Leading in a time of chaos with Alexei Miller

Hi Alexei. Hello Debbie, good morning. As I think I've mentioned to you, we love to get to know you as a human before we talk to you more as a techie, and I love hearing about the journey about how people got into tech. Some people born with it, others wake up and find themselves there. What about you? How did you get into tech? Neither born nor found myself very quickly. Took a while for sure. I think my path to tech can be best described as failed mathematician. And although mathematics and tech are very close to each other, they're actually quite different in terms of career path that you could choose. So in my case, mathematics growing up was easy, or I thought they were easy. The correct statement would be easy mathematics were easy, and then that was enough to get myself into a fairly good math school, arguably one of the best in Russia where I was growing up. And there I discovered that there's actually difficult mathematics, and that one was not easy. And so I was very good with easy stuff, I was decidedly less good with the more complicated stuff. And I was surrounded by people who are really, really, really good with all kinds of stuff. And I held my own, I stumbled along for about four years in a five-year math major program. And in my fourth year, I came to a second revelation which I frankly should have come to much sooner, which was there's no money in mathematics, or at least not in fundamental math or academic math that I was sort of on a gliding course to go to. And so in the fourth year of university, I was starting to go a little crazy and antsy. I certainly didn't want to be a weight over my parents' necks financially. And I said, well, it seems like computers are cool and people seem to be making money using computers, so why don't I do that? And I switched into computer science major, which wasn't very easy because I needed to catch up with a few years worth of studying. But in my fifth year, I finished my university with a computer science major. And in that fifth year, I met somehow through personal acquaintance a bunch of guys, best described as a bunch of guys who were looking to do something, no strategy, no significant purpose as far as I could tell at the time, who were looking for a programmer. And I foolishly said, oh, I'm a programmer, simply because I was just starting to study mathematics and then switched to computer science, so I was a pretty bad computer scientist, definitely very bad programmer. But I liked the guys and they seemed to like me, and we started Data Art, and the rest is sort of history. So I was mildly self-conscious when you said what I was before I was a tech. Arguably I never became a techie. I know enough about technology to pass an impression, but I am certainly surrounded by well over 5,000 much better techies in my own company than I am. And that's always the case, isn't it? To be a truly great leader, you want to surround yourself with people who do things better, faster, more efficiently than you do. And in tech, it's grown to expand just about everything now. I think people would be hard-pressed to find many professions that you wouldn't argue has some link into tech in that respect. For sure. And I think one of the things that I really appreciated about technology, software development or software technology in particular, is that it's everywhere and it provided at the time and it continues to provide seemingly endless opportunities. This sort of ties in my mind to the early days of Data Art company. We together started and continued to work in that. Those first years were not very nice, not very organized, they were full of failure, all kinds of failures. But software as a discipline, the internet that was just getting started back then, there was always something else to do. So you felt in one thing, this project didn't go anywhere, okay, there's another one, there's another idea of how that might lead to money and provide some living for us. So it's almost infinitely flexible. In mathematics terms, we call it fractal, which is like little portal and you open and there's a whole world out there, and you open one of the doors in that world and there's another world that looks just like the bigger one. So software world is like that in many respects. And so I appreciate not the beauty of technology itself. I care about it, but probably not as much as someone in my profession should. But I do care and I'm grateful for this world of software, world of software technology, the opportunities that it provides to not just myself but millions of people. And I do think, you know, when we look across great products, great companies, great services around tech, you need both of those sides. You do need some people who are just enamored with the beauty of tech in and of itself, but that's risky unless you have somebody what they're in love with is what tech can do, the utilitarian view. Those are great partnerships if you can find ways of blending those, which it sounds like you did at Data Art.

Thank you for that opportunity. Data Art helps clients, organizations of all kinds, create custom software systems, modernize their old technology with the purpose of making their businesses better. We are a service to those whose processes or ambitions are unique enough to require custom software tech. And we do it well, we do it at scale. We've been doing this for 25 plus years, and so we're able to tackle fairly significant projects for large and medium-sized organizations that depend on it for their competitive advantage, for their operational efficiency, and so forth. So that's our business, 100% service work for hire, if you will. Outsourcing is another term that is used to describe our business. That's us.

Oh, it's potentially a large, large topic. Where do we start? Look, I think in the modern Western capitalist business world broadly speaking, the term manager or leader have acquired over time this very thick layer of glamour that is not always well earned. I think this image that we often have of executives, managers, etc., as they know everything, they control everything, they tell everyone what to do, much of the time it's not true, and even when it is true, it's probably not very healthy. And so my philosophy, too fancy a word, but my approach to things is you need to provide some direction, you could call it leadership, but you know, we could use more modest terms here. You need to provide support, you need to help people organize, but you largely need to be in the assistant function. Sort of this servant leader, I think is the term that is used to describe this attitude. I don't have a fixed philosophy, I'm not going to say oh I read this book, it opened my eyes on this new New Age management philosophy. I just think that when you operate at some scale, you have to be honest with yourself. Vast, vast majority of work in your company is done not only obviously by other people but also outside of your direct control and sometimes or often knowledge. And so your job as a manager or in this case a builder is to build a system where it is possible, where you have the processes, the data, the financial resources, the people in the right places, motivation system, the ideology even though that's a loaded term, that the system can work, the system knows its purpose, and also individual groups within that system have the freedom to make their own decisions. So I don't know if I'm a builder per se. I'm a lot more comfortable with simpler terms: player-coach or something like that. I know with interest that in American sports we have coaches, in English football for example you've got managers. And to me that's interesting because a manager here in the US is financial type, and the coach is sort of the substance, the playing, and all of that. And in the UK, manager is who manages the team, but you can't really manage the team that's already playing. You can yell from the sidelines, you can huff and puff, you can go drive yourself crazy. There's relatively little you can do. Most of your management work is actually done when you're not able to manage, it's in preparation for this moments. And it's sort of similar. I see this, my approach to things is preparing myself and the team for when they need to act, which in business is just about all the time.

Well, I've learned that it's almost never, it almost never turns out the way you think it will turn out. And it's one of the more frustrating aspects of building a business or managing the business as it were, is that you put your energy and resources and investments into one place, and sometimes the results come from that place, and sometimes they come from somewhere else. You know, a business opportunity might arise in the business area where you haven't really invested at all. And the correlation between effort and reward is certainly not zero, but it's certainly not one-to-one. It's not as direct as a lot of people think. So your level, I learned, I guess, is that we're fooling ourselves. We think we control the future, we don't. We prepare ourselves for different options in the future. And so flexibility, adaptability, open-mindedness are essential attributes of the business, on par if not more with the obvious essentials such as money and proper staff and training and physical resources and all of that. But those things are hard to describe. You know, is your organization flexible? Who knows? Depends on who is asking and when and in what circumstances. So building a business to prepare for some unknown version of the future is exciting, scary, irritating all at the same time. And that it's okay that you don't know what's going to happen is, sort of personally in terms of my personal growth as a business person, is probably one of the more significant, more fundamental learnings. And then of course there are more operational learnings. You know, there's like much like in the season, you know, there are flowers that bloom in the summer and flowers that bloom in the spring, and maybe there's even something that grows in the winter, I don't know. Similarly, you need different things in your organization as you grow and change and as the world around you changes as well. You add maturity, you have to think about unpleasant but necessary things like cyber security, especially at the day and age we live in. And so there were several stages in our organizational growth and development that we have come through. Happy to discuss them, and we will continue to have to change.

Probably multiple ways to slice it, but you know, three stages or phases come to mind, each with their own challenges and rewards, to be honest. Naturally, the startup stage was marked by ultimate freedom and ultimate uncertainty. Those things always go hand in hand. We as a company were always self-funded. We never had an external bunch of money financing our operations and therefore directing where we should go. That changed now; we have professional and very, very good private equity investors, for which we're grateful. But for the first 20 plus years, we were essentially self-funded, and so that inspired a certain conservative approach to hiring, investments, etc. But in the first few years, it was very few people, very little money, very few clients, and ultimate freedom. You could say whatever you wanted, you could do whatever you wanted, you could trust your people or you could not trust, there was no system. And there's a lot of good in that, I think, in terms of the level of creativity that it inspires in all of us individually. It's actually a very good phase, but it doesn't scale very well. And so the next stage, the growth and development and hardening of becoming an actual company. And by the way, I think at Data Art, the startup phase lasted probably longer than normal, or longer than it should have. I think maybe five, seven, ten years or something like that. It certainly wasn't quick. We held on, for better or worse, to some of the wilder aspects of being a startup when there were already many hundreds of employees working in the company. We sometimes paid the price for it, but that's for a separate conversation. And then this next phase is when you develop some processes, you define what it takes to be scalable, you come to grips with the notion you no longer control much of anything. You influence events, but you certainly don't define how exactly they will happen. When you employ first hundreds and then thousands of people, you start to be a lot more prudent with organizational controls: legal, HR, finance, compliance, cyber security, which I just mentioned, all of those necessary things. And you prepare yourself to do big things. We're in a service business, and small project means small dollars, large project means large dollars. That's very simple. And large projects are complicated. There's a lot of companies out there that can write a $10,000 check, that's easy for a company. Not many individuals maybe, but there's no company in the world, no matter how large, that writes a $10 million check easily. They always struggle with it, they always expect a lot, they always watch it like hawks, and so on. So there's this certain level at which you have to operate in order for big check people to trust you with their big checks. And so this is the phase when you get there. And then the third phase, which we are arguably in today, which is state of maturity, is both very promising and very dangerous. And this is where I think it's important not to lose sight. We have many of those things, we are able to execute large projects for some of the world's leading corporations, we are trusted with a lot of business opportunities. All of that is great, and we have a system that can serve them. So that's the good part of it, and it can be run as a fairly profitable business. The danger part of it is complacency. The world around us changes so fast. Technology, which is our tools, how we do these things, changes every nanosecond. So to borrow someone's smart phrase, what got you here won't get you there, and it's true every single day. And so we can't say, ah, we have arrived, we have all those things. We've got to keep changing and keep being prepared for more change in the future. So I enjoy this current phase we're in, but I'm very paranoid that if I allow myself to get too relaxed, it will be the party will be over in a blink of an eye.

Very true. But crucial but also maybe kind of impossible because if you ask me what's next, what am I preparing for next year, the honest answer is I don't know. I am preparing the company and myself for that to be different from today, but I don't know exactly what it's going to be. And so to borrow your big boat analogy, yes, we are a big big boat, but maybe we could be more a little more like a flotilla of small boats, which a little bit easier to turn. Or some other, I'm not a sailor, so I'm if we go much further, trouble the sailors on the podcast.

I don't know if I know the secret to success, but I think it starts with honesty. And honesty contradicts a little bit with what is traditionally seen as part of leadership. As a leader, you're expected to provide your people with certainty: this is where we're going, this is how we're going to get there, this is what good that's going to happen to everyone once we get there. All nice and good, I totally for it, except 90% of the time those leaders have no idea that it's actually going to happen. They will have good ideas of where they want to go, all power to them or us, but are we sure? Can we be sure? And so I think the advice, I mean I'm not sure I'm in position to give advice, my learning is that you have to be transparent and honest with people around you about what you know, what you have doubts of. You have to invite them on the journey. You have to say, we, it's not you are following me, I don't like that position. We together, based on the information that is available to us, are on this journey. Yes, the management, the leadership makes a decision we're going there, you all invited. You will be making decisions independently of us. We will share responsibility for those decisions. We will not leave you high and dry because you've made a mistake. If we align on where we are going and what to do together, we will likely deal with problems together. There will be problems along the way, and changes and twists and turns and whatnot. So putting yourself in a position of doing things together with the company, with the rest of the people in the company, I think is super important. But you can't fake it. You have to be honest, including about things you're not sure about.

I think it also depends a great deal on the type of business you're in, and you've got to be honest about the business you're in. We're not in the business of colonizing Mars or changing humanity in a fundamental way. I have great admiration for companies and leaders that do. We're a service business. We help our clients get better, launch new products, get rid of inefficiency, glean insights into the oceans of data, all of those things that are accomplished with the help of technology. We're fortunate because it's a gigantic market and virtually every company out there needs what we do. That's a very, very good place to be. But we've got to be realistic. We don't exist with our clients. We don't tell every client what they should be doing. We understand what they need and we adjust and pick the way that gets them there in the most optimal fashion. If we allow ourselves for more than a second to run way ahead of our clients, we're likely to be in trouble. And so you've got to stay humble, got to stay realistic in this sense. And it's a great business to be, like I said, but it's also important to know your place, if you will, in the business world. One of the maybe less discussed aspects of a consulting business, whether that is accountants or software builders like ours or anything really, doctors or service business, teachers are in a way of service, is that we see a lot of clients, patients, students, construction projects, whatever it may be, and we aggregate the needs, the wants, the learnings, the constraints across so many clients, and we bring this collective knowledge to the needs of individual clients. So much like bees, they fly around the fields, they collect little pieces from those flowers, and they carry, they pollinate, they bring this pollen from one flower to the other. We collect a lot of knowledge pollen from a lot of clients and we bring it to the next flower, which is our next client. That's very powerful. So when I'm saying we don't exist with our clients, not trying to display like oh we're so miserable, we're totally servant here, not at all. We have a very powerful role in the business society. We should lean into this role of a connector, of a collective learner, of a bee that brings collective pollen to the needs of the next client. But we should organize ourselves to be just that, and not necessarily a whole lot more. And so that's how I try to think about our business, our role in this, if you will.

So I think that there are several areas of human activity where the seemingly theoretical connects to very, very practical. One area that is exciting particularly for me is healthcare, health technology, health policy, and so on. And it was relatively recently, maybe foolishly so, I realized how mathematical, how statistical that field is. And in order for policy makers, large organizations, service providers to make positive change in people's health and well-being, it's really building those systems on the fundamental scientific, statistical, mathematical underpinning. We're doing some of that work for our clients at Data Art, but personally I think this will be a field for huge investments, from new drug development to psychological and social ways to influence human behavior to make healthier choices, to organize our healthcare system so it can be a lot more efficient, a lot less wasteful. I think it's a hugely interesting both personally and professionally field. There are technology developments obviously. I'm sure a lot of your guests here talk about AI and how that may or may not change society. We could talk about that. I think it's a powerful tool, but it's not something that I spend a whole lot of time worrying about as how that will change the world. The world will keep changing. AI as a set of tools will assist it in changing, but the brains of the world, such as they are, they lie elsewhere, and the needs of the world, they lie elsewhere. And so we invest a lot in AI and our clients look at this very, very attentively, but there has to be a purpose, and the purpose has to be clear. In our business, at least, to two very important groups of stakeholders. This is a slight digression from your actual question, but I think it's an important point to consider when we think about the future. When thinking about your business and your business future, you can never lose sight of the purpose. And in our business, it's who pays you, who's your client, and who uses technology that you put together. We create software systems, very simple as that. If no one's using them, it's a failure, even if we got paid for it. If people love it but no one paid me or us for it, it's also a failure because I have a business to run. So those two groups of stakeholders, the payers and the users, hugely, hugely important. And so what they want, how does a particular piece of technology, whether it's AI or something else, impact their experience with the tech, opens new possibility for them, we must never lose sight of that. And one of the luxuries of not being a startup is we can afford to take a somewhat longer view on this. We don't have to look at our next investor as the client. They're an enabler, they're a funder of our operations, but they're not the client. They will not be paying me for software products, they will not be using software products. Therefore I don't create the business for them. And a lot of early stage tech companies build their companies to sell it to investor. I think it may be necessary but ultimately somewhat misguided.

So interesting question. Because one, I've always been a political junkie, and I think it's not helpful, it's not good for me. It's one of those bad habits. I want to, some people drink and smoke, I read political news. I think it's equally bad for my health as if I was smoking. So I do it, I don't enjoy it anymore. I've enjoyed it for years, I'm trying to kick that habit. And so my next area of interest is what I mentioned a little bit earlier around health, wellness, health policy, health technology. I just think it has huge, huge implications to how the world will be organized. So little by little, I start to read. I used to go to Washington Post or Bloomberg or New York Times or Wall Street Journal, all of which I subscribe to and read not fully but regularly, and I would gravitate to sections about politics. Now I try to skip that and I go to business, especially healthcare business, and then health and well-being, not so much for personal needs but out of my interest in how that will impact society. So hopefully in the near future I'll find some books and podcasts, and next time we speak, brag about some of the podcasts I'm listening on this subject. Not quite yet. I can tell you a bunch of articles and podcasts I listen to about politics, but I really want to stop, so I will not talk about that. That's making the addict go back to the scene of the crime.

Thank you so much, Debbie.