Chapter 15. Nudge the Top Line

—GK Murthy (Sierra Atlantic)

GK Murthy could have been a successful project manager who slowly worked his way up the pay scale. Instead, GK nudged his employer off the fence, helped the company grow from 60 to 1,200 employees, and made both himself—and his boss—rich.

When I think about Silicon Valley, I think high tech, high achieving, and high stress. But when I talked to GK, the first thing I noticed was how relaxed he was. Sure, he gets excited when he talks about his successes, but he’s a very calm, down-to-earth kind of guy. Maybe that’s because he’s found the best of both worlds: the middle ground between the 9-to-5 rat race and the risky world of the entrepreneur. And it’s easy to see that the way he found that middle ground was to think like an owner and nudge up profits.

The first nudge came a few months into his job at Sierra Atlantic, a Silicon Valley consulting firm. GK had just moved to the U.S. from India and was used to working for large American companies with projects in Asia. But Sierra Atlantic was small. GK was a little worried about what it would be like at such a small company. “That was my initial feeling, but pretty soon the work was so challenging, it was something I wanted to do,” GK says. And as he got immersed in the project, GK noticed something: The software they were writing could lead to a whole way of selling products to new industries. “I realized we were actually sitting on top of a goldmine,” GK says.

Now, it’s not rocket science to come up with ways to help your company make more money. Let’s face it. Most of us, as we do our jobs day after day, end up coming home thinking, “Wow, this company could be so much more profitable if only...” And then we do nothing about it. And the reason we do nothing about it is because we don’t want to fail. And of course, when we stick our necks out, failing is a very real possibility. As Bob MacDonald says in the previous chapter, if you take a risk and it works out, everything is fine—but if you take a risk and fail, you’re fired.

What’s so great about GK’s story is that he’s proof you can take risks without putting your head on the chopping block. It’s all in the art of the nudge.

Starting from Scratch

The first step in becoming good at “nudging” is to see the big picture. GK learned to have an ownership mentality during the 10 years before he came to Sierra Atlantic, when he was designing hardware and software in Asia. His jobs had taken him to factory floors where he supervised people using the products he designed. So GK was a hands-on kind of guy. When he designed something, he didn’t just do it well—he thought about the people who were going to use it. By the time he came to Sierra Atlantic, seeing the big picture was second nature.

So GK’s talent for seeing the big picture made him a very good consultant and project manager at Sierra Atlantic, but it wasn’t enough. Sure, he was great at managing projects, but GK’s big-picture attitude could have also made him dissatisfied because someone who’s used to seeing the big picture isn’t going to be satisfied managing one project at a time at a small consulting firm. GK could have worked there for a while, gotten bored, and jumped to the next employer, like so many other talented people in Silicon Valley. That’s why his second step is so important.

The second step is to pretend you own the place. That means looking at your job or project as if it were your own little company. GK, only a few months on the job, was thinking like he owned the place. So when he was working on a project—writing a few lines of code for an Oracle product—he thought, why don’t we market this kind of work to other customers? “Buying software isn’t the end of the solution. You have to implement it,” GK explains. “Anytime you buy software, it only answers part of your business problems. Large companies, they buy the software, but they need to do a ton of work outside of the software to run their business.” GK saw the goldmine: Sierra Atlantic could sell their services to do that “ton of work” outside the software.

GK didn’t do what so many of us might have done—just do his job and go home. Or, worse, grumble about Sierra Atlantic being a small-time company compared to the big guns he’d worked for before. Instead, GK saw that plenty of companies would be glad to have Sierra Atlantic come in and tweak their Oracle or SAP software and make it really work well for them. And right away, he went to tell the boss.

GK sat down and told the company’s founder, Raju Reddy, his ideas about selling Sierra Atlantic’s services to customize off-the-shelf software for other companies. This might sound like a brash thing to do, but think about it: If you start a company, your main motivation is to make money. If someone comes along with ideas for how you can make more money, the boss is going to listen. Especially if you handle it like GK, who wasn’t pushy and wasn’t calling the company’s old way of doing business stupid; he just wanted to nudge the company toward growing and making more money. Here’s the thing: Bosses like to be nudged, especially when you have an idea about how to bring in more money.

“Raju was very receptive to this,” GK remembers. “He likes to encourage people to think independently.” GK doesn’t think about that first step—taking an idea to the boss—as earth-shaking. But GK’s first step was about to change things in a big way.

Underestimating Obstacles

Another important step in the art of the nudge: Believe in yourself, but don’t bet the farm. That’s because no matter what, nobody bats 1000. So GK didn’t set himself up to fail by saying that huge numbers of companies would hire Sierra Atlantic to customize their software for them. Instead, GK quietly put together reasonable proposals for companies he was familiar with from his previous jobs in Asia. Sometimes the proposals worked, and sometimes they didn’t. Either way, every company that he approached who signed on was new business Sierra Atlantic wouldn’t have found otherwise.

Just because he didn’t bet the farm doesn’t mean GK didn’t take risks. He took plenty. Like the time he met someone at a social gathering who knew how to provide software support for an older kind of mainframe computer. It just so happened that GK had been courting a boat manufacturer that had the same kind of mainframe computer. The only catch was that Sierra Atlantic didn’t have anyone on staff who knew how to work with that particular mainframe. GK got the guy hired for Sierra Atlantic—at a $100,000 annual salary. Then, GK turned around and gave the boat manufacturer a proposal to provide maintenance and support for its mainframe. It worked. Sierra Atlantic won the contract.

And then there was the time when GK put together a proposal to maintain and support software for a mid-sized specialty chemicals company in New York. In the chemicals industry, where processes are streamlined and controlled by computer software, it’s vital that everything runs smoothly, GK explains. Even little glitches cost money. So GK’s proposal was about getting rid of one of the glitches.

There was only one problem: Sierra Atlantic didn’t have a software maintenance program.

But GK, who always thought like he owned the company, believed in Sierra Atlantic’s ability to do the job, and he underestimated the chance of failure. He believed in Sierra Atlantic so much that he was able to convince the guys from the chemical company. “They saw the passion and honesty that we brought to the table,” GK says, “so they awarded us the contract.”

Within 9 months, GK had nudged the top line so much that he was promoted to “director of process industry verticals.” How many verticals did Sierra Atlantic have? None. GK’s was the first. “They pretty much created this standalone unit for me,” GK recalls.

Now GK had what he’d been pretending to have: his own little business within a business. And he knew just what to do with it.

Building Momentum—Passionately

One of the first things GK needed was a staff. That’s because at first he was director of a brand-new division of Sierra Atlantic, but that division existed on paper only. Soon, it would have 100 employees: “I pretty much recruited every one of them myself,” GK says. Finding people to work for him was a job in itself, but GK was enthusiastic. All he had to do, he says, was find people like himself who had a passion for the company.

“It’s the passion that matters a lot,” GK says. “If passion for the job isn’t there, the chance of succeeding isn’t good.”

Sometimes, GK would hire people he met at social events. Sometimes he would convince people he already knew. No matter where he was, GK was looking for passionate people with computer skills—the kind of person a client would enjoy working with.

And quite a few of GK’s hires were in India, where Sierra Atlantic runs its outsourcing operations. When hiring in India, GK used a clever technique that Sierra Atlantic had come up with: include the parents. That’s because in India parents are much more involved with their children’s lives; adults will even go to their parents to ask their opinion about whether they should take a job. So Sierra Atlantic would hold recruiting parties and invite the parents.

Little by little, GK built a staff in which he had confidence. Many of those hires are still with the company today. He says: “If I look back on my own career, one of the things I feel proud about is the number of people I brought into this organization.”

As he built a staff—and built confidence among clients—GK found yet another way to nudge the top line.

Taking the Next Step

Earlier in this book I talked about the importance of the Triple Rs: Repeatable, Reoccurring Revenue. It’s a simple idea. What it boils down to is that you earn money even when you’re sleeping. In the case of Linda Rabb (Chapter 1, “The Compound Income Effect”), who sells Aflac insurance, the three Rs have to do with earning commissions and renewals on the policies she sells. In GK’s case, he earned significant portions of company stock; one day, when Sierra Atlantic is either sold or goes public with a stock offering, GK will be able to reap those rewards.

The three Rs are important to companies as well as individuals, and GK found a way for Sierra Atlantic to get in on the three Rs by selling its services in a new annuity contracts. The way it works is instead of just writing some computer code and getting paid once, Sierra Atlantic would do a computer project and then maintain that software and hardware for an annual fee. For Sierra Atlantic, annuity contracts help alleviate the “feast and famine” cycle that is so common in consulting businesses. When GK started this in 2002, Sierra Atlantic had one annuity contract; now such contracts make up a huge chunk of its business.

GK also came up with another way to nudge up the top line: buying the competition. It happened in 2005 when GK was running some of Sierra Atlantic’s new business lines in Europe. The company had won some business, but growth was slow, and competition was fierce. One competitor, Iterion, was especially tough to beat. “I was getting uncomfortable,” GK says. Then he came up with an idea: buy Iterion. So far, GK says, that seems like it was a good move.

GK still works at Sierra Atlantic, and now his title is Senior Vice President of Enterprise Solutions. When he tells people at parties in Silicon Valley that he has worked for the same company for 10 years, “They can’t believe it. They think I must be one of the founders,” GK says. That’s because in Silicon Valley companies—as in many companies today—people get dissatisfied and move around from employer to employer. GK has escaped this rat race by cultivating a position for himself at Sierra Atlantic where he gets a piece of the pie—and a reason to stay.

People have a lot of words for someone like GK: rainmaker, mover and shaker, trailblazer, wheeler and dealer. GK’s story shows us how we can take our good ideas and turn them into gold for our employers—and ourselves. GK shows us that with a passion for your work and confidence in yourself, you can nudge the top line and find the best of both worlds: the comfort of a job with benefits and the wealth-making ability of a company founder. So try being a rainmaker, and the best of both worlds could be within reach for you too.

 

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