Wednesday, June 03, 2015

What I would do as NetApp CEO

The first rule of a successful business is to listen to your customers and give them what they want. NetApp has a great product and a loyal customer base. However, it seems that NetApp has become a self-absorbed company that has forgotten that its mission is to provide products and services that customers want. Instead they are alienating the customer base. This has not proven to be good success strategy. Instead, I would try embracing the customers who are loyal and asking them what they want and need. For example, customers really like 7 mode, so the first thing I would do is allow customers to keep the product they like. If some customers like cDot and others want to keep 7-mode why not support and improve both Ontap versions?

The second thing I would do is turn the Software Support model around and stop creating barriers for customers to maintain older equipment. Does NetApp really think that raising the price of legacy support for systems is a successful strategy in a competitive world? High legacy support prices have the same effect as high taxes: they are a deterrent to new investment and create an incentive to look for alternative solutions. In the case of NetApp, customers are given the choice between exorbitant legacy support pricing or a costly migration to cDot. Rational customers will chose the least costly solution to solve their problem and that includes the learning curve for their admins. Since the marginal cost of an additional software license is essentially $0.00, I would empower loyal customers and offer them an affordable software support package for their legacy systems.

As NetApp’ s new CEO, the third thing I would do is look over our past history of acquisitions and see how successful they have been. Warren Buffet says something like “invest in what you understand”, which seems like pretty good advice. Especially when it seems that the history of NetApp acquisitions has been marked by one failure after another. And so I would review the strategy and try to invest in technologies that our customers want.

I have been working with NetApp equipment and customers since 1998, and our company has grown because we listen to what NetApp customers want. I recognize that NetApp probably won’t select me as their next CEO, but perhaps they should look at their recent history and take some advice from George Costanza :
“If every instinct you have is wrong, then the opposite would have to be right.”
– Jerry, to George, in “The Opposite”

No comments: