Dave Duffield: Inspired by Core Values, Ahead of Technology Curve

Fresh out of Cornell, armed with a bachelor’s degree and an MBA, Dave Duffield joined IBM as a sales rep. “I was extremely fortunate to be hired by the most admired company at the time,” he says. Being exposed to the “IBM Way” and its core tenets and values (“Think,” “Respect,” and a focus on innovation) have shaped the type of cultures and companies that Dave has built over a 40-year career. IBM was the “epitome of customer service,” he says. “Living this right out of college was an incredible experience. I worked around the clock and would never let a customer or partner down.” Corporate ethics, core values, a good reputation, and strong leadership – hallmarks at IBM – became a mantra throughout a career that includes launching five companies.

APPLYING THE CORE VALUES

While at IBM, Dave began a side project in collaboration with a brilliant technologist colleague: an exam scheduling system for higher education. Not long after they developed the product, Dave made his first sale – to the University of Rochester. More customers followed. Dave decided to leave IBM after four years to launch his first company, Information Associates. By now, Dave and his partner were developing their second product, a payroll application. Dave received an RFP from Rutgers, sold them the system, and moved into the college dorm while implementing it.

After splitting with his partner, who kept the exam scheduling application, Dave focused on the payroll application and founded his next company, Integral Systems. He continued selling to universities and then moving onsite to implement the application. Integral Systems grew to be a large business, but it was a “consulting business with code,” which led Dave in 1979 to pause and package the solution. This established another one of Dave’s core values: a great company must have a differentiable product.

EMPLOYEES ARE THE KEY

After taking Integral Systems public, Dave recognized that a new technology shift was taking place: the move from mainframe to client/server computing. Dave began assembling a team that would form PeopleSoft. Under his leadership, PeopleSoft grew to 12,000 employees and became the #2 software company in the world. Dave’s original vision for the company was to focus on a payroll application that ran on a PC and competed with ADP for small and medium-sized customers. His strategy was to stay small (less than 50 people) to maintain a great culture and avoid politics and bureaucracy. As the company grew even beyond his expectations, Dave leveraged his prior entrepreneurial experiences along with his IBM background to shape and build a culture that would survive rapid growth – “knowing what can happen can let you prevent problems.”

Throughout his early entrepreneurial experiences, Dave learned about building teams, hiring and firing people, creating a company culture, and taking care of customers. He feels passionately that “employees are the key, and if you really, truly care about people, they will truly care about your customers.” Employees must be respected, empowered, and great to work with. “They’ve got to want to be a part of a winning team,” he says. “I have fired people that acted badly or in ways that went against the culture we were building, even if they were top performers. If they didn’t fit the culture, then they were not good for the team.”

TEAMWORK AND RESPECT

According to Dave, sales are a team effort. “You don’t sell by yourself,” he urges. “Many groups are involved: sales, pre-sales, finance, product, executives, and services. It takes a team to convince the customer that they’re making the best decision.” The company must have a reliable and differentiable product, but it requires the full team to give customers confidence in their decision, which is important, since the wrong enterprise-software decision can cost people their jobs.

Dave cites Jim Collins as a key influence, noting that the idea of defining an organization’s core values was presented to him more than 20 years ago in Collins’ book, Beyond Entrepreneurship: Turning Your Business Into an Enduring Great Company. A big fan of Collins’ Level 5 Leadership, Dave says, “You can’t fake this, and it has to be part of your DNA.”

In addition to core values and brilliant collaborators, Dave brings prescience to the table: His companies have always leveraged changes in technology, from early HR and payroll applications for mainframe, to PeopleSoft for client/server, and ultimately to Workday, a company he co-founded with Aneel Bhusri, with its Software-as-a-Service model. Maybe it was Dave’s training as an engineer or his early experiences with IBM. Dave has a keen eye for shifts in technology and the expertise to capitalize on them.

Dave believes that success is driven by “what your customers say about you.” If you have a good product that’s well represented to the prospect, you have a good chance at being successful. At his current company, Workday, Dave asked a customer that signed on recently: “Why did you select Workday?” The decision maker told him: First, the user experience; second, the company culture; and third was what other Workday customers had said. “She personally called 71 other Workday customers for references!” recalls Dave.

The most rewarding sales success for Dave is when a customer moves to a new company and buys from him again. He’s had multiple customers work with him at Integral Systems, then PeopleSoft and now Workday.

‘ENTREPRENEUR OF THE YEAR’

Dave Duffield’s core values transcend the C-suite. In 1994, he and his wife, Cheryl, created Maddie’s Fund to help subsidize the creation of a no-kill nation for companion animals. To date, the Duffields have endowed the foundation with close to $300 million.

Among numerous other philanthropic contributions, Dave donated $27 million to build one of the nation’s most sophisticated research and teaching facilities for nanotechnology – Cornell University’s Duffield Hall. He also donated $15.3 million to maintain this state-of-the art facility in perpetuity. In 1996, Dave was named Cornell’s Entrepreneur of the Year.

Thanks to the core values and tenets he learned years ago, Dave Duffield has distinguished himself in his community, as well as the corporate world. “Build a strong culture and focus on employees,” he says. “They will take care of your customers, and the rest falls into place.” And it has: Workday was recently recognized as the #1 Best Place to Work among large companies by the San Francisco Business Times and Silicon/San Jose Business Journal. It is the fifth consecutive year Workday has received recognition on the list.

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