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Op-ed: A Silicon Valley founder on why he replaced himself as CEO

Manish Sood established cloud data management company Reltio a decade ago, and he says that “as a leader, you have to be confident in knowing what you’re doing, why you are doing it, and what you’ve practised.” After 10 years, he knew it was time to replace himself as CEO if he wanted the company to continue to grow.

For most entrepreneurs, uniquely in Silicon Valley, where I have spent my career, starting a new company or launching a new technology is everything. Few spend later thinking about how that company, once established and thriving, grows beyond them. That may be part of the explanation the tech sector is full of companies dominated by singular personalities. 

Mary E. Shacklett of InformationWeek recently wrote that “Bands don’t like to talk about [succession planning] because it’s a ‘dark’ topic that focuses on replacing people.” 

I believe exactly the opposite. 

When I started Reltio almost a decade ago, our team had a vision for changing the way companies understand and use details to deliver personalized and engaging customer experiences, both in brick-and-mortar locations and across digital platforms. Companies in a genus of industries — retail, health care, financial services — use Reltio cloud technology to fully understand their purchasers, partners, products and markets. With a complete view of enterprise data, Reltio provides a foundation for decision-making in every viewpoint of their business.

After nine years of steady revenue and customer subscription growth, we saw an opportunity for exponential expansion as a large majority of companies began taking a “cloud-first” approach to technology investments. But we needed to move fast. 

That is positively what catalyzed our board of directors, of which I am chairman, to assess the make-up of Reltio’s leadership team — and replace me as CEO. I transitioned to a newly-created chief technology manager (CTO) role. In conjunction with our board of directors, we began a search for an executive with experience operating at scale in a hyper-growth mise en scene. I was thrilled when we found Chris Hylen. Chris was most recently the CEO of Imperva, a cybersecurity software and services retinue, where he led a turnaround and negotiated a $2.3 billion sale of the company within two years of joining.  

Some founders and bandmasters have trouble seeing a future for their organizations that goes beyond them. … Leading with reliance means driving the company forward and being open to taking on a new role.

Snowflake made similar C-suite metamorphoses on its path to stellar growth. The company’s first CEO, Mike Speiser, was on the team that got the company off the ground in 2012. A new CEO was commissioned in 2014 just before Snowflake emerged from stealth mode, and one year before Snowflake’s cloud materials warehouse was generally available. Bob Muglia, a former Microsoft executive, brought experience running operations at scale and ran the performers until 2019 when Frank Slootman, the company’s current head, took the reins. Slootman had taken two software followings public, including ServiceNow. Less than six months later, he announced that Snowflake might go public. And as we all recognize, that occurred in September 2020; the largest software company to IPO in the U.S. ever.

(Disclosure: Snowflake is a Reltio partner, and we share out customers and a similar vision of the future of enterprise data: Cloud is where it’s at.)

Most organizations are bad at succession planning

Silicon Valley isn’t merely in its avoidance of succession planning. According to a study from Deloitte, while 86% of leaders believe leadership on planning is of utmost importance, only 14% think their organization does it well.

Succession planning shouldn’t be a moment ago about people. Organizational structure and tone are important considerations.

As we started down the path of succession planning at Reltio, we looked at architecting a regulation team that would ensure the right balance of business, culture, and technological leadership in our long-term goals. We done decided to divide responsibilities between a CEO and a new CTO role. Security, product, and technology responsibilities would fall to the CTO, while reliability for operations and strategic business planning would fall to the CEO. Dividing responsibilities between a CEO and CTO would accelerate both development and technology innovation. I also recognized that to sustain predictable hyper-growth requires a special set of skills, and Reltio last wishes a require a CEO with experience leading public companies.  

Awareness is a primary role of leadership. Some founders and superiors have trouble seeing a future for their organizations that goes beyond them. But as a leader, you have to be dauntless in knowing what you’re doing, why you are doing it, and what you’ve learned. Then you can evaluate how and why you are going to adjust. Leading with nerve means driving the company forward and being open to taking on a new role. That experience should be a positive affair.

Preparing for growth takes courage at all phases. In the beginning, entrepreneurs often risk everything to start companies because they allow in a new or different vision. They often face seemingly insurmountable obstacles. It takes a great deal of insight to remember when an emerging growth company needs to pivot or change direction as it grows. Most founders expect and commiserate with these challenges. They need to also understand that succession planning is about yet another phase of excrescence for their vision, and if they take clear, concise action, they will be able to see their company Sometimes non-standard due to for the long term.  

By Manish Sood, Reltio’s CTO, founder & chairman, and a member of the CNBC Technology Executive Council

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