Citrix's Templeton Says Every Company Should Be Thinking And Acting Like A Startup

Mark Templeton has been at the helm of Citrix Systems for roughly 14 years and is widely credited for taking an essentially one-product, $15 million company and turning it into one of the leading developers of virtualization, application and desktop delivery, and cloud technologies.

Early last year, Templeton said he would end his tenure with Citrix once a new CEO was identified. Later in 2014, at the behest of his board, he reconsidered and opted to make a "multiple-year commitment" to stay on as the Fort Lauderdale, Fla.-based software developer's chief executive.

The decision was almost universally hailed as good news by the company's channel, with whom Templeton is very popular. Which made sense soon after I sat down with Templeton, who started the interview by asking me if I had a chance to speak to some the solution providers gathered in Las Vegas for Citrix Summit, the company's annual partner conference. Templeton seemed extremely interested to hear what they were saying to CRN about their relationship with Citrix, the event, and the new products he had unveiled in two keynotes that week.

[Related: Citrix In The Cloud Era: Pushing The Envelope Or Playing It Safe?]

I told him, in my experience, Citrix partners came across as some of the most loyal and engaged in the channel. That observation clearly pleased the CEO.

Mark Templeton: Yeah, you know, obviously, we've had a huge focus on partners as long as I've been associated with the company, which is now 20 years. My predecessor architected the business model of the company, because when you start, especially back then, you sort of have to decide 'How am I going to go to market, am I going to talk to customers directly, or am I going to talk to customers indirectly?'

He made that decision for good business reasons. And then I think because of our culture, in terms of doing things we believe, living our principle and values, it's made the partnerships more than just business relationships. I hate to use the 'family' word, but they're more family-style relationships.

CRN: It does seem like many of your channel partners talk about Citrix as if they are part of the company, kind of an arm of the company rather than just resellers or systems integrators.

Templeton: The word 'culture' has the word 'cult' in it, and we're kind of 'cultish' in the sense people feel they belong. That business decision was made, coupled with our culture overall, that's led to the cult, that's probably the way I would best say it.

It's a cult of partnerships.

CRN: This industry as a whole is changing so fast, the technology is evolving so fast. Do you believe Citrix's best days are still ahead of it?

Templeton: I hope every leader has a plan for better days ahead, as defined by growth and profitability and impact in the marketplace, whether you want to measure that by market share or you want to measure it by value delivered to customers. I like to measure it by value delivered to customers and society, that's how I choose to measure us, and under any of those measures our best days are ahead.

CRN: Has the company lagged at all as the technology has evolved, and is there a need right now to play catch-up?

Templeton: Any technology company that turns 25, 26 years old has to always be thinking like a startup and acting like a startup because you do have products in the market that mature while you invest and serve new markets that can either be disruptive to markets you're already in, or they're just about serving new adjacent markets.

We're blessed in that we have a, or the, leading product in Windows application delivery infrastructure, we have one of the leading products in Web application delivery infrastructure, NetScaler, we have one of the leading products in Web-based collaboration. It's tough to be No. 1 or No 2 in multiple markets.

CRN: The knock you sometimes hear against Citrix is that it was a revolutionary company more than a decade ago when it was pioneering virtualization technologies, but now, with the advent of the cloud, those technologies are almost passe, and Citrix is no longer on the cutting edge of innovation.

Templeton: We're not insulated from the kind of changes being driven by the kind of innovation and invention around us, or what customers want. In the end, what customers want is more value from technology, in the sense of helping a company grow faster, operate more efficiently, make their employees more productive, give them higher ratings in employee engagement. They don't really care how the technology works.

We've been an industry so focused on how things work, the guts of things, and the cloud and mobile devices have introduced the idea of, 'Maybe I don't need to know how it works; maybe I just need to know what I can do with it.' And that's created a huge amount of stress on a traditional industry that's built itself up around complexity, assembling complexity through professional services, and custom-type systems. And the fact of the matter, the industry has enabled the reinvention of the wheel over and over. We're not really different, I'm not trying to say we're better, OK, that's kind of where we've been. A shoe manufacturer or a distributor or a hospital, they're not doing new things. They're still healing people, they're still manufacturing shoes, and they're using technology, but so much is going into reinventing the wheel. I ask CEOs, 'How many of you think that if we compared the architecture of your IT infrastructure, how much of it would you have in common?' They generally agree about 20 percent. 'Well, how much of the output of it would be in common?' Eighty percent. What's wrong with the picture?

CRN: Sounds like they're doing mostly the same things in mostly different ways?

Templeton: Well, it's because we have these guys and their philosophies are this, and we have those guys and their philosophies are that. So they created the wheel one way, and they created the wheel another way. Building wheels, I think is like creating buggy whips in the age of the automobile.

CRN: How do you move beyond this mind-set?

Templeton: When we talk about software defining the workplace, that's actually the act of moving forward to the automobile where you're focusing on transportation, the value of transportation, in the sense of commerce, in the sense of quality of life, as opposed to the classical ways to do things like buggy whips.

CRN: You just mentioned the stress the industry is feeling now. Is there also stress from investors and from Wall Street? Can Citrix continue to thrive as an independent company under the type of shareholder pressures that all tech companies are under these days?

Templeton: We've done a pretty good job of, first of all, driving a lot of shareholder and value creation. Secondly, I think we've done pretty well in articulating to investors, as we've had several invention cycles in the company, there are times when you're harvesting and there are times when you're really investing, and those are the high and the low points, and we're definitely in an investing/inventing cycle right now. The biggest pressure of all is the pressure that we see when we look in the mirror cause we feel such a sense of obligation to partners and to customers to lead them to a better place, whether it's partners, the business opportunity, or a customer -- the worst thing in the world is to lead a customer to a dead end. Who would ever want to be in that position? So the pressure is always the greatest around when you look in the mirror, not when you look at investors, because with investors you can set expectations and deliver on them. The real stress is exceeding the expectations of partners and customers.

CRN: You were almost out the door, and then reconsidered, deciding to stay on in your position. Was there anything that really excited you about the future of the company and the future of the technology that helped make that decision easier?

Templeton: Yes, yes. I'd say for the last couple of years we've begun showing the potential of the integration of the various technologies into a solution that we now have articulated around the value of a software-defined workplace. I felt back when I told the board that I'd like to extend my time, I told them that I thought we were heading to the part where the synergy across products and the integration across the various SaaS-type technologies and product along with our Workspace services products, we were just getting to the exciting time where they would be delivering greater value whether through greater interoperability, greater simplicity, so that we could actually have greater reach in the marketplace and actually deliver on the idea that I talked a little about yesterday [in his keynote], that the escape velocity for any company in our industry is when you get beyond technical solutions and outcomes and you get to business and human outcomes that you're selling. So I think we're on the threshold of that, so I'm real excited about driving it.

CRN: Cloud computing has ushered in a new era in the way these technologies are being used and being integrated. Are we almost at a tipping point now in which almost all business customers are going to start using software very differently, and the way solution providers are bringing these solutions to market is going to need to radically change?

Templeton: Yes, I think there is a tipping point happening, and I think when it comes to partners, a key piece of that tipping point is where do they bring their value-add to the customer. There will be less and less opportunity to bring assembly services and more opportunity to bring applied services to the customer.

CRN: Can you explain the difference between assembly and applied services?

Templeton: Five years ago, if you said, 'Watch this, I can go to this website and I can build a Web application without ever owning any underlying infrastructure to do it, and I can build it, start it up instantly, etcetera, that's sort of, 'Wow, how'd you do that?' 'Well, I had used Amazon.' And it's like, really? It would take five months to do that in our data center.' But now, through the magic of cloud infrastructure that's packaged and consumable for enterprises, your data center can work very much like Amazon Web Services or an Azure cloud and that's not that big a deal anymore. It will be less and less and less of a big deal as we go forward. And let'' face it, looking back, that's been a big piece of what partners have done for customers -- assemble and architect the components that are the underlying platform for applications.

CRN: So more focused on just delivering the solution?

Templeton: Right. More and more of that gets prepackaged, whether it's prepackaged in a cloud sort of format like at Azure or Amazon or SoftLayer, or in an appliance like you see in some of those starting to come onto the market. It's a cloud-in-a-box, and they're pre-engineered and pre-assembled, so once again were moving into an era where it's going to be all about applications, applying the technology, not building the technology.

CRN: It seems that describes the two products you introduced this week, WorkspacePod, your new converged infrastructure solution, and Workspace Cloud, the platform for quickly creating and deploying hybrid cloud environments for remote users.

Templeton: That's exactly right. What you see is the integration of everything. You need these higher layers of abstraction technology to bring these higher layers of abstraction in applying them. Having this integration-of-everything capability will allow partners to get computing out of the way of business, get computing out of the way of humans trying to accomplish a task.

CRN: But those partners who were really good at building data rooms, what should they be doing to continue to be successful, at least successful with Citrix?

Templeton: I think generally to be successful, they do have opportunities to be service providers of core application services or core infrastructure, and many of our partners are already doing that. I'd say over half are already doing that. It's called managed services. It can be on-prem or it can be off-prem. I see them doing all of that using our technologies and other technologies.

But they'll have to keep going up the stack to those levels of abstraction that I talked about. You have to keep moving to the higher layers of abstraction.

At this point, we have so many network-connected things, the opportunity to interconnect them, to make the workplace smarter, to make the home smarter, to make people smarter, to make a smarter city and a smarter business, all that's to come. It's out there, but that takes some new skills that build on existing skills. So we're committed to our partners to lead them to where the opportunity is in these higher layers of abstraction, as well as to help them acquire the skills.

We've been through about two and a half cycles. The first cycle is: 'Look I'm a reseller and I make 30 points on selling products, and I don't charge for installation because I can make the margin on the product.' Then as time has gone on and distribution has obviously changed overall, and products that actually catch on, they go to more of a volume kind of a state in the marketplace and that's where we see partners, we've led them through the transition to really a services and products business model. Next is a product services and subscription type of business model, and we're not the only ones leading them through it, but that's definitely what's next on the agenda in terms of the cycle, and then the subscription will be to the underlying technologies that allow them to build a smart workplace that allows people to be infinitely mobile, productive and make the choices that they want to make around work and life balance.

This article originally appeared as an exclusive on the CRN Tech News App for iOS and Windows 8.