You (and your people) have got to believe. True faith is not when you believe in a vision and pursue it as long as the organization executes flawlessly. True faith is when you believe in a vision and are willing to follow an imperfect person and to tolerate imperfect execution and imperfect results. That's real faith. True believers believe that you're going to learn from your mistakes. What we found was that not everybody in our company had true faith. I don't blame them. I don't hold it against them. On the other hand, we found that most people did have true faith.
Layoffs are the ties that bind. In a way, the emotional bond you have with someone you lay off is even stronger than the bond you have with the people you keep. You and your employees are in a reciprocal relationship: They're getting something from you, and you're getting something from them. But the people you laid off have made a sacrifice that saved the company. You'll always be indebted to them for that.
Find your focus. When the market was funding grander and more expansive business plans, it experienced the equivalent of 1,000 companies wanting to create automobiles. And, logically, it can't afford to have 1,000 automotive factories. What it really wants is 1,000 companies building car components and a handful of companies putting the entire car together. When the market began to fall, the message was, "You guys have to cooperate now," and the question became, "Who can manufacture one component efficiently?" That forced us at MicroStrategy to look at our business and ask ourselves, Where are we no better than anybody else? And where do we have 1,000 man-years of expertise, hundreds of millions of dollars invested, and a rational reason why we should win the business?
Before that, MicroStrategy was about to go to the market to raise $1 billion, so we could hire 2,000 more people and launch 10 different businesses. But we've retrenched and refocused. Now if someone wants to build an intelligent traffic system, we say, "Fine, use our software as one component." We're going to provide the one piece that we know how to do best, instead of taking on the greater risk of building the entire system ourselves. An economist or classic business theorist would say that we've clarified our value proposition, because we've focused on the business most likely to generate positive cash flow. It's not that we don't have a grandiose vision anymore. We still do. But it's a vision over the next 10 years, not the next 12 months.
There's no substitute for experience. When Sanju Bansal and I started the company, we were 24, and we were like people who had taken up yachting for the joy of the sport. Then we got successively better and better, and finally we took a ship onto the open ocean on a major voyage. And the first voyage worked well, the second worked better, the third one worked great, and then -- with the entire world looking on -- we were caught in a "perfect storm." We came out the other end with our lives, but we lost part of our crew. And now I'm sailing again in 2001, but I don't look at the ship the same way anymore. I'm never going to look at the ship as a joy ride. I can't. But then again, maybe that's what qualifies me to run a company. Maybe that's what qualifies a captain to captain a ship.
Chuck Salter (csalter@fastcompany.com) is a Fast Company senior writer. Learn more about MicroStrategy Inc. on the Web, or contact Michael Saylor by email (saylor@microstrategy.com).
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