By J. S. Martin
Marie Thursby in the Innovation Realization Laboratory's "tool
(Purdue News Service Photo by David Umberger)
the advice Jerry Rawls, MSIA '68, president and CEO of Finisar Corp., gave
to the 197 members of this year's entering master's class. It's advice
that grew out of Rawls own experience when he and his partner, Frank Levinson,
now Finisar's chairman and chief technical officer (CTO), started Finisar
based in Sunnyvale, Calif., is a leading provider of fiber optic subsystems
and network performance test systems that enable high-speed communications
over Gigabit Ethernet local area networks (LANs), Fibre Channel storage
area networks (SANs), and metropolitan data networks (MANs). (For a detailed
story on Finisar, see pages 6-9 of the fall 2000 issue of Krannert Magazine.)
goal was to create a company that we would want to work in. That was our
guiding rule and we thought it would serve us well, says Rawls. The two
entrepreneurs didn't have a formal business plan, he added, but they had
confidence in themselves, a lot of idealism, and enough job dissatisfaction
to motivate them to start a company.
still uses the word adventure to describe the story of Finisar. The company
has grown at a compound rate of just over 90 percent a year for the last
six years, recording $67 million in fiscal 2000 (ended April 30), with
approximately $200 million expected in fiscal 2001. The company has been
profitable every year, excluding merger-related costs.
More Quick Tips for Great Leadership
from Jerry Rawls
Communicate well. Acquire the discipline
needed to write well. Write clear, concise sentences. Simple words
and simple sentences communicate powerfully.
Be energetic and enthusiastic. It's contagious.
Turn the metronome up; the organization will move a little faster.
If you as leader don't have a sense of urgency about your business,
you can't expect anyone else to have it.
Apply two tests. At Krannert, for business
decisions, we quantify everything numbers, facts, analyses and
that's good. But at the end of the day, all decisions must pass two
tests: the common-sense test (Does it make sense?) and the gut test
(Does it feel right?). Your judgment is invaluable. As a leader,
you are betting on yourself.
Ask questions. In spite of the fact that
I'm making a speech, making speeches is not important. Asking questions
is important and it's the quality of the questions that's most
Never underestimate your competition. Someone
is always going to try to clean your clock. Paranoia in business
is not necessarily a bad thing, especially when you're competing.
Ask: "How are we vulnerable?"
Focus on the important issues. Don't
get bogged down in small matters it wastes time. Some at Finisar
thought devising cute product names was important. I didn't. After
all, Boeing's 747 has done quite well without a name. Our company
does not have a logo other than our name in a particular blue and
a particular font. We haven't spent a million to design a logo. We're
doing fine without it. Focus on performance, cost, reliability things
that make a difference.
Stay ahead of the information revolution. Our
world is going to be so different in 10 years. Imagine how we're
going to use all the bandwidth and information that's available to
us, and what software services can be delivered to us when we have
a gigabit connection to our homes. Using information in creative,
clever ways will make you successful.
"No" doesn't always mean "No". When
a customer says no, go back again. Say, "Let me get my boss
involved," or "Here's what my product price might be." Let's
go to work on the problem. When someone you're recruiting says no,
revisit the offer. You CAN turn around a customer or a recruit. Don't
take no for an answer until it's "Hell, no!"
Maintain good health. Don't smoke. I've
just had three of my best employees suffer health problems because
of it. Exercise and stay fit. As leaders you've got to run fast.
You have to maintain a pace that is invigorating for your company.
You have to set the pace that you want others to follow.
Make a difference. Measure yourself by
the footprints you leave. There are no sacred cows in our company.
I don't want yes men. I want people who will devise new ways of doing
things new systems, programs, products. You should have a list
of strategic things you are trying to accomplish over and above dealing
with the daily crises. Take measure of yourself to answer the question:
Is this place different because I was here?
predicts more than $1 billion in revenue in five years, with as many
as 5,000 to 10,000 employees in multiple operations in the U.S. and possibly
overseas. Referring to the announcement of the acquisition of Sensors
Unlimited, a fiber optics company in Princeton, New Jersey, Rawls
calls it "an
exciting acquisition - new technology, new people, a center of excellence."
pretty heady deal," says Rawls, about the Sensors acquisition. "I
often think back to the days when I was sitting in this room at age 23.
That I could spend $700 million on anything is pretty unbelievable." (At
time of this publication, four additional acquisitions have been announced.)
Lessons Learned Along the Way
great Yogi Berra (that great mathematician) is reported to have said that
baseball is 90 percent pitching; the other half is hitting and fielding,
Rawls says. Well, in our business it's 90 percent customers, and the other
half is employees and products."
says his company's success depends on letting customers know how important
they are to its business. "At Finisar, we strive to have multiple
touches - by company executives, by people in manufacturing, marketing,
engineering, purchasing, planning to make them understand that we
care, we'll support them, we'll address their concerns. If there's a problem,
we'll work through it with them. You never really know your customers until
you've worked through a problem with them."
it comes to employees, Rawls says, hire smart, share the vision, treat
people well, and pay them well. "Work hard on the front end to
hire bright, competent people," he advises. "Hire smart people
who are willing to hire people even smarter than they are. Good interpersonal
skills are important, especially at a company like ours where people
work in small teams."
he says, share your goals. If your employees know your goals, they can
help reinforce them. Our employees want to know management's vision for
the company. They want to know where they're headed, and why they're going
to be successful. My job is not to tell people how to do their jobs. My
job is to turn them loose, to unleash their creativity, to give feedback,
praise, constructive criticism. That's satisfying for them and productive
for our company.
is also key. "Treat employees with respect," Rawls advises. "Finisar
has almost no turnover, and it's more than just stock options, although
they certainly do help. People leave companies because they feel unappreciated,
he recommends, pay well. Overpay. "When in doubt, pay more -
bonuses should be higher, stock options bigger," he says. "A
key employee can make millions for the company."
it comes to products, Finisar takes a fairly simple approach: We make very
good products. We're going to try to sell the best in our industry,
the most reliable, the hottest performers with the best product features," says
Rawls. "We're always going to be the best, always going to command
a higher price than our competitors do. For us, it's important to differentiate
Management, but Practice Leadership
allocates resources, makes decisions about physical facilities and organizational
structure," Rawls says, "but businesses succeed because of leadership,
not just management. Management without leadership leaves a huge void,
a vacuum, and you won't succeed."
those of you who are entering Krannert to be trained as leaders in management,
I say you've made a good choice. Make everything out of it you can. Think
about the big picture. It's a joy; it's fun; it's stimulating. Work hard
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