Ep. 33 Dan Saks, host of Decoding Digital at AppDirect

Decoding Business Endurance: Secrets for Long-Term Digital Success


24 min

Ep. 33 Dan Saks, host of Decoding Digital at AppDirect

24 min

Over the course of one year, host Dan Saks has decoded 32 different ideas with 32 different guests. In this episode, Dan shares what he's learned from the amazing leaders he's spoken with during the first season of "Decoding Digital." Hear highlights about engagement, trust, driving change, and how businesses—and the people who lead them—can succeed in the long run.

Read transcript

"Today, there are all these factors, internal and external, that are causing a ton of stress, pain, and urgency on not just the founders or CEOs, but on anyone within the organization. What's super important… is to develop this muscle for endurance." —Dan Saks

Quick takes on...

The Problem with Complexity

“Steve Jobs said ‘simplicity is the ultimate sophistication.’ Especially in B2B business and digital enterprises today, it's so easy to add scope creep and to talk about all the features and the underlying capabilities and to drive a lot of complexity, not only into your marketing message, but into the way you operate. It's super, super difficult to break things down and make them simple and intuitive.”

Building Trust

“It takes a long time to build trust, but only seconds to degrade that trust. In the digital world, building trust is much more difficult, because you don't necessarily always have the human-to-human interaction and experience… having faces, and names, and experiences behind your brand is super powerful.”

Living Your Values

“Instead of just being words on a wall, the values can become the way that you hire, the way that you promote, the reason why you let people go... Integrating your values into the fabric of who you are is going to ultimately differentiate values-based cultures from those who aren't and enable you to endure and scale seamlessly in this digital economy.”

Meet your guest, Dan Saks

Host, “Decoding Digital”; Co-founder and co-CEO, AppDirect

Hosted by Dan Saks

Dan has always been an entrepreneur. The son of small business owners, he caught the business-building bug when he was still a kid and started a lemonade stand. As a teenager, he launched a tour company to show visitors the sights of Niagara Falls. Since then, he has gone on to co-found AppDirect and help build it into a global business with a billion-dollar valuation.

Dan is a life-long learner and is constantly looking to discover and share ideas about new things. He is honored to have the chance to learn from some of the smartest people in business and technology, and share his conversations with the “Decoding Digital” audience.

Listen to the next episode

Ep. 34 Home S2 Ep34 Joe Lonsdale

Decoding Diverse Networks: Joe Lonsdale on Building an Enduring Team

Building enduring teams in a remote world

46 min

How did our guest Joe Lonsdale go from high school chess champion to super successful VC? His diverse network and a wide variety of interests to start. Joe has been a part of founding more than a dozen mission-driven companies, including Palantir, Addepar, OpenGov, Affinity, Epirus, Resilience Bio, and 8VC. In today’s episode, Joe talks about how he’s been able to build such strong teams over the years and why even in a remote world, human connection is key to building a strong foundation.

Episode transcript

[0:00] [background music] Dan Saks: [0:05]…

[0:00] [background music]

Dan Saks: [0:05] Just over a year ago, we launched the "Decoding Digital" podcast. It felt like a big achievement at the time, but I'm even more proud of what we've accomplished since then.

[0:15] Over the last year, we've released 33 episodes that have featured 33 amazing guests. Each of these individuals have shared valuable ideas about how to succeed in the digital world. To mark our season finale of Decoding Digital, we wanted to take the time to highlight some of the best insights from the podcast so far.

[0:34] To help do that, I've invited Renee Bergeron, our GM of AppSmart, to join me on today's episode. Renee has been a thought leader in the technology industry for more than 25 years, and we're lucky enough to have her as the GM of our AppSmart business.

Dan: [0:57] Renee, thank you so much for joining and being here.

Renee Bergeron: [1:00] Wow, thank you for that introduction, Dan. Congratulations on an amazing first season of Decoding Digital. I'm super excited to be here and to take a deep dive into some of the big ideas from the past year.

[1:17] It's fun that I get a chance to turn the table a little bit on you and to get more insights from you. Before we jump in, I'm curious. I want to talk about something that came up again and again in your conversation on the podcast, and that's the idea of the digital hero.

[1:36] By the way, I love how you've coined the terminology of the digital hero. What is a digital hero, and why are they such an important part of Decoding Digital?

Dan: [1:49] We've defined a digital hero as an innovator that takes the leap to make transformational change. The key behind any digital transformation is an individual that has a certain set of characteristics, including vision, tenacity, curiosity, and passion that drives a digital transformation within the organization.

[2:13] A lot of the impetus for Decoding Digital was to hear from these digital heroes. Not only hear about their transformation, challenges, and lessons learned but also hear about their personal journey.

[2:25] What we've found is that most digital heroes have to transform themselves personally, really learn and develop, in order to transform their business, and ultimately drive success. The other thing that I'm particularly inspired by is that digital heroes don't need to be CEOs, founders, or entrepreneurs.

[2:44] Digital heroes can exist anywhere within the organization. Digital heroes come from diverse backgrounds and experiences. Some of them can be first time people in business that came up with a vision have that tenacity. Others could be people who have been in an industry for many years. They could be at any level of an organization.

[3:03] What's so powerful about this concept is it doesn't rely or rest just on experience or just on a title. It rests on the characteristics of the individual. We think that those characteristics can be trained.

[3:18] A lot of the research that we do at AppDirect, in partnership with other academics and experts, is trying to uncover these characteristics, quantitatively and qualitatively evaluate them.

[3:31] Also, figure out how these characteristics can be trained in upcoming digital heroes, so leaders across industries can breed the next generation of digital heroes that can drive successful digital transformations across any industry.

Renee: [3:48] That's fascinating. One thing that's been interesting to me is how so many of your guests have talked about long term vision. In a society of immediate gratification, a key part of that long term vision is enduring for the long term.

[4:09] [background music]

[4:09] [beginning of a pre recorded audio]

Renee: [4:10] Eric Ries, who wrote "The Lean Startup," had a lot of thoughts on this topic.

Eric Ries: [4:18] Many of the problems that afflict our society today have as their root cause infection of short term thinking that has seeped into the incentive structure of all of our major institutions.

[4:30] When we make long term investments, when we pride our fields long before we try to sow them, when we're good stewards of the resources that we've been given, we actually outperform, from a financial point of view.

[4:43] [end of a pre recorded audio]

Renee: [4:43] Dan, this is interesting because it is so relevant to you as co founder and co CEO of a now very successful startup. What have you learned about business endurance?

Dan: [4:57] When it comes to starting a business, there's going to be a lot of challenge that you face, some expected, some unexpected.

[5:03] What's core to succeeding at your vision is this concept of endurance and the ability to know that there's going to be things that come at and you that are going to challenge your plan and your strategy. Having the agility to persevere is super critical.

[5:19] When we think about digital heroes, the characteristic of perseverance and tenacity is so important to enable your business to have the muscle for endurance to be able to persevere through the challenges ahead.

[5:35] When navigating a business, you have certain external factors that can be challenging. Team members come and go. There's a problem with your product. There's an escalation. There's a crisis. A customer defects. You have a challenge with your platform. Maybe there's a security issue.

[5:51] All of these elements are things that can cause you to scramble and can be very challenging for any leader and ultimately, can tend to have the potential to demotivate someone or cause burnout.

[6:04] Not only are there these internal factors that can somewhat be in your control, but there's also external factors. Macro things like COVID, competition, or a financial crisis.

[6:16] Today, in business, more than ever, there are all these factors, internal and external, that are causing a ton of stress, pain, and urgency on not just the founders or CEOs, but on anyone within the organization. What's super important in order to enable your company to persevere in the long run, is to develop this muscle for endurance.

[6:38] One of the ways that we believe you can do that is directly based on the feedback that we heard from Eric Ries, which is this concept of aligning a long term vision that everyone can rally around.

[6:49] Defining that, and reinforcing that, and making sure that every decision you make as a business, your team members have the context of how that connects to your ability to achieve that long term vision.

[7:02] When you do that, everyone can align and persevere through challenges because they know it's part of something much bigger. Their individual contributions, the short term challenges, or the immediate pain serves a greater purpose.

[7:18] That sense of purpose allows individuals but also your entire business to come together, and endure to make sure that you have the best chance at continuing to achieve that long term vision.

Renee: [7:32] It's interesting because you talk about agility, you talk about endurance, and there's a common theme behind that. It's a big theme across Decoding Digital, and that is this theme of change. Change is rarely easy, and we all know this to be true from our experience.

[7:53] [background music]

Renee: [7:53] René Obermann, former CEO of Deutsche Telekom, talked about this at length.

[7:58] [beginning of a pre recorded audio]

René Obermann: [8:02] It's very hard to establish firms to drive the transformation, innovation process, [inaudible] disrupt yourself, but you got to be ready for it. If you don't, somebody else will, and you're [inaudible]

[8:12] [end of a pre recorded audio]

Renee: [8:12] Dan, everyone talks about digital transformation. I'd love to understand what you've learned about effectively driving digital transformation.

Dan: [8:29] When it comes to digital transformation, many people have different definitions, but I like to simplify it into two questions. What products do you want to sell, and what channels do you want to sell them through?

[8:40] If you have a good sense of what that is, that helps you build a digital transformation roadmap that's reimagined based on an ideal customer journey.

[8:51] What I've found is that a lot of people, when thinking about a digital transformation. They think about, how can we move services to the cloud, or how can we be digital first, or how can we be remote first? If you're replicating old processes and systems, it's not giving you the full power of a digitally transformed organization.

[9:11] If you do think from the ground up, though, "What do my customers want and what products and solutions can I service up to them?" what you tend to realize is in the world today, it's not just about selling one thing. It's typically about selling a solution or solving a set of problems.

[9:29] When you think about your go to market, in the past, a business maybe could have had a retail store where they can open up on Main Street and sell skateboards, and that's what they do. They sell skateboards in a store.

[9:40] Today, that wouldn't work. There's a recognition that customers want to buy what they want from who they want when they want. Therefore, there needs to be many channels or options in an omnichannel way.

[9:54] Some might want to buy through online, and then have it shipped. Others might want to have a digital experience for subscription products. Some might want to buy through telesales or through a partner.

[10:03] Reimagining your go to market and the way customers interact with you is super critical in thinking about, what's your core right to play? In that skateboard retail example, the future digitally transformed skateboard company might be a lifestyle company around people who love boarding or skateboarding.

[10:24] It might include digital demand gen and inside marketing around cool tips and tricks, and it could have a social media presence with a community. When businesses think about digital transformation, start with that customer journey, the brand you want to build, and the solutions you can provide.

[10:43] That leads you to defining two simple answers to these questions, which is, what products do you want to sell, and what channels do you want to sell them through in order to satisfy and delight your customers?

Renee: [10:55] These are great tips, Dan, and super helpful, because there's still a lot of businesses that have fears when it comes to digital transformation. That may stem from the fact that people have a misconception that technology is overly complex. It's the companies that make technology simple that usually succeed.

[11:19] [background music]

Renee: [11:20] I've had the pleasure of meeting Aaron Levie, CEO of Box, a few years ago. He was also your guest recently on Decoding Digital, where he talked about the importance of not overcomplicating things.

[11:35] [beginning of a pre recorded audio]

Aaron Levie: [11:39] The reality is the only way that I know, at least to build simple software, is to be hyper focused, say no to more things than you say yes to, and then hold the line when you start to see that you're losing that focus or that simplicity.

[11:52] [end of a pre recorded audio]

Renee: [11:56] Dan, this is another area where your experience leading what is now a unicorn platform business is super relevant. How do you encourage teams to prioritize keeping things simple?

Dan: [12:12] Oftentimes, back to something that Steve Jobs said, which is that simplicity is the ultimate sophistication. Especially in B2B business and digital enterprises today, it's so easy to add scope creep and to talk about all the features and the underlying capabilities and to drive a lot of complexity, not only into your marketing message, but into the way you operate.

[12:37] It's super, super difficult to break things down and make them simple and make them intuitive. The best way to do that is through a lot of hard work and iteration.

[12:48] The other things that we've found is if you can break people down into small teams and enable them with clear ownership and autonomy to make decisions, it speeds up the ability to make decisions and makes your business much more simple.

[13:01] You also have to obsess over the right things. Oftentimes, it's unclear the direction you should focus and pull your company in. I know Jeff Bezos with Amazon is focused around being obsessive over the customer. There are other companies that are obsessed over other things.

[13:17] What I do think is guiding your team toward clarity and focus is super important. One thing that I've learned, probably the hard way, is that you definitely have to think about not only what you're going to do, but what you're not going to do, and more importantly, how you're going to do things.

[13:35] Building in a muscle in your organization of focus and the ability to say no to things is super important. In order to truly achieve scale, you need something that has a huge total addressable market and scales elegantly and simply, but that's very hard to achieve.

[13:53] That brings me back to Eric Ries' talk around finding product market fit using lean startup methodology. When you do find that fit with the right addressable market, you can scale infinitely and ultimately drive huge success.

Renee: [14:10] Simplicity is not simple, but it is critical. Here's an interesting thought. As our digital world grows, it's not simplifying, it's becoming more complex. In such an environment, it's fair to say that collaboration is more important than ever.

[14:30] [background music]

Renee: [14:30] Dr. Don Sheppard, director of the MI4 Initiative at McGill University, talked about bringing scientists and business leaders together to fight diseases.

[14:42] [beginning of a pre recorded audio]

Dr. Don Sheppard: [14:46] By leveraging the energy, the frustration, and the pressures that were coming top down with the willingness and flexibility to go bottom up, that was the magic. That was the secret sauce.

[14:59] If you hadn't had this simultaneous public pressure to, "Oh my gosh, we need to fix the fact that we're not testing," with a bunch of people that didn't know what the rules were supposed to be, that allowed people to meet in the middle and find ways to do things that were not the way they had been doing them before.

[15:20] [end of a pre recorded audio]

Renee: [15:20] I have to tell you, I took personal pride in that podcast with McGill University as my alma mater. I know you did, too, Dan, given your role on the McGill Principal's International Advisory Board. Building on from Dr. Sheppard's insight, what are some ways organizations can collaborate better?

Dan: [15:45] It comes back to people, processes, and products. If you have those elements right, it enables people to collaborate seamlessly and effectively, and there are many tools that have evolved in order to enable that.

[15:59] At AppDirect, we use objectives and key results, or the OKR model. We also track and calibrate teams on KPIs, or key performance indicators. Looking, as a senior leadership team and as an organization, around how to re architect and redefine your operating norms on a recurring basis is so important.

[16:20] The other thing that I found is that gauging NPS of your team through team engagement scores with tools like Culture Amp and asking your customers as well for feedback on your engagement gives you a good sense of where the collaboration gaps are.

[16:38] I do think that for a company to have strong engagement with the team and with customers, you always need to get a pulse on where the challenges are in collaboration. There's always going to be challenges.

[16:50] Having real live data and dashboards to figure out when there is a challenge, and then how to unblock that challenge is super important in enabling a collaborative culture.

Renee: [17:03] It's interesting, because you talked about engagement. The reality is engagement is about creating a connection, whether it's internally with employees or externally with customers.

[17:19] I believe the basis of connection in the digital age is trust, which can be something that's difficult to create online. How does one establish digital trust?

[17:32] [background music]

Renee: [17:33] Clara Shih, co founder of Hearsay Systems, had Insights on this challenge.

[17:39] [beginning of a pre recorded audio]

Clara Shih: [17:43] Every interaction that we have with someone or with a brand, it generally either increases our estimation of them and either depends the relationship, or it pulls us away or pushes us way. You can think about each touchpoint as a deposit in a reservoir of trust and relationship.

[18:01] [end of a pre recorded audio]

Renee: [18:05] Dan, what do you see as the most important factors to build trust in the digital economy?

Dan: [18:14] It takes a long time to build trust, but only seconds to degrade that trust. In the digital world, building trust is much more difficult, because you don't necessarily always have the human to human interaction and experience.

[18:29] I do think envisioning a business, even if it's digital first, that does respect that human to human interaction and having faces, and names, and experiences behind your brand is super powerful.

[18:41] Companies that have done this effectively include Salesforce, where Clara is now an executive running one of their business units. They put their heroes in front by telling the experiences of their champions that have implemented Salesforce using their pictures and names and enabling others to realize that they can be like that person.

[19:04] When it comes to trusting an organization, every experience of interacting with that brand helps to touch on either to add to the trust or take away from that trust.

[19:15] Making sure that you're at the forefront and you have real time data and dashboards and looking at when there's a potential incident, whether that's the way you react to a security incident, whether that's the way you react to a customer experience or a customer service inquiry, whether that's your ability to be proactive when there's something that goes wrong in the system, and using that as a teaching moment to reach out to the customer.

[19:39] One of the interesting things that we've learned is sometimes, the incidents that could create the biggest breaches of trust are the opportunities to create the most trust through acting in a transparent way and treating your customer as you would want to be treated.

[19:56] Having processes and systems in place so when things go wrong, your team can act with the level of integrity and transparency that your customers seek is one of those ways of not only ensuring that you can build trust over the long term, but you can regain or maintain that trust when something goes wrong.

Renee: [20:18] It's often how you handle the problem and difficult situation that you show your true value and you build that trust.

[20:30] Dan, I've had the privilege of working with you for the past 18 months. I know that building a values based culture is one of your passions, which puts you in good company with other leaders, like Hélène Barnekow, CEO of Microsoft, Sweden.

[20:49] [background music]

[20:49] [beginning of a pre recorded audio]

Hélène Barnekow: [20:53] The first thing is that you have to look at yourself and your leadership team and say, "What do we stand for, and are we prepared to live accordingly?"

[21:01] [end of a pre recorded audio]

Renee: [21:04] One thing I've observed since joining AppDirect is how the company's values underpin everything, and that's a testament to your leadership, Dan. Why are values so important for companies? What's your advice for leaders who understand the importance and want to build a strong culture?

Dan: [21:26] We spoke about the importance of business endurance and long term vision. What I've found from a lot of research on companies that I admire most is that they have a vision that's defined for the long term that enables their team to focus and persevere through the challenges.

[21:43] Also, the companies that succeed and endure over the long term and have defined values that drive their culture to align their teams. In today's world, as we discussed, there's so many external and internal factors that can be challenging for an organization.

[22:02] The more, as a leader, you can align your organization on those shared values, the more the organization can endure. Part of that alignment is making those values the internal fabric of the way the company operates.

[22:17] Instead of them just being words on a wall, the values can become the way that you hire, the way that you promote, the reason why you let people go. It can be part of your performance evaluation perspective. It can be a part of your systems, your processes.

[22:32] Integrating your values into the fabric of who you are and how you endure and how you build trust is going to ultimately differentiate values based cultures from those who aren't and enable you to endure and scale seamlessly in this digital economy.

Renee: [22:49] That's so true, Dan. I've personally seen the importance of values being exhibited on a day to day basis. It starts with leaders.

[23:00] [background music]

Renee: [23:01] We often talk about how leaders become great. Jim McKelvey had a really interesting perspective on this.

[23:13] [beginning of a pre recorded audio]

Jim McKelvey: [23:14] What I want the world to understand is that all of us, if we're ready to do that little bit of innovation the two or three times in our life when it matters, the world's going to be a better place.

[23:24] [beginning of a pre recorded audio]

Renee: [23:27] How leaders become great is a tough question. From what you've learned, Dan, how do people become great leaders?

Dan: [23:38] People become great leaders by continuous learning, by challenging themselves, by being open to criticism, by stepping back and reflecting on what they do well and what they can do better.

[23:48] In today's society, what's so encouraging is that there's a plethora of information and content that can enable you to be a better leader. If you can seek out that content, if you can seek out those resources, if you can find mentors, it can enable you to be great and endure personally and professionally over the long run.

Renee: [24:09] Great insights from a great leader. Dan, congratulations on season one of Decoding Digital. I can't wait to see what the next year brings.

[24:20] [background music]

Dan: [24:25] To learn more about the findings from "The Digital Hero Mindset" report, visit decodingdigital.com/report.

[24:33] [background music]

Dan: [24:37] Thanks for listening to Decoding Digital. Make sure you never miss an episode by subscribing to the show in your favorite podcast player. To learn more, visit decodingdigital.com. Until next time.

[24:50] [music]