How Adam Selipsky made AWS even bigger

Adam Selipsky, CEO of Tableau Software Inc., speaks during the opening address of the 2019 Salesforce Dreamforce Conference in San Francisco on November 19, 2019.

David Paul Morris | Bloomberg | Getty Images

Andy Jassy, ​​head of Amazon Web Services, will take over from Jeff Bezos later this year. So Jassy has chosen someone he trusts to replace him as head of Amazon, which provides cloud tools for hosting websites and applications.

Now it’s up to Adam Selipsky, who was Jassy’s right-hand man until a few years ago when he became CEO of Tableau Software, to build on Amazon’s already impressive lead.

According to estimates by industry observer IDC, AWS controlled 47% of the cloud infrastructure market in the first half of 2020, more than the next four providers combined: Microsoft, Alibaba, Google and IBM.

Like Jassy, ​​Selipsky saw AWS grow up and delve into the details of many topics. Back in 2016, when he was leaving his position as vice president of sales, marketing and support, Selipsky attended Jassy’s successive “chop” meetings to discuss suggestions.

While Jassy was the last to comment, Selipsky was the penultimate, said Jay Wampold, chief marketing officer at cloud development startup Pulumi and former AWS product marketing director.

For decades, Amazon employees have relied on 14 leadership principles such as “customer obsession” and “bias to action”. People who know him said Selipsky embodied these principles, like Jassy. He is also well versed in Amazon’s practice of creating fake press releases and frequently asked questions documents for potential products. It probably won’t be long before Selipsky remembers the rhythm of work at Amazon.

One thing that sets Selipsky apart from other candidates is that he ran the analytics software company Tableau both as a publicly traded company and as part of Salesforce. Under Selipsky, Tableau’s stock rose as revenue growth accelerated and he led a shift from selling one-time software licenses to subscriptions. He then helped sell it to Salesforce for $ 15.7 billion in 2019. This was the company’s largest acquisition at the time.

“More and more companies are demanding subscription purchase options for all of their software, and data analysis is no different. It’s no surprise that, like subscription, our customers are getting the full power, simplicity, and flexibility of Tableau with lower risk, lower upfront investment, and flexibility,” said Selipsky the analysts in a 2017 conference call. The push was successful: By 2019, 84% of Tableau revenue came from subscriptions.

‘Just do it’

Leading Tableau made Selipsky more aware of the complexities of selling software to non-technical users, said Jay Heglar, chief business officer of Tableau competitor Domo and former AWS sales director who worked with Selipsky. Now, according to Heglar, Selipsky can go back and try to drive adoption of the cloud applications offered by AWS, which were not as popular in the past as its low-level computing, storage, and database products.

For example, being at Tableau meant teaming up with resellers who can roll over software to large accounts, Heglar said. Selipsky could ask Amazon to refine its approach there to promote applications like the Amazon Chime video call service, which is a far cry from a household name like Zoom or even Skype.

Working at Salesforce may have given Selipsky a fresh perspective on how AWS can get even bigger. Salesforce spent four times as much on sales and marketing as it did on research and development in the past fiscal year. This shows that the focus is on selling.

“Make it easy for yourself to do business. Make it easy for yourself to buy a platform,” said Manny Medina, CEO of the start-up Outreach for sales software and a member of the Amazon team that founded AWS. “Sell me a vision. Good ol ‘sales leadership – you need a little Keith Block in this organization.” Block joined Salesforce in 2013 from Oracle and was named co-CEO alongside Marc Benioff before stepping down in February 2020.

Medina said it would be helpful if AWS could sell technology to customers even when it isn’t fully available – a sales tactic Oracle has used in the past. “If you want to grow, you have to make promises about things you don’t already have,” a former Oracle employee was quoted as saying.

Medina also said that Selipsky could make a difference in making AWS easier for users. This week, a small cloud infrastructure provider called DigitalOcean made its debut on the New York Stock Exchange, promoting the simplicity of its services and billing practices.

Compete with Microsoft

Selipsky has to deal with a resurgent Microsoft.

When Selipsky left Amazon, Microsoft was still adding Azure services to its portfolio to meet Amazon’s needs, and Microsoft rolled out data centers around the world to increase capacity. These are no longer big problems. Microsoft has become more successful in convincing long-standing Windows and Office customers to try Azure by encouraging their sales reps to focus on getting customers to use it instead of just paying for it.

Since 2016, Microsoft has also used Amazon’s own behavior against it. Microsoft executives regularly say that companies don’t want to do business with an IT services company that is competing with them in other areas – a testament to Amazon’s continued expansion from e-commerce to shipping, pharmacy, grocery, and more.

Selipsky has to respond to this request, as has Jassy. (Amazon said, “For customers who have created meaningful offerings with meaningful features, these companies have yet to struggle to grow further just because AWS has something in that area too.”)

Whatever Microsoft does, it works. Azure now appears to be on the verge of eclipsing Office as Microsoft’s top-selling company. According to IDC estimates, AWS lost market share in the first half of 2021 compared to the first half of 2020, while Microsoft gained market share. Alibaba and Google also participated.

Microsoft has put together product packages and developed enhancements for individual industries such as healthcare, manufacturing and retail. Amazon has not yet followed a vertical strategy. AWS has won some deals in slow moving areas like financial services and healthcare.

“I think Adam has an opportunity to break part of it as part of a vertical strategy,” said Ed Anderson, a respected analyst with technology research firm Gartner. For example, AWS could bring in more money from industries like financial services and healthcare that have been slow to adopt the public cloud.

Again, his story at Salesforce will be helpful here, as the company deepened its own industry push during Selipsky.

International expansion is another opportunity. Selipsky will step into an Amazon that is still not the cloud of choice outside of America. Alibaba remains dominant in China, and AWS is not yet a huge hit across Europe.

“European companies tend to be a little more conservative and less open to disruption and change,” said Anderson. There are many smaller organizations in Europe that are working with resellers and continuing to use products they are familiar with, Anderson said.

A bigger company

It’s also about building new relationships within an ever-expanding Amazon.

Since Selipsky left, the number of employees at Amazon has more than doubled to around 1.3 million.

At least Selipsky will find familiar faces when he returns to AWS in May. He has been involved in many key business successes, including agreements with Capital One and the US Central Intelligence Agency, Heglar said. He was talented at growing leaders within AWS and was ready to defend his employees in meetings when others pushed their ideas back, Heglar said. His daughter Nina Selipsky works at AWS as an executive content and programming specialist.

Most importantly, Jassy trusts Selipsky.

“He’ll let Adam do his thing,” said Heglar.

SEE: Amazon names the next AWS CEO Adam Selipsky

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