Alan Trefler of Pega: First Customers in 1984 Still with Us Today Thanks to Lessons Learned Working in the Family Business

interview with alan trefler pegasystems

PegaWorld, the annual event put on by Pega, a leading customer engagement and process automation platform provider, will be taking place virtually on May 4th.  And earlier this week my CRM Playaz co-host Paul Greenberg and I had the opportunity to hold a LinkedIn Live conversation with company founder and CEO Alan Trefler to talk about the event a lot more leading up to the event.

Actually, “a lot more” may be an understatement when it comes to speaking with Trefler as there are so many areas you can delve into with him.  Not only is he still at the helm of the company he founded back in 1983, he’s having a lot of fun while also leading Pega to cross $1 billion in annual revenues for the first time last year.  He credits a lot of Pega’s success to the lessons he learned working in the family’s restoration business – which will be celebrating its 100th year anniversary next year.   He’s also a chess master and an accordion player.  

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Interview with Alan Trefler of Pegasystems 

So Paul and I covered a lot of bases in our time with Alan, including what it takes to thrive in business for so long, and what’s in store for this year’s PegaWorld.  Below is an edited transcript of a portion of our conversation.  To hear the full discussion click on the embedded SoundCloud player.

Transitioning Organizational Focus While Keeping the Corporate Narrative

Paul Greenberg: Early on Pega was known for being process-oriented and focused on operational efficiency, but lately you’ve been focusing on customer engagement and behaviors – how a customer is thinking and how to better interact with them. You’ve gone from a left brain to a right brain, so to speak. But the thing that blew me away the most, and it’s consistently done this is that you never lost a beat in your corporate narrative from year to year. I mean, typically when a company makes let’s say a public change that dramatic looking, they lose customers. They churn, because the customers say, well, they’re not serving us anymore. You guys, your churn rates almost zero, right? It’s probably six, seven, eight years, even ten maybe, you’ve made this transition, but it went from like mechanical to CRM-ish to CRM to customer experience to customer engagement, never missed a beat. How did that thinking even evolve? What was on your mind, in the mind of your team to get there without losing any customers?

Alan Trefler: Well, thank you for that. One of the things that I’m really proud of is that my first two customers who went live in 1984, are still customers to this day. The Bank of America and Citibank and much larger customers. We’re still doing the stuff we did for them originally though, literally in both cases, many dozens of other things as well. I think part of it was the understanding that there was a continuum that reaches out from the core skill set we had at being able to get work done, to touching the actual clients and touching what the clients are aspiring for and trying to do. And with the introduction over the years as we have of being able to do the front office CRM type things, but understanding it really wants to be hooked in to being able to do things end to end, and then adding the AI capabilities and a lot of the adaptive analytics and other things that literally got you into the mind of your customers or their customers.

Small Business Deals

I think there is a continuum there and we’ve been very careful unlike a lot of companies in this business to not just go out and acquire a bunch of crap, but when we buy something as a company, it’s because it’s consistent with that end to end vision. And I think that it’s very important because what we’re looking to do is create a holistic vision for our customers and that’s what’s kept us, I think, honest and really engaged.

Drawing on lessons learned working in the family business 

Brent Leary: So how has that vision you have for your customers and how you interact with them, how has this pandemic… how’s the last 12, 13 months affected that image? And how did working in the family restoration business early on in your life help shape your perspective?

Alan Trefler: It’s interesting because in the coming year, that business which is the restoration business is going to have its 100th anniversary.

Brent Leary: Wow.

Paul Greenberg:  Wow.

Alan Trefler: That’s a family business. So I’m a first generation American on my father’s side. He came after having survived the war. He started that business and that business is very dear because literally with his hands, my father who, never actually graduated high school, was able to put two kids through college and build a pretty amazing life for himself. But it also gave me an opportunity to work in close proximity with customers. And though I wasn’t really terrific at the restoration, so it was never going to be a business I was going to be skilled enough to go into, it did provide me a lot of access to individual customer interactions from a very young age and I think that was pretty important to my early development and to the values I think we have as a company.

Pandemic’s impact on digital transformation efforts

Brent Leary: So you mentioned that the acceleration of digital transformation. I think that’s across the board almost every company that I’ve heard from. But how has your customers changed the definition of what they viewed the digital transformation as? Yeah, they know they had to speed up, but what did they have to change in order to kind of stay afloat in what’s going on here?

Alan Trefler: So it’s interesting because I think there are some aspects of this that are going to have ramifications long after the pandemic is done and I think we all recognize this. But one of them is a lot of companies realized that the way they were digitally transforming wasn’t going to be the long-term vision for how they should do it. That there was just too much bailing wire, too many things that were unsustainable. And what’s happened and what’s interesting is some of them clearly have changed their long-term agendas. So it’s not even what’s happening in the moment for us or over the last 12 or 18 months. It’s really, they understand that they’re going to have to look differently at how they connect their customers, their front offices, the customers intent. We talk sometimes about moving from customer engagement that is reactive, which is the way it’s historically been, to proactive and even preemptive. How do you figure out, even ahead of your customer, knowing what your customer’s going to want so that you can really do an extraordinary job of meeting their needs?

Executing on your corporate vision

Paul Greenberg:  How do you take effectively your vision and bring it to life? That’s something a lot of companies fail to do so their vision just ends up being more or less science fiction, right? 

Alan Trefler: We try to balance being visionary and being very pragmatic and some people see this as a contradiction. We just see it as a continuum. I think the most important part is having lots of other visionary people with you. So it’s not my vision, but it’s really a collective vision so that we’re able to progress and we’re able to challenge ourselves and each other to try to come up with the right nuances to keep ourselves on course. And it’s been interesting because so much has changed frankly in the last 30 something years. But the thing that hasn’t changed is the way most companies use technology is just too primitive and too backwards. The way businesses and IT work together is more like they typically don’t work together.

I actually think that computer science… that’s my background… has been enormously disappointing. And a big part of what we’re trying to do is actually realize… I see you nodding Brent, let me give you an example of what I mean. If you look at other industries, for example, look at computer aided design and manufacturing. So you look at the creation of actual goods. It’s come unbelievably far in the last 35 years, right? You have people now will draw a wire frame of something they want connected to a 3D printer. You get to go from concept, to specialization, to actual realization instantly and continuously. Take a look at what Pixar does, where they create models of characters and create brilliant, just brilliant movies, literally by getting the computer to do the hard work of execution so people can think about needs, desires, goals, et cetera. In software, it’s all BS. In software it’s the opposite, right?

We’ve made it harder and more complicated to engage customers or build backend systems or hook it all together. The world of the cloud, which we love, right? We’re all in? But you go take a look at AWS or Azure or the Google Cloud platform, all of which we run on. You go take a look at their catalogs of what’s available. It is mind blowingly complex. And it is so different from how a business person thinks about how they want to serve a customer or how they want to fulfill a product promise. Our mission is how do we create an approach based on models that lets us do in the customer experience and in the software realm, what you’ve seen so successfully done in other industries. 

Low Code and the Lotus Notes Redux

Brent Leary:  We’re hearing a lot about things like low-code/no-code platforms and robotic process automation (RPA) these days.  Where does these fit into the mix? 

Alan Trefler:  A lot of this low code stuff is really just the next generation of Lotus Notes.

Lotus Notes was going to be the great liberator of the business, and it turned out to be the great creator of technical death. Those are people, frankly, who were over-obsessed on how do I create a couple of forms and how in a low code way I push them through something. So, that mistake is being replicated almost perfectly by a lot of the low code stuff. 

The other delusion has to deal with the thought that dropping little robots, RPA robots in my back office to cut and paste between systems is somehow going to make my business customer oriented. We used to call it screen scraping 25 years ago, 20 years ago, right? All you’re doing is to have a little software program like Rumba that would go and cut and paste from this system to this system.

Neither of those are really focused on outcomes. We say look, what is the business trying to do? How do you find that as a business person, independent of channels, and independent of whether you drop a little robot in someplace, which we’re not anti-robot, they’re just not going to revolutionize your business. You need a brain in your business. All the work we’ve done with AI is to make that brain adaptive and not just powerful, but also smart in terms of changing. 

Last year, the industry came up with a couple dozen new computer languages. Who the hell needs more computer languages… I mean, the reality is we need to make things clearer and simpler and more business effective. The software industry has just become too enraptured with complex cloud architectures, data scientists, all sorts of other folks who we should be working to simplify, but instead are almost celebrating their complexity.

Virtualizing PegaWorld

Brent Leary:  PegaWorld is coming up on May 4, and I thought last year’s was the first virtual industry event that started to take advantage of what “virtual” had to offer, while the first batch of events basically just tried to replicate their physical event online. So what’s in store for folks this year?

Alan Trefler:  We were fortunate to have people like Don Schuerman (Pega’ CTO) and Mike Brenner (Pega VP of Client Experience) that knew we had to do things differently.  The first thing I think they decided is we don’t want to hold people hostage for days. I think a lot of folks decided that they were just going to take their talking heads and take their multi-day events and just put them online which was a disaster, right? I mean, if you actually look at the… Though, some people are still doing this. They realized that they had to cut it down to be about two and a half hours. That we were going to have to get really compact. We were going to try to use the medium to perhaps both dive deeper, but also stay more conceptual. And I think especially given the timeframe, they did a terrific job of orchestrating that transition and deserve enormous credit for that.

This year we’re trying to take it up to a whole other level again. So actually moving it to… I’m not going to give anything away, but let’s just say we’re trying a different mode of engagement and a style that is also different from what we’ve seen other shows do. And we’re going to both try to make sure we can operate conceptually, so there are always ideas that are important and sort of elevate the conversation. But then at the same time, be able to punch through, to answer questions, like what is conversational AI about? How do you actually bring AI into the conversation of an organization and their customer and do that at the next level, and actually be able to demonstrate concepts as it relates to AI, as it relates to customer engagement, and as it relates to intelligent automation? To providing the real end to end approach to customer service and acquisition.

This is part of the One-on-One Interview series with thought leaders. The transcript has been edited for publication. If it's an audio or video interview, click on the embedded player above, or subscribe via iTunes or via Stitcher.

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Brent Leary Brent Leary is the host of the Small Business Trends One-on-One interview series and co-founder of CRM Essentials LLC, an Atlanta-based CRM advisory firm covering tools and strategies for improving business relationships. Brent is a CRM industry analyst, advisor, author, speaker and award-winning blogger.

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