From CFO to CEO: Does Anaplan’s new boss have a plan?
Business Management

From CFO to CEO: Does Anaplan’s new boss have a plan?

Maybe it’s because he didn’t grow-up on sales floors that Frank Calderoni, president and CEO at cloud-based planning software business Anaplan, comes across as a calm and pragmatic thinker. There’s none of the typical brashness and over-confident swagger you can often get with CEOs. Calderoni cut his teeth in financial roles most recently at Red Hat but also previously at Cisco, QLogic and SanDisk. Perhaps it’s the accountant in him that shapes his strategy.

Within weeks of his appointment in January this year, Calderoni introduced what he refers to as his “Customer First initiative”, a sort of business plan to, well, put customers first. While it begs the question, ‘shouldn’t all companies be doing this anyway?’ my head drifts back to the previous day’s keynote at Anaplan’s Hub17 customer event at The Masonic in San Francisco and talk of ice hockey legend Wayne Gretzky.

Gretzky is becoming as famous for CEOs using his quotes as for his hockey skills but nevertheless it works, at least in the case of Anaplan and its pitch for being the platform of choice for any business that wants to use data analytics to help create predictive plans. You know the quote, the one about not skating where the puck is but where it’s going to be. Calderoni, a San Jose Sharks fan, was on stage, his first customer event as CEO and was only into the first half of the quote when a number of people in the auditorium finished it off. While audience participation probably wasn’t on the agenda so early into the proceedings, at least it proved the coffee was working and the room was full of a largely willing and receptive crowd.

For Calderoni’s part it was an opportunity, he says, to get amongst the customers but not in an overtly ‘salesy’ way. He seems genuine and convinced that looking after existing customers, listening to their concerns and helping them to solve specific problems will lead to greater internal upselling and subscriptions. Certainly, Anaplan has a broad range of use cases, where the software is being used by a mix of finance, supply-chain managers, sales compensation and HR in different businesses. Convincing other departments within existing customers to try it just makes sense.

“It’s about appreciating the difficulties customers face,” says Calderoni, sitting in a Fairmont Hotel boardroom overlooking Mason Street. “Getting real time data and data you can use to make predictive analysis to make decisions - I’ve struggled with this in every role I’ve had, so coming here and appreciating where our customers are coming from I think gives me a good insight as to how best to work with them.”

 

Learning lessons

Calderoni says he “learned a lot from John Chambers,” Cisco’s former CEO and now executive chairman. “John has been a salesperson throughout his entire career, getting very close to customers and he forced a culture for a management system within Cisco that enabled us – whether or not you were working in sales, it didn’t matter – to connect with our customers and understand that what we were doing is for the benefit of the customer, whether you are in finance, legal, anywhere.”

It was a lesson that was clearly ingrained and to be fair Cisco is not a bad model to follow. Taking lessons learned from previous roles has been key to Calderoni and it is a mark of his humility that he is prepared to doff his cap in the direction of former employers. His shift from CFO to CEO probably would not have been possible if he hadn’t soaked up the lessons learned at Cisco and Red Hat in particular.

So, is Calderoni an anomaly? Questions of whether CFOs can make great CEOs have been going on for years. In 2015 the Korn Ferry Institute even conducted a report into the subject, finding that learning agility – the ability to apply lessons learned from past experience – was a key factor in creating good CEOs. Calderoni seems to fit the mould.

“Yes, I’ve had CFO roles for a number of years but in all those roles I’ve had more extensive responsibilities that involved operations, IT, procurement and I was very connected with engineering and sales too,” says Calderoni. “So even though I didn’t have a CEO role, I’ve done much more than the traditional CFO role. SanDisk, Cisco and Red Hat really helped me to step into this role.”

Another takeaway from a former employer is culture. The fear of any CEO stepping into a disruptive business is a loss of the start-up spirit, a normalisation of working practises and ultimately a less than dynamic venture.

“Over the years I’ve worked in companies that were collaborative – Cisco, Red Hat and SanDisk all had collaborative cultures,” he says. “It’s just how you go about it. It’s not like I know all the answers and I come in and say ‘here you go’, it’s for us all to find answers together.” He wants to breed a culture of ideas and innovation where anyone can be heard and their ideas debated. Easier said than done of course but you can’t blame him for trying.

 

Ducks in a row

But if anyone can get people thinking along the same lines, unified by a plan supported through data analytics, you’d think a planning software company could. Anaplan is certainly taking its own medicine but one plan Calderoni is a little reluctant to discuss is the company’s potential IPO. Is there a date in mind, a strategy?

“IPO is one of the milestones,” he says, talking of four factors that need to be in alignment. “As far as building up and scaling the company, clearly investors would be looking for us to have a substantial base, which we have in terms of customers. Secondly [is] the growth trajectory and tangible revenue, and the third is the path to profitability, which is something we have to continue to work on. We were cash-flow breakeven in the first half of this past year, so I think that kind of indicates that we are a frugal company looking to make sure we are balancing our investment but how that plays out over time is what investors are looking for. The fourth factor would be the IPO market. It was pretty much a closed market a year ago but it’s now starting to open up. When we feel all that coming together, we feel it will be the right timing for an IPO. We haven’t decided yet, specifically, when that will be.”

The company is clearly doing something right. With $120m of revenue, subscriptions up 75% per cent year on year and 660 customers at the end of year, 250 of which were added in the past year, it’s easy to see why Anaplan is starting to turn a few heads.

The next 12 months, you feel are crucial. Calderoni seems determined to scale the business, through acquisition as well as organic growth. He believes the business can thrive as economic and political change force businesses into predictive modelling. Brexit, protectionism, new trade deals; this could all feed Anaplan’s and Calderoni’s hunger. If not and the sales don’t come as quickly as hoped, he will need stamina but then, for someone who confesses to running about six miles a day, that really shouldn’t be a problem.

 

Also read:
Anaplan plots an end to Excel mania

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Marc Ambasna-Jones

Marc Ambasna-Jones is a UK-based freelance writer and media consultant and has been writing about business and technology since 1989.

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