A clear view Featured

7:00pm EDT February 24, 2008
Bobby Yazdani doesn’t have a corner office. So if you’re looking for the CEO of Saba Software Inc., you should probably search the main employee area. That’s because Yazdani, who founded the company in 1997, has learned the value of building relationships with his front-line employees. After leaving Saba in 2002, he returned in 2004 to find the human capital management software and services provider struggling and hovering around $30 million in annual revenue.

Focusing his energy on turning the company around, he made a list of core priorities centered on two-way communication and transparency, letting his 600-plus employees know where the company was going and why changes had to be made. In return for that honesty, they helped him pinpoint problems and create a greater focus on personalized employee incentives. As a result, Saba posted fiscal 2007 revenue of nearly $100 million, up from $71 million in fiscal 2006.

Smart Business spoke with Yazdani about how transparency ignites your staff and why empathy is job No. 1 for a new generation of leaders.

Maintain organizational transparency.

I fundamentally believe that everyone needs to understand the challenges you are facing, and they need to have complete transparency of what the leaders in the company are thinking all the time and what the priorities are.

A leader needs to have a clear sense of transparency in the organization. There needs to be a sense of integrity in a place people work. People have to have a strong sense that there is a great deal of integrity in their leaders because that’s the people that they work for.

Transparency creates a level of integrity where people get engaged better. Whether it’s easy or hard, whether it’s challenging or if there are opportunities, they will be more engaged. An engaged employee base deals in significantly higher quality work.

You have to be enthusiastic; you have to have that energy and enthusiasm. Transparency automatically leads to a level of enthusiasm. I get a lot of energy by having a transparent relationship with my employees and our community here because when they trust you, you learn from them and get an opportunity to share that energy with them.

Take the time to be empathetic.

Empathy is the No. 1 skill a leader should have. For the new generation of leaders, empathy is a skill set we need more than ever in leadership — and that’s so we listen and learn.

It’s extremely key to try to understand where people are coming from, and that yields a level of humility. The days of the celebrity leaders are numbered — those things don’t have the kind of appeal they used to have; that’s why I don’t believe in leaders in corner offices.

Create a personal connection with your staff. As leaders, we have a tendency to know it all, and it’s amazing the wealth of information that comes from people that are closer to the problem.

Creating an environment where there is a forum, where leaders can listen, that’s where your management system really enables. We have a very stringent review process where we review our business, and everyone gets to hear everyone else. Through that transparent environment, we can listen and learn by reviewing the details, and there comes from that a lot of good data about the core issues at hand.

I report back to our employee base every 90 days. I get in front of them, and they get to ask me any questions they want. ...

... It’s my job at these key events to get in front of the employees and make myself available. It really comes down to personal connection. I want to increase the opportunity to have that personal connection and get an opportunity to learn from them. I learn from employees by just being with them and hearing about their observations — and they’re learning from the customers in the marketplace. Relationship building is at the core of it, and personally following through on that creates a training opportunity for both of us.

Tie performance to personalized incentives. There is an approach that we have that is essentially a rating of the performance that yields incentive pay.

The core benefits themselves are crucial, but we want to be able to offer even more benefits to high-performing employees, so the top 50 percent of our company gets acknowledged quite a bit — not just through the management assessment process, but they also get acknowledged with an employee reward program. Employees nominate other employees, we announce that on a quarterly basis and that leads to elevating people that, at times, you don’t necessarily see, people who go above and beyond in helping other people.

I get to present it to the employees, and we show all the nominees and color why the nominee is up there. It’s really a community-based ranking, and there is a gift that we give them, and they really enjoy it.

Focus on core changes. When you are in a turnaround situation, there is a tendency to try to do too many things. You have to pick up two or three strategic initiatives and be consistently focusing on those things and stay on the message to make sure people understand the priorities and the importance of them.

The top priority for us was transparency. It goes back to very basic things: A business has to be profitable; [it] has to be focused on a few categories that you want to excel at. Leadership is always a challenge, so make sure that leaders are always engaged and keeping a consistent culture for those supporting the turnaround.

HOW TO REACH: Saba Software Inc., (650) 581-2500 or www.saba.com