How Steven Birdsall Built a €1B Business Inside SAP When Everyone Said It Would Fail

Narrator: Foreign welcome to Go to Market Science. In this podcast, we share tangible, actionable playbooks from the trenches, working as Go to Market strategy and rev ops consultants for our clients here at Union Square Consulting, and candid conversations with revenue leaders in the market that have been there.

Steven Birdsall: Now, uh, let's get into it.

Rachel: Today on the CRO Stories segment, I'm sitting down with Steven Birdsall, CRO at Alteryx. Stephen has over 30 years in enterprise software experience, including multiple COO and CRO roles at SAP, Anaplan, Oracle, Qlik, and now Alteryx. So early in his career at SAP, he convinced the board to fund a completely new Go To Market motion inside a company that had been selling the same way for 30 years. Every sales rep, every consultant, every partner told him it wouldn't work. Today we're talking about how he launched it anyway. How he got an entire organization to change when the existing model was still producing revenue, and what it took to turn that bet into a billion dollar business, or in this case, a billion euro business. Well, thank you so much for joining me today, Stephen.

Steven Birdsall: It's great to be here. Thank you, Rachel. It's good to, uh, good to see you again. Yeah.

Rachel: So you walked into the SAP boardroom and you asked for 20 million euros to build this business and everyone told you, uh, customers weren't going to want it. What made you so sure that they were all wrong and that you really had something here?

Steven Birdsall: Well, it didn't quite go in that order. So, you know, SAP at the time, this is a little while ago, but at the time SAP was pretty well known, pretty well established, mature software company. Um, the challenge is that we had this moniker. When people think of SAP, they would think of us as, you know, very complex, very expensive, and it takes a long time to implement and get value out of the system. So that's kind of the world that we lived in. And you just kind of assume that, you know, customers are getting everything that they want and they're the ones who create the complexities. Therefore we're giving them, you know, what they want. I think there's a challenge and, you know, very much like today with AI, um, we're all challenged with new technologies and new ways to go to market. And I think there's a question of, like, is the old way of doing things really what customers want? Or can you think ahead and see around some corners and actually deliver them what they need, uh, and think about things in a, you know, in a very different way? So that's a lot of what kind of we were taking into this idea that, um, if we eliminated the complexities and we eliminated the expense and we could get fast time to revenue, fast time to value, you know, for our customers, um, how would that then translate in terms of a market opportunity? And I think many companies had tried before. You know, packaging software wasn't new, but how could we then do that differently? So the thesis that we took into the board was that if we really had a very robust package, meaning that it was included, you know, things like configuration guides and scripts and, and uh, you know, a tight governance, so that you truly did have a package that added value. And it may not be everything that a customer wants, but it's everything that they need. And we packaged that in a way that we could deliver with a defined scope, meaning that it's now fixed fee for the implementation. The only variables is the number of users and that would be, you know, awesome. And so that was what we took in. And then it was a matter of getting the board, you know, comfortable that building out a separate business unit inside SAP is something that we should do. And, uh, I was, I was pretty happy in that. I think the case that we put forward was, uh, understood and acknowledged. And, you know, we tried some things like that before with SAP best practices and other things, but we hadn't tried it really on the go to market from product development, uh, and packaging all the way through the go to market and having the field team aligned around it. So that was, you know, relatively new muscle that we had to create. So it was, um, it was exciting that coming out of that board meeting, uh, they wanted to move forward. And so we got the nod right out of the gate. And then it was a matter of just like building the business. So it was a, it was a fun time.

Rachel: So how did it. Because I remember, um, when we talked earlier, said, you know, they were, everyone was saying like, oh, customers aren't going to want this. When did that happen?

Steven Birdsall: Immediately. So I was given 60 days to tilt up, you know, an entirely new business. Um, otherwise, you know, I got to go hire about 20 people to start with, um, in between sales consulting, the, you know, people that are going to help, uh, you know, the implementation and our partners, those are the three kind of pillars that we, we organized around. Uh, but to set up a new organization inside a, you know, German software company wasn't like, easy in and of itself. Then we had to think about all the operational things that we do. How do you price it, how do you package it, how do we work with the development team in Germany. Uh, so there's a lot of that like first 60 days that was just set up to how do we define the organization? How do we find the people, the right people in the org? And so there was just a ton of energy that went into building up the business. But in a 60 day window, you can imagine if you're going to go build a business from scratch in 60 days, find 20 people that are going to be high caliber and aligned to what you want, uh, from the team, the right skills and attributes that they bring. It's a global, you know, business. So I had to think of all the different regions around the world that had to, you know, required, you know, the need, uh, for these people. Um, there was a lot that went into that. And then working with the development team around what are the first packages that we're going to go build? Um, so a lot of it was, was, I'd say for 60 days was on that, then on day one of, okay, now we're ready, now we've got, you know, a few packages that we built in those 60 days. We identified the people that we brought into the team. So kind of now what? And that's where the real, um, work started. And so it wasn't like we waited until the end. I started talking to first sellers and I'd go out to our, you know, strategic account sellers and talk to them and be like, hey, this is going to be great. We've got this package, we're going to go build. And it was like CRM. And at the time Salesforce was, you know, really making a lot of inroads in the market. And SAP customers wanted SAP CRM, but it was going to take too long to implement. So we thought that's a great place to start. So we kind of built that package. And of course the sellers that I went out to were like, none of our customers want a basic version of CRM. Like they want, you know, SAP. They want everything, you, uh, know, under the sun and they want to go sit on a whiteboard and go kind of map out all of the requirements and how they forecast the business and building pipeline and setting up territories and quotas and like all the things that go with a CRM system. They wanted all of that. And um, so they felt like it was going to be too confined, uh, or too refined for what our customers wanted. So a lot of pushback from the sellers ran uh, out of the gate. And so I thought, well, that's kind of one constituent. Another constituent is our consultants, you know, the people actually implementing. So I went to our heads of SAP Consulting and I talked to them about how we built this, you know, defined scope. And this is going to be great because our customers are going to get fast time to revenue, uh, fast time to value, uh, on their side. And so how do we kind of find and build this, you know, for our, for our consulting group? And of course, you know, met with immediate pushback there because they're like, you're never going to take what's in my head and be able to implement it. And every customer, again, wants to start off with a whiteboard and go figure out what they want to do. So that kind of met with, um, a bit of disdain, let's say. And so I was like, wow, that's, you know, so far, zero out of two. I guess I can talk to our partners, maybe our partners will get it right. So we talked about how this kind of, again, fast time to value, um, we're going to implement this. And the idea was that you could literally buy anything that you want from SAP and you could be live in a fixed scope with a fixed fee in 10 weeks or less. And so that's certainly going to be appealing. Our partners are going to love that. They can go build their own packages, you know, that are rapid deployment solutions as well, and they're going to go want to go down that path. And, um, the immediate math they did, of course, is if the service to software ratio is 8 to 1, 10 to 1 with SAP today, and you're going to take that down to 1 to 1. I'm pretty sure I just lost a bunch of revenue, so that's not going to be good for me. So, um, as someone who was building this, you know, business from inside, now I'm 0 for 3. That was all three constituents. I was like, oh my gosh, like, I wonder if I made a career, you know, disaster move. And, uh, I really was questioning, like, maybe this is like much, much harder than what I thought it was going to be. I thought it was going to be met with kind of applause and praise. And, um, pretty much nobody thought that it was the right thing for our customers. And I was already on. I already built the business, I already built the team. Like, I was starting to really kind of question, like, what am I going to do now? And then I kind of learned the first life lesson in building a business, start with a customer. So of course, the moment I set out in front of customers and I started walking them through, they're like, oh my gosh, you had me. Hello. Um, I've been waiting for this forever. What took you guys so long? I want to go try it. And once you get, you know, a few customers to start trying this, and we developed it, we delivered it, um, they found value in it, then they become your biggest champion, right? And then it was just a matter of taking those success stories that I found in different markets and, and having them come up, you know, on stage at our Sapphire events, at our kickoff meetings, and let it become kind of a naturally viral thing when they start talking about it. Um, instead of pushing this out to the market, instead of us taking this and developing on our own and pushing it, it became much more of a pull mechanism. So our customers did our bidding. Our customers are the ones who were kind of demanding in the market. And then it was a matter of, how fast can I build these packages? So while it started with CRM, it quickly went into HR and finance and transportation management, you know, uh, warehouse management, kind of everything else we built. So in that first, I'd say year to year and a half, I built 100 packages. What was fun, though, was our partners caught onto that. They understood the value. They finally kind of get it that, you know, these SAP projects don't typically have an end date. They usually start and then they evolve and they grow and they start, you know, integrating other things. And so they would package these things together. And what they found is that they could build their own packages. And so we put, you know, parameters around it. We don't want to lose the rnrds. We want it to be rapid. We want to have them kind of get value out of it as well. But, um, they started building their packages. And so while I bit, I built 100. In that first 18 months, they built 900. So we had a thousand different RDS packages, different flavors of it, because some of it had different points of integration, but we all kind of had that same brand recognition that it was 10 weeks or less with implementation. It was a fixed fee for the implementation, and these things need to start being interoperable. And what it became was almost like a Lego block where you could put in CRM and employee self service and workforce planning and some other things and kind of all together. And then you started, you know, putting in packages of packages. So that's where I think, uh, McLaren was one of the first ones. For example, um, they were moving into a dealer network. And, you know, from just being a Formula one, you know, company to having a dealer network where they would sell McLarens, you know, out in the market. And they had to build a manufacturing facility and build out the dealer network and think of all the supply chain and everything. They bought 11 packages. They were kind of our first one. Uh, I was working with our, uh, co CEO at the time, J. Mahogaman Snavi, uh, who went with me to McLaren, and we sold them 11 packages, and we actually transformed their business much faster than what they could even transform themselves. And so that was pretty exciting. Um, of course, I had to become a McLaren customer at that point, but it was pretty exciting to see somebody actually transform their entire business putting together these packages of, uh, rapid deployment solution. So it was a blast. It was fun. And that's how we, you know, in, uh, from 2010 when we started it, to the middle of 2012, it was a billion euro business on a standalone basis. So a lot of fun, a lot of scars in terms of building the business, finding the right people, um, figuring out what packages to go build, how we were going to go incentivize the sales reps. Because I didn't want to create. I had my own sales team, but I wanted to keep it really small and give, you know, all of the different sellers across SAP incentives to sell it themselves. So I gave them, like, accelerators on their comp plans and their quotas and things like that. So a lot of things we had to do to build it out. But, man, it was a. It was a lot of fun. It was, it was chaotic. Um, but what a blast to see a business be, you know, a billion euros in only two and a half years. It was, uh, pretty incredible.

Rachel: Yeah, that's like a lot of stuff that you just went through right there. So I'm going to try to, um, peel back the layers a little bit and get a little bit deeper into all the operational stuff that you worked on to get to this point. Um, so going back to building it out in the first place, um, what were some of the biggest operational challenges that you had in building this new motion? Um, and I know you've had to give up your COO role in order to tackle this big endeavor. So, um, yeah, walk us through a little bit of that.

Steven Birdsall: It was a very risky move. You know, SAP, I think, still is a very performant culture. And so even now, with all of the experience I had had been chief operating officer in, you know, a lot of different markets, and started in North America, went to Japan, then went to Asia Pacific, out, uh, of Singapore, then in Miami, and then it became the global coo. Um, so it got a A lot of personal brand that was built up over that time. And, um, you know, you want to continue that, right? So taking a risk like that of starting a new business that was not proven and had been tried before and failed, um, that's pretty risky. So first is just, you know, do you really feel like I had to kind of wrap myself with. Do you really feel like this is something that you can build and that, you know, the market is going to want? Before I went into the board, of course, I had already gone, you know, through all the analysis. Um, so there's just that internal, you know, motion that you have to go through is, do I really believe in this business? And if you do, um, then it becomes, okay, so how am I going to build it? Well, you need the right people. And because I had been COO in all these different markets, I had really good relationships with the regional presidents. So I think I had some cash, you know, built up with them, and personal relationships where they trusted me, um, that was really important. Um, I leveraged them in terms of identifying the people. So what I wanted is in each of the regions. So in India or, uh, Latin America, America's Asia Pacific, I wanted, you know, these three people. Somebody who was over the sales, somebody over consultants, and somebody over partners. In each of the different regions. We had five different GEOs, so, or theaters. So there's 15 people there. And I kept five people to work globally. So global head of sales, global head of partners, global head of consulting. And then I had myself and then one other person in business ops. That was it. Very, you know, skeleton crew, so to speak. But that was the basis for building the business. The second thing is. Okay, so how do I define what an RDS is? There's a lot that goes into it. The assets included, like I said, configuration guides, it included scripts, it included, um, other material to help Accelerator, you know, accelerate the implementation. So the SAP best practices, all those things you had to package together. I also had to have a defined scope around, you know, what was included in the package. So part of it is just building the package itself. Um, that's working a lot with the development team and thinking about what this would look like. How do we define the scope? So that's really defined. So a lot of plumbing was getting built around that. And then it was like things like reporting. How do I report on an RDS package? So I needed the CRM system to be able to identify that this is an RDS package and what's included in that package. So there was all of Those kind of things that I had to build out just the systems to support the business, um, identifying the people, like I said, because I had regional president, um, they gave me their top talent that was out there. People that they felt were going to be the next managing director of a geo, something like that. So bringing in the right talent to help build this out was really important. And then I think the other was just having the right incentives structure in place so that the sellers, a lot of times the sellers in the field were thinking, these RDS packages are not going to be very expensive. I get that there's value to it, but, um, how am I going to make money? I've got a $3 million quota. How am I going to do this? If it's $100,000 package, I need a bigger package. So what we did was we built incentives that, um, made it so they get, I think it was 1.5x, um, quota attainment and compensation, uh, you know, for selling the package so they could excel, they could retire quota faster, and they get accelerated, you know, quota, uh, commission dollars that go with it, as well as the regional presidents. There was incentive for them to do that as well. And the other thing is, again, I mentioned systems to support it, identifying the RDS package. But then the big thing was making sure that the regional presidents were forecasting RDs in their business. So every week when they got on the forecast call, not only did they have to give their forecast, they also had to give their RDS forecast. So that became more important to them, which then allowed it, you know, to cascade through the rest of the field. Uh, and then just a ton of guerrilla marketing. Like I said, every Sapphire event, every kickoff meeting, every, you know, every big meeting that we were having, I made sure that in the keynotes, RDS was a part of that. So the success stories behind it, the packages that we built, the partners that were certified on the package, all of the assets and accelerators that we built were part of that. So a lot of it was just telling that story. Um, you know, getting that out into the, into the field and making sure that our customers were on stage, you know, talking about, again, just the virtue of having, you know, a package from RDS that they were live in 10 weeks or less, that they paid the fixed fee, and now they're thinking about these other packages they're building. All those things were a lot of that kind of initial build that we had to do.

Rachel: And so when you started having these, uh, conversations with customers, um, and they were telling you, like, no, this is exactly what we're looking for. How did those first conversations look like? How did you get them in the room with you to talk about it?

Steven Birdsall: Well, it was really two things that I wanted to do. One is I needed to convince the sellers, the consultants, and the partners that this was something our customers wanted. So part of it was I wanted to go have the conversation directly with the customers. Right? But I didn't want to go in alone. I didn't want this. It wasn't about kind of me or just my team. I would. I needed to kind of, again, teach them to fish. So what I did was I brought them into these meetings with me. If I'd sit down with a CIO of a Fortune 50 company, I'd bring in the rep and the partner and, you know, the consultants, and they would hear me tell the story, and they would hear what is included in the package, and they'd see the response from the customer, and they became believers. And so, yeah, like, first year, I think I went to 40 or 50 countries. I literally was just on the road 100% of the time and just went around as almost like a cheap fire starter, you know, but. But to bring in these customers and partners and sellers into these meetings, um, and that's how you kind of create that viral effect. So part of it was just not only convincing, you know, customers that this was something that was actually real and it was good and they could rely on it, but is also convincing all the other constituents along the way that this is something that our customers were reacting to in a positive way, and then get them to, again, rinse and repeat that. So, uh, what I would tell the people attending the meeting, the internal people, is coming out of these discussions. You're now going to be the ambassador, right? You're going to be the new RDS ambassador. So not only do you, you know, should you respond to what the customers are saying, but you also need to be the ambassador to tell everybody else what your experience was like. So it was a lot of that, you know, kind of heavy lifting. Um, again, what I would say is the other thing that was really cool is when momentum is on your side, it's like, unstoppable. So it was almost like starting the business and getting everybody excited about. It was really, really heavy lifting and hard. Um, and there was a lot of scars, you know, along the way. But at the same time, once it was there, and I would say within six or nine months, um, it was almost unstoppable at that point. And then it just become much more viral. We started building more and more packages. You know, these packages are, like, very extensive. So it would take us, you know, two or three months to build a package, you know, from the development team. Um, they would be like a half a million euro to go build it out, you know, with all the people. I mean, these were robust packages. It wasn't like this was like, lightweight SAP stuff. They were pretty robust. Um, but, you know, the end result is a package that, um, customers could actually adopt. They were absolutely live in 10 weeks or less. So we fulfilled that promise. They got the fixed fee, we gave the customers what they wanted. But, um, yeah, it was, uh, it was fun and hard all at the same time.

Rachel: Yeah. And I know it turned into something that. It turned into, like a snowball moment later on, but in the beginning, when you still had to convince partners that this was something worthy of them selling, when they have, you know, they're going from an 8 to 1 services software ratio down to 1 to 1, like you said, um, what was the pivotal change for them to realize, uh, that this was a deal worth making for them.

Steven Birdsall: So first is, um, convincing them that this is what the customers wanted, because they're in the same boat that we're in. If a customer wants something and you have it, you deliver it, right? So part of it was just helping them with that experience directly from the customers. But where they caught on was they quickly understood as well that when I had, you know, again, 5, 10, 15 different packages, they started putting the packages together and they realized that, you know, it might be 50 or 75 or $100,000 of services, you know, in the beginning, but when you start putting together, you know, five or 10 packages, then that becomes valuable to them. The other thing is it give them, you know, access to customers and, you know, constituents on their side that they may not have had access to. Um, so, you know, like I said earlier, like, SAP is a massive, massive platform. And the idea was that if you could deliver these things and they're scalable and they actually work together, then the value creation for our customers is far greater. And, you know, these things don't end. There's always going to be other points of integration. There's going to be other things to integrate it with. You roll out core financials, you've got a chart of accounts and a general ledger and everything else that you want to do in your core financials. You're now going to work that with your supply chain. You know, execution, demand planning, or we, uh, called it advanced planning. And optimization. So that all has to be integrated. So another package for that. And then there's like bw, um, is our business warehouse. So we bought a company called Business Objects and there was a whole package around that. So now you got reporting that comes along with that. And then there's the CRM system and you start with sales and you go into marketing and you know, in services. So there's all these other points of integration. So they found that while they may have been thinking big bang and they did these really big projects in bite sized pieces, it's the same thing, but now it's accelerated. Is a faster time to value and you have a very happy customer on the other side. So part of was just building all of that, you know, momentum as well. Once they caught on and they saw it working, that's when they got excited about it. And of course they became believers as well.

Rachel: Yeah, it's amazing what can happen when you build something that's truly customer first and not just revenue first.

Steven Birdsall: That's right. That's right. Yeah. You know, like you build one thing and then it kind of grows and then again just balloons into so many other things that we, I had no idea on all the things that we were going to be able to do. You just kind of start it and then you grow. But um, yeah, part of it is to have a vision and it's another thing to kind of let it then kind of take on its own. Uh, you know, in, in the market.

Rachel: Quick pause. Everything we talk about on this show. Diagnosing go to market ops for prioritizing projects for revenue impact, processes, metrics, insights, building a predictable go to market engine. We've built frameworks for all of it. They're free and ungated on our website leansquare consulting.com frameworks. The link will also be in the show notes, so make sure you check that out. All right, back to the episode. I, uh, want to go back to what you said about McLaren buying 11 packages at once and then they actually, uh, asked you to slow down because they couldn't absorb the change fast enough. What does that tell us about how companies should think about implementation scope versus organizational readiness?

Steven Birdsall: I think what we all learned at the time, and again, you know, SAS kind of lends itself to this as well, is the faster you can get value out of a system, the better. And well, you know, you may sit back, you know, at the time people would sit back and whiteboard all these processes and they were trying to build a system that map to their current processes. When the reality is, if it takes you a year or a year and a half to implement something, um, or integrate it with all these other systems, your business has changed so much that what you built is something that supported you in the past, but it doesn't kind of build what you need in the future. So the faster time you can get value out of any system, um, the better off you're going to be because people will now start using it and then let them kind of evolve it versus sitting in a whiteboard and, and trying to figure out what your kind of current and future state might look like. So I think the main thing is fast time to value. If the faster you can move, the faster you can get value out of something, the better. And I think in a lot of ways we're all experiencing that with AI today. Um, everybody's experimenting with AI, everybody loves it, they are embracing it, um, but there's not a lot of success stories. There's still a lot of experimentation that's going on because it's not trained on business context. So you can't just take a model and put it on top of a bunch of your system data and assume that it has the business context it doesn't. So you have to add the business context layer, um, the semantic layer on top of the data, and then train your models on that. So now you have a refined set of data, it's ready for AI. You train the models on that as a subset and now you've got an agent for your salesforce or for Pipeline or for, you know, whatever it is that you're trying to accomplish. So I think part of it is that, you know, these things have to meet together. But again, you want to get fast time to value, so how do you kind of marry those things together? So you have to think about it and make sure that you're focused on the, you know, customers, you know, on their side. How are they going to get the most value out of whatever it is you're trying to do, whether it's AI or RDS packaging or anything else. And if you focus on that, um, typically you'll have, you know, good positive outcome on the other side.

Rachel: Mhm. And it's funny you mentioned the context thing I was reading on LinkedIn. I can't remember who said it, so apologies to whoever said this. Um, they're saying something like, soon there's going to be a huge influx of a role called AI Context Engineer because of exactly what you said, needing that business context and layering it. And it's uh, going to be different from any kind of like rev ops or go to market ops role because they're going to work throughout every single facet of the business, beyond, beyond revenue, just wherever AI touches any part of the business, layering business context on top and like keeping up with the nuances of everything that's happening. And I just, I thought that was just so crazy.

Steven Birdsall: Yeah. Ah, I was at a customer event, uh, in Pittsburgh and it was, and they were doing all this massive training for thousands of, you know, their, uh, their staff, um, their big, you know, alteryx customers. And it was funny because the first slide that came up said your job is not going to be replaced by AI. Your job is going to be replaced by somebody who knows AI. And that's really true. Right. It's like I teach my kids the same thing, like embrace it, learn it, you know, figure out how to harness it. And that's where you're going to really kind of thrive in the market. Um, so don't ignore it, you know, but, but you know, adopt it. And part of it is like, like you're saying like there's a new role like revenue engineering. It used to be like sales operations, then it was business operations and revenue operations now. And now there's revenue engineering. How do you engineer a company? Well, part of it is how are you using AI and what agents are you building around that? There's a whole agentic framework that you can, you know, you know, build that's um, specific to sales, specific to marketing, specific to product management, product development, you know, all the R and D that's going on in the market right now, AI is actually doing a lot of that, you know, code building. You can do bytecoding. So if you embrace all of that, you figure out how in your particular company or with your particular role, how do you harness that, um, for the greater good, which ultimately is if you focus on the customer and value, uh, like we said earlier, then that's going to be the most successful outcome.

Rachel: Absolutely. And we deal with this a lot at USC also because like you said, everyone's trying to layer AI on top of everything they're doing. But what we've found, um, is that a lot of companies are trying to layer AI onto unoptimized or broken or even missing processes and systems. So the data is bad. You know, salespeople are all off kind of doing their own thing. There's no strict pipeline management structure or anything like that. And then they're trying to automate this with AI and you're just scaling like negative touch points and you're scaling bad data and you're directing the company in the exact wrong direction. Um, so people have to be very careful with that as well.

Steven Birdsall: Yeah, I think McKinsey, BCG, they all come out with studies that 90% of, you know, AI projects fail. Um, it's primary because of that. It's just that, you know, accelerating to a bad answer still leads you to a bad answer. And our business context without, you know, if I talk about my sales organization, um, I, uh, wrote a Forbes article, um, it was published earlier this week about this, that our whole go to market has to change, it has to adapt. It has, you know, into this new world. And part of it is you think about, you know, if you're, if you're selling, how do you, how do you, how are you going to leverage AI? Well, there's some public information that you can go share that you can kind of take a model and go look at and you got a prospect and you're going to go do your analysis and you're going to do Gen AI so that you can write, um, a more effective email. That's great. Like you can, you can do that generally speaking, but you also want to make sure that that's trained on your information so that, you know, are they an existing customer, um, are they in any escalations, um, when is their next renewal? Do I have pipeline? What relationships do I have with, you know, other contexts inside the company? Um, like all these other things. So you, you, you can definitely have, you know, public data, but you need it with your company data that's married up so that you bring those things together. Well, if, if I am looking at a territory, how I define a territory, how I parse out, you know, who actually gets leads, all these things, those rules change all the time. So if you just train AI, you're kind of putting it on top of your company data and you don't have the business context, then when you change your territory, when you, you know, maybe you're refined and you're going to go to an industry, go to market, all those things. Now you have got to train a model on totally different things. So how you define your business has to be understood by AI in addition to all the other things that it's trained on. So you really need to bring these worlds together. Which again is why you have revenue engineers. Revenue engineers is a different role because, you know, you have, there's prompt engineering. So how do you write the right prompt? How do you know which model to use. You know, some models are better than others. X or you know, Grok may be good for social, so you kind of get that aspect. But you might have anthropic that you use for more enterprise ready data and then you might use OpenAI for more science related things. So depending on what it is that you want, different models will give you different, you know, uh, uh, value. And so understanding how that then gets contextualized into your go to market, those things have to be understood as well. So there's a lot of things that have to, you know, get right in order for you to get the most value out of AI. But you can't just say I'm going to go put a model, I'm going to put it on top of my salesforce data and away I go. That's not how it works.

Rachel: No. If only it was that easy. Yeah, ah, uh, AI is supposed to make everything easier, but it almost feels like everything is so much more complicated now.

Steven Birdsall: Like anything, it's the setup that matters, right?

Rachel: Yeah, absolutely.

Steven Birdsall: I always love math because a lot of it's in the setup. You know, there's a lot of different theories, but if you don't set the problem up correctly up front, then uh, if you apply the wrong theory, you're not going to actually be able to solve the problem. So a lot of it has to do with how are you setting up the problem in order for you to effectively go solve the, you know, the problem itself. Um, so I think AI is no different. It the matter, it matters in how you set things up. Data is obviously the critical element in all of this.

Rachel: I feel like I could spend a whole podcast just talking on AI itself with you, but I just want to reel this back to SAP for a minute.

Steven Birdsall: Um, so when we talk about SAP, by the way.

Rachel: SAP.

Steven Birdsall: SAP.

Rachel: Do you, do you not call it SAP?

Steven Birdsall: No, um, it's.

Rachel: Oh my God. I'm the only person who's been doing that.

Steven Birdsall: That's okay. It's the, it's a journey, it's a, it's actually a German language. So it's systems analytics and programming, but it's basically SAP is an acronym in German and that's, that's the derivation of the company. But it doesn't matter. Okay, but, but SAP is, is how,

Rachel: um, okay, that's good to know. Thank you. It's hard when you, when you just learn a term just from reading it and you don't hear about it a lot, you're just going to like come up with Your own way.

Steven Birdsall: Good.

Rachel: All right. So at what point did the momentum with these packages start to take over? And what did you have to do differently once you were scaling versus when you were trying to get those first deals in the door?

Steven Birdsall: It's a good question. Um, so on the scaling side, it was, you know, in the beginning, it was relatively easy to figure out which packages made the most sense. We were super competitive in the market with Salesforce, and so starting with CRM kind of made a lot of sense. And then it was again, these packages, like I said, you know, they were costing about a half a million euro per package to build out because they were so robust. So it's like knowing which package to build next and scaling, um, how do you manage the partners so that you, you know, don't lose the brand of rds, because if the partners built a bunch of their own packages, and all of a sudden now, instead of 10 weeks, it takes 10 months. I go back, you know, in time, so trying to manage the brand. So the scaling aspect was super complicated, uh, and complex. Um, but it required us to really kind of think through what do we really want this business to look like a year from now, two years from now, three years from now? Um, on one side, it was great because from a compensation standpoint, um, I literally had to move from an annual quarter to a quarterly quarter because we were so successful. It was doubling, like, every quarter, and so that was going really, really well. Um, and so from a comp standpoint, it was great, but at the same time, like, how do you know what the growth is going to be? We thought by doubling it in the first year, that would be a pretty aggressive growth target. When we grew at 5x and it was like, okay, so now we got to think about things. So I think part of it is just, like, different problems that you face when you're scaling at that, you know, at that level. Um, so a lot of that had to go, and there was credibility, or are we really actually selling these things, our customers implementing them? So I had to put together a small team, but I wanted people to actually make sure that we were fulfilling the promise of rds. So I would go off and I had just a few people. They would literally get on the phone and call customers after they were live. Are you happy? What was your experience like? Like my own kind of customer SAT survey, um, to make sure that they were actually truly getting the value out of it. Otherwise, you know, people would think, well, you might be gaming the system. And people are just saying that they bought an rds, but they didn't really implement it. So we wanted to follow through and make sure that we truly were, um, you know, selling it and customers were truly getting value out of it. So I think a lot of it is just keeping yourself honest and making sure that, you know, I don't want anybody to think I'm ever gaming a system like, you know, that was my credibility. At the same time, I had a, you know, personal brand and it was important that people felt, you know, understood that, like, this is, this is real. So I think there was a lot of that had to go into it as well. Um, but, yeah, it was, um, like I said, it was a blast.

Rachel: Did you get any growing pains or places where things were straining and felt like they might break and you had to pivot and make changes to your systems or processes as you scaled bigger and bigger? Because this is, this is doubling, you know, every quarter. So that's, that's quite an explosive growth on the system.

Steven Birdsall: Um, I think, you know, we pivoted daily, but it was more on just how we positioned and how we were selling and making sure that we were more refined in the package that we were building, things like that, making sure that the assets we had, like. So, um, a good example would be in finance. They. They started looking at what was included in the package and there was a lot of these accelerators and assets. And so there's a big question like, like, should we putting value on that? Is there, should there be a price tag on the assets that are part of the package?

Rachel: Right.

Steven Birdsall: Contingent was. No, but, like, these are just part, part of the package. So we're selling the package and it's inclusive of basically everything that a customer needs to be live in 10 weeks or less. Um, but I don't want to, you know, I didn't want to refine it back down into like a SKU based. Like there's these five SKUs make up a package. Um, the other thing was making sure that, um, there was a lot of people on my team that felt like we should have our own Salesforce or that we should have like an RDS SKU so that it's literally like a separate software product. And so I was pretty adamant that I don't want to do any of those things because that would minimize my ability to truly scale. Um, I wanted the same software. I didn't want it to be like, oh, that's an RDS software. That's an RDS CRM system. No, uh, it's just SAP CRM So it's important that you know, we kept that in place. We kept the um, the assets themselves were all inclusive in the package and then we delivered that in terms of, you know, the value statement. So a lot of it was just trying to build all those things into it as well.

Rachel: Mhm. Because that allowed you to create the like the LEGO building blocks. Right. And that's what gave you the scale.

Steven Birdsall: Yeah. Because these things all had to fully integrate with one another. And if I had my own kind of version of the software, I would actually create complexity and a customer would think like, I've got this. Like it just, it created way too many complexities. I wanted to keep it as simple as I possibly could, which meant keep everything the same. There's no different in the software. The implementation scope was defined and it was like it was in concrete. I had a lot of customers that I went to, for example, and they would tell me, um, I like what's in the package, but you know, I also want this kind of core HR system to also have employee self service. I'm like, it's not included. So I'm not saying you can't do that after you implement. But this is the scope and we will not deviate from the scope. So there is no other thing. You either buy the RDS or you don't. Um, but it was like being very, you know, um, you got to dictate like these are the terms of the, of the package and a lot of people trying to pull me in a lot of different directions and we just were absolutely adamant that um, what was in the package is what you get and that's it. And once you're live and you're in production, you can do whatever you want. But for this package, this is how we're going to deliberate. So I think a lot of it was just being very um, strong willed in terms of not deviating from the plan that you're on.

Rachel: And what gave you the confidence to keep steady and doing that when you're being pulled in all these different directions and people saying, well, we should do this and this.

Steven Birdsall: Yeah, part of it was just the work that we had to do up front, you know, in just investigating what did we try before, why did it fail. So there was a lot of that upfront work that I would say happened before I went to the board, um, you know, kind of that I was able to articulate to them like all the things that, you know, why we failed, you know, trying best practices and some other things in the past. Um, Most of it wasn't with the package itself. It was. Or the best practices that existed because we had Accelerate SAP, we called it asap. And that was like a model where you could implement SAP quickly. Um, so we took assets from there and these other best practices. What was missing is really the go to market piece. How do you then get that into the field and build that to scale? So a lot of it was, you know, just trying to figure out how we're going to go pull all these things together. Um, what gave us confidence, I would say, is success. Right. So it's one thing like I said, you know, I failed and failed and failed until I went to the customer. So a lot of it was just trial and error, you know, what works. So the packages themselves, I would say, well, we were as dogmatic as we could be in terms of this is the package. We did evolve the package. There were other things that we said, oh, there's, there's some other things that other assets that we should include, maybe broadening the configuration guide or clarifying certain things. So the package itself was, uh, pliable and fluid to a degree, but it was just still within that same defined scope. It was just how we delivered it might be a little bit different. So I think being a little flexible and fluid in the way that you put things together, especially as you're packaging it, those are all important things as well. But, um, yeah, so I'd say being willing to pivot and be fluid in, you know, the go to market to a degree, but being, you know, absolutely stalwart in certain aspects that you just can't deviate from.

Rachel: And so what would you say was the, the big difference between the other times that SAP has tried doing packages like this before and the success of what you did with rds?

Steven Birdsall: I think the biggest difference in retrospect was just having the field go to market team aligned around what was being built. I think in the past, it was a lot of it was just built, you know, in Germany and development, um, and used by the consultants, um, you know, to help accelerate, have, you know, certain guides that made it easier to implement. But what it was lacking is the field go to market piece. And because I had been coo, you know, in all the major markets around the world and kind of worked and built, uh, a strong, you know, personal brand, um, it kind of gave me the ability to go, you know, do that in the market that I think before was uh, not something that was out there. So, yeah, having the credibility and making it kind of work that way, those were all relatively new, uh, things that hadn't been tried before and at a speaker level. Like I said, I made sure that the regional presidency was important to them. Um, we reported on it, we forecasted. Um, all those things were really important in retrospect. And I would say some of it's like blind luck. Like, it wasn't like I thought, hey, here's exactly all the things that we got to do. Some of it was just like, as I was building it, as is, the whole team was building it, um, understanding kind of the decisions that we made and the resulting impact, you know, so it was just, we got lucky, um, and it was the right thing. And the other was, like I said, just knowing when to pivot and change. Um, those important as well. But we had a lot of people that were behind us that wanted us to be successful. And once they caught on and, you know, and again you saw success, then it was a matter of just. Then it became more of a scaling issue than it was like, are people interested and do they want to leverage it?

Rachel: So let's talk numbers for a second. What did the win rate, sales cycles, average deal sizes, uh, look like early the early days, versus once the model

Steven Birdsall: was proven, it pretty much stayed the same. Like, these packages were in the 100k range. Um, the variable was the number of users you had. So if I went to pick a company and a Fortune 50 company, um, that was an SAP customer and I went in with RDS, um, the implementation, the package itself might be 100K. Um, but if they have 500 sellers or 5,000 sellers or 50,000 sellers, then the variable would be the software license cost. So we wouldn't change the implementation. The package itself, it would only have a variable around, you know, the number of licenses. So a lot of it was just scaling up and down based on the number of users or, you know, whatever the metric is. Um, if you're selling hr, the metric is all employees. If you're selling supply chain, the metric is an engine, like an APO engine. Uh, if you're selling a CRM system, it's the number of sellers that you have. So those metrics might change based on the number of users you have. Um, but the reality is, you know, the, the package itself doesn't change. So the point was that you could be live in 10 weeks and be getting value out of it. Then it's up to you. If you want to roll it out, you want to just do it in your test system, you might just put it into like your Your, you know, we build it a test and development system, um, and not put it in production, but you're certainly live in 10 weeks and you can roll it out to your entire salesforce. It's totally up to you as whether or not you want to put it into production. So a lot of it was, you know, those kind of things as well.

Rachel: So to pivot a little bit, if a CRO today was trying to launch a new packaging model, new pricing structure, new sales motion, what kind of playbook would you advise to them for validating it with customers or getting it. Getting their board on board with it and starting it up?

Steven Birdsall: You know, it's interesting, um, we're all in the same mode right now. We're all trying to figure out how AI is going to change our company, how it's changing our products, and how it's going to change our go to market. So all of us are grappling with that already. And that's. There's no different in what I was building 15 years ago and what we're thinking about, how we're building, you know, out the company today. Um, you know, SaaS, if you have a SaaS solution, you built it specifically to go to market. You know, is there a chance you're going to get displaced by AI? Uh, can somebody bytecode a solution that gives you them everything that they want? So we're all thinking through, you know, what is the impact of AI. So I would just argue that that's, that's, that's an evergreen problem. Um, it never goes away. We all have to be refining, you know, what we're doing. What I would say is like, to me, starting off with the customer, you know, I'm going to talk out of both sides of my mouth for a second. Okay. On one side, it's like I should have talked to the customer first and they would have said, you had me, hello. And I would have gone down that path and I would have, you know, built that pull model I was talking about. At the same time, you know, we all know, like Steve Jobs would tell you, you never go to a customer and ask, you know, what they want, because they're going to tell you what they need. They just, you know, if you were. I heard this same metaphor, um, from, you know, people talk about Ford, that if people were to go off and say, you know, to somebody who has, you know, horse and buggy, what do I need? I need a faster horse and buggy. I don't need a car. Like, they would never tell you that. That's what they need, but that's what was built. So I think it's the same thing with us is, you know, like customers are going to tell you what they want. That's a better, faster version of what they have today. But the reality is you might completely get displaced and there might be something totally different. So you have to be able to kind of do both, hear what your customer is saying, deliver, you know, the greatest source of value to them, but also be able to see around corners and know what is in the future and kind of build for that at the same time. That's the problem we all have is, you know, in like Clayton Christensen's innovators dilemma, it's the same thing, right? How do I take and make sure that I continue to drive the growth in the business with what I have today while at the same time investing in, you know, a creative solution? That's what's needed in the future. And you have to be able to do both of those things. And the bigger you get, the harder that becomes.

Rachel: So how would you suggest that CROs actually create urgency for this change when the existing business and the existing motions are still producing revenue?

Steven Birdsall: I think any CRO, uh, would tell you they're, they're already doing that. I don't think I have to convince them that they need to move fast or that they need to think differently. Um, we all, we, we all talk. I mean it's a, in the grand scheme of things, like in tech, we all kind of generally know each other and so there's a good community of CROs and you know, we, we, there's a lot of people will talk. So I think first off is just having a really strong community of CROs is really, really important. Um, I was just, you know, talking to Sam Jacobs this morning. He's got the pavilion. I'm joining that. There's top line. There's like a lot of things where you can just get together with other CROs and they feel your pain, you feel their pain. And what are you doing differently? How do you think about managing your territories? Or what are you doing different in comp or how are you reducing churn? Like there's just the normal go to market stuff. Um, that's really, really important that you have a good strong network of other CROs. I think the other thing is, um, you got to just outthink the problem. Like you got to give yourself enough time to really dig in and understand, um, what's going on in your company in the market today and, and ruminate on that and don't be just quick to make changes changes, but really think about what problem you're trying to solve. What are the different solutions that you know, you have available to you or are the things that you need to create that's totally different based on your respective company and your customer set and you know, everything else? Some of us have a bigger churn problem or downsell problem than others. Um, anthropic, you know, believe it or not, like they have their own sets of issues right now. They're hyper growth, um, that, you know, when I was at Anaplan, we were growing 100% year on year. We're pre public wanting to go public. So having to set up all new systems and thinking about the way we go to market it just again I go back to understand the problem m that you're trying to solve. And every CRO I think, you know, worth their weight would tell you, like, I have to understand what the problem is that I'm trying to solve. And then I can go off and go try to find the solutions. But if you just look for any solution, you know, it's, it's, you can be busy and be active, but not actually, you know, get the work done that you need to. So I think first and foremost is give yourself enough time to really truly understand the problem that you're trying to solve before you start trying to apply AI or any other solution.

Rachel: Awesome. Well, we're starting to run up on time here. I did have one last question. I'd like to ask this question when there is a little bit of time to ask it. I think it's really fun. Uh, what is the revenue leadership story that you don't get to tell enough that you like telling?

Steven Birdsall: I'd love to talk about, um, for me personally, um, I have a very eternal perspective on things. So I don't think of my life ending when I die. I think of my life being more eternal. And to me that's what makes you more genuine. It makes you more authentic. I care about people. I care about the people that I work with. I care about my customers. But not just because I'm trying to make a dollar or because I'm trying to make a name for myself. I truly care about people. And when you're authentic like that, um, it shows, it shows in everything you do. It shows in every, you know, like that's how you show up. And so I think it's really important that regardless of who we are, we're individuals, we're humans, and we should find ways to help each other, even if they're, you know, in some other totally into different industry. Um, I love just like, I think most of us are extroverted, so we like to talk to people anyway. But I think just being genuine, you know, like the old adage that people, um, don't care how much you know until they know how much you care. Um, I truly believe that's the case. And so, yeah, a lot of it I think is do the right things and good things will happen. Um, sometimes bad things happen and that's okay too. And you kind of bounce back from it and you learn from it. But I never look back and regret anything. Um, I. I recognize bad decisions I made. I recognize mistakes I made. Um, I try to apologize for those and, you know, learn from them. But I never, like, let it kind of keep me from making progress. I try to learn and grow and move fast.

Rachel: That's so special. I love that. I think we need so much more of that in the world right now too.

Steven Birdsall: Yeah, I think so too.

Rachel: If everyone thought that way.

Steven Birdsall: Yeah, I agree.

Narrator: Yeah.

Rachel: Thank you so much, Steven. This has been an excellent conversation and I think our listeners will also love it.

Steven Birdsall: Good. I appreciate it. It was good to talk to you and I, uh, look forward to staying in touch.

Rachel: Absolutely.

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