Home | About | Recent Issue | Archives | Events | Jobs | Subscribe | ContactBookmark The Sterling Report


Will the enterprise market spend significant IT budget on Windows Vista in 2007?



CEO Spotlight: Jay Fulcher, Agile Software

By Angel Mehta, Managing Director, Sterling-Hoffman Executive Search

Angel Mehta: Of all the companies you’ve worked with, which were the most influential in terms of shaping you as a CEO?

Jay Fulcher: I think the three most influential companies that most shaped me were Management Science America (MSA), SAP, and PeopleSoft. MSA was arguably the best sales and marketing company in software in their era and I started in software sales, which means I learned the business through the customer’s eyes. After that, Klaus Besier and Hasso Plattner recruited me to SAP, which was a tremendous growth story in the early 1990s, as you know. And of course at PeopleSoft, which I came to via the acquisition of Red Pepper… it was solely an HR company that was transforming to an ERP company, and I had the opportunity to help the team there shape it into fast-growing, great company. I held a variety of roles at PeopleSoft until I left in 2001. I had the great fortune of being there during an interesting time – during two different major growth periods… the stock grew nearly 10X two different times.

Angel Mehta: What were the major challenges being faced by PeopleSoft at the time?

Jay Fulcher: The first massive challenge was about PeopleSoft learning to be a multi-billion dollar enterprise… not an easy thing to do. The second major challenge was the struggle to reinvent the way solutions were brought to market. That was when, quite infamously, PeopleSoft made the decision – which I think at the time required a lot of courage – to try and bring their applications to the Web faster than anybody else – especially SAP and Oracle. That was a ‘bet the company’ decision. It was challenging because I was less experienced and had very limited large-scale organizational experience and I had to take the leadership role for a very, very large part of the business during that timeframe.

Angel Mehta: Which obviously helped prepare you for the challenge at Agile, given how much you’ve grown… tell me about the major inflection points you’ve taken Agile through over the last few years.

Jay Fulcher: You’re right, a lot has happened at Agile the last few years. We’ve more than doubled the size of the company in the last three and a half years. Obviously, scale really matters in a company, particularly when you are dealing with the challenges of being a public company in today’s environment. In terms of inflection points or key moves… the acquisitions we’ve done have been pretty significant. Through five or six acquisitions, we have clearly heightened our profile in a space that’s gotten more and more attention recently. We’ve moved into some new vertical markets like medical devices, life sciences, and more recently, consumer products. Each time you move into a new market, it’s a mini-inflection point, if you will. The company has to be reinvented to move from focusing on just 1 or 2 industries that we felt safe in from our early days, to addressing the needs of new markets. That’s a big leap.

Angel Mehta: Given that you’ve had exposure to some of the most interesting growth stories in the software industry, from the inside, when was the last time you remember being surprised by a business problem at Agile?

Jay Fulcher: Governance and compliance issues are the first things that come to mind. We’re a mid or small-sized public company now, and there are all kinds of issues that arise related to compliance that we sometimes get surprised with… and I think other companies do as well. Even companies that are larger than we are, and have been public for longer, get blindsided by a lot of these issues, so it’s no surprise. But, in terms of our core business? We know the industries we serve really well and we’re pretty good at anticipating what’s down the pipe: it’s really a matter of listening to your customers ALL THE TIME, not just when you’re trying to win a deal. We’re especially good at that.

Angel Mehta: Do you ever run into i2 Technologies in competitive situations? They were one of the early players that helped develop the supply chain market…

Jay Fulcher: Never.

Angel Mehta: So the challenge is hand-to-hand combat with players like SAP and Oracle? How do you win in shoot-outs with those guys?

Jay Fulcher: We win primarily because we have an extraordinary customer base that’s had great results with our software. The referential capability that we bring to any discussion with a prospect is substantially more advanced and more compelling than what any of the competitors can bring, whether it’s an SAP with the ERP solution or a CAD solution such as PTC, Dassault or UGS. So first and foremost, it is the success that we’ve had with customers to this point and our track record for delivering results to customers that we think differentiates us best. We also have great industry domain expertise – from best practices to best-in-class processes, we understand the industries we serve better than our competitors.

Angel Mehta: I’ve always wondered how to manage the challenges to morale that inevitably come with facing competition that is so much bigger. How do you deal with it internally?

Jay Fulcher: By reminding everyone that competition in the market keeps you sharp – it makes all companies better. SAP is a good company, and as a result, they’ve FORCED us to take our game up to another level to the point where we now offer better solutions. Competition forces you to embrace your customers and address their needs in a way that you might not otherwise. So rather than eliminate a competitor, we focus on being able to use all of the competitive pressures to ensure we get better every day.

Angel Mehta: I noticed you have held a number of leadership positions. Which role would you say has been the most challenging?

Jay Fulcher: Well, the one at PeopleSoft was challenging as it was a large square-footage job and I was new to such a large-scale set of responsibilities.

Angel Mehta: How different were the cultures at SAP and PeopleSoft?

Jay Fulcher: SAP is a disciplined analytical-type company that spent a lot of time and energy analyzing everything about its business and trying to make sure it has all of the analysis necessary to make decisions. PeopleSoft WAS a company that relies a little bit less on science and more on the art form of building a company. In general, PeopleSoft was a company that was very reliant on the entire team – they found competitive advantage in the sense of camaraderie that people had, and in being able to collaborate and share ideas. Both companies are very passionate and driven about what they do, but if I had to find a difference, it would be the art vs. science focus.

Angel Mehta: I think it was Einstein who said, “Not everything that matters can be measured, and not everything that can be measured matters.” Do you have a preference for one or the other, given that you’ve seen both approaches used?

Jay Fulcher: I think there’s a place for both. I’m sure it sounds cliché to say that both are necessary, but that’s exactly true. Einstein’s quote is relevant, but the reality is that if it does matter, you need to do everything in your power to come up with a way to measure it. At the same time, there are intangibles and acting on those variables requires some instinctual capability.

Angel Mehta: Do you think that the PeopleSoft culture can live inside Oracle?

Jay Fulcher: I haven’t worked at PeopleSoft in more than 5 years… but I will tell you that when I was at PeopleSoft, Oracle is the company we most wanted to hurt. We were interested in making sure that we made progress at their expense – and we did. Some of that was just geographic proximity – their headquarters was right across the Bay from ours. But a lot of the animosity was due to the cultural differences. If I had to wager a bet, I would say that the Oracle culture has already taken over. It has to, and probably should – Oracle bought PeopleSoft, not the other way around.

Angel Mehta: What was the most difficult adjustment you had to make, or the biggest challenge, after taking on your first CEO role?

Jay Fulcher: Forcing yourself to understand the broad picture and considering all the various constituents as you build the vision for the company. Shareholders are a top priority… but shareholder value is tied to customers… customer success is tied to having and keeping great people… but the short-term interests of those parties don’t always line up. Figuring out how to balance that is challenging.

Angel Mehta: Is running a software company harder than running other types of companies?

Jay Fulcher: I haven’t run other types of businesses, but I think so. I have many friends running a variety of different kinds of businesses, both in and outside software, and given where I sit and the career experience I’ve had to date, for sure I think running a software company is about as difficult as anything that I could imagine. The competitive pressures in this industry are unlike anything I’ve ever heard of elsewhere, and the various challenges that must be balanced are many.

Angel Mehta: You’ve been with organizations that have been famous for their software sales prowess…. What advice do you have for CEOs or Chief Sales Officers with regards to how to conceive of the sales organization of a software company?

Jay Fulcher: To understand the ‘inverted triangle’. The people who are at the sharp end of the customer relationship interacting with the customer every single day – those are the ones at the top of the hierarchical pyramid with our company. A military analogy would be to say that the frontline soldiers are the most important unit. They understand what’s happening in the battle and what matters most in terms of achieving an objective. They are the ones that deliver key feedback about where to place our resources, what our priorities should be, etc.

Angel Mehta: You’ve hired, trained, and managed hundreds of sales reps over the years. What do the great sales reps know that the average ones don’t?

Jay Fulcher: The great sales reps know that it’s absolutely imperative, actually a pre-requisite, that they be a ‘student of their customer’. The best sales people understand the customer situation and understand the customer’s business just as well as they understand our own. They’re able to connect the value proposition that our company brings very specifically to the client’s situation – right down to their earnings per share. We know that the value of our software can actually improve earnings for a customer – and the great sales executives know how to demonstrate that to customers.

Jay Fulcher is President and Chief Executive Officer of Agile Software. He has overall responsibility for company strategy, business development, and global operations. Prior to becoming CEO, Jay served as Agile's President and Chief Operating Officer, and was responsible for all global operations, including sales, marketing, product development, and customer care. During his tenure, Agile has been the fastest-growing PLM company in the industry, expanding the breadth of its solutions exponentially and increasing its customer base to over 11,000 customers across multiple industries. For interview feedback, contact Jay at jay.fulcher@agile.com

Angel Mehta is Managing Director of Sterling-Hoffman, a retained executive search firm focused on VP Sales, VP Marketing, and CEO searches for enterprise software companies and lead investor in http://www.softwaresalesjobs.com, the # 1 site for software sales jobs. Angel can be reached for feedback at amehta@sterlinghoffman.net

Click to email this article to a friend     Back


  Home | About | Recent Issue | Archives | Events | Jobs | Subscribe | Contact | Terms of Agreement
© 2006 The Sterling Report. All rights reserved.