WEBVTT 1 00:00:05.040 --> 00:00:05.873 line:15% I'm Martin Reeves, 2 00:00:05.873 --> 00:00:08.000 line:15% Chairman of the BCG Henderson Institute. 3 00:00:08.000 --> 00:00:09.390 line:15% And I'm very pleased to be joined today 4 00:00:09.390 --> 00:00:11.430 line:15% for our Leaders on Imagination series, 5 00:00:11.430 --> 00:00:14.050 line:15% by Peter Gassner, who is the founder and CEO 6 00:00:14.050 --> 00:00:16.680 line:15% of Veeva Systems, which is a leading provider 7 00:00:16.680 --> 00:00:18.950 line:15% of industry cloud software solutions 8 00:00:18.950 --> 00:00:20.460 line:15% to the life sciences industry. 9 00:00:20.460 --> 00:00:22.240 line:15% Veeva's a very interesting company. 10 00:00:22.240 --> 00:00:24.210 line:15% It's consistently ranked 11 00:00:24.210 --> 00:00:26.350 line:15% at the top of the Fortune Future 50 index, 12 00:00:26.350 --> 00:00:29.450 line:15% which is an index that we pioneered with Fortune 13 00:00:29.450 --> 00:00:31.310 line:15% to calculate the companies 14 00:00:31.310 --> 00:00:33.440 line:15% which had the highest growth potential. 15 00:00:33.440 --> 00:00:34.930 line:15% And in fact, last year, 16 00:00:34.930 --> 00:00:36.270 line:15% Veeva was number two on that list. 17 00:00:36.270 --> 00:00:38.530 line:15% So it must have something special going for it. 18 00:00:38.530 --> 00:00:40.460 line:15% And I'm gonna try and decode that today with Peter. 19 00:00:40.460 --> 00:00:41.960 line:15% So welcome, Peter. 20 00:00:41.960 --> 00:00:44.090 line:15% Thanks Martin. Thanks for having me. 21 00:00:44.090 --> 00:00:46.770 line:15% So tell us a little bit about Veeva's business. 22 00:00:46.770 --> 00:00:48.920 line:15% So Veeva, we're a 14-year-old 23 00:00:48.920 --> 00:00:51.360 line:15% cloud-based enterprise technology company. 24 00:00:51.360 --> 00:00:53.890 line:15% We provide solutions to life sciences companies 25 00:00:53.890 --> 00:00:56.370 line:15% like Pfizer, Moderna and Lilly 26 00:00:56.370 --> 00:00:58.940 line:15% in both the R&D and commercial areas. 27 00:00:58.940 --> 00:01:01.580 line:15% So our customers, they make medicines, vaccines, 28 00:01:01.580 --> 00:01:02.470 line:15% medical devices 29 00:01:02.470 --> 00:01:05.523 line:15% and Veeva, we enable them with cloud technology. 30 00:01:06.370 --> 00:01:09.420 line:15% And with the growth of genetics and precision medicine, 31 00:01:09.420 --> 00:01:12.050 line:15% it's a really exciting time in life sciences, 32 00:01:12.050 --> 00:01:13.890 line:15% it's a time of innovation. 33 00:01:13.890 --> 00:01:16.600 line:15% And we're really happy to be part of that. 34 00:01:16.600 --> 00:01:19.280 line:15% Life sciences, as you know, is a very important industry 35 00:01:19.280 --> 00:01:21.490 line:15% to society and we take that role supporting it 36 00:01:21.490 --> 00:01:22.570 line:15% really seriously. 37 00:01:22.570 --> 00:01:25.650 line:15% And so in February, we became the first public company 38 00:01:25.650 --> 00:01:28.900 line:15% to convert to a public benefit corporation. 39 00:01:28.900 --> 00:01:32.480 line:15% So there's a lot of firsts there, Peter. 40 00:01:32.480 --> 00:01:34.330 line:15% First public benefit company 41 00:01:34.330 --> 00:01:39.330 line:15% and first industry-centric cloud solution company. 42 00:01:39.920 --> 00:01:41.100 line:15% Some very imaginative moves. 43 00:01:41.100 --> 00:01:42.900 line:15% What is business imagination to you 44 00:01:42.900 --> 00:01:44.903 line:15% and why is it important now? 45 00:01:45.900 --> 00:01:47.230 line:15% I think it's always important. 46 00:01:47.230 --> 00:01:49.410 line:15% It always has been important throughout history. 47 00:01:49.410 --> 00:01:51.140 line:15% But business imagination, 48 00:01:51.140 --> 00:01:53.730 line:15% it's the ability to create new ideas 49 00:01:53.730 --> 00:01:55.940 line:15% and turn them into business value. 50 00:01:55.940 --> 00:01:59.270 line:15% So creating ideas, that requires proactively seeking, 51 00:01:59.270 --> 00:02:00.820 line:15% you know, the adjacent possible, 52 00:02:00.820 --> 00:02:03.700 line:15% inviting the random chaos of conversations 53 00:02:03.700 --> 00:02:06.070 line:15% with interesting people, developing relationships, 54 00:02:06.070 --> 00:02:07.520 line:15% having meetings. 55 00:02:07.520 --> 00:02:10.420 line:15% Conversations that might not seem aligned and structured, 56 00:02:10.420 --> 00:02:13.310 line:15% those are the ones that can spark ideas. 57 00:02:13.310 --> 00:02:16.830 line:15% But generating the idea, that's actually the easier part. 58 00:02:16.830 --> 00:02:18.900 line:15% Executing on them, that's the harder part. 59 00:02:18.900 --> 00:02:22.360 line:15% Of the hundreds of ideas, I think you generally need to say 60 00:02:22.360 --> 00:02:26.530 line:15% no to 80% of them, focus on 20% of them. 61 00:02:26.530 --> 00:02:30.603 line:15% And if you have 10% success, you can count yourself lucky. 62 00:02:31.810 --> 00:02:35.090 line:15% In our survey work, about 90% of CEOs say that 63 00:02:35.090 --> 00:02:38.090 line:15% imagination is vital to renewing businesses, 64 00:02:38.090 --> 00:02:41.540 line:15% but they also, similar proportion says that it's very hard, 65 00:02:41.540 --> 00:02:45.370 line:15% especially in established or large companies. 66 00:02:45.370 --> 00:02:48.343 line:15% What is, what is hard about realizing business imagination? 67 00:02:49.960 --> 00:02:51.460 line:15% You know, CEOs, I think they're frustrated 68 00:02:51.460 --> 00:02:53.550 line:15% because they want innovation to happen, 69 00:02:53.550 --> 00:02:54.760 line:15% but it's not happening. 70 00:02:54.760 --> 00:02:56.500 line:15% And so that causes the frustration. 71 00:02:56.500 --> 00:02:58.420 line:15% Now, if we look at the why behind that, 72 00:02:58.420 --> 00:03:00.350 line:15% many management teams, especially larger 73 00:03:00.350 --> 00:03:02.040 line:15% and more established companies, 74 00:03:02.040 --> 00:03:04.870 line:15% they're focused on efficiency and, 75 00:03:04.870 --> 00:03:08.290 line:15% and they struggle to foster imagination. 76 00:03:08.290 --> 00:03:11.080 line:15% And I think if you have an imagination problem, 77 00:03:11.080 --> 00:03:14.160 line:15% you actually have a company leadership problem. 78 00:03:14.160 --> 00:03:16.930 line:15% And humans, you know, we're creative. 79 00:03:16.930 --> 00:03:18.320 line:15% Humans are creative. 80 00:03:18.320 --> 00:03:22.110 line:15% The ideas are there but management can stifle those ideas. 81 00:03:22.110 --> 00:03:24.110 line:15% The company itself and the management team 82 00:03:24.110 --> 00:03:27.610 line:15% needs to make space in their operating model for innovation. 83 00:03:27.610 --> 00:03:31.290 line:15% That means embracing chaos and inefficiency. 84 00:03:31.290 --> 00:03:33.470 line:15% And that's much easier said than done. 85 00:03:33.470 --> 00:03:35.890 line:15% So Veeva has been very successful at this so far 86 00:03:35.890 --> 00:03:37.680 line:15% judging by your track record. 87 00:03:37.680 --> 00:03:39.950 line:15% What are some of the approaches that you personally take 88 00:03:39.950 --> 00:03:43.943 line:15% as a leader to foster imagination in the company? 89 00:03:45.070 --> 00:03:47.860 line:15% First, we hire for diversity of thought 90 00:03:47.860 --> 00:03:49.730 line:15% beyond just race and gender, you know. 91 00:03:49.730 --> 00:03:52.770 line:15% Hire for diversity of life experience, style, 92 00:03:52.770 --> 00:03:54.680 line:15% diversity of location, that's key. 93 00:03:54.680 --> 00:03:58.340 line:15% People are the ingredients into the company. 94 00:03:58.340 --> 00:04:00.700 line:15% And then second thing, you need to make sure you have 95 00:04:00.700 --> 00:04:03.790 line:15% intuitive leaders that stay in the details 96 00:04:03.790 --> 00:04:06.570 line:15% so that they can sense opportunities. 97 00:04:06.570 --> 00:04:08.710 line:15% And then third, your company operating model 98 00:04:08.710 --> 00:04:13.130 line:15% needs to embrace the chaos and be okay with inefficiency 99 00:04:13.130 --> 00:04:14.993 line:15% as the price for innovation. 100 00:04:16.420 --> 00:04:18.760 line:15% So if you think back on the 14-year history of Veeva, 101 00:04:18.760 --> 00:04:21.230 line:15% what would be an example of a, 102 00:04:21.230 --> 00:04:23.110 line:15% a concrete example of an imaginative move 103 00:04:23.110 --> 00:04:26.770 line:15% you'd like to share with us and tell us how that happened? 104 00:04:26.770 --> 00:04:28.420 line:15% I guess one of the biggest one has to be 105 00:04:28.420 --> 00:04:30.050 line:15% the founding of Veeva. 106 00:04:30.050 --> 00:04:33.550 line:15% And that's why I think that imagination is in our DNA. 107 00:04:33.550 --> 00:04:36.300 line:15% We started with this very contrarian idea 108 00:04:36.300 --> 00:04:38.220 line:15% of creating a cloud solution 109 00:04:38.220 --> 00:04:41.910 line:15% exclusively for life sciences in 2007. 110 00:04:41.910 --> 00:04:44.780 line:15% And I can tell you, 99% of the people thought 111 00:04:44.780 --> 00:04:45.900 line:15% it was a bad idea. 112 00:04:45.900 --> 00:04:47.190 line:15% I was encouraged by that. 113 00:04:47.190 --> 00:04:48.980 line:15% I thought we could be first. 114 00:04:48.980 --> 00:04:50.690 line:15% But a more recent example would be 115 00:04:50.690 --> 00:04:52.460 line:15% spring of last year, 2020. 116 00:04:52.460 --> 00:04:55.260 line:15% We realized that COVID was really gonna fundamentally 117 00:04:55.260 --> 00:04:57.660 line:15% change things for the pharmaceutical industry 118 00:04:57.660 --> 00:05:00.490 line:15% and it could be a long-lasting change. 119 00:05:00.490 --> 00:05:02.778 line:15% And so of course we had hundreds ideas 120 00:05:02.778 --> 00:05:06.220 line:15% and we decided the right place to focus 121 00:05:06.220 --> 00:05:09.220 line:15% was an app, to make a new app that made it easier 122 00:05:09.220 --> 00:05:12.570 line:15% for people to participate in a clinical trial. 123 00:05:12.570 --> 00:05:15.330 line:15% And so we moved a senior person from another part, 124 00:05:15.330 --> 00:05:16.750 line:15% an established part of the business, 125 00:05:16.750 --> 00:05:20.740 line:15% a great person to lead this, this self-contained startup. 126 00:05:20.740 --> 00:05:22.990 line:15% And we allocated critical resources to it 127 00:05:22.990 --> 00:05:25.200 line:15% and we said no to other things. 128 00:05:25.200 --> 00:05:27.960 line:15% And from that, we launched My Veeva for Patients 129 00:05:27.960 --> 00:05:29.700 line:15% in February of this year. 130 00:05:29.700 --> 00:05:33.320 line:15% And now we have a whole digital trials initiative 131 00:05:33.320 --> 00:05:35.920 line:15% that could grow into a billion-dollar business over time 132 00:05:35.920 --> 00:05:37.780 line:15% and really change the world. 133 00:05:37.780 --> 00:05:39.737 line:15% But it really started with a decision. 134 00:05:39.737 --> 00:05:44.030 line:15% "Hey, let's take Steve and let him create a new team 135 00:05:44.030 --> 00:05:45.430 line:15% and let's see what happens." 136 00:05:47.470 --> 00:05:50.180 line:15% So having ideas is one part of imagination, 137 00:05:50.180 --> 00:05:53.720 line:15% but of course we have to translate those ideas into, 138 00:05:53.720 --> 00:05:56.390 line:15% into growth and value. 139 00:05:56.390 --> 00:05:57.690 line:15% Tell us about the executional, 140 00:05:57.690 --> 00:06:01.570 line:15% the physical part of realizing the value of imagination. 141 00:06:01.570 --> 00:06:02.520 line:15% Yeah, the hard part. 142 00:06:02.520 --> 00:06:04.810 line:15% You need to create an operational model 143 00:06:04.810 --> 00:06:06.750 line:15% for scale and innovation to grow. 144 00:06:06.750 --> 00:06:07.583 line:15% It's hard. 145 00:06:07.583 --> 00:06:09.430 line:15% You have to separate your innovation zones 146 00:06:09.430 --> 00:06:13.030 line:15% from your production zones from your core revenue producers. 147 00:06:13.030 --> 00:06:14.460 line:15% And these innovation zones, 148 00:06:14.460 --> 00:06:16.970 line:15% you need to give them autonomy to innovate, 149 00:06:16.970 --> 00:06:18.520 line:15% but also pick the right leaders. 150 00:06:18.520 --> 00:06:19.630 line:15% That's hard. 151 00:06:19.630 --> 00:06:23.000 line:15% And focus on short-term goals and learnings 152 00:06:23.000 --> 00:06:25.280 line:15% rather than revenue or profits. 153 00:06:25.280 --> 00:06:27.410 line:15% You really have to embrace the chaos 154 00:06:27.410 --> 00:06:29.970 line:15% and you worry about the alignment much later. 155 00:06:29.970 --> 00:06:34.170 line:15% That's how ideas are given the oxygen they need to survive. 156 00:06:34.170 --> 00:06:35.910 line:15% And if they survive, 157 00:06:35.910 --> 00:06:37.480 line:15% some of them will grow. 158 00:06:37.480 --> 00:06:38.760 line:15% If they don't survive, 159 00:06:38.760 --> 00:06:40.210 line:15% there's no chance for growth. 160 00:06:41.700 --> 00:06:43.550 line:15% So just one more question if I may, 161 00:06:44.780 --> 00:06:46.540 line:15% we discovered this very interesting relationship, 162 00:06:46.540 --> 00:06:49.670 line:15% which is for every doubling of age or size of a company, 163 00:06:49.670 --> 00:06:52.620 line:15% its growth potential decreases by about 164 00:06:52.620 --> 00:06:55.160 line:15% three percentage points on average. 165 00:06:55.160 --> 00:06:57.330 line:15% So it appears to be hard 166 00:06:57.330 --> 00:07:00.840 line:15% to maintain the capacity for imagination with scale. 167 00:07:00.840 --> 00:07:02.220 line:15% Do you, is that something you worry about? 168 00:07:02.220 --> 00:07:04.430 line:15% What are your thoughts on maintaining this capacity 169 00:07:04.430 --> 00:07:06.380 line:15% as you become more and more successful? 170 00:07:07.320 --> 00:07:08.450 line:15% Oh, I think about that a lot. 171 00:07:08.450 --> 00:07:10.940 line:15% I guess Andy Grove said only the paranoid survive. 172 00:07:10.940 --> 00:07:12.620 line:15% So I think about that a lot. 173 00:07:12.620 --> 00:07:14.850 line:15% We've done a good job to get to this point, 174 00:07:14.850 --> 00:07:17.490 line:15% but how can we maintain that innovation 175 00:07:17.490 --> 00:07:20.890 line:15% in 2025 when we have 10,000 people? 176 00:07:20.890 --> 00:07:25.300 line:15% So I feel we have to continue to value this autonomy 177 00:07:25.300 --> 00:07:27.400 line:15% over alignment, continue to push that. 178 00:07:27.400 --> 00:07:29.390 line:15% We have to keep our core values 179 00:07:29.390 --> 00:07:31.760 line:15% and we have to stress the need for change 180 00:07:31.760 --> 00:07:33.620 line:15% in operational procedures. 181 00:07:33.620 --> 00:07:36.550 line:15% Stagnation will kill innovation. 182 00:07:36.550 --> 00:07:38.930 line:15% You know, in this way we can run a big company 183 00:07:38.930 --> 00:07:40.760 line:15% that doesn't feel like a big company. 184 00:07:40.760 --> 00:07:43.110 line:15% And I think that's the best shot we have at it. 185 00:07:44.080 --> 00:07:44.913 line:15% Well, thanks very much, Peter. 186 00:07:44.913 --> 00:07:45.980 line:15% It's been fascinating. 187 00:07:45.980 --> 00:07:47.570 line:15% And thanks for sharing your insights 188 00:07:47.570 --> 00:07:50.390 line:15% on imagination and business with us today. 189 00:07:50.390 --> 00:07:51.420 line:15% Thanks very much, Martin. 190 00:07:51.420 --> 00:07:52.470 line:15% Thanks for having me.