Leadership in telecom: Tom Stanton, CEO of Adtran on adding value, software transitions

Tom Stanton, Adtran
As CEO of Adtran, Tom Stanton sees himself as someone who needs to add value by giving his direct reports and other employees.

In his role as CEO of Adtran, Tom Stanton sees himself as someone who needs to add value by giving his direct reports and other employees a forum to be heard. What this means is that a person needs to know that when they talk to their superior, their manager is adding value to what that employee is thinking. Like other traditional hardware vendors, the Huntsville, Alabama-based hardware vendor is in the midst of helping its service provider customers’ transition to a virtualized network environment via SDN and NFV via its Mosaic platform.

FierceTelecom Senior Editor Sean Buckley talked with Stanton about his role and the company's software transition.

On being a CEO

Tom Stanton: If you look at other jobs like private equity, one of the benefits of that job is you learn a new industry every month so you get a broad perspective how the world works. The thing about being a CEO is, you don’t know about what you’re going to be learning about people and how different operations and different functions within a company. Every day you’re delving into [discussions] about Layer 3 stacks and then in the next meeting discussing the latest changes in the tax codes for employee benefits. It’s a fantastic job if you’re interested in learning different aspects of a company.

I am a big believer that if you work for somebody, that somebody has to add value. If you’re reporting to somebody, you need to feel that when you go to talk to that person you feel that you’re adding value to what you’re thinking. In the job I am in, I have to add value, which means you have to be up to speed enough to add value in a conversation you’re having with that person.

On setting expectations

Stanton: We have three-year goals. We have yearly goals, and those yearly goals come from direct reports to me that are based on financial and other metrics. My rationale for starting this was the not the goals themselves, but the process of having to think about it. We do an update to the company every year and a strategic plan. We just started getting onto that three-year cycle. The rationale behind the yearly plan and the yearly goals is to force people to sit down and think about what they want to get done. If you don’t have a trigger point to make people think about what they want to get done this year, they will continue the cycle of handling whatever is on their desk. It is very tough to change anything that’s material unless someone takes the time to think about what it’s going to be. We review those quarterly to make sure people are on track.

On educating employees

Stanton: If you stay connected, you’re really not surprised a lot. You know for the most part something is not going well, well before it does not go well. You may decide to ignore that hint, but you had that hint. Sometimes I will hear something and let it sit because what that person did was inform me so I won’t be surprised. I am not in a position to add any value to what they are doing right now. It sounds like they’re covering the bases or I know the skills of that individual may not turn out the way we hoped, but it will turn out the best way it could have turned out. There’s no reason for me to have three meetings. All that does is create a bunch of people that work for that person to do bunch of reports to put in a format they think I am looking for, which I am not.

On the future

Stanton: Telecom is our business. If this business ever gets to where I have 90% of market share or I don’t think it’s going to grow and allow innovation, we will need to find new businesses. That’s not the case. We have done a good job at tightening our focus. Companies tend to when they go through good times, and we’re no different in that case, they tend they can’t do no wrong and spread their focus with effectively less scale. When they go into bad times, they tend to refocus.

We intentionally refocus when we go through an uptick because we did not have enough mass to hit the next wave of broadband development and that we were in a position to not get hurt by the move to software. We intentionally did that as part of our restructuring three years ago. If that plays out, and we expect it to, what you’ll see us have higher software content and develop more and more elements that will sit on top of operating systems. The vendor base is premised off of driving incremental and generational type value, which is 10% lower. They do not drive transformational value the way you can do in software. A new app comes up and it changes the economics of something. I think as the telecom industry starts moving towards that software model, you’ll start to see innovation that’s transformative.