Monica Adractas, Head of Americas for Workplace by Facebook: The Customer Is Still Always Right

Good afternoon, everybody. My name is David Apple. I'm head of the SaaS and software vertical at Intac, the world's largest independent provider of pure cloud ERP. It's our pleasure to be hosting today's Tactical Stage. We got a fantastic session coming up here in just a moment, led by Monica Adraktis, the Director of the Americas for Facebook Workplace. She's going to be talking about the customer is still always right. And for those of us who've ever thought about what's the magic and intrigue about Facebook and what it's done and how it engages people, Monica's got some fantastic insights of how we can apply that to our conversations, our engagements with our customers. That's our hope. As she and I were prepping for this session. It's her hope as you guys all walk away with some insights how you can bring consumerization to your own customer experience. Monica's got quite a bit of experience here. Early in her career she worked at Starbucks and then Holiday inn Express, spent 10 years at McKinsey, involved in over 60 other consumer products companies and engagements with them, and then just spent the last several years at Box as the head of Customer success. So she brings a great perspective both from the past and the present. We hope you all enjoy. Monica Adaraktis.

Thanks so much. Thanks, David, for that great intro. Hi everyone. I'm here to talk to you about how to bring a consumer mindset into SAS business. But before I get going, I just wanted to thank Jason Lemkin, organizers of this fantastic event. SAS is truly changing the way people work and the way people live. And so much of that momentum is being driven by the people at this event and the people in this room. Thank you so much for being here and for taking the time to listen. It's a true honor, really. So I want to start off by saying that consumer and enterprise, it's like peanut butter and jelly, it's really just better together. And you may be asking yourself, well, why should I even care about bringing a consumer mindset into my business? I have a lot of other things to worry about. Well, think about this. If you're a consumer company, life is really hard because your customers are judging you at every interaction and they have no long term contracts or commitment to you. Think about it. When you go to a store, if you have a bad experience at that store, you don't have to ever go back. When you use a consumer technology, if it's buggy or it doesn't work for you, or you don't see value in it, you're done. And so consumer companies have really figured out how to listen to their customer and how to provide real value. We all know as SaaS practitioners that that matters for our business too. After all, what is the point of spending all this money on sales and marketing if our customers are going to leave us and we don't reap those long term revenue streams? But I would assert to you today that managing churn and managing retention, to use a baseball analogy, it's a single, it's good, it's necessary, get you on first base. But I would assert that when customers love your product and they derive so much utility from your product that maybe the double is being able to raise your price over time, resulting in more revenue. Or maybe the triple is being able to sell those customers additional products and services over time. And maybe the home run is that your customers like love your product and get so much utility out of it that they go tell other people in the market, thereby driving virality and market demand. Peanut butter and jelly. It's better together. And by the way, if you haven't had a sandwich lately, try it toasted. I promise it'll change your life. If you've ever visited us at Facebook, you've probably noticed we have these posters all over campus. We have a campus that's called the Research Analog Lab and they create all these posters for us. Many of these posters have quotes, slogans, they're fun, they're interesting. A lot of them honestly are just downright weird. But my favorite are the really simple ones that amplify some of our core values. And I thought what I would do is to share three of those with you here today that I think best demonstrate our mindset as we bring consumer into enterprise. The first message I want to share with you is, is People over Pixels. People over Pixels. What People over Pixels says to me is that we have to think about how we put people first and how we use our technology to make their lives better, their personal lives, their work lives. It means providing solutions to their problems and not just offering technology for the sake of technology because it's cool or it may be marginally better. Let's face it, change is happening. We know this. This is not a surprise. Change is happening fast in the world around us, often driven by technology. And I think the world around us is a great place to to identify opportunities where you can help people and you can identify problems. At workplace, we think a lot about the way the world is changing when it comes to people's work environments. Think about the work environment of yesterday. It was really traditional, it was fixed. There were multiple sources of information. It was command and control. It operated in silos, and it provided exclusive access to some. Given changes in technology and the way that we're all operating in our personal lives, this is evolving rapidly to a next generation workplace. That next generation workplace is highly mobile. It offers a centralized platform and transparent sources of information. It's open, it's democratic, it's connected, and it provides access to all, not some. This is already how we are living in our personal life and we're bringing the same habits, behavior and expectations into the workplace. If you think about younger workers today, they have grown up with this as an expectation and they will be the majority of our workforce no time soon. Okay? So to continue with the changing work environment that we're all experiencing, I want to talk about the Harvard Business Review. The Harvard Business Review likens what's happening to something that they call new power. And they describe new power as a current. New power is no longer an ivory tower of siloed information, but instead it's open, it's participatory, and it's peer driven. Like water or electricity, new power surges. And the goal with new power is not to hoard it, it's to channel it. Let's look at one other thing that's changing for all of us, the way that we communicate. So let's look at this one example from my recent trip to Italy. Not that long ago I made a trip to Italy. I would communicate about it via text, maybe an email, maybe an SMS to my friends and family. That very quickly evolved to photograph on platforms like Facebook and Instagram. That is very quickly evolving to video. We're seeing our daily page views of video skyrocket on the Facebook platform. And even that is evolving rapidly to more rich and immersive forms of media such as 360 video. So what's fascinating about this is that in our personal lives, most of us are communicating on the right hand side of this chart. But if you think about the way that you communicate in your work life, my guess is you're on the left hand side. So it just doesn't add up. Why are we communicating on the right hand side in our personal life and the left hand side in our work life? That is the people over pixels problem that we're trying to solve with workplace. So just for a little context, actually let me ask you a question, just a show of hands. I think I can see you. How many of you raise your Hand have a Facebook account. Okay, so this is a picture of Workplace. And every time I show people Workplace, I have to say the big surprise. There's no surprise. It looks and feels a lot like consumer Facebook. And that's very intentional. It has a lot of the features that you would recognize, like news feed, profiles, groups, search, and the work version of Chat of Messenger, which is Chat. However, Workplace is a private instance of Facebook intended for a company to collaborate and to get work done better. And it's been altered to meet enterprise needs and enterprise requirements around security, user management, data ownership, and analytics. I wanted to give you this context because we'll be talking about some examples that pull from Workplace. As we thought about the changing workplace and problems that we wanted to solve, we thought a lot about leaders. Imagine being a leader today in the work environment that we discussed. Even if you want to be a next generation leader, you want to be open, you want to engage with your people, you want to create an open, accessible and connected culture. How do you do this? I had a CEO come visit me a couple weeks ago down at Facebook and he was really frustrated. He said, you know, I really want to understand. I want to understand what's happening in my company. I want to understand what my employees think because I'm pretty sure they would have some great feedback that would enable me to make better decisions. And he said, I'm really frustrated because like a lot of great leaders, he makes the time to go out into the field and interact with his employees. But he said, every time I do, I feel like they've been scripted and I can't get my finger on the pulse of what's really going on. So with Workplace now, he's able to engage, he's able to have a real dialogue with his employees, and maybe most importantly, he's able to listen. He's really listening to what's going on, which is enabling him to make better decisions and move his company faster. By the way, this is an example of a CEO using Workplace to go live. He's the CEO of a shipping company in Norway and many of his employees are on ships in the middle of the ocean. It's amazing. So you may be wondering why there's a group of guys playing broomball on the screen behind me right now. No surprise. This is from our friends over at GoPro. GoPro has grown very, very quickly, and as a result, they've struggled with how to bring that one culture and connectedness that we talked about. This video was the first that they posted in a group that they created for internal dogfooding called Live it, eat it, Love it. After this video was posted, there were literally thousands of photos and videos that came after it that had provided direct feedback into their product team, which has enabled them to make changes related to cameras, related to mounting equipment, even features for their new Carma drone. It's enabling their company to move faster and innovate better. Imagine what happens when you have a truly distributed environment. This is a supermarket chain down in New Zealand called Countdown. And the problem that they were facing is counterfeit bills circulating in their system. Think about how they had to address this problem. Before technology. Somebody at headquarters would literally have had to draft a communication, they would have had to print it on paper, they would have then mailed it to the stores. Somebody would have to tape it up in the break room or on a cash register. And then you would just hope that people read it, remembered the message and were able to enforce it with customers. Now, in 90 minutes, they reached 190 checkout counters. So people over pixels the problems that your customers are trying to solve. My second message to you to be open, listen, really listen to what your customers are telling you. I think consumer companies do this really well. I remember when I worked at Starbucks. Starbucks requires every single employee in their company, no matter what your position, to spend time working in the store as a barista. And this, their belief is this drives empathy for what's happening with the customer and what's happening in the front line that pays dividends no matter what an employee goes off to do later. I remember my first week in the store, they wouldn't let me anywhere near the espresso machine until the very last day. And I think it's important to remember as we're open, that those of us sitting in Silicon Valley here, we're a strange breed. I mean, let's face it, we all have multiple laptops, tablets, phones. We can't go 10 minutes without checking our email, SMS and 5 apps. My 7 year old daughter knows scratch programming and wants to be a mobile programmer and just asked me last weekend if she can have her own blog. It's important to remember that we have 1% problems and issues here in Silicon Valley and we do not represent customers at large. Most workers aren't like us, they're not behind a desk and they may not even be connected by technology to their place of work. Starbucks recently addressed this problem with workplace by connecting people across their stores and went live to a very distributed workforce. This is enabling their culture to come together in some Pretty difficult times here in this country. And also enabling cross pollination of best practices such as how to merchandise and greater collective success. One more example I want to give you of workers being different company called Fit for Mom. Fit for mom is a franchise model. They have instructors in over a thousand locations that provide fitness programs to moms. Previously they had no great way to facilitate communication across their organization. Now they're using live to offer 30 minute instructional videos on a daily basis. This is energizing, inspiring and spreading best practices across their company. So yeah, we listen a lot and at Facebook we thought about how could we possibly listen to more people at scale. And so we decided to apply something called Metcalfe's Law. If you're not familiar with Metcalfe's Law, it was invented by Bob Metcalfe a few years ago and originally referred to the telephone system. And it goes something like this, which is basically the more nodes that you add to a network, the more valuable the network becomes. And that's because each node in the network can talk to every other node in the network. So for example, on the left hand side of this chart you've got five nodes which comprise 10 connections. But on the right hand side you have 12 nodes which equate to 66 connections. Obviously a very important concept for Facebook, a really important concept how we think about networks in companies for workplace. But we wanted to take this one step further. In workplace, there's a functionality that's called multi company groups. This is the ability to communicate and collaborate with another company or companies that are on workplace. As the world gets more specialized, we think this is critical because we have so much more coordination and collaboration to do with customers, vendors, partners, et cetera. And so what we did was created the concept of customer groups and partner groups where everyone can share back best practices information and feedback. Some of our best ideas have come from these groups. So we listen a lot. But we're also obsessed with the data. On the chart behind me is one customer that deployed Workplace and took to it very quickly. You can see they achieved almost 95% clearance rate almost in the first week. We love this obviously, but we don't take it for granted. And we dig into the data to try to understand what actions, what features, what timing enabled this user engagement to happen. We run a B tests constantly because we recognize that it's often a series of really small decisions that create for greater impact when it comes to user engagement. It's really important that all functions in your company work together on this at workplace. Our One primary metric across our entire team is user engagement. When I was at Box and we were driving customer retention programs, we made customer retention one of our core focus primary metrics. And I'm pretty convinced that that was a key success factor to what enabled industry leading retention at Box. So it's absolutely critical that go to market and product work hand to hand. And for those of you who are investors and CEOs, keeping an eye on that and intervening when necessary is critical for user engagement. The third and final message that I wanted to bring to you is that fortune favors the bold. Many of you have already made very bold decisions. Maybe you left a well paying job, maybe you've had to hire people, fire people, self fund your company or take VC funding. I would challenge you to make equally bold decisions as it relates to your customer. We've made some pretty bold decisions at Workplace and I wanted to share a couple of examples with you here today. Many of you might remember when Workplace was in Beta, we were called Facebook at Work. And back in the day, Facebook at Work was actually an integrated offering with consumer Facebook. This was really natural to those at Facebook. This was how Facebook had used the product for over 10 years. And Facebook's DNA really just didn't understand why anybody would want a separated offering. As much as that may seem counterintuitive to all of or intuitive to all of us. As Facebook at Work went into the market, they learned that wow, users actually don't want all of their personal and work information commingled. They want it separate. And enterprises had high needs around security and data control and user management. This was a really bold decision for Facebook to separate out the two platforms. But we knew that without the bold decision, potentially there'd be no future for Workplace. Another bold decision that I mentioned earlier that we've made at Workplace is to be absolutely obsessed with user engagement. It is our 1 primary metric in our North Star and the implication of that is that there are many other core metrics that we have deemed are important but aren't our North Star. And those include things which I'm sure important to all of us like revenue seats, logos, contract, all of those. Take second stage to user engagement. A really good example of this and another bold choice is how groups show up in Workplace. We have over a billion people that use groups on consumer Facebook. I'm sure many of you are probably part of a family group or an alumni group. However, my guess is that most of the time when you post on Facebook, you're posting to your entire friends and family network on your timeline. This is a real problem in the work environment. Imagine being in a company where everybody was posting to everybody about everything. It would get noisy very quickly and so we elevated the prominence of groups in the product. Again, a bold decision because it goes against the grain of what users are used to on consumer Facebook, but something that we knew would be critical for user engagement in the long run. The world is changing and nobody knows this better than your customer. Think about the companies that didn't embrace mobile a few years ago. They're gone. So I would encourage you to act with urgency. Focus on your customers as people with problems to solve. Don't just pitch them technology. Be open to listening and to counterintuitive feedback. And finally, don't be afraid to make bold, scary, maybe even terrifying decisions. Maybe. As SAS leaders, I challenge you to walk out of this session thinking of at least one opportunity that may feel hard, but that you know would benefit your customers and address it. And if you do this over and over again, the sky will be the limit in terms of your SaaS success. Thanks again for having me, for taking the time to listen and for all the change that you're driving. Good luck.