I caught up with Bill McDermott, who is the CEO of SAP, the world’s largest business software company. His new book about his life journey is called Winners Dream: A Journey from Corner Store to Corner Office. Before joining SAP in 2002, McDermott served as executive vice president of Worldwide Sales and Operations at Siebel Systems and president of Gartner, Inc., where he led the company’s core operations. He spent seventeen years at Xerox Corporation, where he rose from a sales professional to become the company’s youngest corporate officer and division president. McDermott holds an MBA in business management from the J.L. Kellogg Graduate School of Management at Northwestern University and he completed the Executive Development Program at the Wharton School of the University of Pennsylvania. To read his regular updates, follow him on Twitter @BillRMcDermott.
In the following interview, Bill talks about who influenced his work ethic, the risky career moves he made that really paid off, his sales secrets that helped him accelerate his career and how millennials are changing how we do business.
Bill McDermott is the CEO of SAP
Dan Schawbel: You have an inspiring rags to riches story. Can you explain how growing up with little gave you the work ethic required to be successful in corporate America?
Bill McDermott: My dad had an unflinching work ethic. I definitely inherited mine by watching him get up early for forty years—sometimes in the middle of the night—to work a grueling job soldering and splicing underground cables for ConEd. Through Dad, I learned that success requires doing things we don’t like or want to do, without complaint. That’s true of any job.
I also grew up understanding that anything given or earned can be taken away. A house. A family member. A job. From day one of my career, I never took anything for granted. To this day, I truly believe I must keep proving myself. When people or companies start to feel entitled, when they get lazy and stop pushing, that’s when they start to slide. I celebrate achievement, but even when we hit a goal I tell people that we’re never done.
Schawbel: What are some of the more risky career moves you've made that really paid off? How did they pay off and what would have happened if you were more risk averse?
McDermott: Two stories. First, as a young salesman at Xerox I was #1 in my category but got passed up for a job I wanted. Instead of accepting my fate, I drove to the company’s headquarters where the top executives worked, walked in without an appointment, and asked to see the head of my region. When he agreed to see me, I did not lobby to get the job I’d lost. I just wanted to ask how I could improve, and to express how serious I was about excelling. I even told him I dreamed of being the CEO. No doubt, my bold move could have derailed my career. But because I also had a history of hard work and performing well, voicing my ambition helped me stand out. The next job I went after, I got.
Another risk was leaving Xerox after 17 years, saying goodbye to the only company I’d ever worked for. But I had to leap. The world was changing in ways that I could only be part of if I left my comfort zone. The two companies I worked for after Xerox were not the perfect fit for me, but they were crucial stepping stones that got me to SAP.
Had I not taken these and other risks, I would never have landed the dream job I have today.
Schawbel: What did you learn during your time at Xerox that prepared you for the career you have today at SAP?
McDermott: Some fundamental lessons definitely carried over.
From a career perspective, there is no substitute for professional training to achieve what you set out to do. Passion is the fuel, but expertise, knowledge, and execution are engines that make dreams come true.
From a corporate perspective, Xerox taught me the importance of having a culture that values and celebrates performance. That’s why I always try to create an environment where it’s so much fun to be a high performer.
Finally, Xerox’s history taught me that constant innovation is the key to growth. Customers’ needs constantly change. Unless a company has a bias toward innovation, versus a bias toward the status quo, it’s easy to become irrelevant. Innovation is about change, and change can be painful. But better to take a few ounces of pain today than few tons of irrelevance tomorrow.
Schawbel: You're a master salesman and that's part of why you are where you are at SAP right now. What are some of your best strategies to influence others into action, from customers to employees? What doesn't work?
McDermott: First, empathy. Successful salespeople and respected leaders know how to empathize. Whether selling or leading, you must put yourself in other people’s shoes, understand their needs, care about what pains them, and do all you can to solve their problems. When you care, customers want to do business with you and employees want to follow you.
Leaders also must give their people a reason to work hard. We all crave a higher purpose; a reason to strive that is bigger than ourselves. SO find a cause. Growth for growth’s sake is not a cause. Neither is a monetary or a numeric goal. A true cause is something that sparks imaginations and extends people’s stamina, pushing them that extra mile.
In Winners Dream, I write that a compelling cause it like kerosene—it lights up a work ethic! At SAP, our mission has evolved from helping companies run better to helping the world run better and improve people’s lives. These are powerful words that give our 67,000 employees a reason to work as hard as they do.
As for what doesn’t work? Selling with intimidation or leading by fear. Intimidation destroys relationships. And fear may boost adrenaline in the short-term, but it also spurs people to make bad choices. On opportunity to achieve something amazing, versus simply avoid failure, inspires greatness.
Schawbel: SAP has been doing a lot of research on the future of work and the millennial generation. What is your take on this from a CEO perspective? What are three trends that you personally are watching?
McDermott: I love this generation! They have courage. They have drive. They are hungry. I believe in pushing them early into big opportunities, even before some might say they’re ready. Trust me, with the right support, they will rise to any challenge.
One trend is that this is first generation born into the mobile device. They live on their smart phones and tablets. If what companies have to offer can’t be downloaded or have a digital component, then Millennials aren’t likely to use it or buy into it.
Second, Millennials grew up with disruptive innovation. So they expect it and want to participate in it. Because they don’t fear change, they are eager to try big things, but they must also be given permission to fail. Companies that don’t do this risk losing terrific talent to companies that do.
A third trend may be the most meaningful: Millennials are aware of the world’s significant challenges. Better yet, they expect action. Companies with an authentic social and environmental conscience will win Millennials’ loyalty. That’s why I love this generation! They’re pushing all of us to be better.
Dan Schawbel is a speaker and best-selling author. Connect with him on LinkedIn.
