Growth and Arrogance vs Customer Culture

Speaker: Art Papas – CEO & Founder, Bullhorn (@ArtPapas)

About Bullhorn

• Started in late 1999
  • Raised $4M from GE Capital
• 525 employees
• 5 global offices
• 40% bookings growth
• 7l%+ competitive win-rate
• 5,700+ customers

Went from being a 30% owner to a 5% owner after taking another $500K after the dotcom crash due to anti-dilution full-ratchet clause in original funding from GE Capital.

Bullhorn Mission in 2003: To power the desk of every staffing professional worldwide.

Annual revenue growth

• $2.5M in 2004
• $4.5M in 2005
• $8M in 2006
• $13M in 2007
• $20M in 2009
• $24M in 2010

One of the fastest growing companies in Boston. Had tons of term sheets. Pick General Catalyst and Highland Partners as investors.

In 2007, mission became “Global Domination” in jest. But then people started jokingly put it into presentations. Culture is about the things you tolerate and allow. He shouldn’t have allowed this.

Customer Experience Index ticked up in 2009, but then started ticking downward. Not dramatically, but it was a trend.

Solds Bullhorn to Vista Equity Partners. Within 6 months, everyone on the management team left. Either because they left or he asked them to.

Bullhorn then went on an acquisition spree. and acquired 4 companies in 6 months.

Competitors started cropping up with the message “we care when Bullhorn doesn’t”. First customer then called and said she was firing Bullhorn. Said employees were too arrogant.

At that point Customer Experience Index went from 60 in 2009 down to 26 in 2013.

Then surveyed employees. Surveyed employees about mission and over 50% hated it.

Went on a retreat. Hadn’t had a positive conversation with a customer saying the product was great for the past year or two.

Decided to change the culture of the company.

Created new core purpose:

Help businesses create an incredible customer experience.

We help businesses achieve extraordinary results by transforming the way people work and interact with customers. We create software that’s both powerful and easy to use.

Core Values:

• Ownership
• Be Human
• Speed & Agility
• Energy
• Service

Changed management incentives to be all about the customer experience, not new bookings, etc.

After launching the new mission and core values, several people complained and said it wasn’t fair. Those people aren’t with the company any longer. Only those who aligned with the new culture remained.

Bullhorn hasn’t updated their SaaS application in years. Became an untouchable applicaiton. But that’s why users were leaving.

Had a designer redesign from scratch. Got immediate positive feedback.

Had an issue where a customer support e-mail came in and they couldn’t figure out the e-mail chain. Created Bullhorn Pulse to solve the problem, not just for themselves, but for others.

Then started recording all their support calls. Not to catch people doing things bad, but to catch them doing things well. Started recognizing people during company meetings.

Customer Experience Index hit a lot of 24 in December 2013. Has since started climbing and is back up to 55 in August 2015. Glassdoor rating started going up to.

Ultimately, they started growing faster, even with their higher revenue. Bookings are now growing at 40% annual growth. And their first customer has returned.

Summary

• Create a memorable and polaziring mission
• Eradicate goals that undermine the mission
• Never OD on your own kool aid
• Focus on the customer first
• Clear a path from customer feedback to action
• Abolish “we’re a big company” talk
• Leverage recognition to drive cultural change

Questions

1. In terms of executing the strategy, did you have to deploy more resources into client support, or was it just redefining the mission?
   1. No. The people in those roles just weren’t given the right high-level direction. Defining the goals and outcomes we were trying to achieve aligned them with the core mission.
2. Do you ever run into tensions between new and old customers wanting things and how do you resolve that tension?
   1. A good product manager zooms out and looks for the similarities between the two parties. Before they would only focus on the new customers
3. Why was “a great customer experience” as a mission polarizing? Who would want to provide a poor customer experience?
   1. People’s objections were “Isn’t selling software our mission?” or “this will reduce our profit”. They had a hard time shifting from being rewarded based on customer happiness instead of company revenue.
4. When you have only a handful of customers that suck up most of the customer support person’s time, how do you handle that? When do you fire your customers?
   1. Bullhorn makes the investment because he views these customers as brand ambassadors. They know they are needy.
5. When you shifted the mission, were there areas where you saw the most pushback?
   1. Sales team had the most pushback. What does this have to do with us? New software is going to kill my pipeline.
   2. Professional services had the most turnover.
   3. Support pushed back on switch from being graded on number of tickets closed to customer satisfaction. But number of tickets went dramatically down after moving away from managing by number of tickets. Support reps were doing the minimum just to close a ticket, even if the issue wasn’t fully resolved.
6. How did you address the issue of your ownership for your 2nd round?
   1. Bought out the original investors and recapitalized the company.
7. How much of the turnaround in NPS do you attribute to the new product vs new culture?
   1. First half from 24 to 40 was product
   2. Second half from the culture. Most positive comments from cusomters now are about the culture
8. If you had one quesiton to ask during the interview to ensure they are the right fit for the culture? Once the person is in, what’s the onboarding process to embue the culture?
   1. Favorite question: What do you enjoy doing professionally?
   2. Onboarding for new employees is 10-12 weeks. Art does training on core values. If people feel they can’t do those things, then they talk.