Learning from Scale - A reflection

Microsoft announced it's financial results for fiscal year 2019 recently, and thanks to tens of thousands of employees pulling the same way - it was another stellar year :) Azure continues to grow rapidly, showcasing and paving the way for a virtuous cycle where more organizations and functions move mission critical infrastructure to the cloud. Surface is now a regular member of the $1B/Q club, LinkedIn and Dynamics were both up healthily, and market sentiment took the stock past $140/share. The number that most stood out for me personally though, was the sheer scale of the commercial cloud business. Whether it was the 31% growth on Office 365 commercial business, or the 65% gross margin driven by Azure - the commercial cloud is now at almost $40B clip a year growing quickly. To put into context, that's bigger than Uber + Tesla + Twitter's combined revenue in 2018! It made me think about running business at scale, and to my own experience at the company.

Over the last 2 years I've played a combination of roles as part of the APAC Management Team running our Corporate Accounts Segment. Working closely with the APAC Small, Medium & Corporate (SMC) GM, I've played a role in everything from closing multi million $ deals with customers, to playing host to customers at our Microsoft Technology Center in Singapore. From driving our Rhythm of Business internally, to creating and landing recognition, training & development programs for our sellers across APAC. From working closely with our Digital Sales team based in Sydney covering APAC via an Inside Sales Model, to coaching our sellers and managers on key topics.

Through it, I have picked up some insights that I wanted to document about what it's like to drive a scale business.

• Macromanage. When applied to a business at scale, there are simply too many variables at all times to control, so adopting a broad strokes approach with the right leading indicators is the most efficient way to manage the business. If you run a pipeline driven sales process, the key is to pick 2-3 leading indicators of the pipe that you can trust, and then model the future outcome of those based on historical trends. That way, you have a current and future view of the business across variables that drive towards 1 overarching common goal (usually revenue, but can be applied to any material metric).
• Inside Sales works, particularly well when you have local touch. Over the years, several companies have implemented this model to great effect, and Microsoft followed suit in a really big, structured way a couple of years ago. We've seen the model really pay dividends even with medium-large customers, who are impressed not only with fundamental account management but also the ability to cater to their needs on the phone. Technology has really helped this model with deep integration across the digital landscape, and really brought home by having some sellers locally on the ground. No matter how advanced the market, product or customer - sales will never go awry with someone sitting in front of the customer!

How your customers feel when they engage with you matters above all - Tiffani Bova

• Expensive sales resources backed by engines. In a scale model, your most expensive resources are almost always your quota carrying sales force. In order to maximize their impact and return, it's key that they're helped and aided by engines that can drive initial sales cycle steps, or generating revenue on their own. Whether it's a tele-engine doing lead qualification, channel partners engaging technical sellers on their opportunities, or the role that Marketing plays in demand generation and acquisition - all critical to the success of a scale business. It can't be left to sellers alone, and if it is, your cost of sales is going to be through the roof.
• Particularly at scale, one size does not fit all. This is true whether your business sells more than 1 product, or cuts across multiple geographies, or even types of markets by maturity and size. Developed Vs. Emerging markets, English Speaking Vs. Localized markets, Cloud Vs. Non-Cloud products - all need their own unique touch. Difficult to implement at scale, which is why it's important that the mix of your sales force and engines can all cater to different parts of the business. Getting that mix right is key, maybe to a lot of the initial inertia at scale.
• Learning & Development is oxygen. Products, markets, people and customers are changing everyday. Even for businesses that are tremendously successful and potentially household names - its absolutely imperative that there is a culture of learning in the team. Microsoft is moving towards being a "learn it all" culture, but it takes time and constant enthusiasm which is easier said than done. It's easy to fall behind the curve out of complacency, but that's the time for leaders to show the path. It's not easy, particularly for a team really good at something changing but I usually encourage people to adopt "knowledge doping". All the benefits without the stigma!

Life without learning is death - Seneca

• K.I.S.S. I'm a big believer in simple. Simple ideas, beliefs, products and pitches are the ones that are usually the most successful and that's not rocket science! With scale comes complexity, and driving clarity while generating energy is the hardest job any leader of a scale business can have. It's not by accident that I left this one last, because while all of the points I've mentioned might sound obvious, this is probably the most obvious one. And the hardest. As you reflect on your own situations, think about how you run your business today, and is it really as simple as it can be? If not, there's work to do :)

There are 2 caveats I'd like to make to add color. One, that a scale business also demands going super deep at times, and that's ok. Whether it's the hockey stick at the end of a quarter, or figuring out the right leading indicator - there is no brush that can paint over the need to really understand the minutiae. And two, that these are just 6 that I picked. I could potentially have picked 6 totally different themes, and undoubtedly your own list might look still different. That's the beauty of running business at scale - you never know when the next ingredient to success is coming from :)

I'd love to hear your thoughts on this from your experience across organizations, products, business or industries. Do these hold true for you? What best practices have you seen that help you run efficiently at scale?