Tech Sales Insights LIVE featuring Scott McNealy, Curriki

Yeah, I'm getting up there in age and he's the first one to get married. So at his birthday party with all the family and in-laws around, I gave him an envelope with a condom with a tip cut off and two Viagra. So a very clear message: pull the goalie, buddy. Pull the goalie. Can't make it up.

Yeah, he's the factory-to-car network guru there.

Yeah, I'm kind of the chief funer and chairman of Meritus, and I'm the psych coach for the boy as he learns how to be a CEO. He's already better than me. I'm pretty amazed, actually.

Yeah, Maverick said, 'I need you, buddy.' He wants to go hunt down his first win with Scout on the bag. I think they can do it.

Yeah, this is my cow. We've got a Jack Valley Ranch, and we're going to be coming out with some designer beef and some lifestyle products around the JVR brand. So I'm now B2C. I've never done B2C, so this is my new deal. I'm gonna have a thousand cattle on 1800 acres and just living the dream, really.

Get some good pairing there.

I do, like it was yesterday.

I couldn't get into BC, so I went to Harvard.

Yeah, he's one of my great idols, maybe Jack Welch being another one, Ken Ashman. I had a chance to see a lot of really great CEOs. My first job was washing cars for a buck 75 an hour, and I also opened up the car dealership in the summers. I had to make sure that there was not one cigarette butt on property when Roger came into the office. I got this push sweeper out and I'd spend the first hour of the day pushing this sweeper and making sure Roger never found a cigarette butt. I'm proud to say.

I walked in on the first day of the board meeting and I'm wearing blue jeans and a dress shirt, and Jack Welch goes: 'Are you gonna go to the GE board meeting in blue jeans?' I said, 'Yeah, am I the first one?' He said, 'Well, yeah.' I go, 'Great,' and I walk away and he's shaking his head like he can't believe it. But walk in and there's Roger Penske, who's also on the board. So it's kind of a circle of life thing going from a buck 75 an hour to helping run General Electric. It was quite a fun moment.

That's a tough one. There's a lot of ex-CEOs trying to fix the education problem, and we're kind of on our fourth wave and effort and strategy with Curriki. My oldest son, you can donate through www.birdiesforeducation.com. Every time he gets a birdie, people are donating a dollar or $5 or $10 or whatever for every one of his birdies, and he's raised millions of dollars for the effort. We're trying to do a great job of investing that in better ways to do education.

It is, absolute kick. I can't help Maverick in golf anymore because at the age of 12 he thumped me. Dakota is doing deep R&D technology work in software, and I can't help him a lot. But Colt being a CEO, I can help him a lot. I can help Scout on caddying. I love caddying. The caddies are all sitting in the caddy room going, 'Boy, we went out, me and my guy, we got a birdie and a birdie and a birdie and a birdie, and then he doubled, and then we got another birdie, and then he doubled again.' So he's learning the caddy speak. 'We did great, he screwed up.' Exactly.

That's a good question. I didn't care much about my golf game at the time, so I'd go out and swing away and swing easy and have a good time with it. I got better as a CEO because my net worth, my personal self-respect, wasn't built on my golf game. As soon as I retired, my game went to heck and I was trying too hard. To this day I can't play like I did when I was CEO because now I'm supposed to play well.

Well, actually, I'm here to talk about sales and I was known as a pretty good sales guy, but I would love to do an hour-long podcast on my views on parenting and the responsibility that both parents have. If you're going to bring a child into this world, you ought to take full responsibility until they're out of the nest. We had some very tough rules on the boys. You're all going to play golf and hockey because I like those sports. I'm not going to watch you play soccer or stand around in right field playing baseball. I wanted to be part of that process, and I thought those were two good sports. They were very different: one's team, one's personal; one's physical, one's emotional. There are a lot of things the kids learned. They all slept in the same room. We had four beds lined up barrack style. No electronics were allowed in the room. They had set bedtimes. They ate the same food. They went to the same school. They played the same sports. They lived by the same rules. They slept in the same room. They had a little study that they all worked in. If you didn't eat dinner, we wrapped it up and that was breakfast. There was no negotiation. They had a wonderful loving tiger mom. We made sure that we were always on the same page. You couldn't divide and conquer the two of us. No electronics in the bedroom. We had one game machine that lasted about two weeks until somebody kicked a wire out of it and broke it; we never fixed it. We told them no games and no social until you were into college. We had their passwords on all their electronics. We didn't allow them to do sleepovers. We got them out of government schools because they weren't focused. We put them in a school called Challenger that most parents didn't want to put their kids in because the kids were so academic. I thought, 'Let's let them swim with the sharks, with the real aggressive learners.' That was well-spent energy and time. Finally, I had an advantage when the boys were two, four, six, and eight. I had been running Sun for decades and I'd been through it. I got married at a late age, 39. Susan and I just celebrated our 30th at the Little White Chapel in Las Vegas with Elvis, Dolly Parton, a couple of showgirls, and all my buddies and her buddies there. It was a blast. I got a chance to step down as CEO from the best job in the world because I didn't want to leave Susan with a two, four, six, and eight-year-old boys. I spent a lot more time at home. I didn't stop working, but I spent a lot more time at home rather than traveling around because I wanted to be there for my boys.

Andy's like one of the maybe the greatest commercial hardware engineer ever. Bill Joy was the best Unix and OS guy in his era, I think by far. Vinod was an IIT from India engineer and had been doing engineering workstations before. I was building tanks and had a golf major from Harvard. So it was pretty clear who was going to do what. Vinod ran the joint. Bill and Andy did the hardware and software. I did manufacturing. I built the racks. I ordered the parts. I gave them part numbers. I did my first ERP system on vi for those who know Unix. I was the sales guy, the original sales guy. I kind of did any and everything that I could. Eventually, two years into it, Vinod left and they asked me to take over temporarily. Unfortunately, that temporarily turned into decades. But it was quite a ride and a lot of fun.

Yeah, there was Autotrol, ComputerVision, Mentor Graphics, whatever. There were about four major CAD companies at the time, and Apollo had locked up three of them. They were about to get ComputerVision, the largest. If ComputerVision went to Apollo, Apollo would have had 95% of the market, and Sun is gone. There's nowhere to sell engineering workstations if 95% of the market is with your competitor. So we had to win it. We were doing everything we could to win it. We were sitting in Vinod's office at about 2:30, 3:00. The phone rings, Vinod picks it up. He's not a very light complexion guy, but he said, 'Yeah, yeah, yeah,' and then he went absolutely pale white. He hung up, and I said, 'What happened?' He said, 'That was ComputerVision. They called and they said thank you. Click.' We looked at each other and went, 'What do we do now?' So he said, 'Let's make a proposal.' We got the engineers in and we designed a new workstation with unbelievable statistics and capabilities, priced it at below cost, said we'd give them manufacturing rights which was unheard of in those days, said we would do joint this and joint manufacturing. We put everything we could think of that would make a difference in a proposal. Then we made seven FedEx packages. We had to get it done by 4:30 when the FedEx truck came. We FedExed to seven people that we knew inside ComputerVision this outlandish proposal. I think we even offered them stock options in the company. Vinod and an engineer got in an airplane, flew a redeye, went to the lobby, and sat in the lobby all morning. They were calling people saying, 'Did you get it?' Nobody would talk to them. Finally at lunchtime, somebody came down and said, 'Get out of here before people walk through the lobby. We got your proposal, we understand it. You're not going to do any good here. You got to get out of here.' So Vinod came home. About three days later on a Thursday, we got a phone call. They said, 'Meet us at Chicago O'Hare Saturday morning. Bring a printer and a contracts lawyer, and if we hear peep one about this, the deal's off.' So we flew out there, negotiated the deal, announced it Monday, and that was sort of the end of Apollo. The message there is deals are never lost, they're only postponed. You can never get arrogant and think you have the deal until you have it signed. It ain't signed till it's signed. You can change the course of history in some pretty interesting ways. I give Vinod huge credit for being the guy who said, 'We're just not going to lose this.' My reaction was, 'If we lost that deal, we lose everything anyway, so throw in the kitchen sink. Throw in source code, throw in manufacturing rights, throw in some equity. What do you have to lose? Nothing at that stage.' The Hail Mary did work in that case.

So here's the lost art today with the young kids who've been learning on a blue screen, self-paced, on-demand learning: sales is a contact sport. You've got to be there. You can't Zoom your way to B2B success. You might be able to do B2C success on the screen and Zooming and all the rest of it, but B2B, you better be there. You better take him to lunch. You don't have to buy a fancy lunch, but you got to be there. They got to see you. I went to Japan 15 times where I sat there. I remember sitting down with Toshiba's executive team the first time, and there's all the board, the CEO, and they just sat there and they grunted. They just looked at me, waiting to see if I was patient enough to let them talk first. Fortunately, I had good coaching and schooling, and I just sat there and politely bowed. After about 15 times and a bunch of dinners, I'll never forget when I got engaged to Susan, the CEO of Fujitsu said, 'What's new with you?' I said, 'Well, I just got engaged.' He leans back and goes, 'I understand you go from open systems to proprietary systems now.' The whole place cracked up. That's when I knew we were going to have a big relationship. When they're finally cracking jokes and having fun with you, you know you're going to have a great relationship. Fujitsu, I think, was our largest customer along with maybe AT&T and Kodak and a couple of others. You just got to go spend the time, accept the culture, accept the management and personalities of the people you're working with, and compliment them. You still got to be you, but you got to be very... they got to like you, they got to trust you to do these big deals.

Exactly, exactly. What Sun did aggressively was we had two tech support engineers for every sales rep. The sales rep could go make a call and drop off a tech support engineer and leave them there to help and do the work. Sales reps thought they were important, but our TSEs were far more important. In fact, our Unix capability in our tech support engineering was the second best Unix development team in the world behind our own development team. That's how you have to build a really great sales force. If I'm a sales rep, I would take care of the TSE. I would take them to lunch because you want them on your side and wanting to help your customers.

He was awesome.

It was just survival. I didn't want to be CEO. I never did. My dad was vice chairman of American Motors, president of AMF, and ran an ad agency, and I never saw him. I didn't want to do that with my boys. So I never wanted to be CEO. I always wanted to be number two. I talked Vinod into being CEO and we started the company, but two years later, all of a sudden I'm CEO. I handed the board a resignation letter the day I took over and said, 'Anytime you guys want me to step down, I will help you find a real leader.' There are a lot of stories about how that went, but I spent my whole time trying to develop my replacement. As a result, Carol Bartz, Eric Schmidt, Satya Nadella at Microsoft, Bill Coleman at BEA... we added it up and there were over 200 former Sun folks who became CEOs in tech and the valley and all the rest of it. I was successful in developing, but I never was smart enough to make them take over. Eventually, I just said, 'All right, I've had enough, it's time to step aside.' But that development was always to ask us to seek denial. We delegated, we architected, then distributed the responsibility. I spent a lot of time architecting the company and then telling people, 'You go get it done.' To ask us to seek denial was a really important part: 'Go do it and don't screw it up, and if you screw it up, come back, apologize, and then fix it, and everything will be fine. Don't you dare cheat.' We had a dress code: you must kick butt, have fun. It's your responsibility to stay skills current, not the company's. We had a lot of big rules to help us run the company. Joe Robach helped us in sales: 'Where there's a wallet, there's a way.' I would always say that no deals are ever lost, only postponed. The customer comes first. I also got trained well in sales by a lot of very senior sales guys. They looked at me and went, 'Look at this kid, he's not even shaving yet, and I got to take him in.' So they would kind of slap me around a little bit before we go in. What I learned first was you don't go in and talk. The first thing you do is say, 'Hey, how are we doing?' If they're a current customer, don't you dare try and sell something new. Say, 'How are we doing? Are we taking care of you? Is everything okay?' The last thing you want to do is step on the landmine without letting them explain to you where the landmines are. Then you say, 'All right, we're going to get those fixed.' The thing I would say always on the way out the door, and I probably did that to you more than once, I would say to the customer, 'Thanks for your time. I appreciate it. If Randy isn't getting it done, here's my phone number. You call me the second he's not getting what you need done.' The customer appreciated that, and the sales rep would go, 'Oh my god, I don't want them calling Scott.' So I kind of put them on notice, and it's your job to keep these guys happy. But making the customer talk first: if they weren't a customer, I would say, 'All right, who are your current suppliers and what are your big pain points?' I would make sure they talked. After they talked, I would go, 'Wow, that's exactly what I'm here to solve,' no matter what they said. It really made your sale. I don't know whether they believed it or not, but you could craft a story that would explain how what you're doing will help them with their pain points. That was the key to success. I think too many salespeople want to hear themselves talk.

I hired really great sales managers who didn't mind letting people go who didn't fit the culture. I think that's the hardest part. I know with Colt, he's sort of like me. My biggest fault was always at the board when they would do my reviews: 'You don't fire the people you come in and complain about.' I had a hard time if I hired somebody because I liked them. That's a key component. I think that's why almost everybody, 99.9% of the people who are former Sun, said that was the best place they've ever worked. We all got along. We were good people, nice people, hardworking, all the rest of it. But sometimes people are misplaced or we mishired. Good sales managers will let the people who aren't getting it done go and not think about it. Joe Robach, Darl Barb... all these guys who helped build our company, they said sometimes I made a mistake, and they would address them quickly. I think that's important for sales management. Some people aren't cut out for sales. Some people just don't have the neck, the constitution to take no and respond from it. Some people take no and crumple. Other people should take no and go, 'Watch this, hold my beer.' You got to get the right crew in there.

You're not your kids' friend, you're their parent. Too many parents want to have sleepovers, go water skiing with their kid, do all these other things, or let them play their sport of choice. If the boys didn't want to play golf, when we went to the driving range, one would whine, 'I want to play.' I said, 'We sit in the car, no problem. Then we get ice cream and go hit golf balls at the ball picker upper.' Everybody would laugh and have fun, and the kid would come out and play. 'I don't want to play hockey. I want to quit.' 'All right, go in and tell your coach.' 'I'm not telling him.' You've got to be their parent, not their friend. If you do that, they'll be your best friend for life when they're out on their own. I hear from all four boys every day. There's nothing that makes a life more fulfilling than having your kids call you every day to tell you what's going on, ask you a question, ask for advice, brag about something, or complain about something. There's nothing better. I don't understand the new generation not wanting to have kids. I wish I had 12 kids. My role model was Fred Smith, who never missed dinner and built FedEx in the world. He's more impressive to me than Elon Musk, who's at least having the kids. I'm not saying he's not a great dad, but Fred Smith is a super dad while still doing unbelievable things. It can be done. Jack Welch taught me that. It's good in parenting too: deal with things as they are, not as you wish they were, and deal with them quickly. Once you've established reality, step in, do it, and be consistent with that. By the way, my boys didn't want me to be home all the time. They wanted to see me working. They need a role model, not somebody who's tailgating and watching sports all the time. They want to see somebody who's actually trying to move the capitalist ball forward.

We'd have times when things would break, and we'd get in there, you'd come out. Most CEOs and leaders would kind of run away; you'd jump in the fire. There's no problem you can't overcome. In the early days, when I took over two years to the day, we had $2 million in sales and we were losing half a million a month. I went out to the factory floor and every third workstation had a red hat on it, meaning it was broken and failed diagnostics. We would ship the workstations to the customer, and within 10 seconds, about 25% of them, the monitor would just go off like a flashbulb and die. Some phosphor would break off the screen during shipment and go back to the high voltage arc the MOSFET transistor. I remember all of this to this day. The screen would go dead, so it looked like the computer died. We couldn't stop shipping because they would go to Apollo, so we kept shipping them. We said, 'All right, let's send a whole bunch of extra monitors to the sales office.' When the customer would call, the sales rep would be there within minutes with seven extra monitors to turn them on. The guy would go, 'IBM doesn't have this kind of service.' We were able to turn lemons into lemonade in a very powerful way, even though we had an engineering problem. Sometimes you have to spend the money, but we totally solidified customers. You should almost do that on purpose: have your stuff blow up and then go in and fix it right away. 'Look at the service on these guys.' I'm not recommending that.

Nobody believes that, but if you go find my Cranbrook High School yearbook, it says, 'Scott, shy and unassuming. One of my wealth of friends.' I was. I didn't want to get embarrassed, and I just didn't want to get called out. I just wanted to sneak through life doing my thing. All of a sudden I became CEO, and I gave the first annual shareholders' meeting speech. John Doerr was in the back row as one of our board members and major investors. I put up slide one and I turned my back to the audience and read the first slide. Then I clicked and I read the second. I never turned around and even looked at the audience. I went click, click, click, click, click, and said, 'Any questions? Please. No questions.' At the end of it, John Doerr hauls me aside and says, 'I'm sending you to New York for a three-day speech therapy class. You're going to learn how to give public speaking.' He sent me out there. I mean, Stanford MBA, I was not a good public speaker. That's just ridiculous. They taught me nothing about sales. Absolutely ridiculous. That taught me that I'm just going to have to be an extrovert. If I'm going to be on stage... I remember the first two, three years I gave speeches, I would have to wear a jacket because I was sweating under my arms. Nervous about speeches. I would be nervous the night before. Pretty soon after a while I got into it where the only thing I'd prepare for was my top 10 list: top 10 reasons Bill Gates is a monopolist, or top 10 signs you're a GE executive. I would always come up with something and have the place laughing and being a wise guy, then I'd tell my stories. I learned to have slides that had one word or just a picture, and I'd tell stories. I was a storyteller up there. I learned to walk into a customer, look him in the eye, shake their hand, and forget their name immediately. I still do that. I learned if I'm going to represent... we had 235,000 employees roll through Sun Microsystems. If I was going to represent them, I couldn't be a hermit. We couldn't advertise. We couldn't out-advertise IBM, DEC, HP, Intel, Microsoft, all these other companies. I had to get the press. I had to be a quote machine. I would be a quote machine for 'Beavis and Butt-head' and 'big hat, no cattle' and all those other things. I used to be 'big hat, no cattle.' Now I'm 'big hat, lots of cattle' with the ranch I just bought. But I digress. I learned to use the power of the press. I would say to the reporter after every talk, 'I gave you a lot of good content. Treat me right, treat me fairly, and I'll give you more.' Even still, they always used the word for me... 'the outrageous,' 'controversial,' whatever. They would always have some adjective about me. 'Brash' was the one. 'Scott the brash CEO of Sun.' I'm not brash. If you come to dinner with me, I'll be kind of quiet. But I learned that I had to have a persona that cut through. We didn't have the advertising dollar, so I got a lot of free advertising, lots of free PR.

Yeah, this is the sales persona. I learned, one of my first jobs before I even went back to business school, I sold plastic for Rockwell International. So I knew what it was like and how hard it could be. We wanted to reward the sales guys, we wanted to motivate them. Sales club was a thing; this was an '80s thing. It's too bad it's gone because there was nothing harmful about it, nothing toxic, nothing exclusionary. But it was outrageous and people drank. Anyway, we rented the Marriott Desert Springs one year. We rented the whole thing. There were about 3,000 rooms. Sales reps were allowed to bring their significant other. I brought my mom most of the time because I was single through all those years. Joe Robach would have a theatrical play, and he always had to be the center of attention. People loved it and laughed about it. They would do things, have fun. I tended to stay away because I wanted to have fun and I didn't want them to think the boss was watching. They were there with their significant others. I was checking out after three days. I could see the light flashing on the checkout screen of the gal, and she goes, 'Are you Scott McNealy from Sun Microsystems?' I go, 'Yeah, yeah, yeah.' She goes, 'Don't move,' and she ran and got her manager. She came around, got toe-to-toe, and she goes, 'He's Scott McNealy.' So the manager wasn't gonna thank me for my business. She said, 'I don't ever want your company back at my hotel again.' That's when I knew we were gonna make our numbers the next year. I tried not to laugh. I said, 'Well, what seems to be the problem?' I'm trying to be serious. She says, 'Well, your place was out of control. Everybody was drunk, they were up all night, they were loud and screaming. We had a couple other guests who weren't yours, and they were all complaining about the noise. Then you gave out all those neon necklaces and bras; they're all up in the trees. It looks like Christmas everywhere, it's littered everywhere. It's just amazing. Then you had that... what was it called? The Knights and the King Arthur dinner. She said, 'There were at least 45 Cornish game hens in the air at any single moment. There was this absolute food fight.' I'm just going, 'I wish I'd been there.' She said, 'What the final straw that broke the camel's back was when your team pushed the live camel into the pool.' At that point, I'm really sorry, we won't come back. But let me tell you, our sales meetings were absolutely epic. The spouses and significant others would, on the flight home, say, 'Don't you come back into the house until you've qualified for club the next year.' That's one of the reasons the team was so motivated and focused and worked so hard to make our numbers. They wanted to go to club. Plus they had a lot of other people that they knew. I made it very explicit: 'You guys don't sell, we're laying off people in this company.' I would also go to the chip team and say, 'You don't get this chip on time, we're going to have to lay people off.' I wasn't that direct with it, but I explained that a lot of your friends and compatriots are farewell.

Absolutely. It doesn't happen automatically. Yet at the same time, you have to put constraints on. You got to tell them, 'You sell what's on the price list, and if you're going to move off the price list, you better get management to agree to do that. You can offer service and time, but don't make the company do something it wasn't designed to do unless...' It was always a balance. Joe Robach was famous in the budgeting process for yelling, 'All right, if you're not going to do this, close Chicago. Just shut it down. No reason to have Chicago.' So that became a fun tagline during budgeting time: 'Just close Chicago.' I did have Java hacked out of the budget while James Gosling was developing it at least four times. My COO had cut it out of the budget, and I had to go back and put it back in. It is sort of the boss's problems. I made the mistakes and I made the good decisions both, and I had to take responsibility. I don't want to go into all the mistakes I made, but there were a lot. In retrospect, it's really amazing how screwed up I was, but we did better than most.

Maybe I'll tell you the best thing we ever did for our sales team, and people can go back and search all the... there were no scandals, there were no issues of ethics at Sun. That's the thing I'm most proud of. We were a good company. We shared our technologies, we shared in the success of the company enormously. It's why I'm a rancher instead of building a prepper thing in Hawaii right now. I didn't care to win the dollar race. I cared to win happy customers, fulfilled employees, and doing it in an ethical way. I sort of wish a lot more of the leaders in all aspects and all institutions of America would take a stronger focus on that. I think we've lost the commonality of purpose and the commitment to the rule of law and ethics and personal responsibility in a horrible way. I hate to leave on a downer, but I'm very proud of the team and all 300... 235,000 former employees that make, just including you, the best network of family that you could ever have. Like all the people that are helping Colt with Little Horse, it's just so heartwarming for me to see Sun employees cheering Maverick and Scout along on the sidelines. Everywhere I go, the old people still remember me.

Yeah, it was on the cover. I don't think he meant it that way, but it came across that he said, 'I love my job. It's a great job. I love Motorola. The only bad part of it is the customers.' I don't think that's exactly the message you want to put on the front page about being customer-centric. Little misquote. But I can vouch personally, Greg is wired like you: customers first, sales kind, everything else.

I'm always ready to help any of you out there, former Sun folks and anybody else. You can work through Randy here to get a hold of me if you want. I'm always eager to help any former Sun employee.