8 mins

Conversation with Founder & CEO of a Software Company

8 mins read . by Sandeep Mahagaonkar . October 25, 2016

I recently had the privilege to have an in-person conversation with the founder and CEO of a mid-size software company. The company has been in operation since the last 10 years and have been doing extremely well in their chosen industry domain. I was requested not to publish any names in this article, so I will use the name Rahul Verma for this CEO as an alias for this article. 

In this conversation, Rahul talks about various aspects of leadership at a granular level, what one needs to know before starting on their own,  what a CEO expects from his people, and much more. Excerpts from the conversation:

SM: You worked many years in company that developed software products before you founded this company which offers software services. How easy was this transition?

RV: Moving from R&D to services was a major challenge.  The budget scenario is a whole new connotation in service segment. In R&D one is accountable for a budget, and if managed well and not burnt unnecessarily, then great. In services segment however, there is a higher degree of accountability and the client expects transparency on how the money is spent vis-à-vis the service offered.

Despite being several years in an R&D set-up, I have a new perception now that everyone should work in a service industry. I believe it makes individuals well-rounded.

SM: What makes you think so?

RV: It is primarily to do with understanding the customer expectations better. In product companies, not many are exposed to the customer. There are a few who do all the customer interactions and then pass the message across to back-office teams. This needs to improve. Also, how many can manage customer support? Can individuals handle 10 phone calls from irate customers and still stay focused on the job? It’s tough and that is the reason I believe one should, during the lifetime of their career, have genuine on the ground service experience.

SM: How can product and license based companies address customer engagement at various levels?

RV: It’s difficult, but small things like having engineering teams on certain customer calls helps. They may be passive participants, but get to appreciate who the customer is and what they do. The customer needs to be made aware of the people who are on the call. It’s the responsibility of the leaders and management to facilitate this actively. 

I know of a product team from my earlier company that had 20 people on a customer call and only one person spoke. The customer was oblivious who the other 19 were and what their roles were. And also for these 19 blokes, as they were not required to contribute they remained reclusive. We need to have better engagement models.

SM: One of the challenges organisations have these days is to find and retain a high-performing individuals. How do you address this aspect?

RV: If you look at the dynamics of the job market now, it is relatively easy for graduates to find a job. The degree of difficulty in getting hired 10-15 years ago is not the same now. Also there is a large pool of graduates to hire from. The challenge for organisations now is to find talented and well-groomed young graduates.

People do leave organisations and you can’t really stop that. Having said that, if you look at attrition from an experience bracket, the 2-6 years’ experience folks make the most leaps. This is more to do with the availability of jobs in this experience bracket. Also, my experience suggests that people are more sensitive and complacent in this category. If there is high pressure to deliver, the exit route to another organization is always lurking around the corner. This is not always the best of strategy. If one can learn to handle pressure and disagreement better, it makes them more competent.

SM: In a world that emphasises highly on IQ of an individual, what skills do you value the most in the candidates you hire? 

RV: The person should have a strong EQ (Emotional Quotient). Finding people with high EQ (affinity, loyalty, long term thinking, empathy, grit, patience etc.) is the key. Every company goes through highs and lows and people who can understand this and sustain are the people with high EQ. So any company that can find such people can build great teams. 

SM: What attributes according to you should individuals focus more on and tighten their game?

RV: One, is about accountability. They should not come with preconceived notions about work. If we are talking of a developer, they shouldn’t believe their job is to just write code without thinking much about the functionality. If they fail to realise what they are doing today has a business value, the team/organisation can face consequences in the future. They also need to understand that they are building something today that will be used by a business someday in the future – this aspect is very critical. 

Two, is about mindset. One should never think whatever happens, happens. There needs to be a purpose in everything we do. There cannot be boundaries drawn when it comes to customer delight. Developers need to realise that compiling code and checking it in is just 25% of the job done. They need to visualise the production environment and ensure all the gaps are sealed. One cannot just handover the baton to the next person and throw-up his hands. It is a collective process.

SM: Do organisations need to invest on training people to perform their jobs better?

RV: Absolutely!  Training and mentoring should be in the DNA of the organisation. It plays a big role in finding people for the right jobs. People need to know what would be expected of them when they take on bigger roles.

SM: In this world of intense competition, how do organisations ensure they keep their customer base intact?

RV: Organisations need to really think on the short term and long term strategies. Many times we hear customers saying they were great last year, but something is not right this year.  Why does that happen?  Why an incumbent company gets dropped by customer and a new vendor is brought in?

It could be a cost issue, but to me, it’s also an issue of scale. Was the scale from, let’s say, 100 – 200 people done appropriately? If a person managing 5 people suddenly has 20 people to manage, how will he review, mentor, manage etc.? It can be a problem if organisations scale too much at the lower levels of the pyramid.

Another aspect is quality. Unless the basics are done right with little or zero management oversight, organisations cant keep customers satisfied.

SM: What’s your advice to people who want to start on their own?

RV: It firstly depends on where in your life you are – if one is a 25 year old bachelor, there are not many risks associated. In the later stages of life it gets difficult – hardest is to get your kids used to a lifestyle and then trying to alter it. Having said that, if the person if financially stable and can manage their family for the next 6 -12 months, then they are good to go.

One needs to figure out the opportunity v/s cost and be clear on the market and segment that they want to play. Once these things are settled, have the following in mind:

Have a clear goal: E.g.: whether to build products and licenses and why this is better than a service model or vice versa.

Be Realistic: Don’t over-theorise and don’t be over-zealous. E.g.: we have to make $10K in second year of operation. The metric of measurement should not be only money. Instead do things right and the money will eventually follow.

Be ambitious of making money: Its fine to dream of money as long as you have decided it’s not a charity organisation.

Don’t give up: There will be discomfort and prepare yourself mentally for that. Sometimes people give up when success is just a minute away. One needs to have the grit to sustain all the highs and lows.

SM: As a Founder and CEO, what drives you?

RV: I have always been inspired by building great teams. To me it’s about building leaders of the future. Also I would be happy to leave a legacy behind by my contributions.

SM: As a CEO, what is the message you normally give to your teams?

RV: I occasionally observe people walking across the floor and should I notice them without a purpose in their walk I tell them so. To me a person walking with drooped shoulders is a sign of lack of energy, purpose and not being in control of things. If a fresher sees a senior manager walking with poor body language, imagine the impression is he/she getting. Every moment of the day we are being judged (or judging others). Even if you are not doing great someday, but can display energy and purpose, it has the potential to make the other person think – Oh well! I should bring some energy here. To me, Visual Leadership is very important.

The other thing that is important to me is respect for the job.  When I was doing my Masters in U.S., my part time job for first 3 months was transferring meat from freezer to cafeteria. Although I am a vegetarian, this job made me realise that it’s a service that I am doing and I need to respect it. The job took care of some of my financial needs. So whether you are a rocket scientist or service guy in cafeteria – respect your job. 

I tell my managers they need to be a consummate salesman. If they are suggesting an architecture on a large initiative they need to sell their idea keeping in mind the decision they are making can have an impact on the $100-1000 million project in the future.  Basically, at the end of the day, people need to be well rounded personalities.

SM: I am sure this will benefit a lot of people. Thanks a lot Rahul for your time and for sharing your wisdom.

RV: It is my pleasure to be of service, Sandeep.