Does your company have different functions in different geographic locations, or will it hire the best people it can find regardless of where they live and let the geographic structure of the company follow?
Jen-Hsun Huang, CEO and co-founder of NVIDIA, presented many of his thoughts on running an international knowledge-based company the Spring 2008 Leavey Lecture on Monday. Priya Natarajan, President of the student International Business Network interviewed Mr. Huang in a casual conversation dubbed a “fireside chat.” The primary theme of Mr. Huang’s remarks was that NVIDIA let a rather organic worldwide structure form as a result of its early formation as a networked organization and its subsequent pursuit of great talent around the world. Some notes and quotes on the main topics that were discussed are below.
The format for the talk worked really well - Congratulations to the International Business Network for setting this up. At the time, it seemed too much of the limited time was used up at the start by showing a video produced by company employees for a company meeting. But in hindsight the video helped to set the atmosphere for the conversation about the company structure and culture, and this was the most substantive of the three Leavey Lectures I have attended.
Notes on the main subjects of the conversation:
Comparing the role of CEO in a start-up to his role today: There’s no management in the early days of a company because there are no resources to manage. A big part of the job is continually raising money. Another part is leadership. (”Lead. Compel. Evangelize.”) Now that the company is large, leadership remains an important part of his job.
NVIDIA as a networked company: When the company was started in 1993, they found that the only way for everyone to their own e-mail client at their workstation was to use a network of Sun workstations. NVIDIA was started at exactly the right time to be a networked company from the start. NVIDIA started its remote offices in response to finding and hiring people who happened to live in a particular area. Some of these remote offices were, and still are, one or two people working out of their homes.
Cultural differences: Over time, the company acquired what Mr. Huang called global “sensibilities” - an understanding of how to operate in different cultures (countries). This was a recurring theme of Mr. Huang’s talk. These sensibilities apply to developing products that resonate with the culture, managing people working in the culture, and working with customers and business partners in the foreign culture.
Indian parents: Mr. Huang (born in Taiwan and raised in America) got a spirited positive response from the audience after comparing how to deliver an “average” performance assessment in America and how to do it in India. He said that if you simply tell a worker in India that they are doing an average job and meeting expectations, the worker will be very upset and their parents may call you to ask what the problem is. “I have met more employee parents in India than in all other countries combined!”
He recommends delivering an evaluation in China with a speech such as, “I’m really disappointed, because you can achieve such great things, and I expect much more from you than this.” This will be more readily accepted because the worker is probably used to hearing this kind of nagging from his or her parents all the time! [Editing note: I thought he was still talking about India here but another student corrected me.]
Outsourcing: Mr. Huang was rather frank here. First of all, he criticized the culture of other countries for not being aware of why many Americans feel threatened by the effects of globalization on the work force. “In a way, they are taking our jobs.” However, like any modern CEO he believes that by using all of the company’s resources efficiently the company will grow more rapidly and benefit everyone. He used the US health care system as a counter-example of a system in which inefficiencies in the system cause everyone to suffer.
How to best use the workforce in each country: Mr. Huang turned the table on a question of how NVIDIA is able to use the strengths of each country in the overall operations. He presented the examples of coworkers from America who have recently returned to their home country of India or China. Did the Indian suddenly change from a computer architecture expert to a software QA engineer when he got to India? Should the Chinese programmer start working on PCB boards?
The network is the computer, or the display is the computer? Mr. Huang presented a vision where the network becomes to ubiquitous as to disappear, and the only part of a computer that the user is conscious of is the display.
The loosely connected organization: Mr. Huang believes that NVIDIA has an “organic architecture” as a company without a well-defined org chart and little emphasis on strict direct reports. He himself has 16 direct reports and is comfortable not having weekly 1:1 meetings with each member of his staff. He believes in using informal e-mail updates to make sure everyone is working in the same general direction, but also having them work towards a few important KPIs (key process indicators). He emphasized that the company relies on innovation and serendipity, which cannot be clearly predicted.
Contributing to multiple products: In an after-speech conversation with some students, he said that the company is able to produce more products than its competitors, but because each employee contributes to many products, an employee may not feel the same sense of craftsmanship that he or she would have from a larger role on one particular product.
Those are the main things I took away from the speech, aside from the fact that Mr. Huang is a very comfortable extemporaneous speaker with a healthy sense of humor. I left out some of the personal stories and I probably missed a few important points.
Altogether, this was a good event to start out the quarter with, and as far as I hope the next lectures are as interesting as this one.
[Editted 2008-04-04 to say that the parental-lecture style of performance evaluation was about China rather than India.]