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Speaker 2 00:08 welcome to the breakout growth podcast where Sean Ellis interviews leaders from the world's fastest growing companies to get to the heart of what's really driving their growth. And now here's your host, Sean Ellis.
Speaker 3 00:23 In this episode of the breakout growth podcast, I'm speaking with Jessica Hawk and Dean croaker from Hitachi solutions about their journey from a small startup to an impressive acquisition by Hitachi. We talk about their response to covert 19 and how their startup agility and experience with remote implementations have been really helpful for the acquiring company. We also talk about the transformation that they made from a traditional approach to growth for an it services business to one that really uses data well and experimentation to to accelerate growth. So Jessica and Dean have worked closely together to drive this change and they have a lot of great learnings to share. So before we get started, I want to take a moment to update listeners on the publishing frequency of the breakout growth podcast. Given my focus on helping college students and professionals connect during the crisis through the online career fair.org initiative.
Speaker 3 01:22 I'm now going to make this a two times per month podcast. I'll return to weekly podcast episodes once we get back to some level of normalcy, but it for now I need to cut it back to two times per month. So I also want to thank all of the listeners who've signed up to offer college students career coaching during the crisis. As you know, in the USA alone, we have nearly 27 million newly unemployed and college students are naturally really nervous about their future career prospects. So if you haven't volunteered yet, please sign
[email protected] and you can make a huge difference with just one hour of your time. So let's now get started with my interview with Hitachi, SVP of operations, Jessica Hawk and growth team lead Dean Kroger. Hi Jessica and Dean, welcome to the breakout growth podcast. Thank you. Thanks for having us. Yeah, it's really exciting to have you guys on. I know you have some, uh, some, some news of a recent acquisition that closed, so we'll get to that in a minute. But, uh, how about we start by you, um, explaining how Jessica, if you could explain what Hitachi solutions is and, and what problems it solves.
Speaker 4 02:39 Sure. Thank you. Uh, so we are a systems integrator, which means that we work with Microsoft and their, um, enterprise customers to, um, help companies take advantage of the software development that's coming out of Microsoft for cloud services. So it could be anything, an application that's used internally at an organization to manage order processing or we work with a lot of ISV software companies who are building products that are externally facing, um, that, uh, allow people to, uh, buy and conduct business online to the data platforms that sit underneath all of these systems. The modern workplace infrastructure, things like Microsoft teams, you know, it's an online check collaboration tool. Anything that, uh, that a company might use off of the Microsoft, um, product set to, uh, to do their business. And so our team is, uh, is made up of, uh, technology experts, um, who, uh, help customers adopt these tools. Uh, sometimes that can be a really large ERP project running off of dynamics or a smaller, um, you know, power BI project to drive more, uh, enterprise reporting around, you know, what's happening with the business. Uh, and they work hand in hand with those companies as consultants every day.
Speaker 3 04:01 Great. And then I assume, uh, from how you guys make money, it's, it's charging by project or by hours or how does that,
Speaker 4 04:09 right, so we charged by, we charged by project. It's um, it's a kind of a traditional consulting model, time and materials most, most commonly, occasionally some fixed fee. Uh, but it's uh, uh, you know, when we get together with a customer, we'll, we'll work to do our best to define what the project is going to look like and what types of folks you would need to work on that project. So what are the roles? What are the resources, what are the hours to the best of our abilities, which always brings up some pretty cool conversations around agile versus waterfall. Um, and then we put statements of work together and, um, we get paid that way.
Speaker 3 04:42 Excellent. So will I know when, when Dean and I first connected, you guys were looking at how did, how do you approach a, uh, rapid iteration growth hacking type approach to a services business? So it'll be interesting to see. That was several months ago. It will be interesting to see how that, how that shakes out. But this is the first kind of services business that I've, that I've looked at on the breakout growth podcast. So it should be interesting. But before we get into that, um, Dean, why don't you tell us a bit about, uh, the journey that took you guys from, uh, uh, Catholics global to, uh, becoming part of Hitachi now? Yeah,
Speaker 5 05:17 sure, sure. Yeah. So I guess I started at capex back in 2016 mid 2016. And at that point we had 12 employees. And so quickly, we grew out our Philadelphia office actually, that grew to about four times the size within a year. And we, uh, as of January of 2019, we were at about 200 folks, including contractors. And that's when the Hitachi solutions acquisition took place. And, uh, you know, so we've kind of had quite a bit of growth in the cap years. Uh, cap X was this, uh, large scale cloud company like Jessica was alluding to, kind of building everything from smart vehicles to custom insurance brokerage applications and Hitachi solutions was a traditional ERP and CRM implementation shops. So building resource planning and relationship management tools. And so kind of taking the two and having them come together was really in our best interest, especially because we both had that Microsoft focus. And, uh, you know, the acquisition was, was kind of pretty smooth sailing. And so now, officially as of April 1st, 2020, we are one company now, capex and Hitachi together.
Speaker 3 06:24 Wow. Congratulations. That's a, I'm, I'm sure that's a kinda exciting transition point, but probably, probably, uh, a bit nerve wracking as well. Anytime there's big, big change that's uh, it can be, um, just, just different and obviously probably the biggest change that's affecting everybody right now is, is covert 19. And, um, it's, you know, especially for cloud businesses, I guess it could potentially be, um, helping business in some sense. We don't want to really take, talk about, you know, something as negative as a, as a virus helping. But, um, some businesses maybe are getting hurt more than others. So it'd be great. Jessica, if you could help, uh, help shine a light on how, how code 19 is affecting you guys.
Speaker 4 07:06 Well, it's, um, it's been interesting. So, so you know, you really do think about Hitachi solutions. North America is having kind of two primary divisions, right? There's the traditional, um, Hitachi biz apps focused department, and then there's the capex department that is, um, uh, coming off of, you know, more of a focus around cloud services and Microsoft Azure. And so when you do an ERP project, and those are big projects, right? Um, part of the business type projects, they can go one to two years, uh, easily. Um, the, the model has always been people on airplanes sitting at the customer all week long. And when you do, um, custom application on the kind of the bleeding edge of the Azure stack or these big, um, um, data projects, there's been less of a, of a customer need for us to be quote unquote sitting in the building with them.
Speaker 4 08:05 And so most of what capex has done traditionally, um, has been, uh, delivered remotely. And so in terms of our actual offices, we have offices in a couple different cities across North America as Dean was mentioning. Um, but they tend to be filled out by more folks on like the sales and marketing and operations side and leadership folks. The delivery team has always been pretty remote. And so one of the first things that happened after it became clear that, you know, planes were going to stop flying and States were going to shut down was as a leadership team. We pulled together and started doing some training across the org to help our partners on the dynamic side of the business, the traditional Hitachi side to to understand how we've always done our projects, which is to deliver them remotely. So there was kind of an immediate immediate opportunity to go help our, our teammates, which was pretty cool to watch.
Speaker 4 08:58 And so we have a really great, um, UX user experience group that's led by Dan Allen and he, and, uh, some of his team are kind of right at the forefront of um, design, sprinting planning and they've been doing this, this collaboration with a J smart for the entire year around how to conduct sprint design planning sessions globally remote way. Um, so there was all this great content material and some, some evidence frankly, that this can actually be done because it's one thing to, to write code remotely, you know, for an app that's pretty straightforward. It's another thing to conduct an envisioning workshop with 20 people from finance around their next generation ERP system. And you really kind of, people want to be in the room for that. Um, and they just can't be right now. So that, so what are the choices? The choices are either where we stop signing new deals and stop kicking off projects, which nobody wants to do or we figure out a way to do those kinds of meetings virtually. And so leveraging that experience that our team, we could already site, you know, endless lists of customers where we've delivered projects remotely and it's gone really well when you combine that with the really like forward thinking work that Dan and his team have been doing on how to, how to conduct an incredible meeting experience, um, over the phone, um, we were just in a great position to really help our customers get through the mental math of switching to virtual.
Speaker 3 10:30 No, that makes a ton of sense. So I guess the timing couldn't have been better to have you guys in the fold when, when everything up and yeah, it's interesting. I, um, I got a note from a friend of mine who works at a large architecture firm the other day and he was saying that since they've moved remote, their productivity shot way up and he, he wanted to get my thoughts on that just because he knows like in the tech space, it's not that unusual to do things remote. And uh, and he's trying to, they're thinking about reconfiguring their business to being much more of a remote business since productivity has been so much better. So it is really interesting how this is driving a lot of transformation for a lot of different types of industries and companies.
Speaker 4 11:11 Yeah. And we just decided that we're gonna actually we're gonna record the journey. So we're going to pick one or two of our project teams that are now doing this all remotely that wouldn't have normally done it and ask them to blog about the experience over time because we're really hoping to capture. Um, cause you know, anytime you can keep people from having to fly away from friends and family every single week, that's a win. You know, we don't want people to have to be road warriors. And so, and it's a win for customers when they save them all that travel and expense that, you know, we actually did some math on it. It's several million dollars worth of what you'd call pass through revenue coming through the business. Right? It's, it's, it's, I mean, other companies, neither us nor our customer are benefiting from that, from that work.
Speaker 4 11:58 Um, so, so there's real savings for the customer, which they can then reinvest into, you know, project work. And so we wanna we want to, um, capture, and we're going to use our marketing team to do this because there's so much high quality. Uh, the folks in our marketing group are just, you know, uh, polished and professional and what they put together is so much better than anything that I could do, um, to, to really make something of this journey that we're calling it. So that when we come out of this thing, which we all want to do and know, we will eventually, that we can really have something we can point back to customers and say, look, we, we did do it this way and it worked out really well and you did get extra time. You probably do get more time because they're not traveling there. You know, people get up and they have breakfast and figure out what the heck they're going to teach the kids that day. And then they sit down and start working and, um, we're seeing that productivity spike as well. So, uh, we're going to be very mindful about capturing this moment and really trying to produce something that when we come out of this, we can talk to customers about and, and have a sense of confidence that yes, this can be done remotely.
Speaker 3 13:04 Right. And on the personal toll side, you're, you're absolutely right. I think I traveled over a hundred thousand miles last year and, uh, it, it beats the crap out of you and, and be a, definitely lose a lot of time with family. So, um, I think, yeah, that, that, that productivity and just sort of the better side of things for, for business. But then, you know, when people are, yeah. Not, uh, not unhealthy. Like I actually think that my last trip to Europe in late February may have, uh, may have gotten me the virus. It's a, I mean, it just your, your, um, your health suffers anyway because your, your immunity drops when you're going through all the time zone changes and then you're exposed to a lot of things plus plus all of the other things. So, so I agree that there could definitely be some, some good that comes out of this in terms of figuring out better ways to work. Um, so, so Dean, when you and I first connected, I hadn't realized that you have a computer science background. So I thought that was really interesting that you, you started in that route and then got to, uh, being more interested in focusing on growth. Can you, how did, how did you decide to do that?
Speaker 5 14:12 Sure. Yeah. So I probably wore just about every set of shoes at I guess now Hitachi solutions, right in the capex family. I've, I've done kind of traditional product management as well as engineering. Um, you know, kind of working on big data projects as well as custom application projects. And I've always thought, especially after reading your book and you know, listening to your podcast and all, I've always thought of growth as less of a marketing agent and more of a, of a business agent have a way to grow your business overall. And it certainly works very well within the marketing pipeline, but traditional marketing teams are kind of very focused top of funnel acquisition. How do we acquire more customers? And in the consulting space, our product is our people. Actually we're more focused on delivery than we are. Uh, you know, uh, delivery lends itself to better customers.
Speaker 5 15:04 And so, uh, our growth levers are way different than a traditional SAS company. And, um, you know, as such where we're kind of thinking about ways to grow internally and to activate our employees and to retain our employees in a way that can help them scale and make happier customers. And then ultimately that leads itself to the more traditional marketing levers, which are kind of, you know, customer acquisition, how do we retain our existing customers, et cetera. But one leads to the other without focusing kind of internally on our product, which is our people. Uh, you know, we'd be, we'd be foolish to think we actually had a real growth team. Right,
Speaker 3 15:39 right, right. No, I think it's a, I completely agree with you. I mean I definitely have figured out that growth is much more cross functional and much more a function of all those different customer points coming at it from a marketing perspective initially. But realizing that, you know, you bring people in the door and if you can't keep those people, you can't grow. And what does it take to keep them really good? Onboarding, really good ongoing customer contacts, understanding how they're getting value, making sure you're doubling down on the things that matter. There's, there's so many pieces that fall outside of the simply the, the marketing arm of things. And so having, having that view, whether you're starting from some of those pieces and working outward to how do I get more customers or starting from how do I get customers in the door, but actually keep them and make sure they're getting lots of value. Um, it is interesting how a lot of people can come to the same conclusions in terms of all the different levers that are important for driving growth. So that's a good transition point to getting into the incredible growth that you had. I think you said you, you joined in 2016 and there were like 12 employees and then before the acquisition you, you'd gotten up into the hundreds of employees. So what, what were the most important drivers of growth that helped you get there?
Speaker 5 16:54 I think it was thinking about the customer problem and more than that it was thinking about the customer's customer's problem. And often in, often in consulting, we saw all our competitors kind of stuffed at a client for multiple years on end trying to solve their problem. And that was kind of the differentiator was, you know, we're, we're going to come and we're going to embed and kind of augment your team for a long period of time. What differentiates us on the other hand is really that most of our employees have about 15 years of experience and the median is pretty close to that as well. So kind of give you an understanding of the distribution. And so as a result, we put far fewer people on projects and then we solve their problems far quicker. And uh, usually it means that we're actually staying at the client for a longer period of time. But jumping from project to project, our engineers get bored easily. I get bored easily. So it's a much more fun consulting model to solve
Speaker 4 17:50 a problem, then move on to a different problem at that client that they have. They kind of think of us as a, you know, kind of their secret weapon rather than just another part of the team.
Speaker 3 18:00 No, I can imagine that just having that relationship and trust to, to keep coming back to you guys to focus on a different, uh, th the next problem that needs help, but you get, that's going to be an amazing resource for them. Yeah. So, so Jessica, I know from a operations perspective that growth can often be really challenging. That, um, that again as a Dean was saying that, that, you know, all of these interdependencies that drive growth are, are important. But a lot of it comes down to serving the customer well as you get lots of more, lots more customers in and, you know, trying to keep some level of quality in the team as you scale the team really quickly. What are some of the areas where you guys ran into some challenges and how did you overcome those challenges as, as you've scaled the business?
Speaker 4 18:48 So I think, uh, the first thing that comes to mind, and I'm blatantly stealing the term from Satya Nadella, um, is, uh, w when companies grow fast, they tend to apply duct tape and paperclips solutions to the, to the growth, which just hits a ceiling. And, uh, you know, we go and solve that problem for our customers all the time. So I think we're a little bit more likely to recognize that pattern and nip it in the bud earlier than other orgs might be. And so the first thing that we did as a, as we were starting to realize, you know, we've definitely got a winning formula here and we were growing, adding, you know, five to 10 people every single month. Um, you mentioned onboarding. It's a huge component to, to the things that we focus on, um, was realizing that we have to make from an operations perspective, this needs to be a, a great experience that we can't think about the operation side of the business.
Speaker 4 19:49 It's just kind of the necessary work that has to be done. And it has to be in an unpleasant way. Um, I think a lot of companies on the ops side that there's a lot of dark corners and lack of transparency and visibility and I'm a firm believer in you can't manage what you don't measure. And so the first thing we did really, um, in kind of a more mindful growth mindset sort of way was, uh, apply some tech intensity to everything we do. So that's a, that's a Satya term. Um, but I think it really, I think it resonates with us particularly well because we're a company of technology people, right? So we already know what good looks like. And so if we were asking everybody to run the business on a bunch of Excel sheets, how would we be? We'd be in a good category.
Speaker 4 20:34 We just wouldn't be. And so, so Dean and I just started hacking away at the problem. And, um, rather than kickoff huge six month, 12 month company wide initiatives with 20 people, project teams and you know, big virtual conference room meetings, um, to define requirements for three months. We just started to look at what some of the problems might be. And the first one we picked was, was managing the financials. We wanted to make sure as we were growing quickly that everybody who needed that information could get it in an easy to ingest way and that we were all seeing the same information. Cause that's the other trap with running a business on Excel and email is you're not always sure that everybody's seeing the same data, which is, which can be deadly. Uh, and so we just, we started building reporting. Um, and, and it was just the two of us kind of working through the problem.
Speaker 4 21:25 Um, Dean does have a technical background, uh, which has been I think an extremely useful addition to the growth team. Um, and as we're adding more people into that team, we're, we're very mindfully looking for folks who have some technical skill sets because so much of what we want to solve for is, is, uh, solving problems that computers are either faster, better, easier to do and save the people time for the strategy work. And so reporting is just one great example of where you, you just, you don't want people spending all their time massaging data in Excel. So, uh, so definitely tech tech intensity, it has been a, has been a key theme for us and getting all of that business process out of email and into systems where people can see. So we started with reporting around financials, then we went into project metrics.
Speaker 4 22:16 Uh, we added recruiting to that cause we're growing so fast, we wanted everybody to be able to really see what was happening with recruiting because we have a centralized recruiting group that's serving all of our different practices. And um, email isn't, email is not a business system. That's what I say around here all the time. They're getting sick. Probably been emails for asking your husband, where do you want to go to dinner tonight? Email is not something that you manage your business through. And so, but that's what was happening, right? Practice lead would email the recruiter. How did it go with that interview? Well when you're interviewing, you know, 50 to a hundred people a month, a times the rounds of interviews that we typically go through here, which is at least for, you know, just imagine how you would keep track of all that.
Speaker 4 22:57 So we built a system to track the progress of the candidate and then to report out on it. And we could've gone off and bought a a candidate system, right? A job management platform and trust me, Dean would have liked for us to have done that. He tried to pitch it several times, but it didn't feel like we needed to go there yet. You know, we're still, uh, we're, we're a company in the thousands, not the hundreds of thousands, right? Hitachi corporate, where we roll up to in Tokyo is, is a 300,000 person firm, but this, this North American division, we're, um, just under 10,000. And so, you know, that it felt like we could probably solve this problem more quickly, um, ourselves. And so we did and we iterated on it in a couple of sprints and it was out there and it was getting used. And of course we make changes all the time, but, um, that, that concept
Speaker 5 23:46 of experimenting first and putting something out there and then, and then iterating on it has just been, it's, we are viewed as as masters of this domain and it's really just Dean and ice scrapping it out.
Speaker 3 24:00 That's awesome. I, uh, I definitely can see the challenges myself when I'm trying to execute in any kind of project where like growth systems, when you have the same engineers that are building core product, I know you guys don't necessarily have core product there, but you, you have engineers that are probably focusing on customer products and um, getting them to carve out time to work on growth systems tends to be pretty challenging. And I know Dean, you wrote about that in, in the paper you shared with me a while back. How, how did you, how did you get people to step back from day to day to build some of these systems?
Speaker 5 24:39 Yeah, sure. So I, I definitely echo justice sentiment and that, you know, you are what you measure and with any successful growth team you have to be able to very quickly and you know, a two to four week period of time measure whether or not an experiment was successful or not and just have this, Jess and I kind of talked through the concept of the growth team a couple of years back even and, uh, w w without that kind of core, some, some level of reporting and visibility on how you actually measure your experiments and, and hopefully invalidate some, you know, not everyone's a winner, right? Um, you, uh, we, we, we would have failed. Um, and so definitely that was very, a very collaborative effort. All of our VPs and directors each had their own mechanism to report and on the business and on their teams.
Speaker 5 25:28 And so kind of consolidating that was a good part of it. And then in terms of the growth team itself, we've got growth ambassadors in each practice that committed about five hours a week of time, has the expectation. And so they actually contribute directly to our growth backlog. And so we don't like to be the ones that come up with all the ideas. We come up with many of them, but we'll pick a lever. So next month we're focusing primarily on customer activation and in the customer activation space we pull all of the VPs and directors and growth ambassadors to come up with challenges. We really just want to know what their biggest challenges are. If they want to contribute directly to the backlog, that's fine. But usually what we'll do is we'll actually solution off of those challenges. We'll prioritize those solutions, you know, and that will in turn affect and impact what what it is that we decide to sprint on the coming in the coming months.
Speaker 3 26:21 And so do you guys have a separate marketing team as well? Or how, how does that, how does your growth efforts fit in with that?
Speaker 5 26:27 Yeah. So our marketing team is actively participates in many of our growth team experiments, but they are a separate team right now. They are a product of tattoo solutions. There are quite a few capex folks on the Hitachi solutions team. And so we're collaborating with them on a fairly regular basis and we help them a lot both in their reporting and how they run their team. But they are kind of a much larger engine supporting the global marketing needs. So there is a separation of the two right now. And um, yeah, there's, there's definitely close collaboration. We ran a route, grant ran that whole growth hacking workshop, two day workshop with them onsite Chicago several months ago. And um, you know, they're, they're jazzed about the concept of the growth team and they've taken a lot of the, a lot of the work that we do on the growth team and implemented it themselves as well.
Speaker 3 27:21 And then I assume salespeople play a role as well and bringing in new business. Is that, is that the case? Yeah, definitely. And how, how is there much experimentation? I know in my experience in working with salespeople, it tends to be there. There is experimentation. It's just not very well documented. Um, are they, are they subscribing to this process of, of test and learn and, and capture that as, as kind of company, um, company learnings?
Speaker 5 27:48 They are, they've loved it actually recently, especially because we, uh, in, in Catholic stays, we had to, when I started, we had one seller. When when we got acquired we had five, four, four or five and Hitachi solutions has about 50. And so you go from five to 50 sellers. And again, this is five sellers selling cloud technology and 50 sellers selling business applications, slightly different technology, uh, business applications, much more software oriented. And the kind of technology we do is much more custom services. So it is a different mindset when it comes to selling. And we've run quite a few experiments. The most recent of which is a sales enablement course. It's a teachable.com course that we offer internally to our sellers and basically a series of three to five minute videos from all of our experts to try to help the Hitachi solution sellers who might not necessarily know exactly how to sell the services business and then to help the services sellers who might not necessarily know how to sell the software components. And that's gone over really well. We've doubled down to a few a few times and iterated on that experiment as well.
Speaker 3 28:52 Well, so what would you say is the most impactful thing that you, that you did in terms of kind of the transformation that you started to go through several months ago. Um, what do you think had the biggest impact on growth from, from what you were doing previously to what you do now?
Speaker 4 29:09 I'd like to take that one cause that would be great. Yeah, I think that, uh, so this, this, this growth movement feels a lot like, uh, the agile movement of, you know, 10, 15 years ago in that you're asking people to do their job in a, in a different way. And it takes courage and some trust and for sure it requires, um, a champion, a teacher to guide them through that process. And so to me, this, the thing that's made this most successful is his Dean because he's like the scrum master of growth for our company. And he's demonstrating he's D one of the things that I love about working with Dean is he's a voracious reader and I think of him as my Harvard business review editor. So they used to have a product, it was called book notes or something, I can't remember exactly what it's called.
Speaker 4 30:03 They used to have a product in the nineties where they would exit or the summary of like the top five books that they would recommend. And you know, if you've read a lot of business books, there's a ton of background, you know, they're like pseudoscience, right? And a lot around methodology and um, how you, how they did their research and you know, with the Harvard business review, they just basically said, I'm going to validate it. I'm the good housekeeping stamp of approval on this book. So we've said, we've done the research and we know that we liked their methods. I'm just going to give you the five salient points that you need to understand. Um, that's what Dean does with business books all the time. And so he'd come across the growth, um, books, yours included. And, um, and he started bringing the ideas forward to me.
Speaker 4 30:47 And in my role, since I sit across the entire org, you know, I have the ability to change the way we work, but I mean anybody who's been part of any kind of change initiative in a company, you know that that's a, it's a tough road. So you have to have somebody who is super committed to the cause and understands the, the framework that you're suggesting and then can actually go do. And so I got to create things happen this week. Um, we did a company call with our senior leadership out of Tokyo, um, and then we did an all hands call yesterday with our North America practice. And in both of those calls and the senior leadership call, uh, I listened to our global head of marketing talk about the design growth experiment workshops that Dean kicked off and that was back in January and all the work that's come from it because the CEO out of Tokyo was noticing how much activity and improvement there had been in some of the marketing material and just their approach, um, go to market in general.
Speaker 4 31:53 And so, um, Michael Stratton actually called it out and he said, right, we're working with Dean and, uh, uh, a group of people to really sort of rethink the way we do our planning effort. And we're now very agile and we do it in short sprints and we do experiments and we, we recognize which, which levers we're going after. So it was just kinda great to sit there and listen to him talk about it. Um, and that Dean had the courage to go do that workshop for a couple of days, uh, with somebody from that UX team that I had mentioned before. And they just did a great job. And, and you know, change happens when people see action and so you got that win in the marketing group and so now that's starting to trickle around the orchids of course everybody else on that leadership calls hearing that.
Speaker 4 32:35 Right? Um, and then, and then we have yesterday where our president North America president was, was talking about experiments, um, to the group because one of the things that I've been asked to look to look after in my role is the bench time that's going to come from COBIT, right? We know that we're not going to be as busy as we were before. And so we want to make sure that when our consultants are riding the bench, as we say in the consulting world, not working on customer delivery, that they're working on things that are really going to be meaningful to the business. And so, so Dean and I are running this, this backlog, this growth team backlog that goes after. What are the things that would be most useful for people to do while while they have some free time? The key difference between the way they did that last year versus now is it's not a list of 12 month initiatives because that's just nobody could predict, right?
Speaker 4 33:34 No one knows what next month looks like. So there were running it truly with that growth mindset of experimentation first. And so we've asked everybody, don't, don't propose anything that can't be thought of, tried, designed and reconfigured within a month. So two, two weeks sprints. That's what you got. Think about it from that perspective. And so we started with that and we did it in April. And how many did we get done? Dean's six. I think we got six things done and, and the whole thought over yet. And it's terrible. You're right. We get, we get six more days. But the whole org is watching that. And so now you've got, you've got one department that's blended old co NewCo and you've got, now you've got, and they're having success. And then you've got your president on the town hall call talking about experimentation. And he's really keen on that word. He likes using the word experimentation to shit to signal the mindset shift. These are not going to be year long initiatives, these are going to be what we're going to do next month and here's your six examples of what we got done in this method this month. And so now people are going to start to trust.
Speaker 3 34:36 That's great. That's great. And I think the fact that you guys kicked off a lot of it with a workshop, in my experience I, I, it took me a long time to kind of get to the workshop as something that can really kick off that mindset change. But it is really, as you said, uh, you have to rethink how all of this works and it's really hard to rethink it when you're in the day to day trenches of execution. So stepping back into a one or two day workshop and having key people really buy into at least the picture of what you're going to try and then, and then hopefully you get results quickly. Like you have to where it can reinforce that. But I think that that in my experience has been what works better than anything else that I've tried. Just because I found even as a consultant, I would go in and try to work with some companies over a several month period and incrementally drive the changes. And it's just, it's just too hard because you know, if you don't have everyone in sync across the organization around this, it's the people trying to drive experimentation
Speaker 5 35:38 tend to get blocked by people who don't understand why it's important. So I'm curious if, if you found that at all, if you had any false starts before you got to the workshop and um, and what your general thinking is around having a cross functional alignment as you, as you drive experimentation.
Speaker 4 35:57 Yeah, that's so, so I would agree with you that you have to, you have to take the time out and, and do, do the, the workshop style way of introducing all this. I think that, I think that people have, it's just a natural human tendency to not believe it. Anytime you put something new in front of people, there's sort of like, it's the way I've described it as, it's almost as if people kind of lean back in their chair a little bit. Like that's different and I'm not sure. I just think that's, I just think that's help, sadly. I guess that's how our brains are wired. And so, um, we've been asking people to kind of try to recognize that that's like the natural human tendency to, to call it what it is and then to say, just try to like get just a titch uncomfortable and lean forward instead of back back's gonna feel more comfortable instead like get okay with just being a little bit like, Oh, don't, if this is going to be a good use of time at all.
Speaker 4 36:56 What does Dean talking about, you know, get like recognize that feelings going to come and then just like, just ignore it and say, all right, well that's going to be there for a little while. Um, and so, so, so that's the model that we've been using. And that, that like just saying those words has I think been kind of helpful. I think. I think when you, I, I am a big believer in, in, in, uh, open candid conversation, right? And so just just recognize that that's what people will normally go to and call it out. So, so one thing that, one thing to add
Speaker 5 37:27 here, I think that confidence is clearly a prerequisite for success. So if your goal is to begin to garner alignment across an entire business, a facilitation opportunity for you individually is actually a really awesome way to garner that level of confidence and alignment within your team. And so our, our UX team especially has been a huge contributor to my work and my success on the growth team. Jason Rood and Dan Allen, those guys are, are, uh, are super design sprint experts. And so when you are familiar with Jake Knapp methodology of running design sprints, which is great book by the way, sprint by Jake Knapp, um, you are then a lot more confident and able to garner alignment in a short period of time. You know, you run through a one day workshop or a two day workshop and by the end of the two days you, you've actually built something.
Speaker 5 38:19 You have a team that has priorities and the team is actually all in agreement of what those priorities are. And so I think without some sort of reset, especially in the larger words like ours who, who, you know, kind of are custom to, uh, to, to keeping the same and to, to not a lot of change. Um, I think that providing that level of reset and reframing the conversation in a way that's a bit more agile and nimble and thinking is a, is imperative to anyone's success. And I think you had mentioned that, uh, Dean, that you had been in Germany doing some workshops as well. Do you have much, much kind of exposure on the European side? Not too much, uh, in, in person. I was out in Australia for all of all of February. So a little bit of collaboration with our existing clients out there in terms of workshopping, but, um, Germany, I'm trying to remember, I could just be scrambled brain from too much, uh, staying alone at home, but too much boat time, too much boat in mountain time. Um, so, and then I know when you had asked me, one of the things that I always emphasize is, um, is North star metric and you know, understanding the machine that moves that metric. So, um, did you guys come up with a North star metric?
Speaker 4 39:42 So, um, as we've been working through <inaudible> it's, it's, it's tough, right? I mean, North star metric right now is stay in business and uh, and so, so, you know, here's how we've been talking about it. Actually just had this discussion with our president yesterday. Um, and it's really fun to listen to him. He started to pick up all the vernacular. It's pretty great to watch. Um, but, uh, we were talking about North star metric and we agreed that, um, if it weren't for coven, it would be very easy for us to define it. And, and the, and the metric would be, um, additional projects within an existing account, um, because that's the best indicator of, um, we're doing good work. We're providing value to the customer. It's, it kind of touches employee retention as well as customer retention. Um, because, um, happy employee equal happy customer.
Speaker 4 40:40 Right? And so for us that, that would be the one. And so what we talked about is, well, let's, you know, let's just, let's just recognize that covert is introducing, um, some strangeness into the ecosystem that we're not going to be able to change. So let's kind of put that aside and still still focus on that metric. Um, even though we know at the same time, we also very much need to be watching things and we're trying to just, you know, run a run a cost neutral business while we all get through this crazy time. So, um, so that's what we're going to run after. And, uh, and then as Dean said, I'm just starting to educate the broader LT around picking that metric and then picking the lever to run after. So Dean did a great job of landing that message with the marketing department in particular.
Speaker 4 41:29 So you've got a pretty sizable group that's already familiar with those concepts, is about 25 people, I would say. Um, and so now we're now we're, we're tasked with bringing that same structure to the broader leadership team. So next month actually, um, we'll be doing our first formal presentation of this is the metric that we're going to run after. This is the lever that we're going to run after and here's how we're going to organize the effort over the next, you know, what, what's it going to be? Three months, six months, 12 months, not sure.
Speaker 3 41:59 Very cool. So, so I mean, one of the themes that keeps coming up, which is great, is that that, uh, you guys are really focused on driving lots of experimentation and there's, there's no improvement without experimentation. There's actually, uh, a great, uh, Jeff Bezos quote that I came across in the last few months that is, um, our success at Amazon as a function of how many experiments we do per day, per month or per year, per month and per day. And so I think they tend to be fairly quiet about what they do at Amazon. But clearly all of the breakout growth companies of the last 20 years have been very experiment driven. And, um, but it starts with also understanding your, your core business before you run those experiments. And, um, if you, if you don't understand exactly who your customers are and how they get value from your product and how they discovered it in the first place and how they got started and how they, you know, when you say your product, I mean your, your service and your case, but, um, how they ultimately become these, these loyal customers that spread the news about what you're doing and, and continue to, to use your services, um, then, then the experimentation isn't gonna be very effective because you could be breaking important parts of the business.
Speaker 3 43:11 So let's, let's look at kind of what that, what that journey looks like from, uh, getting a new customer in the door. We talked about the sales and marketing play a role there too. You, you also talked about that activation is kind of a key focus area for you right now, but if we could kind of go through that journey to where someone becomes this, this raving fan of Hitachi solutions, um, it'd be great to see what that journey looks like. Dean, you want to start on that?
Speaker 5 43:36 Sure, sure. Yeah, it, I would say it definitely depends. It's especially interesting because of the merger and since the merger, uh, the, we have a ton of customers who start with a simple assessment like, you know, a one or two or three or a few week. Um, basically proof of value. Let's, let's go ahead and build something that will solve some problems today. Um, but basically applying that kind of fast iterative development tactic to solving their biggest problem in a very quick period of time, knowing that it's not necessarily the longterm solution. We have other customers who we spend with highly detailed or with our technical folks kind of talking through the problem over a course of a couple of weeks or a few weeks. And then even in Hitachi Hitachi's world, we have a, a lot of customers who will spend several months kind of building out and designing the enterprise resource planning tool that they ever, you know, that they've dreamed of and then ultimately will execute upon it.
Speaker 5 44:38 Um, we also get quite a bit of referral from Microsoft. We work with their field sellers, they've got thousands of field sellers around the country, all of whom, uh, get to know us through a variety of ways. And, and so actually we'll, we'll sprint on experiments to try to help their field sellers. And then obviously, you know, that leads in turn to more referral from those field sellers. So they'll introduce us to customers who they already know have problems. So it's really kind of all across the board in terms of how we acquire a customer.
Speaker 3 45:07 Do you do any outbound, uh, does your sales team do any outbound prospecting?
Speaker 5 45:12 They do. Yeah, quite, quite a bit actually. And we're using a couple of different account based marketing tools. Um, we're using Marquetto, we've got a new site core website that's coming out, uh, you know, a week or two I think actually finishing up with that now. And, uh, and we've got quite a bit of outbound marketing that kind of fuels our, our customer relationship management software ourselves and you know, kind of applying those same best practices or attempting to, uh, within the business.
Speaker 3 45:42 And so, uh, both of you have really touched on that, that referrals and, and retention are an important component of the business. Jessica, are you guys doing anything to, to, to try to accelerate, um, referrals and, and, and to improve retention over time?
Speaker 4 45:59 So the referral thing is a, is an interesting one. So on the Microsoft side, right, they're our channel partner. And so, um, we measure it. We actually do try to keep track of how much of our new logos are coming from Microsoft referral versus our own. Get out there and find it. And, um, I don't have numbers across the entire business, but on the, on the old cap side, um, between 2017 beginning of the year, I think when we first started measuring it to, by the end of the year, we were able to flip the ratio. We were about 75%. Microsoft referred to 25% net new on our own. And by the end of that year, we'd totally reversed that. So it was that 25% was Microsoft led and the rest was all us finding our own work. And sometimes that would also just be more work within an existing account.
Speaker 4 46:50 Cause again, that's us. Like new logos are great, but you know, for us, you know, we're S we're truly winning when we're finding more work within an existing account. So, so I'm proud that we were able to get that done. Um, on the actual customer side though, that's where it's hard because it's, it's, I mean, this is one of the things that I think is one of the bigger differences between, uh, you know, services company versus a B to C product company. Um, you know, there's, uh, like you think about the kinds of things that you would use to insent right? And, and, and what, what you do that would be ethically appropriate for the type of business we are. That's really been the challenge, right? I mean, can, can we start writing Amazon gift cards to customers? I mean, that feels it feels off. Right. And so, you know, so then what do you think about, well, maybe we could try to do, you know, uh, you get a workshop for free, you know, so those are the things that we should experiment with that I, I'll be truly honest, we just, we haven't done a lot of it. Um,
Speaker 3 47:56 well, and it also doesn't have to be incentives. Like it can sometimes it can just be, um, we have, uh, we feel like we have a really good relationship with you and it's working well. Do you know any other companies that are in, in your kind of world that could benefit from working with us? Sometimes just asking the question can help to accelerate it
Speaker 4 48:14 and, you know, see that's the kind of that that's, that's right. So, so thank you for that life tip. Should definitely go do that. And, and then I guess what we would say is, is the experiment would be, well, it's probably not going to be financially incented, right? So then what are some other things? Cause I mean, you're right, if sometimes just just calling the ball and saying, Hey guys, we, we want to programmatically go out to our existing customers and you know, each one of those 50 salespeople, you know, think of your top three accounts. Who do you have the texting relationship with that you could, could reach out to them and say, you know, these are interesting times and everyone's just trying to, you know, do the best they can for their business. Are there any companies like yours that you would suggest we speak to that, that'd be, that'd be something that we should go do? We have not spent enough time around it.
Speaker 3 49:02 Yeah. And like with any other thing, maybe it doesn't help at all and maybe it doesn't, that's why you run it as an experiment. Even if it's, even if it's not like a, uh, a very super data-driven pure experiment, you can still try to get some signal if it works or if, if it's better to just focus on, on other things that have, have historically worked. Um, so what one question I really like to end with, um, at on these interviews and I feel like both of you have probably learned a lot about growth in the last year or two. So, um, I think this'll be a good one for you guys, but, um, w what do you feel like you understand about growth now that you didn't necessarily understand as well a couple of years ago? So, Dean, you want to take that first?
Speaker 5 49:45 Sure, sure. Yeah. So I think that a couple of real, a couple of really big things that I've learned recently. Um, uh, the, the first is that, you know, what they say about assuming and, and realistically there are a lot of assumptions that take place, uh, not just throughout our business but throughout many businesses. And so it kind of, as I've expanded, we're, we're out in Chicago and so as I've expanded my network and met more people in growth in Chicago, uh, I've discovered that folks tend to make large scale assumptions that drive their business for several months. And that's no way to run a business. And so I really enjoy working with Jessica quite a bit because it allows us to not paint the picture from a marketing standpoint, but paint a picture from an entire business standpoint. And realistically, the outlook of growth and building a business that is able to validate and validate ideas over a very short period of time is imperative, especially right now.
Speaker 5 50:44 Um, so, so kind of that, that understanding of, uh, you know, measure it over a very short period of time, whatever it may be, um, and don't necessarily come at it from a hypothesis standpoint rather than a, uh, rather than, uh, uh, uh, clear. Um, you know, you don't want, you don't want to assign, um, you don't want to have the reporting dictate how you run your business. You want to be able to run your business. And then, uh, iterate through different strategies, right? So that would be the first big thing. The second thing is in order for something to truly be innovative, it needs to be new, surprising and honestly, radically youth useful. Right? And so to try to, uh, change the, the idea of, you know, what are our biggest challenges? Okay, well let's look at the numbers. Let's, let's sort on, you know, the, uh, the individuals who aren't building enough hours, let's see if we can upskill them.
Speaker 5 51:34 And, and you know, in order to, in order to take away that kind of general sense of assumption, you have to really be able to think outside the box. And so I think allowing our, our UX practice and allowing folks within our, our, uh, our organization to come and provide kind of radically transparent feedback to the way that we're running things and then accept it. Um, there's a book by, um, by Kim Scott called radical candor, which is totally awesome. And I talk about it quite a bit and it's, uh, you know, you want to be, um, you know, you want to be, you want to care personally and challenge directly and you want to be able to accept feedback that, uh, when others are challenging directly. And so to have that kind of collaborative mentality is, is also imperative for growth because you're obviously not going to come up with innovative ideas unless you turn your listening ears on and, and really, truly listen to the, to the peers that's around you. I love that. I love that. So how, how about you, Jessica? Is there anything that you would pinpoint beyond those that's, that's an important learning and growth in the last couple of years?
Speaker 4 52:36 Yeah, for me, the coolest one has been that, um, this, this framework, this way of approaching growth is to me the very best way to deal with change management within an organization. And I think that's a, that's a problem that everyone's been trying to solve for a long, long time. Um, I, you know, I'm thinking back to John Kotter and rom shrunk type days. Um, and, uh, and the reason is because of what you guys were saying earlier. You don't have to, like if we're going to go do that referral program, I don't have to go spend six months spinning up some very overly managed, overly planned, um, program that then has to have this wide adoption pattern. And, and, you know, all that effort, we can actually just spend couple of weeks trying it out quietly. And that's to me how we get real organizational change is, um, again, it gets back to people just, you know, they have their opinions about what works and what doesn't and when everything net new is presented as a major, you know, life changing initiative, um, you, you've set yourself up for some really tough conversations versus we're not going to invest a ton in this guys.
Speaker 4 53:50 We're going to have this always be learning concept running through our brains. And it's about experimentation. And so to me, it's turned out to be like a playbook for how we do our own internal change around the way we think about strategy and prioritizations and, and where we want to put our energy. Um, as an organization into, into growth. So it's like, uh, it's like a crash course in how to affect really successful company wide change.
Speaker 3 54:19 Awesome. Yeah. And I, and I think especially as you said, like change management, um, in, at this time right now in the time of Cova, it's like even if you didn't want to go through change and you talked about comfort versus discomfort and um, comfort can often cause people not to want to change something cause cause the same as comfortable. At least it's known. But there's this, there's this big thing that's been thrown at all of us that has caused us to have to rethink how we do things. And having that, that kind of test and iterate mentality and approach to things is, is probably going to help people navigate through that, that, that crisis a little bit better than, than those that are super fixed in their way of doing things.
Speaker 4 55:01 Yeah. It's, it's just the most excellent blueprint that a leader could hope for around, uh, embarking on something significant within the org, which we all are.
Speaker 3 55:11 Yeah. And, and I definitely think that sort of the stronger a mission is that a company is focused on, the easier it is to sort of think about, okay, what are some other ways to achieve that mission? Maybe even some better ways in light of changes. And, and if it's not better ways, it's as you said, you know, survival, we got to go on and, and, uh, and so being able to, being able to just think, okay, how do, how do we make it through this so that we can keep pursuing that mission is, is really important. Right? So if you haven't bought hacking growth by Sean Ellis and Morgan Brown, highly suggested thank you. Better for you to throw that pitch out there than me. Um, I appreciate it. So some of the key takeaways, there's a lot of great takeaways from this conversation with you guys, but some of the ones that I wrote down through, through the conversation are, um, I think being problem focused, which is, which is similar to what I was just saying about being mission-focused, but just, you know, the more that your problem focused, the more that you can iterate on what the solutions look like.
Speaker 3 56:11 Um, that was something that I think Dean said pretty early, probably like both of you guys have touched on it multiple times. And then, uh, Jessica you talked about having that, that trusted growth champion in Dean has been really helpful in, in keeping kind of a growth change initiative, top of mind for a lot of people and having someone who's, who's constantly reading and trying to figure out better ways to do all of this and sort of the best of breed. But like in the case when, when Dean reached out to me it was like there's not a lot written about how do you do this in a, in a services type business. And so, um, you know, a lot of times you have to be creative and thinking about how do we, how do we retrofit some learnings that have happened in a company like Facebook or Amazon to, to when you're selling, you know, big B2B kind of contracts of, of helping to solve problems through through services.
Speaker 3 57:05 And then, um, I think that that the, the workshop is probably important. As I said, I've, I've realized that myself and kind of igniting change and getting everyone on the same page. Um, so those, those are probably some of the most important. And then also the, you know, measure to manage, um, is, is really important. And that, that ultimately all of these kind of changes tend to tend to stick through through that, that process of kind of bearing down and going through that uncomfortable process in the beginning. But when you start to see some wins and improvements from that experimentation, you get buy in over time. And then I, I've seen it happen with a lot of companies where, where, um, momentum takes over and it becomes easier and easier. But by pushing through that inertia can be pretty tough in the beginning. So anything beyond those key takeaways that I, that I mentioned that, that you would like to add to that.
Speaker 3 57:58 Do you think that's exactly the right list? Awesome. Awesome. Well, I appreciate so much that you guys took time out and this, uh, what's, what's a really busy time for a lot of people right now and um, and shared what your journey's been like. It's, it's much more exciting than probably a lot of, uh, a lot of people might think in kind of bigger B2B, but I, I think the way that you've approached it makes for a really interesting conversation today. So congratulations on the success. I'm excited to see where you guys go from here and to everyone listening, thanks for tuning in. Stay safe. Thanks for having us. Thank you.
Speaker 1 58:32 <inaudible>
Speaker 2 58:37 thanks for listening to the breakout growth podcast. Please take a moment to leave us a review on your favorite podcast platform, and while you're at it, subscribe. So you never miss a show until next week.
