Looking Backward Before You Go Forward with Epicor CEO, Steve Murphy
Steve Murphy, CEO of Epicor Software, discusses why sometimes you have to look in the rearview mirror in order to move ahead.
The company was a Goliath in its industry and Marissa had a lot of respect for it. But she also knew the company was facing hard times, and when she got the call asking her to join the team as CEO, she knew that turning things around would be no small feat.
The company had an attrition rate of close to 25% — meaning 1 in 4 people were leaving. It had cycled through six CEOs in the last 5 years. The stock price was dropping and revenue losses were at an all-time high. Most news sources, investors, and business execs agreed that the company was on the way to the grave. To join the sinking ship would be crazy — and Marissa knew it was crazy.
But, of course, we wouldn’t be sharing her story if she hadn’t taken the leap.
Marissa started as CEO the day her appointment was announced. But rather than jump in, take the wheel, and try to save the ship, for the first 90 days, she did… nothing. She didn’t present a strategy, she didn’t cut off haemorrhaging lines of business, she didn’t try to recruit a new team — no, she remained silent, and, for three months, all she did was listen.
It’s a technique many notable CEOs have used when entering a new organization, and it’s one that Steve Murphy, CEO of Epicor has relied on time and time again, but it wasn’t easy-going
“Third day on the job I had a town hall, like literally the third or fourth day on the job, years back, I was in a town hall,” Murphy recalled. “And I could tell, we just had a really frustrated labor force. They had just been through a lot of cost cutting and there had been layoffs and people had had their job responsibilities changed… And I basically just took verbal punishment.”
Murphy was brought on as CEO of Epicor at an inflection point. So, what exactly helped Steve and Epicor write a new ending to their story and how did he come up with his leadership strategy?
“I remember as a kid taking apart a lawnmower that didn’t work and as a ten-year-old putting it back together,” Murphy remembered. “I was always interested in building stuff, and could give you a long list of things that I built.”
These formative experiences taught Murphy that to fix something, you have to go backward and understand what’s broken to begin with. You have to go to the root cause. It was in his first job on the shop floor of Procter & Gamble that he realized that software can help you to figure out things that would take months in the hands-on world of mechanical engineering.
“If you like to build things, the place where you have an unlimited opportunity to build almost anything is software,” Murphy said. “You’re not constrained by anything.”
Murphy became the CEO of Epicor in 2017 at a time of turmoil and transition. By working with his executive team, board members and directly with employees, he pivoted the company and helped to set it back on track.
“You have a lot of people, especially people about my age, you know, forties, maybe up to fifty where they are set in their ways around their work process,” Murphy said. “And it was a significant effort to… make the shift to this new flexible model. It was hard.”
Epicor has turned around its relationship with employees and with its clients, while also providing a fuller perspective on the future. Four years later, Epicor is a thriving business, making more than $900 million in revenue, with 20,000 customers in more than 150 countries. In 2020, it was acquired for $4.7 billion, one of the largest software acquisitions that year.
The huge turnaround was a result of being able to pause, and take a look backward before moving forward. A trait that brings us back to Marissa that we mentioned in the beginning. Marissa in this story is Marissa Mayer. And the goliath company that she managed to turn around was Yahoo.
To find out how Steve Murphy managed to step back before stepping forward to turn the Epicor ship around, how it took its employers and customers with him, and the next steps that Murphy is taking to ensure stability for its clients, tune into Business X factors.
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