Hemanth Puttaswamy Of Malbek On How To Use Digital Transformation To Take Your Company To The Next Level
AI is Everywhere: Address the fear many people have around AI and tech so they understand how AI is an enabler. For example, instead of a lawyer thinking CLM will take their job, we help reframe their thinking to see how AI can help them expand from, say, 100 contracts to managing 200 or more contracts in the same amount of time.
As part of our series about “How To Use Digital Transformation To Take Your Company To The Next Level”, I had the pleasure of interviewing Hemanth Puttaswamy.
Hemanth Puttaswamy is a technology entrepreneur. As CEO and co-founder at Malbek (A Contract Lifecycle Management solution provider), his vision is to redefine the quote-to-cash solution aimed for the age of AI. Hemanth is a hands-on leader with a passion for building a great team with an amazing culture that zealously works to make every customer successful. He is responsible for overall corporate strategy and product vision with a keen eye towards building the best solution interface that will delight every user.
Thank you so much for joining us in this interview series. Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?
When it comes to our origins, when I was working as an executive in a public company, a yearly audit of financials showed major issues with the way revenue was recognized across our 2,500+ customers. The company had to restate financials going back ten years. This is when I realized the impact of badly managed contracts and non-standard contract terms.
A light bulb went off that there is a clear need to have a solution that would standardize contracting processes with complete enterprise visibility for every business.
This sparked a fire, which led me to research the available solutions to manage contracts. It was painfully obvious that implementing a contracting solution would take years, cost a lot, and there was no guarantee of it working. In fact, fifty percent of the implementations have failed.
A few years later I was fortunate to work with two amazing people, Matt Patel who had a decade of experience in Contract Lifecycle Management (CLM) and Madhu Poolu who is a technology guru. Together we co-founded Malbek. We set out to reimagine this entire space where we simplify end-user experience as well as admin experience.
Implementing and configuring any contracting process can be done in just weeks, not months or years, with self-service functionality that a non-technical person is able to operate without paying millions of dollars on services and having a seamless AI-engine embedded across the contract lifecycle.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘take aways’ you learned from that?
When we started the company, one thing I had in mind was people should be able to relate to the name of the brand. The challenge was to come up with one word that encapsulated what we were trying to achieve. Namely, bringing people and processes together in smart, new ways.
We came up with more than 100 names, but nothing reflected our personality — the fun, light-heartedness, and also something that people could remember. One of our friends recommended BAHMM, which was funny and sounded like Emeril’s famous tagline while including everyone’s initials. It was funny, but not what we were looking for. We wanted the name to be about what the company could do for customers.
While we were working to revolutionize the contract space, we didn’t want the name contract in our name as we felt it limited our company’s potential. In the meantime, the placeholder name we chose for the company was Malbek (with a K) because the co-founders were brainstorming names over a bottle of Malbec. We finished the evening by toasting, “To Malbek!”
Afterwards, we laughed at how we had the right name all along. To me, Malbek represents coming together and bringing our best ideas to the table just like when you enjoy a nice bottle of wine with friends or family. It symbolizes the power of what we can accomplish together, and it relates nicely back to what we do — bringing so many different people across departments together as they work on contracts.
We believe our platform, just like a good bottle of wine, brings sales, legal, procurement, and finance teams together to collaborate for a common mission and is just waiting to be uncorked at every organization.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
Sometimes the lessons we learn from people are unexpected. They might even seem negative in the moment, but afterwards we realize that they helped clarify things for us, helping us to clearly avoid the wrong path.
For example, when we built the product and were trying to sell it to the first customer while pitching to VCs, everything seemed to be aligning perfectly. The customer wanted to purchase the product, and the VC wanted to give a Term Sheet.
Then it all started to fall apart. The customer ended up not being able to buy the product and the VCs term sheet went in a direction that wasn’t favorable to us. Through that experience, we learned the customer we had been going after wasn’t the right target. We also learned that the approach from that VC was not the preferred path for us.
I am thankful to both those individuals because not working with them worked out really well for us. We learned exactly what we didn’t want, and we learned how to better position our story to sell to the right audience. In fact, one of our earliest potential customers was so captivated by our vision that they became an early investor, and that changed the whole equation for us.
Is there a particular book, podcast, or film that made a significant impact on you? Can you share a story or explain why it resonated with you so much?
Life’s experiences resonate the most for me, but there is an excellent book for people like myself who are product people who focus on building the right product that is going to delight every user.
I highly recommend “Build What Matters” by Ben Foster and Rajesh Nerlikar. It addresses the question of how you build a product that has a perfect market fit with a balanced view.
Extensive research suggests that “purpose driven businesses” are more successful in many areas. When your company started, what was its vision, what was its purpose?
Malbek exists to create products that delight its customers while building an organization made up of exceptional people who enjoy what they do and do it with passion.
We believe we have just scratched the surface with AI. Our algorithms learn from the user’s behavior, collaboration, contract syntax, and semantics using Deep AI NLP. Our vision is to be the middle-office platform that builds a seamless bridge between CRM and ERP. We believe that 95% of mundane tasks related to source to pay and quote to cash can be completely automated.
Are you working on any new, exciting projects now? How do you think that might help people?
We are working on a continual basis to improve our AI algorithms. A few exciting things are centered around automating negotiation processes for organizations. We do this by reducing human touch by up to 90%, freeing up valuable time. The second part is industry benchmarking of efficiency, effectiveness, and efficacy. Benchmarking to see how well you are doing against the whole industry. That’s important because it creates a gamification kind of experience where you’re competing to do well in the industry and get better compared to other companies.
Thank you for all that. Let’s now turn to the main focus of our discussion about Digital Transformation. For the benefit of our readers, can you help explain what exactly Digital Transformation means? On a practical level what does it look like to engage in a Digital Transformation?
We had the chance to work with a multi-billion dollar global food supplier that did contracts on paper only — you can imagine the days and months contract management took. They dealt with hundreds of thousands of contracts in painstaking processes.
We transformed their whole enterprise to go paperless, with collaboration across departments, during a global pandemic. The first few months were a transition, but they now cannot live without our solution and have saved so much time and sped up their service to their customers because of the time saved.
Which companies can most benefit from a Digital Transformation?
Every company working with today’s consumers can benefit from at least some aspects of digital transformation. Today’s consumers expect digital options and experiences.
We’d love to hear about your experiences helping others with Digital Transformation. In your experience, how has Digital Transformation helped improve operations, processes and customer experiences? We’d love to hear some stories if possible.
Contract Lifecycle Management (CLM) is one solution that can help the topline of any company by improving the efficiency and effectiveness of deal cycles. It can also boost the bottom line by capturing and flagging all the commitments and obligations from vendors, ensuring that the enterprise is utilizing the products and services that they buy effectively.
Legacy CLM solutions are extremely difficult and expensive to implement and operate. Many of the next-generation solutions in the market are too shallow with narrow functionality focused on a specific persona or use case. They cannot scale with complexity when enterprises have advanced needs to automate business processes.
There are many point-solutions which focus on one or two areas of contract lifecycle use cases but not the entire span. We built Malbek as a true enterprise-grade Contract Lifecycle Management solution with seamless integrations to popular applications and a real emphasis on the ‘L’ of Contract Lifecycle Management with our LifecycleAI™ engine. These are core parts of the platform, solving the complete need of contracting with no-code, self-service configuration.
Has integrating Digital Transformation been a challenging process for some companies? What are the challenges? How do you help resolve them?
The first challenge is always resistance to change in large enterprises. But the minute you start explaining all the benefits, the worries start to fall away. This includes things like reducing contract drafting cycles from weeks to minutes or seconds, negotiations reduced from months to days. They will have complete visibility across the enterprise to all their contracts. This changes the equation. The consumer-grade interface is also key. It makes searching for your contracts like finding a product on Amazon.
Ok. Thank you. Here is the primary question of our discussion. Based on your experience and success, what are “Five Ways a Company Can Use Digital Transformation To Take It To The Next Level”? Please share a story or an example for each.
- Explain Why Transformation is Needed: Oftentimes, people think they don’t need technology solutions since they are fine doing things the way they’ve always done them. So, in order to get people to see the need for transformation, you have to sometimes step back and educate them about the gaping problem right in front of them. In our space, research shows that a staggering 85 percent of enterprises lack an effective contract lifecycle management solution. And for the typical organization, contract management pitfalls, like missed contract milestones, erode 9.2 percent of revenue annually. That adds up quickly and makes the case for stepping in and making changes.
- Focus on What Matters & Demonstrate a Better End State: A lot of companies are focusing on digital transformation because it’s the new buzzword (although people have been talking about this for years). But, if you don’t start out with what matters in mind and know what problems you want to solve, your chance of success is low. For example, we work with many companies that know they need to improve their contracting process, but can get lost in the minutiae of change. When we take a step back and focus on how our solution can bring their teams together and help everyone save time and money while reducing risk in contract management, things become clear and digital transformation projects move forward.
- Create Technology Solutions That Give Customers Time Back: Our time is our most finite resource. Creating technology that helps customers save time is critical when it comes to digitalization. We see this in the contract lifecycle management space as one of the main drivers in every single conversation.
- Change the Behavior of the Customer: Many people are intimidated by technology and so they don’t engage. That’s why it’s important to ensure your solution is easy to explain, addresses customers’ real pain points, and is done in a way that excites them to take a step into something new. One customer recently was talking with our team about this very topic and said, “Things we once relied on IT to help us with, we are now able to do ourselves with the support of the amazing Malbek team.” When technology empowers people, that is when true digital transformation occurs.
- AI is Everywhere: Address the fear many people have around AI and tech so they understand how AI is an enabler. For example, instead of a lawyer thinking CLM will take their job, we help reframe their thinking to see how AI can help them expand from, say, 100 contracts to managing 200 or more contracts in the same amount of time.
In your opinion, how can companies best create a “culture of innovation” in order to create new competitive advantages?
We stand apart as a company that is both remarkable and refreshing with a unique culture that creates an amazing working environment. That starts with focusing on hiring innovative and curious people who are willing to share their ideas and finding inventive ways to connect. My team at Malbek doesn’t merely touch base periodically to connect and talk about work. We connect on a deeper level as people. We sing. We play music. We read poetry. And we do this regularly.
When you build a culture where people can be themselves and feel at ease to say, “I had this big idea…” that’s when true innovation can flourish.
Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
I have a personal quote I often say to myself. It’s become my mantra of success. “Unconstrain your mind and remove your limits.”
Thinking this way has helped me approach challenges differently and see life and work from an entirely new viewpoint.
How can our readers further follow your work?
This was very inspiring. Thank you so much for the time you spent with this. We wish you continued success and good health!