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Building on success Featured

8:00pm EDT July 26, 2009

Christopher Cabrera could almost hear the questions before they were even asked.

Xactly Corp. had just acquired Centive, a move which was going to result in a significant overlap in job responsibilities in the merged organization.

“So in this already challenging time where people are concerned and a little bit scared, we had this other event happen, which caused people to be even more concerned,” Cabrera says. “So we were very direct and very clear telling people what was going to happen. There was some overlap, and there would be some reduction in force as a result. But we didn’t let it linger on.”

Time will tell how this move ultimately affects the 150-employee provider of sales performance management services. But Cabrera’s ability to push the right buttons with Xactly’s culture helped it achieve an 87 percent increase in revenue from 2007 to 2008.

“If you have (employees’) hearts and minds, you can get through tougher times,” says the company’s founder, president and CEO.

Smart Business spoke with Cabrera about the keys to managing a healthy culture.

Don’t dwell on cuts. We’ve talked plain and simple and clear. We’ve laid out time frames. We’ve said, ‘These next two weeks, we’re going to decide where the overlaps are and we’re going to announce the cuts, and that’s going to be it.’

We stuck to our guns and to our time frame, and we communicated that.

Employees are part of and are sharing in the success or failure of the business. They’ll understand that times are tough, and in order to preserve the golden goose for tomorrow, we need to do something today that might be a little uncomfortable.

As long as you are direct and you share that with them, and whatever cuts you make are not disproportionately affecting the employees and not the executives, my experience has been they understand that.

If these cuts are adversely affecting your culture or core values, you’re going to find yourself in a death spiral and you’re going to kill the golden goose.

Set the stage. People who think leadership is about dictating a culture don’t understand culture. Culture is driven by the people below. It’s driven by the rank and file. All the leader can do is set the stage as to what collectively we think our values are.

Xactly One is a foundation that today has shares of stock in it and today drives a lot of corporate activities and events around philanthropic activities. We give of our time, and we do food drives and soup kitchens and every kind of thing we could imagine to help the communities.

Employees really like that because it ties into what I said about our core values. It’s not just, ‘Oh guys, we care about the community.’ We’re saying we care about the community through our actions, not because leadership is saying it’s important.

Empower your people. One of the biggest problems I’ve always seen at companies that don’t have a great culture is that there is a fear that if I do something wrong, I’m going to get fired. I just had a conversation with an employee yesterday and I kept saying, ‘Why wouldn’t you come talk to me about this?’ The response was basically that they were scared. It bothered me because that’s exactly what I’m talking about.

We need our employees not to be scared and for them to truly understand that it’s OK to make a mistake, as long as you’re trying. You’re never going to get in trouble for trying.

Anyone in the company should feel comfortable coming in with an idea or a complaint or an issue or concern and talk to anybody in the company.

If a manager is ever uncomfortable with that person going around them, they are the wrong manager for this company. Now a case in point was this employee I talked to yesterday. Not everybody feels good walking into the CEO’s office and lodging a complaint because they think there is going to be some backlash.

The challenge is convincing them there isn’t and living and breathing that. So when that does happen, there is no retaliation and nobody is in trouble for doing that.

Dare to be different. Weak leaders tend to hire people who look and seem and act just like them and probably have similar backgrounds to them. It’s an area we strive very obviously to avoid. Look at our executive team. What you’ll see is a real amalgamation of people from very diverse backgrounds, ethnically but, more importantly, experientially. That is critical to having a thriving culture.

That is true not only of our executive team but throughout the company. I don’t know any other way to do it. That’s just always the way I’ve done it throughout my entire career. It’s always paid such huge dividends because you get such diverse and different thoughts and ideas.

Don’t be afraid to change. The old-school way is, ‘Hey, we can have these employees’ bodies here from 8 to 5, maybe even longer.’ I would try to convince them that I don’t care at all about having their bodies here from 8 to 5.

I care about having their hearts and minds. If I can get their hearts and minds, then you’ll see e-mails popping in at 10 at night or on a Saturday or a Sunday. It’s not a time-clock environment.

Try not to get hung up on who is doing what when but measure them on the quality of their work. In this day and age, that’s how you’re going to get people’s hearts and minds.

How to reach: Xactly Corp., (408) 977-3132 or www.xactlycorp.com