Here is the list (in no particular order), based on our collective experiences:

• Assembling a great team - See my thoughts in previous linked post.
• Fierce Sense of Urgency - Ditto
• Persistence - Ditto
• Vision - Defining, communicating and inspiring a clear, easy-to-understand vision, especially in challenging times.
• Capable - The ability to consistently demonstrate limitless capacity to solve problems.
• Humble - The ability to overcome the instinct of self-preservation, to fly under the radar and to make decisions that are best for the company.
• Trustworthy - The proven ability to empower their team and deliver as expected.
• Decisive - The ability to make timely, often tough decisions, in an unwavering fashion.
• Genuine - The ability to garner respect because of who they are and how they lead, instead of what they’ve done.
• Responsible - The ability to take responsibility for all team decisions that they’ve participated in, regardless of the success or failure of those decisions.

Tom Peters probably phrased it best: “Management is about arranging and telling. Leadership is about nurturing and enhancing.” I want to thank all of you who have sent me your thoughts via email. I still marvel at the similarity of your recommendations and thoughts on these commonalities.

Happy Thanksgiving everyone!

I wanted to follow-up on my last post and provide more details on the questions and my answers. Here are some of the questions asked during the panel:

“How do the skills required change from a Functional VP role to the CEO role?”
I answered that both roles share common skill sets, but as the CEO, the constituencies have changed: All Employees, Board members, Investors, market makers and Industry leadership are key constituencies that the CEO needs to address. My role is to set the strategic direction for our Company and to provide proof points to those constituencies that a market can be made. We’re trying to make something from almost nothing and the CEO needs to articulate this opportunity to those constituencies.

“What skills/advice had helped you in working with your Board of Directors?
This was an interesting question because frankly, it’s one of the hardest skills to develop for a new CEO. How much information do you share with your Board and how often? My style is to give frequent, transparent, high-level communications throughout the quarter. Establishing a good, trusting working relationship with your Board is essential. A very smart person taught me long ago, “Bad news is not like fine wine, it does not get better with age.” Transparency, defining a plan of action and managing expectations are the most important skills to develop when interacting with your Board of Directors.

[The very smart person that I reference above was my Grandfather, a hard-working, Italian national, who was a Blacksmith with the Italian Cavalry in Naples, Italy. He had a lot of great quotes for me when I was growing up and helped instill in me the work ethic that I employ to this day.]

“Are there any disciplines that you wish you had more experience with now that you’re a CEO?”
I could write for days on this subject, but the short answer is yes. I wish that I had a Law Degree (J.D.) and a CPA Degree. What I’ve learned in business is that having a great product, building a great company and making a market is only half the battle. The other half resides in the details: financing a business for growth requires experience and is complicated. Raising Venture capital is complicated. Structuring deals with customers is complicated. As the CEO, it’s important to understand every functional area, but hire the very best you can in each discipline.

“What Mistakes are most common for a first time CEO? What mistake did you make that you learned the most from?”
There are a lot of common mistakes for a first time CEO and I’ve made them all. The most common mistake, in my view, is not firing fast enough. A bad hire, without taking action, can really set a company back. Interestingly enough, there was violent agreement amongst the other panel members on this subject and my answer. The other common mistake is not taking risks. I call it “failing fast.” I use this term with my team a lot. It simply means that I am willing to provide a safe environment for innovation, but in return, the team commits to “failing fast” on the initiative. This means that the initiative has a very small team (1-3 people), architects the idea, prototypes it and then compares the idea to what our customer base is looking for. If it works, I authorize further development. If not, it “fails fast” and we move on to the next initiative.

“When you are hiring executives, what do you look for?”
This question really caught the attention of the attendees. Since most of them were Stanford GSB graduates or students in the GSB program, I think everyone was expecting a silver bullet answer. As you know, there aren’t any short-cuts when it comes to experience. What I look for in an executive is their ability to be a utility player—experience counts. A track record of success and knowledge/experience in different areas (Sales, Marketing, Finance, Engineering, Product Management, Product Marketing, Channel Development, etc.) is important to me. Once this hurdle is crossed, a good cultural fit is extremely important.

“What is the key to your success in one sentence?”
Work hard, do your homework, hire great people, instill a fierce sense of urgency in everything you undertake, take risks, don’t take yourself too seriously and have a GREAT sense of humor.

Overall, this was a great experience for me. I enjoyed my Panelist colleagues, their unique perspectives and their sense of humor. One thing that is very interesting is that each of us, though we all had disparate backgrounds, share a number of common traits as leaders in our respective companies.

I was flattered to be invited to join a panel discussion for the Stanford Graduate School of Business entitled “Getting to the Top.” I was one of four CEO panelists, fielding questions about leadership, management, career paths and a number of leadership topics.

I was looking forward to this panel for two reasons: First, I was interested in hearing how other CEO panelists would answer the questions and compare them to my experiences and, secondly, I wanted to hear what the Stanford GSB students were thinking about when it came to management and leadership.

After a brief review of our respective backgrounds, moderator Kathy Ullrich kicked-off the discussion with the following question: “What are the most important skills that a CEO needs?” I answered that first and foremost, the ability to assemble a highly skilled and talented, functional team was the key to success. The ability to recruit, assemble, build and coach a world-class executive team were important skills to develop. [I am fortunate enough to have a strong management team of which several members could easily be CEO’s of their own companies. This matters when you’re trying to build new markets and make something from nothing].

Ms. Ullrich then asked me to lead off and answer the following question: “What leadership/management skills has/have been most useful to you to help you move up?” I responded that from a leadership perspective, the ability to remove the fear of self-preservation was important. When a leader makes decisions to ensure his/her survival, then they aren't taking the necessary risks that are required to build a company. From a management perspective, I believe that the ability to set clear direction and goals, as well as instilling a fierce sense of urgency to meet those goals is paramount. Transparent Communications, Presence (to really be there when you’re meeting and listening, not playing with your Blackberry and ignoring cell phone calls during that time) and Coaching are all skills that have helped me along the way.

I will post another entry (or two) with some of the other questions from both the panel and the audience in the coming week.

But now, I have little kids knocking on my door asking for candy--Trick or Treat!

Amazingly enough, Galileo’s telescope lead us on a direct path to today’s super-modern Large Hadron Collider that was fired up last week when I was in London. (Funny aside, my British colleagues and prospects were not in favor of this experiment—they, and a number of other Europeans, thought that this would have unintended consequences—like open up a Black Hole that would swallow all of Europe!)

The article goes on to state that throughout history, scientists have had to continually invent new tools and theories (for instance, to explain the behavior of atoms, scientists had to invent quantum theory, which led to semi-conductors and other technologies that account for a huge portion of the 20th century’s economic output).

How does this relate to the folks here in Silicon Valley? Because like scientists, new tools and theories are invented or evolve to break through to the next level of efficiency. We continually look for ways to invent, innovate, re-configure old tools or even more commonly, invent new tools to propel businesses forward (think telescope to atoms to quantum theory to semi-conductors).

Look at Apple and how they've transformed digital entertainment. Consumers can now carry their entire music library, plus TV shows and movies all on one device that fits easily in your pocket. Can you imagine floating this concept around twenty years ago?

VMware [NYSE: VMW] is another great example. The company broke new ground by allowing one server to run several operating systems at once, or allowing a particular operating system to run on any server. The server, essentially, becomes virtual—its function is no longer locked into the physical machine.

Or how about social networking? I believe that social networking will replace the need for CRM. Why? Between FaceBook, MySpace, Twitter, LinkedIn and whatever else is on the horizon, all of the information that you need to know about your customers will be available in tidy, relevant places.

And to think, Galileo made it all possible with the invention of the telescope.

Since I’m a little off on my body clock, I thought that I’d post a quick follow-up entry to my last posting. I’ve received some very good comments/feedback about common traits among successful leaders. So far, I’ve received consistent feedback on two important traits:

Fierce sense of urgency:
Just look to the beginning of the Internet boom for this trait: Marc Andreessen & Jim Clark of Netscape. Larry Page and Sergey Brin of Google. Reid Hoffman, first dabbling with SocialNet, then PayPal and now at LinkedIn. How about the leadership at eBay? Amazon.com? Successful leaders instill a fierce sense of urgency in everything they do. Who else would you put into this category?

Persistence:
Apple boss, Steve Jobs is a great example of possessing this successful trait. Mr. Jobs is always on the forefront of trying new things and keeping his critics guessing. The iPod. iTunes. The new iPod. The iPhone. The new iPhone. MacBooks, iTunes subscription service, what next Apple TV? You never know, but one thing that you can be assured of, something is always brewing with Mr. Jobs and his team. Persistence = keeping at it. Pushing hard. Never giving up.

I believe that these two traits surely belong in our coveted Top 10 common traits among successful leaders. Please let me know your thoughts and ideas. We have eight more traits to go!

I’ve often looked at successful leaders and have tried to pinpoint what sets them apart. What things do they (or in some cases, don’t do) that make them so successful? Is it management style? Leadership skills? Unique abilities? What do they do differently than the rest of the pack?

What's the secret behind Steve Jobs' incredible accomplishments? Or how about Carol Bartz? John Chambers? Dianne Green? What do each one of these successful leaders do that is so unique? Why have they been able to rise to the top?

I had an interesting thought last week while thumbing through the book Simplexity, Why Simple Things Become Complex (and How Complex Things Can be Made Simple), by Jeffrey Kluger. The book is thought-provoking and intellectually stimulating. When I first put the book down, I sat there for a moment and tried to apply what I’d read to my leadership role at StrongMail. And then, BAM! I realized that maybe I was looking at this all wrong. Instead of trying to identify unique traits, I'm going to reverse my approach and start looking at the commonalities of successful leaders for insight.

One clear common attribute of successful leaders is their team. Every successful leader has a great team—they’re leaders in their own right. Steve Job of Apple has a great team. Carol Bartz of Autodesk had a great team. John Chambers of Cisco, again, has a great team. A great team attracts great people. Great people execute.

Over the next month or so, I’m going to take note of more commonalities during my interaction with people: internal meetings, prospect and customer meetings, reading the business press and my news sources. I’d like for you to do the same.

Let’s try to assemble the top 10 common attributes of successful leaders to share with this audience.

I look forward to hearing your thoughts, observations and personal experience on this topic.

It was fascinating to read the back-story to some of these high-profile CEO ousters and the dynamics of the CEO and their respective Board members. The article covers three well-known CEO’s who lost their jobs involuntarily: David Neeleman, founder of JetBlue, Jim Donald, former CEO of Starbucks and Ed Zander, former CEO of Motorola. First, kudos to Fortune Magazine and writer Patricia Sellers for pulling together this story. How lucky are we to be able to read about these men and learn from their mistakes?

What I found most interesting about this article was the honesty that all three executives displayed when discussing what is surely a highly personal, pivotal and emotional period in their careers. All three executives were at one point “high-fliers”—so getting them into a room to talk about their toughest day and outline their lessons learned presents an amazing educational opportunity for management-types. And, of course, I was intrigued to read lessons from other graduates of the School of Hard Knocks.

Here is the free advice that I was able to extract from these three senior executives:

• Communications: Keep your key constituents updated. If you don’t, they will draw their own conclusions.
• Invest abroad to grow and hedge.
• Get inspired in the field. Prospects really do know what they need – and, they’ll tell you for free. Just ask them.
• Move fast on people, whether it’s hiring or firing. Great talent makes or breaks a company.
• Focus on building long-term value. Focus on the decisions that reinforce your long-term strategy.
• Admit your mistakes. Explain them and move on.
• Ideas are good. But execution is everything.

In addition to the information above, I found some other very nice pieces of free advice sprinkled throughout the article from the likes of Ted Turner, Martha Stewart and Oprah Winfrey:

• Keep taking risks.


• Don’t let doubters get you down.


• Seek a purpose.


• Visualize the next big win.


• Learn from your mistakes.


• Remember: Failure can be temporary.

I enjoyed the simplicity of the article and the nuggets provided by all three executives. There weren’t any new, ground-breaking management theories outlined in this article, just good-old fashioned, tried–and-true business tenets. Lessons learned from The School of Hard Knocks.

It was funny to hear this NPR interview during my morning commute last week. Well, maybe “funny” is the wrong word, but I found myself intrigued. Here I am in Silicon Valley, leading one of the most innovative, on-premise email solution providers that serves the world’s largest corporations, and I'm listening to a radio interview with the rank and file complaining about email. It’s similar to a head-coach listening to a post-game interview from a sportscaster and a fan.

Email continues to be a conundrum for consumers, leading some to delete their entire inbox as they declare a state of email bankruptcy. So, what to do? Well, our prospects and customers think they know part of the answer - build relationships.

Forrester Research issued a report in April called, “Break Free from Bad Email” and introduces the notion of Intentional E-Mail:

“Using email for only-short-term revenue gains is myopic. Instead, marketers should use email to improve customer relationships and grow their long-term value. Doing this requires a combination of best practices: integrating data from external sources, targeting based on past behaviors and calculating the business value of an email subscriber.”

Many of our prospects and customers realize that the relevancy and frequency of email is important. More and more companies hope to address this by bringing email in-house and centralizing email streams—giving them the visibility and tools needed to pull email out of Chapter 11.

The problem with forcing “The New, New Thing” onto your organization is that these big leaps are distracting, destabilizing and unrealistic. I’m a fan of iteration—the long, steady march of building something from nothing. Making good on the promise of your original business plan. The sustained, laser-sharp focus of being the best and owning your market segment—by listening to your prospects and customers closely and taking note of their needs, worries and requirements—not only now, but five years from now. Most importantly, by truly understanding your prospects' and customers' businesses—this iterative process builds on your core strengths and technology platform.

We know this first-hand here at StrongMail because our product road map is driven by our customers. They’ve asked us to build the world’s best commercial grade, on-premise solution for marketing and transactional emails.

It’s amazing what happens when you listen to what your customers want.

I was recently asked by our investors about the state of the economy and the impact on our current business. Are we recession-proof? Recession-resistant? Tough questions for a CEO, indeed, especially since my trusty crystal ball has been in the shop for the past 20 years!

I've spent a lot of time thinking about the state of the economy and its possible impact on our business, and it really bugs me that it's impossible to answer that question with any certainty. Fortunately, I do know that we’re being prudent about our spending and hiring and matching those directly to our operating plan. And I believe that we have a good process in place to monitor key data points from our end.

As I consider these questions, Mr. Charan’s article has helped me put a few things into perspective and, more importantly, validated several lines of thinking that I feel are important in running a business.

Keep building
Mr. Charan outlines several very reasonable points to keep in mind. In uncertain times, you’ll feel tempted to cut discretionary spending – just be sure not to include Product Development, Innovation or Brand Building in the “discretionary” spending category. He goes on to say that if you keep building, you will come back strong. During tough times, it’s important to reinforce your core values, and being a high-technology company, StrongMail's core values center around product development, innovation and engineering excellence and loyalty.

Communicate intensively
During uncertain times, getting accurate data to the operating folks is imperative to make fast, correct decisions. Where’s the best place to get this information? From your customers of course! Speaking to your customers’ customers may give you an even better picture of what’s really happening out there. This is a great point, and I'm going to ensure that StrongMail does more of this.

Evaluate your customers
Mr. Charan states that in good times, companies manage the P&L; in bad times, cash and receivables matter more. As a company that is gaining momentum (e.g. maturing), that is something we’ve always tried to do, but haven’t yet perfected. Acquiring customers is paramount to our success, so balancing customer acquisition with identifying high-risk, cash poor customers can be tricky.

Just say no to across-the-board cuts
Finally, this is a good time to look at and clean out your company’s “attic.” Mr. Charan endorses having a purpose and a plan for cutting specific expenses, but not across-the-board cuts. This makes sense since it augments the “keep building and investing” section above.

Overall, these are relevant pieces of advice that reinforce the fundamentals of growing and managing a business. There is no magic wand advice here, but good old-fashioned blocking and tackling. This was a great refresher course for me. I would love to hear from others on how your companies are looking at (and what you’re doing) during these uncertain economic times.

It’s easy to get distracted with spreadsheets and numbers, or worse, look for trending information in data points, where none exists. I like to be consistent in my messaging to my team: customer acquisition, successful customer deployment, customer retention, and finally, complete customer satisfaction.

The more customers you win over, the more customers you will attract. We call it ‘self-fulfilling prophecy’—the more you have, the more you’ll get. Of course, we have to earn every customer's business, but our focus on customer success and satisfaction is fierce. Happy customers buy from you again. Happy customers tell other companies that they’re happy. Happy customers are loyal. Happy customers help you build momentum.

We’ve gained a lot of momentum during the past year by focusing on two things: execution and keeping our current customers happy. We’ve used this simple approach to attract high quality companies to become StrongMail customers. That same approach works in attracting high quality employees.

I think that we should take a long, hard look at what Sir Richard Branson, the famous English entrepreneur and inventor of the Virgin label, is doing to transform the US Airline industry with his Virgin America. In my last post, I spoke of change and being disruptive within your market.

How is Mr. Branson instigating change?

• Convenience
  
• Freedom
  
• Service
  

Convenience and Freedom. Virgin America Airlines has new aircraft with “Red In-Flight Entertainment” systems. Don’t let the words like “Red” or “In-Flight Entertainment" fool you. The entertainment system is really your personal portal. These seat back consoles unleash complete freedom for you, the flying public. You can literally order something to eat or drink whenever you’d like. Just swipe your credit card and within minutes, a flight attendant will have your order brought to your seat. You can also order as often as you’d like (as long as you’re willing to keep swiping your card). Additionally, you can listen to satellite radio, watch television, watch movies, play video games, instant chat with another passenger on the flight, track your flight progress with Google Maps and so much more. Mr. Branson has put you in charge of the flight. I just put on my headphones and start working. Everything that I need is right in front of me—I don’t feel dependent on anyone during the flight. What a refreshing change from the other major US carriers.

Service. Virgin America’s team is amazing. On my way back from New York, I asked a group of three flight attendants on the jet this question: “How does Virgin America instill such happiness and sense of ownership to all of its employees?” If you really think about it, these folks must have all worked for a previous airline, but how can you change their old attitudes and ways of thinking to the new, brash, customer-oriented culture that Mr. Branson envisions? They gave me some excellent insight. I also noticed similar personality traits amongst these three—they are competitive, enthusiastic and like being part of a team. They had to take a very long personality test as part of the application process. After they pass the test, they go through a series of interviews whereby the desired culture of the new company is discussed. There’s an air of camaraderie amongst the crew, even the pilots—they don’t look down upon the flight staff, they call them team members. They’re enthusiastic about this new company and really want to change the air travel experience. And they want to win.

It seems obvious now that you think about it. Why hasn’t anyone done this before? And more importantly, when will the major US carriers follow suit?

Service and Freedom. Now that’s old school thinking, but still extremely relevant today.

That got me thinking about the parallels between running an intense political campaign and managing a fast-growing business. Personally, I find change appealing, especially in a nascent business like ours: If we don’t define the market and strategy for our customers, somebody else will. Nature abhors a vacuum, and so do we.

Change is disruptive. The term disruptive, in this case, is good. Great companies are built on the backs of things like first-mover advantage (Microsoft, eBay, Starbucks), being disruptive to a certain category and moving quickly to fulfill the new found demand. A quickly growing company requires change to stay healthy and understand customer requirements.

Smart politicians know that simply promising change isn’t enough. The same goes for company leaders. Plans and actions are required to instill the culture of change and adaptability within your organization.

• Kill complacency in your organization.
  A good way to keep your best and brightest employees focused on moving your business forward is to modify organizational alignment, even if only for a set period of time. Just because the organizational chart from your college textbook states that it should be one way, feel free to experiment.

• Change things up.
  One thing that I like to do is to have smart team members take on additional responsibilities outside of their area of expertise for a set period of time (typically 90 – 120 days). This is a great grooming mechanism, with low down-side potential and huge up-side potential. Getting a new set of eyes on a functional area gives you two advantages: it offers the new manager additional experience in an area that’s important to your business, and it allows you to make something better than it was before.

• Get involved, Mr. CEO!
  You are ultimately responsible for making sure things work smoothly and efficiently so your team can grow the business. Change your areas of focus frequently. When you’re not meeting with prospects, customers, partners, sales reps or your engineering team, be sure to drill down into your functional areas and understand the issues, risks and plans. Ask tough questions. This is a good way to drive change.

A number of our customers initially come to us because of a compelling event—ultimately, customer satisfaction is at stake. Not only are unhappy customers not fun to deal with, they also put an extraordinary drain on your team, including hidden costs (especially “Opportunity Costs”—wouldn’t you rather have your team focused on completing that new project instead of stopping production, taking a step backwards and trying to fix a problem that should have been caught somewhere well before this point?).

I recently spoke to a StrongMail prospect at a major brand who described a scenario that underscores this point. A customer orders something from your company’s web site, but doesn't receive the confirmation e-mail or the download link. At this point, the customer has invested considerable time searching your site, evaluating the right product, looking at alternatives, made a decision, chose your product, completed the pain-staking checkout process and hit the "Order Now" button. Now, she waits for the confirmation email that contains the download link for her software purchase. Waiting. Waiting. Waiting. No confirmation email. Time to call a real person. This is not good for customer satisfaction.

Imagine the impact of this one customer (not to mention if things go really badly, a dozen or more unhappy customers):

• Confirmation email not received, but the customer entered credit card information to purchase product and wants to know the status of their purchase.

• The unhappy customer calls into your Call Center, which we all know is expensive. Service calls take time, resources and de-focus employees who could be moving your business forward, but must now stop what they’re doing (delaying the forward movement of your business), double-back to make sure that they address this customer’s concern.

• This requires time to chase down historical events (to make sense of what went wrong). Back-tracking stalls development of new products or even efforts to improve customer satisfaction.

• At some point, the issue is resolved, typically manually, and the customer is left with a bad taste from the overall experience, which may not bode well for your company in the future.

Do you realize how many millions of hours are wasted each year on correcting something that could have been designed into either the product or the deployment process?

One thing to strongly consider is putting the energy upfront to avoid this scenario at all costs. Understanding the underlying infrastructure of your business is key to building efficiency. Understanding your customer and customer threats upfront are key to building a long-term, viable and successful business. Build it into both the product and the culture of your company.

I was asked by a reporter recently, “How do you attract quality employees and what do you do to motivate them?” First off, I speak to a lot of people. I’m always chasing down leads on talent. It’s hard and takes a lot of time. In fact, I just returned from a conference, where I spoke to a number of people - and I know that we will hire at least one person, and possibly two, because of the opportunity I had to share the StrongMail story. Not a bad investment at all.

The best way to attract quality employees is to:

• Talk to a lot of people for leads and networking, even your competitors. \
• Outline your company’s vision and why you will be a winner.
• Outline their potential role within that vision. \
• Outline what you, as the leader of the company, are doing to get the company there.

We have a unique culture here at StrongMail. Talk to anyone on my team and you’ll quickly find out that things change regularly. One reason that we’ve been so successful at hiring great talent here is because of our culture of allowing people to change things up. We like to get a fresh pair of eyes on old problems - and new challenges. In a start-up environment, it’s important to have your athletes stretch their comfort zones.

Think of it like this, if someone is usually a quarterback, either one of my executives or I would propose that this person play free safety for the next two quarters. This way, the person will get exposed to a new set of challenges (which incidentally, can solve many problems with a new pair of eyes), round out that person’s experience, and continue to be challenged. I’ve found this to be not only invigorating for the team as a whole, but very motivating for the athlete.

I feel very fortunate with the quality of my team here at StrongMail. On my management team alone, we have a handful of execs who could easily be CEO’s of their own start-up companies.

More later.