Smith:Sun has grown enormously since you helped start it. How have you been able to adapt when most entrepreneurs can't make the transition to a big corporation?
McNealy: My advice is to surround yourself with people who're smarter than you are. First of all, that's the only way you're going to learn anything. It's also the only way you're going to feel comfortable entrusting someone else to make important decisions for you. As Sun started growing, I quickly learned that I couldn't do everything, and as it has continued to grow, I've given more and more responsibility to the people around me. That allows me to focus on what I really have to do. Also, others are doing things I never would have thought of.
One of the biggest weaknesses of executives is that too many overthink things. The best decision is the right decision. The next best is the wrong decision. The worst decision is no decision.
Smith:Does Sun have any management practices that distinguish it from other companies?
McNealy: We've found that the best way to ensure a bright future is to change strategies in the middle of our successes. It's all about preparing for market shifts before the competition does. As Wayne Gretzky used to say, "You have to look where the puck is going, not where it is."
Smith:But a lot of firms fear that their best talent will all go off to work at Web start-ups. How do you keep that from happening?
McNealy: Attracting and retaining top talent is a big issue right now. Always has been, really. But especially now, since opportunities in the technology sector are expanding more rapidly than the pool of available talent. Incentives are important. Cash compensation, benefits, stock options-the good, old-fashioned profit motive. But so is creating the right work environment. At Sun, I tell managers that they work for their employees, not the other way around. I want our employees to be challenged, inspired and supported. They're our most important resource. We can't be successful without them.
Smith:You obviously are especially dependent on sales reps. What do you look for in hiring them?
McNealy: I've been out with our team on thousands of sales calls, and I'd say the most important qualities are character and integrity, because you can always learn sales skills. These are the people who represent your company, who interact with your customers. To a very large extent, your viability rests in the hands of your sales force. They also have to understand your customers as well as they understand your products.