Certinia under new leadership - an exclusive interview with DJ Paoni, its new CEO

Phil Wainewright Profile picture for user pwainewright December 8, 2023
Summary:
We speak exclusively to DJ Paoni in his first media interview since joining Certinia as CEO in October and find out more about his plans for the company.

DJ Paoni CEO Certinia
DJ Paoni, Certinia (Certinia)

There's been a big change in leadership at cloud ERP and PSA vendor Certinia in the past couple of months, following on from the change of ownership to new private equity investors Haveli at the end of July this year. Former SAP veteran Donald ('DJ') Paoni came in as CEO in mid-October, replacing Scott Brown to become the venture's fourth CEO since its foundation in 2008. Within a few weeks, Paoni had brought in a former SAP colleague as Chief Revenue Officer, along with a new CFO, a new Chief People Officer, and another newcomer in the new role of Chief Operating Officer. We caught up with Paoni last week, in his first media interview since joining, to find out more.

Regarding the new leadership team, Paoni is keen to emphasize the continuity represented by the likes of Dan Brown, who remains in post as Chief Product & Strategy Officer, and Todd Kisaberth, who continues as Chief Customer Officer. There's no hint of any change in the product mix or customer focus. His mission is all about taking the existing business to the next stage. He tells me:

We do have some new amazing leaders that we have hired on, that have experience in growing and scaling businesses. But we also have the company anchored by some really strong leaders that have been here for a while ...

I think we have a good mixture of some new players that can bring some fresh perspective to the organization, and some more established players that can continue the history and the journey that we've been on. So it's a great team. We're gelling really well, and we're getting to know each other, and we're focused completely on customer success and employee engagement.

From SAP to Certinia

Prior to joining Certinia, Paoni had spent virtually his whole career at SAP, rising through the ranks during a 26-year stint to become President of SAP North America, a position from which he retired last year. At first sight, it seems like a big change to go from a leadership role at such an industry behemoth to become CEO of a much smaller growth company. But he reminds me that when he first joined SAP, its US operation was around the same size as Certinia is now. He goes on:

I've seen this movie. I've lived this the past couple of decades. I think what drew me to Certinia is ... the people and the culture, the market-leading product, and it's somewhere that I believe that I can make a difference.

What I felt like my experience at SAP enabled me to bring to the table at Certinia is, first off, I have a lot of experience in scaling a business. I'm very well versed in the fundamentals of how you grow and how you expand a business. I understand customer-facing organizations and how you build those up and how you focus on talent development.

It's clear that Paoni sets great store on helping people achieve their potential. When I ask him what he would most like his impact on the company to be, he returns to the same theme:

I am all about developing and putting a lot of time into the culture of an organization, and growing people, and growing leaders and ensuring that people are just being the best versions of themselves that they can be. As much as I can do to create a culture that allows that, that would be a huge win for me.

As part of that, he wants to bolster management skills across the company. He says:

I think it's so critical that your first-line managers at the company have the skill set to not only roll up their sleeves, and be there in front of the customer, but also to coach and mentor and develop people. I call that operational range. You need to have that range if you want to scale. That's certainly something that I learned at SAP and that I'm bringing with me here, and I've seen a lot of it already, in terms of the people [and their] ability to scale.

Market potential

When it comes to market opportunity, it looks like there will be no deviation from Certinia's existing focus on services-based organizations. If anything, the focus will sharpen on Professional Services Automation (PSA), which has long been Certinia's strongest product offering, often deployed in tandem with its Cloud ERP platform, and soon to be complemented by the new Customer Success Cloud, currently in beta. Paoni says:

Let's be clear, the professional services automation market, it's a multi-billion dollar market. We are the market leader in PSA, and we've had some some huge wins recently. Our pipeline is very strong. Combine that with the opportunity, in our Customer Success Cloud, which will be generally available soon, I think it points to a really bright future for Certinia. I think we're just scratching the surface here.

He believes the market potential in serving services-based businesses continues to expand:

The economy continues its long term trend to become services-centric. And our thesis, as a company, is pretty much predicated on that. With services comes a very different operating model with regards to how you interact with your customers, how your people do their work. Solutions that aren't built with this in mind I think are really missing key use cases, such as how do contracts flow through revenue recognition, and how to orient people to the most important work? Or how to deliver on the promise of customer success as a team activity that takes into account all the data that you have about your customers.

Therefore investment in the product set will continue, with AI coming to the fore. He says:

Machine learning, including Gen AI, have the massive potential to streamline operations and really help these customers re-orient their people around the more nuanced kind of customer-centric and project-based work, as opposed to the repeatable process-based work ... helping customer-centric employees deliver ongoing value to their customers ...

We're going to continue to invest in the product. Customers love our product, that's the feedback that I've been getting, but we're always going to be looking at ways to improve, make it easier to implement, make it easier to use, and we continue to invest so that we're going to remain the market leader, we are not going to get leapfrogged.

Salesforce relationship

Another theme that has stood out in conversation with customers is a shift towards doing more with fewer platforms. He elaborates:

Many of those midmarket companies are coming from either highly customized homegrown systems, and so they want standardization. They want a platform that they can reduce all these different handoffs, all these different interfaces, so that things can flow seamlessly across the platform. And that's absolutely what we're going to provide them.

Certinia's relationship with Salesforce, on which its products are built, is proving very helpful in this context. He goes on:

In the past year, they've invested aggressively in data and AI. That has helped us tremendously. We're leveraging the Salesforce Einstein platform in our products for machine learning use cases, like days-to-pay in ERP and days-to-staff in PSA. And we're building on Data Cloud for our CS Cloud products — customer health scorecard that we will be coming out with soon. And we've been collaborating with the Einstein GPT team to incorporate that generative AI into all of our clouds.

That is taking full advantage and leveraging that Salesforce platform and that trust layer to protect our customers' data assets. We recently renewed a long term partnership with Salesforce, we continue to be deeply engaged in go-to-market programs. They're a huge customer of ours. And our partnership with them is extremely strong at this point.

My take

Certinia's evolution continues after its third change of CEO in seven years. When founding CEO Jeremy Roche handed over the reins to Microsoft and Salesforce alumnus Tod Nielsen at the beginning of 2017, the focus was on Nielsen's platform experience and software industry clout. His tenure was characterized by a sharper focus on core products and customer-centric product development.

Nearly four years later, Scott Brown stepped into his shoes, crossing the fence from one of the vendor's larger customers. Under his leadership, the company doubled down on its PSA offering and also added new complementary offerings, including services estimation and the forthcoming Customer Success Cloud. These moves underpinned a strategy unveiled by Brown called Services-as-a-Business, emphasizing the platform's ability to bring together all the end-to-end processes and metrics that drive success in a services organization. His tenure culminated in the name change to Certinia, followed by the transfer of ownership to Haveli.

It seems these new owners had already decided upon a change of leadership and therefore lined up Paoni to shepherd Certinia into its next phase. He has put in place a new set of lieutenants to galvanize the vendor's sales, marketing and operations, signaling a significant change of pace. But at the same time, there seems to be a firm commitment to the existing product direction, customer focus and company culture. His mission it seems is not to reshape Certinia, but to build on that foundation and bring it into a new phase of growth. We'll keep on tracking that journey.

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