people playing sports.” Over the course of three weeks or more in January, the company’s collective leadership focused entirely on syncing up at various locations around the world and presenting mid–fiscal year results. Each year the process became more elaborate, took longer, involved more people, and became more all-consuming with ever-increasing import. Every country, though some were presented in regions, marched through a standardized slide deck slicing and dicing sales budgets and forecasts, finding holes, ferreting opportunities, and sharing best practices. These meetings were tense, terrifying, and a test of thinking on your feet under the harshest of business conditions.To be extremely clear, this seemed an absolutely fantastic way to run the sales force. To me, this was their version of vision meetings, bug triage, and daily builds. The field was scaling up to tens of thousands of people pushing with a relentless focus. The military precision and standardization were obviously brilliant. My own love of flow was exactly what made me appreciate this process. The scale was mind-blowing.But I didn’t need to see it to appreciate and understand it, any more than I thought the field needed to attend spec reviews or triage meetings. Product groups saw each other every day and maintained a tightly integrated effort in continuous adjustment starting and ending with Redmond. The product teams integrated across many levels almost constantly.The field was a geographically, linguistically, and culturally dispersed organization of massive scale tuned to be with customers operating on its own, focused on goals decided at the start of a twelve month execution process. The field was the definition of an organization tuned to thinking and acting locally. Each fiscal year, the global team regrouped and realigned for the next. MYR was the halfway point, checking in on all the assumptions and results that defined the fiscal year and fixing what needed fixing.The connection between corporate and field was essential. There are many ways to connect—MYR was not the only time to see the field. I visited subsidiaries, connected with PSS routinely, (still) attended executive briefings, and we engaged marketing and planning essentially full time with counterparts in headquarters and subsidiaries, and directly with customers in forums like the OAC. The field headquarters staff was where the planning and coordination of the subsidiaries and regions coordinated full-time. Issues and resolutions bubbled up from the field to HQ for solutions in real-time with the BGs. Every year since becoming a vice president in 1998, I made a point of attending some MYR reviews, just not all of them. In the latter part of the 2000s, attendance became tightly controlled and required an invitation and resulting assigned seat. Failing to show (thus wasting a slot) was deeply frowned upon and clearly visible by a name placard and empty chair. For many, attendance became mandatory, and despite the protests, attendance was viewed as career progression.What was an MYR like?Meetings were usually held offsite, often in an airport hotel meeting room, and started at 8 a.m. Wherever we were, the room was always filled to the brim and oxygen was soon replaced by stale air, usually extremely cold air with that breeze of hotel air conditioning. Seating was assigned around a big rectangle of worktables. SteveB sat at the head of the table and fanned out from him on either side by rank were the field executives, followed by leaders from sales segments such as enterprise, education, small business, OEM, retail, and others, along with an army of finance people from corporate and the subsidiary and the region. Across the room from SteveB sat the subsidiary leadership guiding the meeting, with the GM sitting in the center and then a mirror of subordinates on their side, also by rank with the exception of a chief of staff or business manager right next to the GM as owner of the MYR Deck of slides. There was a gallery of the HQ business divisions on one side—usually the head of marketing and the senior product leader (such as, me). Outside sat (or loitered) everyone else who could not fit into the room but was on hand ready to provide backup materials should they be urgently summoned.There was a slide deck, but it was not made of slides so much, but rather posters printed in 8- to 10- point type on 17 x 22-inch paper, spiral bound. The pages were fully packed with rows, columns, bullets, numbered callouts (“as you can see at callout number 7. . .”), and a lot of heat maps (mini spreadsheets with cells colored coded red, yellow, and green to indicate severity of issues). Every year brought innovations to the decks from better data integration on the back end to the use of color. A most prized possession was the databook, which was essentially a cheat sheet for the whole process that was available to the field executive leadership and SteveB—it contained global and regional summary tables, making it possible for comparisons to be discussed mid-meeting.Each page was easily eight slides worth of data. Deck preparation began in the fall and was practically a full-time job for a team of people—in the big subsidiaries, dozens were deep in preparation. The slides were almost all data—data pulled from sales systems and reconciled across, and up and down, all the subs. Once all the numbers were right, the teams went through the decks and compared the actual numbers with the start-of-year budgets. Preparation was knowing exactly why for every variance, positive or negative. Outlying data was identified with a callout and a concise explanation was at the ready. Why did you sell fewer education PCs this year? Why are enterprise renewals behind budget? Why have you not met your hiring goals? Why did you rent such an expensive venue?Every. Single. Number.Intellectually, I knew for me to sit in this meeting watching what was going on was akin to a salesperson pondering the endless discussion about a single code change in a bug triage meeting. Emotionally, it was another story.SteveB and the sales leaders were relentless and disciplined about accountability. An inability to explain a number credibly, or worse missing that a number was off, was bad, really bad. Every GM knew that this was not a meeting, but a performance review. Meetings that went poorly were legendary. Everyone was aware of the story of that time a meeting went so badly that when it was finally time for a 15-minute lunch break at 3 p.m., upon returning the seat the GM held before the break was vacant and his name placard was gone. Did that happen? Not quite. But the legend was all that mattered.When a page turned in the book and the speaker changed, on to OEM sales for example, everyone briefly looked at the page (with a ruler and magnifying glass) and noted the circled numbers and carefully placed arrows. Then suddenly, usually, SteveB pointed to some specific number amid a giant grid of numbers and asked, for example, why business PC laptops were so low last quarter. Missing an outlying number was a crime, and it was shocking to watch what happened as a result. Panic ensued. An important skill among sales leaders is the kind of inherited capability the cheetah has to pick out the camouflaged prey from among all the small creatures in the veldt. Picking those outliers are the small prey of sales executives. SteveB was Jedi master of finding out what was important or determining the opportunity in a grid of otherwise indecipherable numbers.This, unlike a standard meeting, was an ultramarathon. For a major subsidiary, like the United Kingdom, France, Germany, or Japan, or an important growing one like Korea or Russia, a MYR meeting could go on for 10 or even 12 hours, even though they were only scheduled for half workdays. And when it finally seemed over, the next team showed up. Jetlagged, suited up, hungry, and tired, they could have been waiting half the day in the lobby, but then they were on. We sat there the entire time, and while we broke for a meal, we usually brought food back to the table (which made the whole room smell of food and tired humans). We finished most days past midnight in the early hours of the morning and were right back hours later for 8 a.m. or earlier if the next meeting was already looking like it would go long.An MYR was to me like what being on a space flight must be—long stretches of nothing and then a moment of terror when some instrument buzzer went off, warning lights strobed, and then the everything turned a red hue of emergency situation. That was these meetings. The buzzer was a subsidiary saying something about Office, the product or business, that was either negative or non-supportive. Then all heads turned and looked right at me. If my head was down in a laptop (or flat on the table asleep, “Bueller . . . Bueller”) then everything about that moment of terror was amplified. The cardinal sin: “I’m sorry. I did not hear what you said.” Leaving to go to the bathroom or to get a drink at the wrong time escalated into a “bad MYR”.While most of the slides were financial and focused on clear, sales-oriented accountabilities, for many years there was a qualitative section called Feedback to Corp. Usually offered by a GM, the feedback was candid, addressing areas that needed improvement that only BGs in Redmond could fix. Topics ranged from a single product bug that cost a big EA contract, to marketing materials not appropriate to the sales motion, to resource allocation guidelines that were not right, to broad product feedback usually connected to a big and challenging customer. The field was run diplomatically, so ambushes weren’t supposed to happen.The months-long preparation provided time to socialize the feedback so the BG could have a properly prepared response to recite at that point. These meetings were, in many ways, theater—for both sides. As an example, at the end of a meeting SteveB and the execs offered feedback, which was usually a series of messages about how to approach the second half of the year. By the third major subsidiary, messages were not only honed, but the subsidiary staffs shared them with the downstream subs and everyone knew what to expect and was on the lookout for even the slightest variations (variation was the real feedback). Dedicated staff judiciously tracked every question and potential follow-up, entering information into a tracking system that later pinged the relevant parties with email until an issue was resolved. Over the years this tracking system was automated and targets of feedback received reminder mails for months until an issue was marked as resolved.MYR 2001 for major EU subs was at the Hilton at Charles de Gaulle Airport. By day three, I had my fill of French hotel food and was longing for the McDonalds that I knew was in Terminal 1. I knew I needed to find time to hop on the shuttle to get there. The shuttle circled from the hotel to the gates and back at regular intervals, taunting me each time I imagined it passed. It was cold and dreary outside. I had no idea what time it was as we’d been in meetings for days on end. Modafinil wasn’t in use yet (Provigil a non-narcotic prescription drug originally used to treat narcolepsy now a favored pharmaceutical for traveling executives). We’d already gone through the United Kingdom and France. Germany was up. Germany and a dozen other countries loitered anxiously in the lobby for two days, in the hopes of picking up some G2 about questions and drill-downs.The NASDAQ crashed one year earlier, and many countries were in rough shape. MYRs reinforced the adage that “when the United States sneezes the world catches cold.” Still, PBS was generally doing well, though there were concerns that growth was slowing. In reality, we were going through a transition from choppy retail licensing to greater and smoother revenue through Enterprise Agreements. We were riding the year of deploying an enterprise-standard desktop of Windows 2000 with Office 2000, and Exchange 2000 just released. There was plenty of exciting enterprise software and strong initiatives.The other thing that became clear was that changing the whole world market takes time. While the United States moved to enterprise licenses, the rest of the world was lagging. At the extreme, another decade would pass before Japan was fully enterprise licensed. Germany was in the middle, especially because its market dominated by giant manufacturing companies moved deliberately, meaning slowly. The implications were twofold. First, the enterprise section of the review was tense—HQ was putting pressure on sales to get big customers signed to EAs. Second, most of the Office teams in subs still viewed a retail launch as the big driver, something HQ made second fiddle for Office 2000 and which for Office10 was even less of a priority. While Office planned a single big worldwide launch event, the primary effort was on 100 local North American enterprise events. The strategy was to replicate this in each major market at appropriate scale.When it finally came time for the PBS section of the meeting, I tried to perk up, still thinking how much I wanted to get on the shuttle. There was some back and forth conversation happening over enterprise selling and the difficulties of customers in the manufacturing and autos sector. There was some friction over the ever-troubling state governments who wanted lower prices on Office and perennially threated to switch to Linux and open source if they didn’t get it.Everything seemed normal. Then it was time for Feedback to Corp and, with it, an ambush.Germany decided to make a big deal out of an Office10 retail launch. Our BG guidance was to spend marketing dollars on the enterprise launch (with the large number of local events to drive IT awareness of SharePoint and business value). We planned a global launch event in New York, with BillG in attendance. While the event proposed by Germany was different, if the field made its numbers (all of them) then it was empowered to do what it believed was right. For all the top-down planning, execution was remarkably empowered with the field.The rub was the German team was in contract negotiations with an expensive venue for the retail event and needed a solid commitment for software availability. They literally needed an immediate certain date for when volume quantities of German Office10 could be available through all German retailers. This was January 2001 and we were scheduled to RTM three months later. They knew we could commit—how could we not? They didn’t like our scheduled date, though, and wanted an earlier one. Our actual boxes in stores date was May 31, which gave us buffer and was the plan.We scheduled down to the day for everything, but we were not operating the team as though this was a date–driven release at the level of manufacturing. I was 90 percent certain of RTM on March 2, 2001 (3/2/01). Our worst case, we thought no later than March 16 which was only two extra weeks. We could slip because of a bad bug that took time to track down, or if there was a production hiccup (a bad master CD, a virus in an image, a delay in collateral for the box). Beyond that there was time needed to complete localization. We were not yet to the point where English and German versions were done on the same day, but we compressed that difference down to a week or so, especially for German (we always did German early because the words are really long and that was a good test for the product visuals, plus GrantG leading testing was a native German speaker). The final step was manufacturing the CDs, which happened in Japan, and then getting those assembled into boxes and distributed. Any time lost on this step could be made up by spending money on air freight and expedited shipping if really needed.Such logistics steps and concerns raced through my head in the fraction of a second it took the entire room to turn and look at me like I was the last human in Invasion of the Body Snatchers. Then I committed a fatal error. I did not say, “Yes, book the venue for that date and we’ll make it.” Instead I said, “I can’t be certain of that [earlier] date. We have a schedule, but we are not operating to guarantee retail boxes in stores in Germany on that date. Given what I know and how we’re working, I would do this at the end of May as planned.” I suggested we might finish early (that was the single worst thing I could have done on top of my first worst thing). We already communicated our end of May date in the leadup/socialization phase MYR, but they wanted an earlier date for local reasons and chose to make that case in the MYR forum—it was that important to them. I said a lot of words I should not have bothered saying.My words were met with silence. I felt like that moment in outer space disaster movies when the alarm is off and all that remains is the silence of space and the red emergency lights. I’m certain I was perspiring.Because of their venue choice, none of what I said was “acceptable,” I was later told. They wanted that venue, on that date, and were forcing the issue—managing me in front of JeffR (whom they knew super well) and SteveB (whom they knew sided with them). The back-and-forth continued and I kept digging myself a deeper hole—at some point my spirit rose above the room and I watched the mess unfold.Most of all, what was on my mind (that I could not share) was that we were still in the middle of figuring out a product name. The corporate branding team was working to come up with a name that spanned Office10 and the next Windows release. Without a name we could not finish the software and we could not make boxes, marketing materials, or even announce the product to retail partners. The lack of a name was becoming a sore spot with the engineering and localization teams. We were three months out and literally did not have a product name. Shocking for Microsoft, I know.As of MYR, there was no name and corporate was suggesting we slip the Office product so they could have time to come up with one. They were working on a Windows timeline, with scheduled end of summer ship date. It bugged me that they were nonchalantly considering a slip of Office so Windows could have more time to come up with a name. As if I needed a reminder that Windows was the lead dog. I was being a good citizen and not throwing that team under the bus at MYR. In the process, I stepped in front of or under the bus myself. Heck, I threw myself off the bridge at the bus.Neither of us could see the other’s point of view. They were asking me for a favor: Make it happen. Germany could not see that I was trying to avoid an embarrassing event with no software and had no idea that I was working to avoid embarrassing corporate branding or shifting blame to them. I kept thinking that the team back in Redmond was doing so well, the last thing I should do as the manager was come back from a three-week hiatus to create a fire drill over the retail launch in Germany when we prioritized the worldwide enterprise launch for two years, especially when they were in a holding pattern on naming.Germany and HQ called a truce and accepted the feedback, and marketing agreed to work out the details. The body language directed at me from the SteveB side of the room was painfully clear.Following the conclusion of the meeting, JeffR pulled me out into the lobby of the hotel where I stood longingly watching the shuttle bus to Terminal 1 roll by every 15 minutes of this ad hoc 1:1. He was obviously livid though maintained a calm delivery—we had only been working together for a few months. Without asking any questions he said, “That cannot happen.” He said we were obliged to deliver. He told me I handled it wrong. This went on for what felt like an eternity—look, there’s the shuttle again. The entire time I assumed my name placard was being removed.In that moment, I welcomed being put out of my misery.When we returned to the main room, my name card was still there. I sent some mail back to the United States to say we needed to make Germany happen. Grant believed we could do it, but he could not guarantee that date. We told them to go ahead. Everything was fine.Except me.The biggest cultural difference internally was that MYR was the field’s shining moment. It was a chance for them to overtly manage the HQ organizations, so long as they had the facts straight. The field took direction from HQ on good days and put up with shoddy work and poorly executed marketing and product on bad ones. For 50 weeks of the year, they absorbed everything. Each country wanted its chance to be in charge and their meeting was when they had the upper hand over the BG.Until this MYR in 2001, I hadn’t grokked the power dynamic. The idea of being managed in front of a room was so opposite the old Apps product group culture that for the longest time I simply thought I was being bullied. JeffR taking the side of Germany in the meeting was him taking part in the ritual of the culture when he sided against me in front of everyone. It is always weird to experience your new manager not supporting you in a big public meeting. I wondered if this dynamic was different or crazy or a bit of both?One thing was clear: My job was different. Same software. Different job. I had some learning to do.On to 068. The XP eXPerience This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit hardcoresoftware.learningbyshipping.com