Steven Birdsall on this episode
Steven Birdsall, current CRO of Alteryx and former business unit leader at SAP, demonstrates credibility earned through over 30 years in enterprise software across multiple CRO and COO roles. In this episode, he breaks down how he convinced SAP's board to fund a €20 million bet on a completely new go-to-market motion when internal stakeholders predicted failure.
The core thesis: Fixed-scope, fixed-fee software packages that deliver value in ten weeks or less can reshape how enterprise customers adopt complex systems. This flew in the face of SAP's 30-year-old playbook of long, expensive implementations. Birdsall faced zero internal buy-in from sales reps, consulting teams, and partners before ever talking to a customer. Each constituency saw the model as a threat to their existing revenue streams.
The reframe came when Birdsall took the idea directly to customers instead of trying to convince internal skeptics first. Within weeks, customer enthusiasm shifted the entire narrative. What started as a push motion became pull-driven by customer demand. Birdsall scaled from zero to 100 internal packages in 18 months, while partners built 900 additional offerings. A single customer, McLaren, bought 11 packages and transformed their entire business faster than expected. The business reached €1 billion in revenue in 2.5 years.
The episode covers the operational machinery behind this scaling: how compensation structures got sales teams aligned without forcing adoption, why partners suddenly saw economics that made sense, how to maintain brand integrity across a thousand variations of the same product, and why the same lessons about fast time to value apply directly to how enterprise companies should approach AI today.
What we cover in this episode
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0:46
The €20M Board Pitch Birdsall's thesis on bundling complexity, cost, and time into fixed-scope, fixed-fee packages with ten-week implementations.
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4:21
Zero for Three: Internal Pushback How sales reps, consultants, and partners all rejected the idea before a single customer conversation happened.
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9:12
Customer-Led Pivot The moment Birdsall talked to Fortune 50 buyers and discovered immediate pull demand, turning skepticism into evangelism.
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13:00
Operational Scaling Playbook Building organizational structure, compensation incentives, and systems to support doubling growth every quarter.
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18:51
Field Alignment Through Joint Meetings How bringing sellers and consultants into customer conversations transformed internal resistance into ambassador mentality.
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24:58
Fast Time to Value as Competitive Moat The principle that matters for any new motion or AI implementation: getting measurable value in weeks, not months or years.
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34:04
Scaling Without Losing Rigor Moving from annual to quarterly quotas, managing partner ecosystems, and maintaining brand integrity across 1,000 package variations.
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45:17
Playbook for Today's CRO Start with customer validation, balance listening with foresight, and solve for organizational readiness, not just product fit.
The lines worth sharing
The moment I set out in front of customers, they said, oh my gosh, you had me at hello. I've been waiting for this forever.
Steven Birdsall · 9:12
Zero for three. That was all three constituents. I was like, oh my gosh, maybe this is a career disaster.
Steven Birdsall · 8:49
Once it was there and momentum was on your side, it was almost unstoppable. Within six or nine months, it became viral.
Steven Birdsall · 20:46
Accelerating to a bad answer still leads you to a bad answer. That's why 90% of AI projects fail.
Steven Birdsall · 30:33
Common questions from this episode
How do you launch a new packaging model when the existing business is still producing revenue?
Start with direct customer conversations, not internal stakeholder validation. Build operational infrastructure (compensation, forecasting, systems) to align the existing field team. Use early customer wins as proof points to shift from push to pull motion. Maintain strict governance on scope and pricing to avoid complexity.
What made partners shift from viewing packaging as a threat to becoming 900-package builders?
They realized customers wanted rapid deployment packages regardless. Once they saw the math of stacking five to ten packages together, the services revenue exceeded what they'd have made on a single long implementation. Direct customer conversations, not internal pitch, created that realization.
How do you scale a new motion without losing rigor in execution?
Move from annual to quarterly quotas. Create a small validation team that calls customers post-implementation to confirm actual value delivery. Stay dogmatic on scope and price while remaining fluid on packaging and asset inclusion. Keep the software unchanged across all variations to avoid fragmentation.
What's the connection between Birdsall's RDS playbook and AI adoption for CROs today?
Both require fast time to value, business context layering before deploying models, and organizational readiness beyond technical capability. CROs scaling AI should focus on customer value first, not just model deployment. Unoptimized processes amplified by AI scale negative outcomes.
Why did McLaren buying 11 packages matter so much to the business?
It proved that packages stacked together as Lego blocks created transformational value for large customers. McLaren accelerated their dealer network build-out and business transformation faster than they could have done independently, demonstrating pull demand and justifying the entire model.
How should CROs balance listening to customers with strategic foresight about future needs?
Customers tell you what they want (faster versions of today). You have to see around corners to what they need (new categories entirely). This is Christensen's Innovators Dilemma. Invest simultaneously in improving the current business while building the future one.
SEO meta description
Steven Birdsall built a €1B business inside SAP by packaging complexity into ten-week implementations. Learn how he turned internal skepticism into pull demand.
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Read the full transcript · 62 KB · Steven Birdsall
EDDIE0:04Welcome to Go to Market. In this podcast, we share tangible, actionable playbooks from the trenches working as go to market strategy and rev ops consultants for our clients here at Union Square. Consulting and candid conversations with revenue leaders in the market that have been there. Now let's get into it.
RACHAEL0:22Today on the Crow Story segment, I'm sitting down with Steven Birdsall. Crow at Alteryx Steven has over 30 years in enterprise software experience, including multiple cow and crow rules, SAP and a plan Oracle click and now. Now. So early in his career at SAP, he convinced the board to fund a completely new go to market motion inside a company that had been selling the same way for 30 years.
RACHAEL0:46Every sales rep, every consultant, every partner told him it wouldn't work. Today we're talking about how he launched it anyway, how he got an entire organization to change when the existing model was still producing revenue, and what it took to turn that bet into $1 billion business, or in this case, €1 billion business. Well, thank you so much for joining me today, Steven.
STEVEN1:08It's great to be here. Thank you Rachel. It's good to good to see you
RACHAEL1:11Yeah. So you walked into the SAP boardroom and you asked for €20 million to build this business, and everyone told you customers weren't going to want it. What made you so sure that they were all wrong and that you really had something here?
STEVEN1:25Well, it didn't quite go in that order. So, you know, SAP at the time, this is a little while ago, but at the time was pretty well known, pretty well established, mature software company. The challenge is that we had this moniker. When people think of SAP, they would think of us as, you know, very complex, very expensive, and it takes a long time to implement and get value out of the system.
STEVEN1:49So that's kind of the world that we lived in. And you just kind of assume that, you know, customers are getting everything that they want, and they're the ones who create the complexities. Therefore, we're giving them what they want. I think there's a challenge. And, you know, very much like today with AI, we're all challenged with new technologies and new ways to go to market.
STEVEN2:11And I think there's a question of like, is the old way of doing things really what customers want? Or can you think ahead and see around some corners and actually deliver them what they need and think about things in a in a very different way? So that's a lot of what we were taking into this idea that if we eliminated the complexities and we eliminated the expense, and we could get fast time to revenue as time to value for our customers, how would that then translate in terms of a market opportunity?
STEVEN2:42I think many companies that tried before, you know, packaging software wasn't new, but how could we then do that differently? So the thesis that we took into the board was that if we really had a very robust package, meaning that it was included, you know, things like configuration guides and scripts and, and, you know, a tight governance so that you truly did have a package that added value.
STEVEN3:08And it may not be everything that a customer wants, but it's everything that they need. And we package that in a way that we could deliver with a defined scope, meaning that it's now fixed fee for the implementation. The only variables is the number of users, and that would be awesome. And so that was what we took in.
STEVEN3:26And then it was a matter of getting the board, you know, comfortable that building out a separate business unit inside SAP is something that we should do. And I was I was pretty happy in that I think the case that we put forward was understood and acknowledged. And, you know, we tried some things like that before with SAP, best practices and other things, but we hadn't tried it really on the go to market from product development and packaging all the way through to go to market and having the field team aligned around it.
STEVEN3:57So that was, you know, relatively new muscle that we had to create. So it was it was exciting that coming out of that board meeting, they wanted to move forward. And so we got the nod right out of the gate. And then it was a matter of just like building the business. So it was a it was a fun time.
RACHAEL4:14how did because I remember when we talked earlier said, you know, they were everyone was saying like, oh, customers aren't going to want this. When did that happen?
STEVEN4:21Immediately. So I was given 60 days to tilt up, you know, in entirely new business. Otherwise, you know, I got to go higher. About 20 people to start with, in between sales consulting, you know, people that are going to help, you know, the implementation and our partners, those are the three kind of pillars that we organized around. But to set up a new organization inside a German software company wasn't easy in and of itself.
STEVEN4:49Then we had to think about all the operational things that we do. How do you price it? How do you package it? How do we work with the development team in Germany? So there's a lot of that, like first 60 days that was just set up to how do we define the organization? How do we find the people, the right people in the organ?
STEVEN5:07So there was just a ton of energy that went into building up the business. But in a 60 day window, you can imagine if you're going to go build a business from scratch in 60 days, find 20 people that are going to be high caliber and aligned to what you want from the team, the right skills and attributes that they bring.
STEVEN5:25It's a global, you know, business. So I had to think of all the different regions around the world that had to, you know, require, you know, the need for these people. There was a lot that went into that. And then working with the development team around, what are the first packages that we're going to go build? So a lot of it was it was I'd say the first 60 days was on
STEVEN5:44Then on day one of okay, now we're ready. Now we've got, you know, a few packages that we built in those 60 days. We identified the people that we brought into the team. So kind of now what? And that's where the real work started. And so it wasn't like we waited until the end. I started talking to first sellers, and I'd go out to our, you know, strategic account sellers and talk to them and be like, hey, this is going to be great.
STEVEN6:09We've got this package, we're going to go build. And it was like CRM. And at the time. Those force was, you know, really making a lot of inroads in the market. And the SAP customers wanted SAP CRM, but it was going to take too long to implement. So we thought, that's a great place to start. So we kind of built that package.
STEVEN6:25And of course, the sellers that I went out to were like, none of our customers want a basic version of CRM like they want, you know, SAP, they want everything under the sun, and they want to go sit on a whiteboard and go kind of map out all of the requirements and how they forecast the business and building pipeline and setting up territories and quotas.
STEVEN6:45And like all the things that go with the CRM system, they wanted all of that. And so they felt like it was going to be too confined or to refined for what our customers wanted. So a lot of pushback from the sellers right out of the gate. And so I thought, well, that's kind of one constituent. Another constituent is our consultants, you know, the people actually implement.
STEVEN7:07So I went to our heads of SAP consulting, and I talked to them about how we built this, you know, defined scope. And this is going to be great because our customers are going to get fast time to revenue, fast time to value on their side. And so how do we kind of find and build this, you know, for our, for our consulting group and of course, you know, met with immediate pushback there because they're like, you're never going to take what's in my head and be able to implement it.
STEVEN7:31And every customer again wants to start off with a whiteboard and go figure out what they want to do. So that kind of met with a bit of disdain, let's say. And so I was like, wow, that's, you know, so far zero out of two. I guess I can talk to our partners. Maybe our partners will get it right.
STEVEN7:49So we talked about how this kind of again, fast time to value we're going to implement this. And the idea was that you could literally buy anything that you want from SAP. And you could be live in a fixed scope with a fixed fee in ten weeks or less. And so that's certainly going to be appealing. Our partners are going to love that.
STEVEN8:07They can go build their own packages, you know, that are rapid deployment solutions as well. And they're going to go want to go down that path. And the immediate math they did, of course, is if the service to software ratio is 8 to 1, 10 to 1 with SAP today, and you're going to take that down to 1 to 1, I'm pretty sure I just lost a bunch of revenue.
STEVEN8:27So that's not going to be good for me. So as someone who was building this, you know, business from inside, now I'm zero for three. That was all three constituents. I was like, oh my gosh. Like I wonder if I made a career, you know, disaster move. And I really was questioning like, maybe this is like much, much harder than what I thought it was going to be.
STEVEN8:49I thought it was going to be met with kind of applause and praise, and pretty much nobody thought that it was the right thing for our customers. And I was already I already built a business. I already built a team. Like I was starting to really kind of question like, what am I going to do now? And then I kind of learned the first life lesson in building a business start with a customer.
STEVEN9:12So of course, the moment I set out in front of customers and I started walking them through, they're like, oh my gosh, you had me. Hello. I've been waiting for this forever. What took you so long? I want to go try it. And once you get, you know, a few customers to start trying this. And we developed it.
STEVEN9:28We delivered it. They found value in it. Then they become your biggest champion, right? And then it was just a matter of taking those success stories that I found in different markets and, and having them come up, you know, on stage at our Sapphire events or our kickoff meetings and let it become kind of a naturally viral thing when they start talking about it, instead of pushing this out to the market, instead of us taking this and developing in our own and pushing it, it became much more of a pool mechanism.
STEVEN9:57So our customers did our bidding. Our customers are the ones who were going to demanding in the market. And then it was a matter of how fast can I build these packages? So while it started with CRM, it quickly went into HR and finance and transportation management and, you know, warehouse management kind of everything else we built. So in that first, I'd say year to year and a half, I built 100 packages.
STEVEN10:19What was fun though was our partners caught on to that. They understood the value. They finally kind of get it that, you know, these SAP projects don't typically have an end date. They usually start and then they evolve and they grow and they start, you know, integrating other things. And so they would package these things together. And what they found is that they could build their own packages.
STEVEN10:38And so we put parameters around it. We don't want to lose the we want it to be rapid. We want to have them kind of get value out of it as well. But they started building their packages. And so while I, I built 100 in that first 18 months, they built 900. So we had a thousand different RDS packages, different flavors of it because some of it had different points of integration.
STEVEN11:00But we all kind of had that same brand, you know, recognition that it was ten weeks or less for the implementation. It was a fixed fee for the implementation. And these things need to start, you know, being interoperable. And what it became was almost like a Lego block where you could put in CRM and employee self-service and workforce planning and some other things kind of all together.
STEVEN11:20And then you started, you know, putting in packages of packages. So that's where I think McLaren was one of the first ones. For example, they were moving into a dealer network. And, you know, from just being a formula One company to having a dealer network where they would sell McLarens, you know, out in the market, and they had the build of manufacturing facility and build out the dealer network and think of all the supply chain and everything.
STEVEN11:45They bought 11 packages. They were kind of our first one. I was working with our co-CEO at the time, who went with me to McLaren, and we sold him 11 packages, and we actually transformed their business much faster than what they could even transform themselves. And so that was pretty exciting. Of course, I had to become a McLaren customer at that point, but it was pretty exciting to see somebody actually transform their entire business putting together these packages of rapid deployment solutions.
STEVEN12:14So it was a blast. It was it was fun. And that's how we, you know, in from 2010 when we started it to the middle of 2012, it was €1 billion business on a standalone basis. So a lot of fun, a lot of scars in terms of building the business, finding the right people, figuring out what packages to go build, how we were going to go incentivize the sales reps because I didn't want to create.
STEVEN12:35I had my own sales team, but I wanted to keep it really small and give, you know, all of the different sellers across SAP incentives to sell it themselves. So I gave them like accelerators on their plans and their quotas and things like that. So there's a lot of things we had to do to build it out. But then it was a it was a lot of fun.
STEVEN12:52It was it was chaotic. But what a blast to see a business be, you know, €1 billion in only two and a half years. It was pretty incredible.
RACHAEL13:00Yeah, that's like a lot of stuff that you just went through right there. So I'm going to try to peel back the layers a little bit and get a little bit deeper into all the operational stuff that you worked on to get to this point. So going back to, to building it out in the first place. What was what were some of the biggest operational challenges that you had in building this new motion?
RACHAEL13:24And I know you had to give up your role in order to, you know, tackle this big endeavor. So, yeah, walk us through a little bit of that.
STEVEN13:34it was a very risky move. You know, SAP I think still is a very performant culture. And so even with all of the experience I had had been chief operating officer and, you know, a lot of different markets and started in North America, went to Japan, then went to Asia Pacific out of Singapore, then in Miami, and then it became the global COO.
STEVEN13:55So it got a lot of personal brand that was built up over that time. And you know, you want to continue that, right. So taking a risk like that of starting a new business that was not proven and had been tried before and failed, that's pretty risky. So first is just, you know, do you really feel like I had to kind of wrap myself, but do you really feel like this is something that you can build and that, you know the market is going to want?
STEVEN14:24And before I went into the board, of course, I had already gone through all the analysis. So there's just that internal, you know, motion that you have to go through is do I really believe in this business? And if you do, then it becomes, okay, so how am I going to build it? Well, you need the right people.
STEVEN14:41And because I had been COO in all these different markets, I had really good relationships with the regional presidents. So I think I had some cash, you know, built up with them and personal relationships where they trusted me. That was really important. I leveraged them in terms of identifying the people. So what I wanted is in each of the regions.
STEVEN15:00So in the or Latin America, Americas, Asia Pacific, I wanted, you know, these three people, somebody who was over the sales, somebody over consultants and somebody over partners in each of the different regions. We had five different GEOs, so their theaters. So those 15 people there and I kept five people to work globally. So global head of sales, global head of partners, global head of consulting.
STEVEN15:23And then I had myself and then one of the person in business ops that was it. Very, you know, skeleton crew so to speak. But that was the basis for building the business. The second thing is, okay, so how do I define what an RDS is? There's a lot that goes into it, the assets included, like I said, configuration guides.
STEVEN15:41It included scripts and included other material to help accelerator, you know, accelerate the implementation. So the SAP best practices, all those things you had to package together. I also had to have a defined scope around, you know, what was included in the package. So part of it is just building the that, that the package itself that's working a lot with, you know, the development team and thinking about what this would look like, how do we define the scope.
STEVEN16:08So that's really defined. So a lot of plumbing was getting built you know around that. And then it was like things like reporting how do I report on an RDS package. So I needed the CRM system to be able to identify that this is an RDS package and what's included in that package. So there was all of those kind of things that I had to build out, just the the systems to support the business, identifying the people, like I said, because I had regional, you know, president, they gave me their top talent that was out there, people that they felt were going to be the next, you know, managing director of a Geo or something
STEVEN16:42like that. So bringing in the right, you know, talent to help kind of build this out was really important. And then I think the other was just having the right incentives, you know, structure in place so that the sellers, you know, a lot of times the sellers in the field were thinking, well, these packages are not going to be very expensive.
STEVEN16:58I get that there's value to it, but how am I going to make money? I've got to, you know, $3 million quota. How am I going to do this? You know, if it's $100,000 package, I need a bigger package. So what we did was we built incentives that made it so they get, I think it was 1.5 x quota and compensation for selling the package so they could sell.
STEVEN17:20They could retire quota faster and they get accelerated, you know, quote a commission dollars that go with it as well as the regional presidents. There's incentive for them to do that as well. I think the other thing is to get I mentioned systems to support it, identifying the package. But then the big thing was making sure that the regional presidents were forecasting DDS in their business.
STEVEN17:40So every week when they got on the forecast call, knowing did they have to give their forecast, they also had to give their RDS forecast. So that became more important to them, which then allowed it to cascade through the rest of the field. And then just a ton of guerrilla marketing. Like I said, every safari event, every kickoff meeting, every, you know, every big meeting that we were having, I made sure that in the keynotes, RDS was a part of that.
STEVEN18:04So the success stories behind it, the packages that we built, the partners that were certified on the package, all of the assets and accelerators that we built were part of that. So a lot of us just telling that story, you know, getting that out into the into the field and making sure that our customers were on stage, you know, talking about, again, just the virtue of having, you know, a package from that they were live in ten weeks or less that they paid the fixed fee.
STEVEN18:29And now they're thinking about these other packages they were building. All those things were a lot of that kind of initial build that we had to
RACHAEL18:36And so when you started having these conversations with customers and they were telling you like, no, this is exactly what we're looking for. How did those first conversations look like? How did you get them in the room with you to talk about it?
STEVEN18:51Well, it was really two things that I wanted to do. One is I needed to convince the sellers, the consultants and the partners that this was something our customers wanted. So part of it was I wanted to go have the conversation directly with the customers. Right. But I didn't want to go in alone. I didn't want this. It wasn't about kind of me or just my team.
STEVEN19:10I went, I needed to kind of again teach them to fish. So what I did was I brought them into these meetings with me. If I'd sit down with the CIO of a fortune 50 company, I bring in the rep and the partner and the consultants, and they would hear me tell the story and they would hear what is included in the package, and they'd see the response from the customer, and they became believers.
STEVEN19:31And so, yeah, like first year, I think I went to 40 or 50 countries. I was just on the road 100% of the time and just went around. It was almost like a cheap firestarter, you know, but but to bring in these customers and partners and sellers into these meetings, and that's how you kind of create that viral effect.
STEVEN19:49So part of it was just not only convincing customers that this was something that was actually real and it was good and they could rely on it, but it was also convincing all the other constituents along the way that this was something that our customers, you know, were reacting to in a positive way, and then get them to again, rinse and repeat that.
STEVEN20:07So what I would tell the people attending the meeting, the internal people, is coming out of these discussions. You're now going to be the ambassador, right? You're going to be the new RDS ambassador. So not only do you know, should you respond to what the customers are saying, but you also need to be the ambassador to tell everybody else what your experience was like.
STEVEN20:25So it was a lot of that, you know, kind of heavy lifting. Again, what I would say is the other thing that was really cool is when momentum is on your side, it's like unstoppable. So it was almost like starting the business and getting everybody excited about it was really, really heavy lifting and hard, and there was a lot of scars, you know, along the way.
STEVEN20:46But at the same time, once it was there and I would say within 6 or 9 months, it was almost unstoppable at that point. And then it just become much more viral. We started building more and more packages. You know, these packages are like very extensive. So it would take us, you know, 2 or 3 months to build a package, you know, from the development team, they would be like a half €1 million to go build it out with all the people.
STEVEN21:09I mean, these were robust packages. It wasn't like this was like lightweight SAP stuff. They were pretty robust. But, you know, the result is a package that customers could actually adopt. They were absolutely live in ten weeks or less. So we fulfilled that promise. They got the fixed fee, we gave the customers what they wanted. But yeah, it was it was fun and hard at the same time.
RACHAEL21:34Yeah. And and I know it turned into something that it turned into like a snowball moment later on. But in the beginning, when you still had to convince partners that this was something worthy of them selling, when they have, you know, they're going from an 8 to 1 services software ratio down to 1 to 1. Like you said, what was the pivotal change for them to realize that this was a deal worth making for them?
STEVEN21:59So first is convincing them that this is what the customers wanted because they're in the same boat that we're in. If a customer wants something and you have it, you deliver it, right? So part of it was just helping them with that experience directly from the customers. But where they caught on was they quickly understood as well that when I had, you know, getting five, ten, 15 different packages, they started putting the packages together and they realized that, you know, it might be 50 or 70 5 or $100,000 of services, you know, in the beginning.
STEVEN22:29But when you start putting together 5 or 10 packages, then that becomes valuable to them. The other thing is to give them, you know, access to customers and, you know, constituents on their side that they may not have had access to. So, you know, like I said earlier, like SAP is a massive, massive platform. And the idea was that if you could deliver these things and they're scalable and they actually worked together, then the value creation for our customers is far greater.
STEVEN22:58And, you know, these things don't end. There's always going to be other points of integration. There's going to be other things to integrate it with. If you roll out core financials, you've got a chart of accounts and a general ledger and everything else that you want to do in your core financials, you're now going to work that with your supply chain, you know, execution, demand planning or we call it advanced planning and optimization.
STEVEN23:18So that all has to be integrated. So another package for that. And then there's like BW is our business warehouse. So we bought a company called Business Objects and there's a whole package around that. So now you've got reporting that comes along with that. And then there's the CRM system. And you start with sales and you go into marketing and you know in services.
STEVEN23:36So there's all these other points of integration. So they found that while they may have been thinking Big Bang and they did these really big projects in bite sized pieces, it's the same thing. But now it's accelerated as a faster time to value. And you have a very happy customer on the other side. So part of was just building all of that, you know, momentum as well.
STEVEN23:54But once they got on and they saw it working. That's when they got excited about it. And of course they became believers as well.
RACHAEL24:00Yeah. It's amazing what can happen when you build something that's truly customer first and not just revenue first.
STEVEN24:05That's right. That's right. You know, like you build one thing and then it kind of grows and then it it again just balloons into somebody. Other things that we I had no idea on all the things that we were going to be able to do. You just kind of start it and then you grow. But yeah, part of it is to have a vision and it's another thing to going to let it then kind of take on its own, you know, in the
RACHAEL24:30Quick pause. Everything we talk about on this show. Diagnosing go to market ops. Prioritizing projects for revenue. Impact processes. Metrics. Insights. Building a predictable go to market engine. We've built frameworks for all of it. They're free and undated on our website. Union square consulting frameworks. The link will also be in the show notes, so make sure you check that out.
RACHAEL24:53All right. Back to the episode.
RACHAEL24:55I want to go back to what you said about McLaren buying,
RACHAEL24:5811 packages at once. And then they actually asked you to slow down because they couldn't absorb the change fast enough. What does that tell us about how companies should think about implementation scope versus organizational readiness?
STEVEN25:12I think what we all learned at the time and again, you know, SaaS kind of lends itself to this as well, is the faster you can get value out of a system, the better. And, well, you know, you may sit back, you know, at the time people would sit back and whiteboard all these processes, and they were trying to build a system that mapped to their current processes.
STEVEN25:32When the reality is, if it takes you a year or a year and a half to implement something or integrated with all these other systems, your business has changed so much that what you built is something that supported you in the past, but it doesn't kind of build what you need in the future. So the faster time you can get value out of any system, the better off you're going to be, because people will now start using it and then let them kind of evolve it, versus sitting in a whiteboard and trying to figure out what your, you know, kind of current and future state might look like.
STEVEN26:02So I think the main thing is fast time to value. If the faster you can move, the faster you can get value out of something, the better. And I think in a lot of ways we're all experiencing that with AI today. Everybody's experimenting with AI. Everybody loves it, they are embracing it. But there's not a lot of success stories.
STEVEN26:19There's still a lot of experimentation that's going on because it's not trained on business context. So you can't just take a model and put it on top of a bunch of your system data and assume that it has the business context. It doesn't. So you have to add the business context layer, the semantic layer on top of the data, and then train your models on that.
STEVEN26:41So now you have a refined set of data. It's ready for AI. You train the models on that as a subset, and now you've got an agent for your Salesforce or for pipeline or for whatever it is that you're trying to accomplish. So I think part of it is that, you know, these things have to meet together. But again, you want to get fast time to value.
STEVEN27:00So how do you kind of marry those things together? So you have to think about it and make sure that you're focused on the customers, you know, on their side. How are they going to get the most value out of whatever it is you're trying to do, whether it's AI or RDS, packaging or anything else? And if you focus on that, typically you'll have good positive outcome on the other side.
RACHAEL27:21And it's funny you mentioned the context thing I was reading on LinkedIn. I can't remember who said it. So apologies to whoever said this. They're saying something like, soon there's going to be a huge influx of a role called AI Context engineer because of exactly what you said, meeting that business context and layering it. And it's going to be different from any kind of like rev ops or go to market ops role, because they're going to work through out every single facet of the business beyond revenue, just wherever AI touches any part of the business, layering business context on top and like keeping up with the nuances of everything that's happening.
RACHAEL27:55And I just I thought that was just so crazy.
STEVEN27:58Yeah, I was at a customer event in Pittsburgh, and it was and they were doing all this massive training for thousands of, you know, their, their staff, their big, you know, Alteryx customers. And it was funny because the first light that came up said, your job is not going to be replaced by AI. Your job is going to be replaced by somebody who knows AI.
STEVEN28:18And that's really true, right? It's like I teach my kids the same thing, like embrace it, learn it, you know, figure out how to harness it. And that's where you're going to really kind of thrive in the market. So don't ignore it, you know. But but you know, adopt it. And part of it is like like you're saying like there's a new role, like revenue engineering.
STEVEN28:41It used to be like sales operations and it was business operations and revenue operations now. And now there's revenue engineering. How do you engineer company? What part of it is how are you using AI and what agents are you building around that there's a whole framework that you can, you know, build that specific to sales Pacific to marketing, specific to product management, product development, you know, all the R&D that's going on in the market right now.
STEVEN29:06AI is actually doing a lot of that code building. You can do vibe coding. So if you embrace all of that, you figure out how in your particular company or with your particular role. How do you harness that for the greater good, which ultimately is if you focus on the customer and value, like we said earlier, then that's going to be the most successful
RACHAEL29:26Absolutely. And we deal with this a lot at USC also because like you said, everyone's trying to, you know, layer AI on top of everything they're doing. But what we've found is that a lot of companies are trying to layer AI onto unoptimized or broken or even missing processes and systems. So the data is bad. You know, salespeople are all off kind of doing their own thing.
RACHAEL29:48There's no strict pipeline management structure, anything like that. And then they're trying to automate this with AI and you're just scaling like negative touch points and you're scaling bad data and you're directing the company in the exact wrong direction. So people have to be very careful with that as well.
STEVEN30:07Yeah, I think McKinsey, BCG, they all come out with studies that 90% of AI projects fail. It's primarily because of that. It's just that, you know, accelerating to a bad answer still leads you to a bad answer. And that business context without you know, if I talk about my sales organization, I wrote a Forbes article that was published earlier this week about this, that our whole go to market has to change.
STEVEN30:33It has to adapt into this new world. And part of it is if you think about, you know, if you're if you're selling, how do you how do you how are you going to leverage AI? Well, there's some public information that you can go share that you can kind of take a model and go look at, maybe you've got a prospect and you're going to go do your analysis and you're going to do gen AI so that you can write a more effective email.
STEVEN30:53That's great. Like, you can you can do that, generally speaking, but you also want to make sure that that's trained on your information so that, you know, are they an existing customer. Are they in any escalations? When is their next renewal? Do I have pipeline? What relationships do I have with other contexts inside of the company, like all these other things?
STEVEN31:12So you can definitely have, you know, public data, but you need it with your company data that's married up so that you bring those things together. Well, if if I'm looking at a territory, how I define a territory, how I parse out, you know, who actually gets leads, all these things, those rules change all the time. So if you just train AI and you're kind of putting it on top of your company data and you don't have the business context, then when you change your territory, when you, you know, maybe you're refined and you're going to go to an industry, go to market, all those things, now you've got to train a model on totally
STEVEN31:44different things. So how you define your business has to be understood by AI in addition to all the other things that it's trained on. So you really need to bring these worlds together, which again is why you have revenue engineers. Revenue engineers is a different role because you know, there's prompt engineering. So how do you write the right prompt?
STEVEN32:04How do you know which model to use? Some models are better than others. X or grok may be good for social, so you kind of get that aspect. But you might have anthropic that you use for more enterprise ready data, and then you might use OpenAI for more science related things. So depending on what it is that you want, different models will give you different, you know, value.
STEVEN32:25And so understanding how that then gets contextualized into your go to market, those things have to be understood as well. So there's a lot of things that have to, you know, get right in order for you to get the most value out of AI. But you can't just say, I'm going to go put a model, I'm going to put it on top of my Salesforce data.
STEVEN32:41In a way, I go, that's not how it works.
RACHAEL32:43Now, if only it was that easy. Yeah, AI is supposed to make everything easier, but it almost feels like everything is so much more complicated now.
STEVEN32:51Like anything, it's the setup that matters, right?
RACHAEL32:53Yeah, absolutely.
STEVEN32:55I always love math because a lot of it's in the setup, you know, there's a lot of different theories, but if you don't set the problem up correctly up front, then then if you apply the wrong theory, you're not going to actually be able to solve the problem. So a lot of it has to do with how are you setting up the problem in order for you to effectively go solve the, you know, the problem itself?
STEVEN33:16So I think AI is no different. The matter it matters in how you set things up. Data is obviously the critical element in all of this.
RACHAEL33:25I feel like I could spend a whole podcast just talking on AI itself with you, but I just want to reel this back to SAP for a minute.
RACHAEL33:34So when you talk.
STEVEN33:35About SAP, by the way.
RACHAEL33:38Sap.
STEVEN33:39SAP.
RACHAEL33:39Do you do you not call it SAP?
STEVEN33:41No.
RACHAEL33:43Oh my God, I'm the only person who's been doing that.
STEVEN33:45That's okay. It's the it's it's it's actually a German language. So it's systems and Linux and programing, but it's basically SAP is an acronym in German. And that's, that's the derivation of the company. But it doesn't matter.
RACHAEL33:59Okay.
STEVEN34:01Call it that. But but SAP is is how.
RACHAEL34:04Okay. Well it's good to know. Thank you. It's hard when you when you just learn a term just from reading it. You don't hear about it a lot. You're just going to, like, come up with your own way of saying it. Good. All right. So at what point did the momentum with these packages start to take over? And what did you have to do differently once you were scaling versus when you were trying to get those first deals in the door?
STEVEN34:25It's a good question. So on the scaling side, it was, you know, in the beginning it was relatively easy to figure out which packages made the most sense. We were super competitive in the market with Salesforce, and so starting with CRM kind of made a lot of sense. And then it was again, these packages, like I said, you know, they were costing about a half million euro per package to build out because they were so robust.
STEVEN34:48So it's like knowing which package to build next and scaling. How do you manage the partners so that you, you know, don't lose the brand of RDS? Because if the partners built a bunch of their own packages and all of a sudden now instead of ten weeks, it takes ten months, I go back, you know, in time. So trying to manage the brand.
STEVEN35:09So the scaling aspect was super complicated and complex, but it required us to really going to think through what do we really want this business to look like a year from now, two years from now, three years from now on one side, it was great because from a compensation standpoint, I literally had to move from an annual quota to a quarterly quota because we were so successful, it was doubling like every quarter.
STEVEN35:34And so that was going really, really well. And so from a comp standpoint, it was great. But at the same time, like, how do you know what the growth is going to be? We thought by doubling it, you know, in the first year that would be a pretty aggressive growth target when we grew at five and it was like, okay, so now we've got to think about things.
STEVEN35:51So I think part of it is just like different problems that you face when you're scaling at that, you know, at that level. So a lot of that had to go in. There was credibility. Or are we really actually selling these things, our customers implementing them. So I had to put together a small team, but I wanted people to actually make sure that we were fulfilling the promise of RDS.
STEVEN36:10So I would go off and I had a just a few people, but they would literally get on the phone and call customers after they were live. Are you happy? What was your experience like? Like my own kind of customer set survey to make sure that they were actually truly getting the value out of it. Otherwise, you know, people would think, well, you might be gaming the system and people are just saying that they bought an RDS, but they didn't really implement it.
STEVEN36:29So we wanted to follow through and make sure that we truly were, you know, selling it. And customers were truly getting value out of it. So I think a lot of us just keeping yourself honest and making sure that, you know, I don't want anybody think I'm ever gaming a system like, you know, that was my credibility. At the same time, I had a, you know, personal brand and it was important that people felt, you know, that, like, this is this is real.
STEVEN36:51So I think there's a lot of that that had to go into it as well. But yeah, it was like I said, it was a
RACHAEL36:56Did you hit any growing pains or places where things were straining and felt like they might break, and you had to pivot and make changes to your systems or processes as you scaled bigger and bigger. Because this is this is doubling, you know, every quarter or so. That's that's quite an explosive growth on the system.
STEVEN37:15I think, you know, we pivoted daily, but it was more on just how we positioned and how we were selling and making sure that we were more refined in the package that we were building, things like that, making sure that the assets we had, like so a good example would be in finance. They they started looking at what was included in the package, and there was a lot of these accelerators and assets.
STEVEN37:37And so there's a big question like, should we putting value on that? Is there should there be a price tag on the assets that are part of the package.
STEVEN37:45Right. Contingent was no. Like these are just part of the package. So we're selling the package and it's inclusive of basically everything that a customer needs to be live in ten weeks or less.
STEVEN37:56But I don't want to, you know, I didn't want to refine it back down into like a skew based like there's these five SKUs, make of a package. The other thing was making sure that there was a lot of people on my team that felt like we should have our own sales force, or that we should have like an RDS skew, so that it's literally like a separate software product.
STEVEN38:16And so I was pretty adamant that I don't want to do any of those things, because that would minimize my ability to truly scale. I wanted the same software. I didn't want it to be like, oh, that's an RDS software. That's an RDS CRM system. No, it's just SAP CRM. So it was important that, you know, we kept that in place.
STEVEN38:34We kept the the assets themselves were all inclusive in the package and that we delivered that in terms of, you know, the value statement. So a lot of it was just trying to build all those things into it as
RACHAEL38:45Because that allowed you to create the like the Lego building blocks. Right. And that's what gave you the scale.
STEVEN38:51Yeah. Because these things all had to fully integrate with one another. And if I had my own kind of version of the software, I would actually create complexity. And a customer would think like, oh, I've got this. And it just it created way too many complexities. I wanted to keep it as simple as I possibly could, which meant keep everything the same.
STEVEN39:07There's no different in the software. The implementation scope was defined and it was like it was in concrete. I had a lot of customers that I went to, for example, and they would tell me, I like what's in the package, but, you know, I also want this kind of core HR system to also have employee self-service. I'm like, it's not included.
STEVEN39:28So I'm not saying you can't do that after you implement, but this is the scope and we will not deviate from the scope. So there is no other thing you either by the RDS or you don't. But it was like being very you know, you got to dictate like these are the terms of the, of the package. And a lot of people trying to pull me in a lot of different directions.
STEVEN39:49And we just were absolutely adamant that what was in the packages, what you get and that's it. And what you're live and you're in production, you can do whatever you want. But for this package, this is how we're going to deliver it. So I think a lot of it was just being very strong willed in terms of not deviating from the plan that you're on.
RACHAEL40:08And what give you the confidence to to keep steady and doing that when you're being pulled in all these different directions and people saying, well, we should do this and this.
STEVEN40:16Yeah, part of it was just the work that we had to do upfront, you know, in just investigating. What did we try before? Why did it fail? So there was a lot of that upfront work that I would say happened before I went to the board. You know, kind of that I was able to articulate to them, like all the things that, you know, why we failed, you know, trying best practices and some other things in the past, most of it wasn't what the package itself was or the best practices that existed because we had accelerated SAP, we called it ASAP, and that was like a model where you could implement SAP quickly.
STEVEN40:47So we took assets from there and these other best practices. What was missing is really the go to market piece. How do you then get that into the field and build that to scale? So a lot of it was, you know, just trying to figure out how we're going to go pull all these things together. What gave us confidence I would say, is success, right.
STEVEN41:04So it's one thing, like I said, you know, I failed and failed and failed until I went to the customer. So a lot of it was just trial and error. You know what works. So the packages themselves, I would say, well, we were as dogmatic as we could be in terms of this is the package. We did evolve the package.
STEVEN41:20There were other things that we said, oh, there's there's some other things that other assets that we should include, maybe broadening the configuration guide or clarifying certain things. So the fact itself was, you know, pliable and fluid to a degree, but it was just still within that same defined scope. It was just how we delivered. It might be a little bit different.
STEVEN41:38So I think being a little flexible and fluid in the way that you put things together, especially as you're packaging it, those are all important things as well. But yeah, so I'd say being willing to pivot and be fluid in, you know, the go to market to a degree, but being, you know, absolutely stalwart in certain aspects that you just can't deviate from.
RACHAEL41:59And so what would you say was the the big difference between the other times that SAP has tried doing packages like this before and the success of what you did with RDS?
STEVEN42:10I think the biggest difference, in retrospect, was just having the field go to market team aligned around what was being built. I think in the past it was a lot of it was just built, you know, in Germany and development and used by the consultants, you know, to help accelerate. Have, you know, certain guides that made it easier to implement.
STEVEN42:29But what it was lacking is the field go to market piece. And because I had been to, you know, in all the major markets around the world and kind of worked and built a strong, you know, personal brand, it kind of gave me the ability to go, you know, do that in the market. That I think before was not something that was out there.
STEVEN42:49So, yeah, having the credibility and making it kind of work that way. Those were all relatively new things that hadn't been tried before. And like I said, I made sure that the regional president, it was important to them. We reported on it. We forecasted all those things were really important in retrospect. And I would say some of it's like blind luck.
STEVEN43:10Like it wasn't like I thought, hey, here's exactly all the things that we got to do. Some of it was just like as I was building it as as the whole team was building it, understanding kind of the decisions that we made and the resulting impact. You know, some of it was just we got lucky and it was the right thing.
STEVEN43:28And the other was, like I said, just knowing when to pivot and change those problems as well. But we had a lot of people that were behind us that wanted to be successful. And once it cut on and, you know, and again, you saw a success, then it was a matter of just then it became more of a scaling issue than it was like, are people interested and do they want to leverage
RACHAEL43:46So let's talk numbers for a second. What did the win rate sales cycles average deal sizes look like early in the early days versus once the model was proven.
STEVEN43:57It pretty much stayed the same. Like these packages were in the 100 K range. The variable was the number of users you had. So if I went to pick a company in a fortune 50 company, that was an SAP customer and I went in with RDS, the implementation of the package itself might be 100 K, but if they have 500 sellers or 5000 sellers or 50,000 sellers, then the variable would be the software license cost.
STEVEN44:22So we wouldn't change the implementation, the package itself, it would only have a variable around, you know, the number of licenses. So a lot of it was just scaling up and down based on the number of users or whatever the metric is. If you're selling HR, the metric is all employees. If you're selling supply chain, the metric is an engine like an Apple engine.
STEVEN44:41If you're selling a CRM system, it's the number of sellers that you have. So those metrics might change based on the number of users you have. But the reality is, you know, the package itself doesn't change. So the point was that you could be live in ten weeks and be getting value out of minutes. Up to you. If you want to roll it out, you want to just do it in your test system.
STEVEN45:01You might just put it into like your your, you know, we call it a test and development system and not put it in production, but you're certainly live in ten weeks and you can roll it out to your entire Salesforce. It's totally up to you whether or not you want to put it into production. So a lot of it was, you know, those things as well.
RACHAEL45:17So to pivot a little bit, if a crow today was trying to launch a new packaging model, new pricing structure, new sales motion, what kind of playbook would you advise to them for validating it with customers or getting it, getting their board on board with it and starting it up?
STEVEN45:35You know, it's interesting. We're all in the same mode right now. We're all trying to figure out how AI is going to change our company, how it's changing our products, and how it's going to change our go to market. So all of us are grappling with that already. And that's there's no different in what I was building 15 years ago.
STEVEN45:50And what we're thinking about how we're building out the company today. You know, SaaS, if you have a SaaS solution, you built it specifically to go to market. You know, is there a chance you're going to get displaced by somebody? Bytecode a solution that gives them everything they want. So we're all thinking through, you know, what is the impact of AI?
STEVEN46:08So I would just argue that that's that's that's an evergreen problem. It never goes away. We all have to be refining. You know what we're doing. What I would say is like to me, starting off with the customer, you know, I'm going to talk out of both sides of my mouth for a second, okay. On one side, it's like I should have talked to the customer first and they would have said, you had me.
STEVEN46:27Hello? And I would have gone down that path. And I would have, you know, built that pool model I was talking about at the same time, you know, we all know, like Steve Jobs would tell you, you never go to a customer and ask, you know, what they want because they're going to tell you what they need. They just, you know, if you were heard this same metaphor from, you know, people talk about for that, if people were to go off and say, you know, to somebody who has, you know, horse and buggy, what do I need?
STEVEN46:51I need a faster horse and buggy. I don't need a car. Like they would never tell you that. That's what they need. But that's what was built. So I think it's the same thing with us is, you know, like, customers are going to tell you what they want. That's a better, faster version of what they have today. But the reality is you might completely get displaced and there might be something totally different.
STEVEN47:09So you have to be able to kind of do both hear what your customer is saying, deliver, you know, the greatest source of value to them, but also be able to see around corners and know what is in the future and kind of build for that at the same time. That's the problem we all have is in like Clayton Christensen's Innovators Dilemma.
STEVEN47:27It's the same thing, right? How do I take and make sure that I continue to drive the growth in the business with what I have today? Well, at the same time, investing in, you know, a creative solution, that's what's needed in the future. And you have to be able to do both of those things. And the bigger you get, the harder that becomes.
RACHAEL47:44So how would you suggest that crows actually create urgency for this change when the existing business and the existing motions are still producing revenue?
STEVEN47:53I think Niekro would tell you they're already doing that. I don't think I have to convince them that they need to move faster, that they need to think differently. We all we we all talk. I mean, it's a in the grand scheme of things like in tech, we all kind of generally know each other. And so there's a good community of crows.
STEVEN48:11And you know, we we there's a lot of people will talk. So I think first off is just having a really strong community of crows is really, really important. I was just, you know, talking to Sam Jacobs this morning. He's got the pavilion. I'm joining that. There's top line. There's like a lot of things where you can just get together with other crows and they feel your pain.
STEVEN48:31You feel their pain. And what are you doing differently? How do you think about managing your territories or what are you doing different in comp or how you reducing churn, like there's just the normal go to market stuff that's really, really important that you have a good, strong network of other crows. I think the other thing is you got to just outthink the problem, like you got to give yourself enough time to really dig in and understand what's going on in your company, in the market today and, and ruminate on that.
STEVEN49:00And don't be just quick to make changes, but really think about what problem you're trying to solve. What are the different solutions that you have available to you? Where are the things that you need to create that's totally different based on your respective company and your customer set? And you know everything else. Some of us have a bigger churn problem or down sell problem than others.
STEVEN49:21Anthropic you know. Believe it or not, like they have their own sets of issues right now. They're hypergrowth that, you know, when as an enterprise we were growing 100% year on year, we were pre public wanting to go public. So having to set up all new systems and thinking about the way we go to market, it's just again, go back to understand the problem that you're trying to solve.
STEVEN49:40And every crow I think you know, worth your weight would tell you. Like, I have to understand what the problem is that I'm trying to solve, and then I can go off and go try to find the solutions. But if you just look for any solution, you know, it's you can be busy and be active, but not actually, you know, get the work done that you need to.
STEVEN49:59So I think first and foremost is give yourself enough time to really, truly understand the problem that you're trying to solve before you start trying to apply AI or any other solution.
RACHAEL50:09Awesome. Well, we're starting to run up on time here. I did have one last question. I'd like to ask this question when there is a little bit of time to ask it. I think it's really fun. What is the revenue leadership story that you don't get to tell enough that you like telling?
STEVEN50:24I love to talk about, for me personally, I have a very eternal perspective on things, so I don't think of my life ending when I die. I think of my life being more eternal, and to me, that's what makes you more genuine. It makes you more authentic. I care about people. I care about the people that I work with.
STEVEN50:45I care about my customers. But not just because I'm trying to make a dollar, or because I'm trying to make a name for myself. I truly care about people. And when you're authentic like that, it shows. It shows in everything you do. It shows in every, you know, like that's how you show up. And so I think it's really important that regardless of who we are, we're individuals, we're humans, and we should find ways to help each other, even if they're, you know,
STEVEN51:10in some other totally different industry I love.
STEVEN51:13Just like I think most of us are extroverted, so we like to talk to people anyway. But I think just being genuine, you know, like the old adage that people don't care how much you know until they know how much you care. I truly believe that's the case. And so, yeah, a lot of it, I think, is do the right things and good things will happen.
STEVEN51:32Sometimes bad things happen and that's okay too. And you kind of bounce back from it and you learn from it. But I never look back and regret anything. I, I recognize bad decisions I made, I recognize mistakes I made, I try to apologize for those and learn from them, but I never like, let it kind of keep me from making progress.
STEVEN51:54I try to learn and grow and move fast.
RACHAEL51:56That's so special. I love that I think we need so much more of that in the world right now too.
STEVEN52:00Yeah.
RACHAEL52:01Think if everyone thought that way.
STEVEN52:03Yeah I agree.
RACHAEL52:05Yeah. Thank you so much Steven. This has been an excellent conversation. I think our listeners will also love
STEVEN52:10Good, I appreciate it. It was good to talk to you and I look forward to staying in touch.
RACHAEL52:14Absolutely.
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