Customer-Driven Development — An Interview with David Cancel, CEO at Drift

Customer-Driven Development - David Cancel - CEO at Drift

As part of our Customer-Driven Development series, we had the opportunity to chat with David Cancel, CEO at Drift. We discussed how to align product and engineering teams around customers, the reason why so many businesses fail to build customer-centric cultures and the 3 most important things that a product leader needs to be constantly working on.

About David Cancel

David Cancel is CEO at Drift.com and a serial entrepreneur. He is best known for creating hyper-growth companies, products and product teams at companies such as HubSpot, Performable, Ghostery and Compete. David is an inspiring leader whose podcasts, talks, books and posts have impacted several generations of entrepreneurs around the world.

The following is an excerpt of a longer conversation. We extracted the very best from it so we could share it with you in a short post. Enjoy!

Sofia: For some reason, after decades of ongoing discussions about customer-centricity, most companies are still not doing it. Why?

David: I think it’s simple. I think the ego gets in the way. To be a true customer-centric team or organisation, you have to be willing to put your ego to one side. A lot of people don’t do that, they don’t want to serve. They view that as being subservient to their customers. And so, it’s all about them.

It’s a hard frame of mind to get into, to stay focused on serving someone else and not be distracted by one’s own ideas or wants or needs.

Sofia: Is it because incentives are focused on status/power within the business? Where is that coming from?

David: That’s a great point. If you take the ego out of it and you just look at it structurally, most product teams are actually incentivised to not spend time with the customer. Why is that? Because in most companies we measure them using entirely different sets of metrics. Most teams are measured on things like, “Did they release the thing? Did they release it on time? Did it have the features they said were gonna be in there?”

We measure all of our product and engineering teams on metrics that have nothing to do with the customer. The customer doesn’t care that you shipped the product on time or care that the features you decided on at the beginning of your process were there at the end. All the customer cares about is a very selfish thing, which is “What the hell is in it for me? Why should I care? Why should I spend time even thinking about this?” Because we’re all busy and self-centered, right?

For whatever reason, I think we are institutionalized to set up metrics that don’t factor in customer behavior. But the lunacy and freaking insanity of this is that we then expect others to be customer-centric, right? We give them a set of metrics that we will measure them on and we’ll say, “Hey, this is how you will succeed inside the company and how we will measure whether you’re doing a good job or not or whether you should be promoted or not”, all of which are totally devoid of the customer. And then we say, “Why aren’t you spending more time with customers?”

We set up a system where the incentives are misdirected from the very beginning. You have to set up incentives that are aligned with the result that you want. It’s very simple. You want someone to do something? You need your incentives to align with your objective.

Sofia: How do you cultivate a culture that puts the customers first, especially within product and engineering teams?

David: I try to help our teams to understand what is important for the customer and how to think about it.

An example that I use all the time is that when you search something on Google you get a brilliant result first time. As a customer of Google, you do not care how they actually made that happen. You don’t care what kind of machines they use. You don’t care if it was an algorithm. You don’t care if it was 3,000 people divided between India and China who actually hand-groomed an index which they have had for many, many years, making sure the best things are at the top. Do you care about that? No. Nobody cares about that. You care about your problem. And the same thing with Facebook. You buy a Facebook ad, you don’t care that they have 3,000 people in India who hand approve every one of those freaking ads. Or if it’s magic AI, right? The truth is it’s both. Nobody cares. Those are internal problems and we just get lost trying to optimize those things that have nothing to do with the customer.

We should address this because over time they affect our margins, they affect our profitability. And that’s why I always love Bezos’s approach. You know, like how he will be willing to lose money on products and categories for years. His reply is Whether we lose money or we make money on a category is not a customer problem. That’s not our problem. It is our challenge as a company if we want to stay customer-centric to figure out a way that, over the long haul and we take a long view on the customer, that we are able to have a very profitable relationship with the customer. But whether I lose or gain today, it doesn’t really matter. That’s not the customer problem.

Sofia: What mechanisms or processes you put in place to make sure every team is aligned with customers needs?

David: I design the game. In other words, I just start to setting up the rules.

An example for us is that engineers have to ship every single day. From the day that they walk in to their last day here, they must ship every day. And that is something that we monitor per team. A lot of people will say they want engineers to ship on their first day but they don’t have incentives and rewards around that. It has to be clear that it is important, it is measure and it will be rewarded.

This way we focus the conversation not around the process but around the outcome. All I care about is that they are shipping every day. I don’t need to know about how they build it. And the flip side of that is empowerment. It gives them the autonomy to make decisions without having to explain themselves. All I care about is this output. And we are shipping every day.

I have another forcing function that every team has to be talking to customers at least once a week. For us, it’s really daily, if not hourly. So I’m measuring that. And again, because I’m measuring that and I’m only giving them credit for these things, that’s what they optimize for. I focus on those bigger-picture things, the outputs of the work versus the details of the work. The details of the work, they should have mastered already. Especially engineers. They shouldn’t have to explain details to someone in sales or marketing or even to a product person, “Oh, you don’t understand, Sofia, it’s complex. It works like this and we’ve gotta to do this stuff and we’re got to re-platform, blah, blah, blah”. I don’t care. We don’t need to talk about it. Show me the outcome.

I am an engineer so I do care. I geek out on that stuff. But I communicate thatI don’t care because I don’t want to give credit for solving complexity, I want to give credit because it impacted our customers.

 

Sofia: I guess that…having that game and that structure, putting the weight on the right things might help you avoid all this engineering culture where there is too much power given to engineers just because they may be just great at coding and tackling complex technical problems.

David: Oh, absolutely. And I say this to businesspeople all the time…CEOs, mostly. CEOs want to talk to me about this stuff because they don’t have this methodology and they aren’t engineers, usually, so they can’t push back. And I say, “Look, it’s very simple. Every team within a company should agree that a company only exists to serve its customers. Can we all agree on that?” We state that over and over. It’s an obvious thing but we have to restate it even here every day almost. That’s why we exist. There’s no other reason a company exists. A company doesn’t exist to provide you ping pong. A company doesn’t exist to make sure you have sushi for lunch. A company doesn’t exist for these reasons. We exist to serve our customer.

Now that we agree that, if we look at every other part of the organization we measure them on their impact to the customer. Did they bring in more revenue? Did they support them? Did they make them successful? Did we attract the right ones? And we’re willing to push on every one of those people to make sure that they are hitting those numbers and being accountable for that stuff.

But when it comes to the magic fairy land of engineering, product, and design, because business people don’t know how to speak their language, they give them a different set of rules. “Oh, I don’t know. I can’t push back because this brilliant person keeps going on the whiteboard and drawing some stuff. I don’t know what it is. Some Egyptian symbols. I don’t know what it means..” And I say, “It’s very simple. You should treat your product and engineering people exactly how you treat everyone else in the company. How are they impacting the customer? Hold them accountable for that too. Just like sales”. If you want to talk to me about the latest infrastructure tech out there, I don’t care. What I want to know is did we sell more or not?

I don’t want to get lost in the minutiae. This is not easy. You have to practice every day. It is like maintaining a garden. What does it take? It takes active pruning. And so, you have to do the pruning every day. You can’t say this only once. I say this every day.

Sofia: What are the 3 most important things that a product leader needs to be constantly working on?

David: One is the thing we touched upon earlier, which is is the simplest thing, but the thing we overlook the most: Measure the right things! And the inverse of that, which is don’t measure the wrong things! That will solve the bulk of your problems. Most problems I see are those problems. We measure the wrong things. So that’s number one.

Number two is how do we remove the roadblocks? How do we remove the roadblocks that keep our engineering team from having direct contact with the customer? Every day we’re looking for ways to prune back, to remove excuses or structural problems that keep engineers separated from the customers. That could be as simple as something like not sticking them in a corner somewhere. They should sit with their internal customers — sales marketing support, the touchpoint for a lot of the customer communication.

But it’s second-hand. You don’t only want to rely on second-hand information. You still need first-hand customer contact. But at the very least, we should encourage those teams to communicate every day and sit next to each other. So I’d say that’s the second thing.

Three is the one that’s dearest to me, which is to make sure that everyone on your team is learning and progressing every day. I believe that will create a pull effect versus a push effect in your team. If I focus on making them more customer-centric, whether it’s getting them to listen to a podcast or reading an article, I make sure that they’re learning every day. That does two things: It keeps them progressing and it helps combat the ego, right? Because to learn and progress, you need to be able to turn off the ego at least for five minutes.

By doing that every day, by having that daily practice of learning and progressing, it’s actually helping them to curtail their ego a bit which will help when it comes to being customer-centric.

Sofia Quintero

Founder and CEO at NomNom

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