| Matthew |
I’m Matthew Cottingham, and I’m a Program Director at RWS Moravia focused on digital post-production for streaming services in the entertainment industry. Today I’m fortunate to get the chance to talk with Jim DuBois, former CIO and 25-year veteran at Microsoft and the author of Six-Word Lessons to Think Like a Modern-Day CIO. Our conversation today is focused on digital transformation and the lessons Jim has learned from helping lead Microsoft through its own transformation. We’ll be covering how a company starts on the digital transformation journey, building a culture for accelerating transformation, how to adapt, learn and continue to get buy-in along the way. |
| Jim |
Matt, thank you. I’m Jim DuBois. I finished a 25-year career at Microsoft as the CIO. In those four years in that role coincided with Satya’s first four years as CEO, so it was a super exciting time to be at Microsoft. I did a bunch of different things within the company in product groups but mostly in IT, infrastructure applications and led the security team at one point, and just had a fabulous career there.
Since I left, I have joined several boards on companies ranging from Fortune 500 size down to startups and I’m an advisor on a bunch of startups. I wrote a book that cio.com listed as a top read for tech leaders and worked a little bit with a couple of venture capital companies in an advisor role and really just having fun. |
| Matthew |
I thought we could start with, talk a bit about digital transformation and the difference between what real transformation means and sort of what paper transformation would mean. |
| Jim |
Yeah. There’s tons of different definitions for digital transformation because everybody’s doing a digital transformation. But if you ask them what is the digital transformation at your company, you got a couple of different flavors of answers.
Sometimes it was, you know, our digital transformation is our IT organization’s not delivering fast enough and we needed to do more and it was really fixing IT, not digitally transforming the company. And that ranged all the way up to answers that were, you know, we have this opportunity in our industry and if we can change this path, we can completely disrupt and make a huge difference and change our company. So, it was completely about what the company’s doing, not what they’re trying to do with IT that is the digital transformation. |
| Matthew |
So when you’re launching down this path of digital transformation, how do you know you’re getting it right? How do you know you’re on the right path? |
| Jim |
Yeah. So I think, and I talk about this in the second chapter of my book, that it’s about the vision that you have for what you’re going to transform and getting the clarity on that vision and being able to communicate that effectively. But also have the ability to recognize that you can’t get it all figured out at first, that you’re going to learn along the way, and that you can have a vision that’s a living vision that you can get clarity to the whole company but recognize you’re going to learn things. If you’re going to go fast and move ahead down this transformation journey, you’re going to find some things that work out better than you thought and some things that don’t, and you’ve got to adjust the vision as you go, but keep towards this north star. You really want to have the vision for what the future’s going to look like and clarity around that and be driving towards that. |
| Matthew |
Yeah, you mentioned thinking about it as a project and I’m wondering does it ever really stop? Do you get to a point where you say, “We’re transformed, ta da!”? |
| Jim |
Yeah, no, this is a learning journey that’s going to keep going and you’re going to keep finding new things. The transformation is almost the ability to get the whole organization aligned and going in that direction and getting rid of all the friction that’s holding it back so that you can go towards that vision, but continually evolve the vision as you go to something better and better. It’s not a project that’s going to stop. |
| Matthew |
Yeah. Well, you mentioned things that hold us back, whether it’s people or if we allow technology or legacy systems. How do you overcome some of that…sometimes it’s reluctance or some of the things that trip people up? |
| Jim |
Yeah, yeah, and that was the first chapter of my book because it’s actually the most important thing to get right, is getting everything aligned and a culture in the company that’s going to embrace what you’re trying to do and support moving it forward as opposed to fighting the progress and holding it back.
And it’s the biggest thing that Satya recognized in being able to transform Microsoft. In fact, when they were going through the interview process to find a new CEO, the board actually got to the finalists and the projects that the board gave to each of the finalists was to write a paper on what they would do when they took over as CEO. You know, pretty kind of generic whatever. Satya’s paper was all about how he was going to transform the culture to allow the acceleration of progress.
And that was what got him the job. And that’s what he set about to do. He did a bunch of things very purposefully on resetting the culture. It was like a four-step process. You have to be really clear and purposely define the culture that you want to have, and that’s maybe the obvious part. But he did some specific things in that. You know, I want a learning culture that we’re going to be able to define a hypothesis and experiment and learn from that and keep going as a way to learn faster. An inclusive culture where everybody’s ideas are heard so that we can, you know, get to a better solution. But he’s very purposeful about what he wanted that culture to look like.
And wherever your company’s coming from, it’s going to have some things that are a deep part of the culture, and some things in that that you like and want to keep and some things that you don’t like, and some attributes that you want to have that maybe aren’t a strong part. So, he was really clear on ‘this is the culture that we want to have’ and he got buy-in from everybody on that. So, purposely defining the culture, that’s the first step. But that’s not enough to just say, ‘this is the culture we want to have’.
The second thing is the leaders need to model that culture, because if they say, “this is the culture we want to have”, and then they don’t behave that way, nothing’s going to change. And Satya was very purposeful about not just modeling that himself, but teaching other leaders how to model the new culture and calling people out when they weren’t, and kind of created within the exec team at Microsoft this ability to say, “No, no, no, no, that’s not what we’re trying to advocate now; that’s not the culture,” and help each other kind of sharpen their own ability to be a model for the new culture.
So, there was a lot of that. And there were some stories that went viral that Satya did in that that were just amazing. And I’ll do a quick one. You probably remember this; this is several years ago. There was an experiment that Microsoft was running to learn about natural language processing. And they had a bot interacting on the internet modeled after one that they’ve built before in China, but it was a teenage female persona interacting and learning and talking on the internet.
So, a bunch of internet trolls got ahold of this and just started feeding data and training this sweet, teenage female persona to be, you know, racist and mean and, you know, spouting Nazi propaganda and all this crazy stuff. And Microsoft shut it down but not before, you know, some of the rants that the bot went on were public, and the press got ahold of it and had a field day. You probably remember seeing some of this. |
| Matthew |
Yes, yes. (Laughs) |
| Jim |
But the press was like, “How come you didn’t have better controls in place?” You know, “whoever did this should be fired.” “This is an awful thing that happened.”
So, the woman that was running the team that was doing this experiment gets a phone call. Do you imagine what she’s thinking? It’s like, ‘oh, okay, this is it’. And actually, the first thing he does is say, “Are you okay?” Because she’s getting beat up in the press and this is, you know, what the empathy that Satya talks a lot about in his book.
But then he says, “What did we learn? How are we going to help everybody learn from this?” Not ‘what were you thinking?’ You know, ‘not how could you let this happen?’ “How are we going to learn from this so that we can be better next time?” And then he had her go speak to a bunch of teams around the company to explain what she learned to share that learning. And it turned out that it wasn’t as much about sharing the learning, it was about her talking to everybody about how Satya responded to her. |
| Matthew |
Sure, sure. Yeah. I love it. |
| Jim |
And that’s what went viral. It’s like oh, Satya didn’t beat the crap out of her. He didn’t yell at her. He asked what she learned, you know? So, if we’re going to do an experiment, we’ve got to make sure that we’re learning from that experiment. We have all the right controls around it and they had them in place and were able to shut it down before it did any real harm other than just kind of that reputational brief moment.
But I think the response around that and how he was wanting to make sure we were learning from that to be better was just a huge part of modeling the new culture. So, that’s the second thing in changing the culture. Define it, have the leaders model it, because it’s never going to change if the leaders aren’t modeling.
The third thing then is you have to look at all the parts of the company that are built around how you recognize and reward people and how things are celebrated, and make sure that all of those are completely aligned with the culture that you want to have. Because that’s the reinforcement mechanism of this culture you want to have.
Here’s how people celebrate, here’s how people get recognized, and he looked at those and he said, “There’s this thing that Microsoft does and people love it, but it’s recognizing the wrong thing, so we’ve got to get rid of it.” And it turns out that as he was trying to get people to think about iterative releases and just continuous releases and the whole agile practice, that this whole concept of doing a huge release and getting it out the door and then having a big ship party was kind of counter to this ‘agile release all the time’ thing.
So, this concept at Microsoft of the ‘ship party’ that everybody looked forward to after all the long hours of getting a release done, he killed. |
| Matthew |
Yep. I remember the helicopters coming in for Windows 98 and the gold discs shipping off into the sky and champagne and everything, yeah. |
| Jim |
Huge parties! The ship party was a major milestone and a deep part of the old Microsoft culture. But Satya recognized if we’re going to get to this ‘agile continuous release’ thing, we’ve got to get away from having ship parties because we don’t want people to artificially find the time to do a big ship party. We want them to, you know, have a continuous release process where we’re looking at telemetry to see things and learn from that and get better. That was a deep part of what he wanted the culture to celebrate and to reward.
So, he had to kill the ship party even though it was a big part of the culture, the old culture. It’s an example of looking at what are all the different things that exist in your company that are the important ways we recognize things and make sure those align with that culture that you want to have. And you might have to get rid of some, but you can emphasize or tweak some so that they fit the culture. But it’s really important to make sure that how somebody thinks they need to behave to get promoted has to align with the new culture. You know, how somebody thinks they need to behave to get a good review score needs to be part of the culture. And it’s all those things have to align to the new culture. And that’s really important to think about. And, you know, Satya was preaching on it, but there’s a lot of work by the HR team to go through and remodel all of that stuff. And it took a while for people to actually believe that they were going to be rewarded differently than they had in the past. |
| Matthew |
As we talk about corporate culture, with a company that’s global like Microsoft, there’s a lot of people in the field, there’s different geographies, there’s different sometimes ways of approaching things culturally from sort of a different definition of culture. And so, aligning those other cultural expectations or call it local ways of doing business, how do you then align those different perspectives into this corporate transformation? |
| Jim |
Yeah. Yeah. And that’s a good point because in a global company you’re going to have, you know, lots of people from different countries that have different cultures, and there’s going to be things in those that are going to be different. Part of that is the inclusiveness piece that Satya was pushing at because bringing the different perspectives is what makes the vision even better.
And as long as you can be really clear on, you know, what you think the vision is, but open to ideas to make it better, then you open that door for all of these different cultures and different perspectives. Whether it’s a field customer perspective or a different nationality perspective or, you know, all the different things that we highlight from a diversity perspective, all those different points of view all have the opportunity to bring ideas to make the vision better and as leaders, you have to be open to hearing all those ideas and molding those into that vision.
And if you’re not doing that, then you’re going to shut down all these voices that could be making the vision better. You know, in the old Microsoft culture, there were these technical leaders that did the design and their word was law, and everybody just kind of built that. The world’s going too fast for that to work anymore. You have to be able to learn faster and bring new ideas in.
You can still have your experts that help form things, but adding all the different perspectives to make it better really does make it better. You know, there’s tons of research on the more perspectives that you bring in, the better the solution is. You have to have a way to continue to make progress and measure what success is and keep working towards that and have very data-driven things so that you’re not slowing it down.
But you have to have a way to look at new ideas and see does that go into our future? And then when you do change the future, think about, you know, how does that change our plan to get there from now? Because a lot of changes won’t change anything in the short term, but some of them, you have to start tweaking what you’re doing now right away. You have to have that iterative planning mentality that you get with the agile practice. |
| Matthew |
So you mention technology, right? At some point, we have to make some decisions about what sort of technologies are we going to go after, right. You can enhance the things that are getting you along the way or you can redesign and rethink things that are legacy. And so, how do you make those decisions about which are the best technologies in order to enable, you know, velocity for the overall transformation? |
| Jim |
Yeah. There’s a bunch of different kinds of technologies. So, there’s the technologies you use to build things, a whole suite and you know, what kind of things are we going to use and how do we standardize those across the teams? You know, as I’m building a product, I’ve got to make a decision: am I going to build it all, or are there pieces that some other company’s already done that we can acquire and integrate in and do that? There’s that piece of the technology decision, or there’s a hole in the portfolio and we need something new and there’s a company out there that does something like that that we want to bring in and it’ll help the overall portfolio.
All of those things fit into the models that we’ve already been talking about. You have to be clear on the vision and then the goal is what’s the fastest way to get to the vision. And it’s a prioritization of the things that are going to get us along the path faster, we do first. And if there’s something that exists that we can adopt, you have to look at how much it takes to integrate it in and is the culture of that team going to fit with our culture? Those were also important points, not just the technology, but bringing things in to help accelerate is a huge part of helping things go faster.
If it’s not going to help you go faster, even if the technology is great, you may decide not to do that and just build your own. And I remember being involved in some of the merger and acquisition discussions where there was great technologies that it’s like, oh man, we should buy that, it would fit perfectly, but gosh, the culture just wouldn’t fit, and it would be really hard to integrate, and the technologies that were used to build them were completely different. So, it would take a lot of rework to drive consistency.
And then on the other hand, there were places where, you know, this looks like it would fit, but actually the talent they have and the culture they have is going to help us go faster on our acceleration. So that would be a big piece of that. And in fact, the LinkedIn acquisition was like that. There were some clear business opportunities where we could integrate and do some things faster. But as Satya spent time defining the culture that he wanted Microsoft to have, LinkedIn was a lot closer to what he wanted than Microsoft was.
And part of bringing LinkedIn in was, you know, having another 10-plus-thousand people that had the culture that you wanted to get to. In fact, they had a role at LinkedIn, the person’s title was Chief Philosopher and their job was this evolution of culture. And Satya had this person go around to the Microsoft teams and talk about, you know, what they were doing. And it was appealing to a lot of us that were kind of frustrated with the older, caustic culture and wanted, you know, a better environment to work in any way. It was super appealing to talk to what they were doing and help, you know, embrace that as part of what we were doing at Microsoft, help accelerate what was already in progress. |
| Matthew |
That’s a great example. It’s a great example. We’ve talked a lot about old Microsoft and new Microsoft and transforming of cultures. I know you work with startups as well, right? New businesses who are in a race. It’s all about velocity, but I assume they need to think about the same things, the cultural things. So, how do you get that built-in from the ground up? |
| Jim |
Yeah. To some extent, the energy in a lot of these startups is such that there aren’t any set ways yet. So, it’s easier to put in, this is how we’re going to, you know, reward, this is how we’re going to promote, this is how we’re going to attract because there was no way that that existed.
So, you don’t have some of the barriers that a bigger, longer culture would have. At the same time, a lot of cultures, they don’t know what they don’t know yet and they’re going to figure it out along the way, which is great. But you can just bring little nuggets to help bring them along faster and help accelerate things and start to point out ‘this is easy now when there’s a few of you, but when there’s a thousand of you, that’s not going to work’. So, we have to think about how do we want to do this in the future?
And sometimes that’s just a discussion where everybody agrees, ‘yeah, we’re going to have to do this different, but right now we don’t have time to do anything different, we’ve got to keep ready to run’. But it helps them start to think about where you’re going and that same concept that we’re talking about: have a vision, know what we’re trying to get to. And you know, I was on a call with one of the startups that I’ve been helping yesterday and they were talking about this big transformation that they were doing. And I could recognize that it’s an interim step to where they want to be.
And we talked through all the stuff and I just had to stop and say, “This is great, these are all the right things and don’t change what you’re doing here, but remember, this is where we want to go eventually. And I know that’s too big of a step to think about now, but keep that in mind so that we know that we’re on a path to that as opposed to ‘this is the thing’. Because this is really cool and it’s going to really be beneficial, but it’s not the thing.” |
| Matthew |
Yep. It must be very tempting in pursuit of stock price, bottom line, to cash in on what you know is going to help now and lose sight of the long-term effects. You can be a victim of your own short-term successes because in some way that’s the way you do things. |
| Jim |
Right. |
| Matthew |
And we can nickel and dime— |
| Jim |
And miss out the big opportunity, exactly. |
| Matthew |
Yep. So, we’ve talked a little bit about top-down and cultural change, you know, Satya coming in and modeling behavior for people. I’m certain that there are environments out there where the top-down culture is not as receptive yet or needs to be convinced about doing this. And so, what advice do you have for people managing from the middle out or from the middle up in order to help this conversation progress? |
| Jim |
Yeah. I think that’s a really good point because there’s a lot of companies where the people at the top maybe don’t know yet what they need to drive faster or they’ve, you know, come from an environment that’s you know, more risk-averse in they’re hesitant to change too much, too fast. And, you know, if the culture doesn’t like change, then you have to be even more careful with how you’re changing.
You do need to go talk to the senior leadership and say, “Hey, I think this is where we need to go and I can be an example, maybe an experiment for you, rather than risking the whole company to do this in a different way, and help you see what’s possible. And we can learn over in our little corner.”
You need some sort of endorsement from leaders of, “Yeah, I’m open to you doing something in your world, but I don’t think we can go company-wide with that; that’s too scary right now.” If you can’t get at least that kind of endorsement to do it within your world, you know, I want to say, go find another company where you can get that, that is. But you want to at least be a little bit careful about how you drive big change.
If you do it right, though, you’re going to be able to attract people from the rest of the company that want to be part of that. So, you’re going to get the best talent within the company and they’re going to start seeing that. The leaders are going to see that and it’ll be something that they’ll come around to. |
| Matthew |
What advice would you have for people to avoid some of the things that you had to learn along the way? |
| Jim |
Yeah. It’s really hard because we learned so much along the way to say, ‘gosh, I should have done this differently’. Most of us, we just didn’t know yet because we hadn’t started going and we pushed things quickly. Now I think if you’re not the leading-edge pioneer in something, then somebody else has been going through the learning and you can take advantage of that. I mean, having a learning culture isn’t just what we learned. It needs to be what is getting learned out there because it’s way easier to take advantage of somebody else’s learning.
So the advice that I would have is like, if you are going to do a cloud migration, look at the people that are done and what they learned and start with that. Like, don’t try to plan it all out in advance and then get that approved because that plan is going to last for a couple weeks before you realize that you want to change it. It’s important to have a plan, like battle plans that you have in war. You know, you want to have a plan, but all good plans only last until, you know, first combat, and then you need to adjust.
In in some ways, if you’re going to go as fast as companies are going these days—and some companies are going fast and being really disruptive and taking advantage of the pandemic and continuing to grow even faster, and some are hunkering down and trying to ride it through—the ones that are taking advantage of going faster, they’re having to do some of these things we’ve talked about culturally and whatnot, but they’re going to be hugely successful coming out of this as opposed to the ones that have just had to hunker down and now are going to have to try to restart. They’re going to be way behind. So, look at somebody that has been, you know, going and what they’ve learned and jump on board and follow those learnings and go.
No matter how great the technology is or how great the talent you have is or, you know, whatever you’re trying to do, if you don’t have a culture that’s going to support what you’re trying to do, you’re going to be too slow to take advantage of this economy. |
| Matthew |
What got us here isn’t going to get us there. I think that’s an a-ha moment for a lot of companies to realize that in order to get to the next 10 years or the next three—the next three months, sometimes—they’re going to have to think about their business fundamentally differently. That’s where it begins.
Well, thank you so much. This has been a great conversation. |
| Jim |
Thanks Matt. |
