How to Manage Geeks

There's a saying in Silicon Valley: "The geeks shall inherit the earth."

That's a sign, if you needed one, that we have permanently entered a new economy. Once a term of derision, the label "geek" has become a badge of honor, a mark of distinction. Anyone in any business in any industry with any hope of thriving knows that he or she is utterly dependent on geeks -- those technical wizards who create great software and the powerful hardware that runs it. The geeks know it too -- a fact that is reflected in the rich salaries and hefty stock options that they now command.

But how do you manage these geek gods? Perhaps no one knows better than Eric Schmidt, CEO of Novell Inc. Schmidt, 44, is a card-carrying geek himself: His resume boasts a computer-science PhD and a stint at Sun Microsystems, where he was the chief technology officer and a key developer of the Java software language. And, as if his technical skills weren't enough to prove the point, Schmidt even looks the part, with his boy-genius face, his wire-rim spectacles, and his coder's pallid complexion.

Two years ago, Schmidt left Sun and took charge at Novell, where he has engineered an impressive turnaround. After years of gross mismanagement, the $1 billion networking-software company, headquartered in Provo, Utah, had been written off by competitors and industry observers alike. Since Schmidt's arrival, however, the company has become steadily profitable, its stock price has more than doubled, and, within its field, Novell has again come to be seen as a worthy competitor to Microsoft.

A good deal of the credit for Novell's turnaround must go to Schmidt, who excels at getting the best out of his geeks. He has used his tech savvy to bring focus to Novell's product line and his geek-cred to reenergize a workforce of highly skilled but (until recently) deeply dispirited technologists. In general, Schmidt speaks of his geeks in complimentary terms, while acknowledging their vulnerabilities and shortcomings. "One of the main characteristics of geeks is that they are very truthful," says Schmidt (who, in fact, uses the term "geek" only occassionally). "They are taught to think logically. If you ask engineers a precise question, they will give you a precisely truthful answer. That also tends to mean that they'll only answer the question that you asked them. If you don't ask them exactly the right question, sometimes they'll evade you -- not because they're lying but because they're being so scrupulously truthful."

With that rule of geek behavior in mind, Fast Company went to Novell headquarters to ask Schmidt a series of precise, carefully worded questions. His answers add up to a short course in how to bring out the best in your geeks.

You've got to have your own geeks

Today innovation drives any business. And since you don't want to outsource your innovation, you need to have your own geeks. Look at trends in e-commerce: Who would have thought that all of these "old" companies would have to face huge new distribution-channel issues, all of which are driven by technology? The truth is, you need to have a stable of technologists around -- not just to run your systems but also to help you figure out which strategies to pursue, which innovations to invest in, and which partnerships to form.

The geeks control the limits of your business. It's a fact of life: If the technologists in your company invent something ahead of everybody else, then all of a sudden your business will get bigger. Otherwise, it will get smaller. You simply have to recognize and accept the critical role that technologists play. All new-economy businesses share that property.