Her reputation always preceded her. For 15 years she’d ride into town, head over to the local dysfunctional IT company, fix what was broken, and clean up the mess. Then she’d saddle up and head to the next broken-down mess of an IT company and do the same thing. The companies might have been different, but the problem always seemed to be the same: badly behaved leadership.
The hired gun was Kathleen Brush, a corporate turnaround specialist who grew up in IT, rode in to fix 12 broken IT companies in those 15 years, and went on to establish a global leadership, business and strategy consulting practice. She also managed to find time to write about all those bad leader behaviors in her book, “The Power of One: You’re the Boss,” which was released last October.
I spoke with Brush on Thursday, and I think my favorite quote from the interview was this one: “If Oracle is blaming the lack of new product sales on a problem in sales, they’ve got people running the company who don’t know how to run it.” But I’m getting ahead of myself. Let’s back up.
I began the conversation by noting that those 12 companies she was called in to turn around were all IT-related companies, from Seagate Software, Websense and WatchGuard Technologies, to Rogue Wave Software, Webtrends and Openwave Systems. I asked Brush what the reason was for that common denominator, and she said it was a simple matter of IT being her area of expertise:
I don’t know that the processes or practices are any different to fix in a non-IT company. But certainly the background heightens your attention to the types of problems that are common in IT. For example, they have very short product lifecycles, and in every company I worked for, their products were no longer innovative. There was also a high probability of finding employees who had been good technicians that made it into management, and hadn’t taken the time to develop new skills. One of the big challenges there is that you often find in highly technical positions that people are more introverted, which is a great thing for somebody in a technical position. However when you get into management, it becomes equally important for you to be able to reach out to employees and at least fake that you enjoy and find it energizing to lead people.
I asked her if she would consider taking the helm as CEO of a company to grow it over a longer term if the right opportunity arose, and she said she absolutely would. The problem, she said, is that she’s been typecast:
I didn’t get my Ph.D. [in management and international studies] until 1994, and I got it because I didn’t feel that I was ever going to get the mentors that I needed in the companies I worked at. And I thought that that was going to be one of my tickets to getting with a company and building it. But by the time I got done, I was sort of typecast. So I’ve just kind of learned to live with that. If I’m talking to somebody about a permanent position, they’re sitting there thinking, “You’re a turnaround person.” And they didn’t hear one thing that came out of my mouth that said “turnaround.” For what it’s worth, it’s absolutely a fascinating business—I get to go into situations and see things that other people don’t get to see, and have the opportunity to fix them. And that’s a great joy.
We went on to talk about Oracle, which in March had blamed its sales force for its third quarter revenue shortfall and a resultant 8 percent drop in its stock price. Oracle Co-President and CFO Safra Catz told analysts on a conference call, "What we really saw was the lack of urgency we sometimes see in the sales force.” I asked Brush what that told her about the corporate culture at Oracle. She said it was an admission that they weren’t managing their company properly:
It is so easy to motivate salespeople—they’re the easiest people to motivate in the world. They’re the coin-operated ones. So to me, that spoke to somebody in management at Oracle not understanding that this is a management problem, because they’re advancing this as an excuse. I can see a PR person coming up with something like that, but then when it went through the approval processes, the vice president of marketing or whoever would say, “No.” … If Oracle is blaming the lack of new product sales on a problem in sales, they’ve got people running the company who don’t know how to run it.
So if Larry Ellison called her in to fix the problem of there being a lack of understanding that it was a management issue, where would she start?
One of the things I’ve seen in almost every company that I’ve worked for is that the first action that managements apply to a shortage of revenue is to blame it on sales. They’ll increase sales commissions, increase salespeople, and then what will happen is the sales won’t increase, because the problem is not a sales problem. It’s a product problem—the products are old and the salespeople can’t sell them. There’s market saturation and there’s no one to sell them to. So I would probably go down that path in about half an hour, eliminate that it’s a sales problem, and go straight to taking a deep dive into the product portfolio to understand if there were enough products in that introductory and growth phase—those innovative products—in order to sustain the growth targets for the company.
Finally, I asked Brush where managers in the IT industry fall on the bad behavior scale compared to managers in other industries. She said it’s not any worse in IT. What is worse, she said, is the impact:
The reason I say that is because the IT industry tends to attract fairly knowledgeable people. They’re highly educated. The other thing that exists in the IT industry is that it’s relatively easy to swap jobs. So the pressure on managers to purge those bad behaviors is much higher. That’s because these knowledgeable employees won’t tolerate bosses who behave badly. They won’t tolerate bosses who can’t do their job. These IT employees are qualified to do their jobs, and they expect the same from their boss. And if they don’t get that, they’re going to change their jobs. That’s what’s very different in IT. So it really ups the ante on managers to develop their skills. Because if they don’t, they’re going to lose their best employees.
Brush also had some interesting things to say about the H-1B visa debate and the global IT competition scene. I’ll cover that in a subsequent post.