Editor’s note: The next-generation spreadsheet, known as “Smartsheet,” is a unique, highly effective software tool for collaboration and planning. I spoke with Brent Frei, executive chairman of Smartsheet. In 2001 Brent was recognized by the Smithsonian Institute as a “Pioneer in Technology” and also was awarded Dartmouth College’s Thayer School of Engineering Fletcher Award for lifetime achievement. In this article he shares insights into trends around collaboration software tools and his company Smartsheet.
SandHill.com: Why do we need a “next-generation” spreadsheet?
Brent Frei: It’s statistically clear that spreadsheets are the dominant tool for general work tracking. I divide that into two types of activities: 1) number crunching (financial analysis and data analysis) and 2) general tracking of projects and processes (sales pipelines, marketing events, product launches and customer issues list). The number-crunching tasks are where spreadsheets truly shine and are where the majority of innovation has occurred to date. The general tracking tasks have not benefited from innovation in spreadsheets; yet this is the dominant use of spreadsheets today.
Ultimately what happens is at some point people outgrow spreadsheets for certain tasks, so they purchase a purpose-built tool. For instance, a spreadsheet might be no longer sufficient for new-candidate tracking in HR, so they get a candidate-tracking system. Or it’s no longer sufficient for event planning and they get an event-planning system.
SandHill.com: So a next-generation spreadsheet includes automation aspects of purpose-built tools?
Brent Frei: If you were designing Microsoft Office from scratch today with no historical context for it and were building it for what people do today, it would be very different from what Office looks like now. For instance, you would design Word as a combination of LiveWriter, Word and PowerPoint because we put content into presentations or on the Web in a way that people consume it. It’s the same thing for spreadsheets.
If you were going to design a spreadsheet from scratch for how the majority of people use spreadsheets today, it would be a combination of the major features that people use in a spreadsheet but would also include features from tools like Microsoft Project. And it would be tightly integrated with the calendar. If there were dates in your spreadsheet, you would be able to see them on your calendar and coordinate them there. You could attach files and establish automated workflows. Tools on the Web are more uniquely designed to work together.
Interestingly, as office tools have gone from the desktop to the Web, they’ve just basically moved them from the desktop to the Web rather than innovating and taking advantage of what’s possible today.
SandHill.com: Why isn’t there much innovation going on in this area?
Brent Frei: There has been sort of a land grab to get to the Web. And some companies, like Microsoft for example, are carrying an installed customer base, which legitimately constrains their ability to innovate too far without abandoning their customer base. Others have taken more of a piecemeal approach to problems they’re solving.
As a result, there are 300 different derivatives of Microsoft Project online, for example, all of them claiming to have some unique feature that makes them great. There are 40-50 derivatives of threaded work-tracking tools that are simple solutions. But no one took this new approach to make a collaborative tool with a familiar spreadsheet look and feel — until Smartsheet began acting on its vision.
SandHill.com: When did this happen?
Brent Frei: We started this approach seven years ago, and it took us four of those years to really refine our design and identify how our Smartsheet tool needed to function to make it better than the spreadsheet era. We actually had our product in the market within the first year, with all the core concepts that we thought were correct. And for the most part they were. But exactly how we put them together wasn’t quite right.
SandHill.com: Did you rely primarily on customer feedback in that four-year process?
Brent Frei: It was a process of putting the product out there and having a lot of people use it. We analyzed a ton of click-stream data and accumulated a lot of feedback from customer use and onsite user testing.
As it turned out, we had to start from scratch again. It was a really painful process. We had to fundamentally abandon some of our favorite features; we recognized that if you’re in the users’ shoes, they expect it to do certain things. And they don’t care how hard it is technically to make it do that; you have to make it be that way. The good news is that’s what we ended up with when we did the redesign. We solved some hard technical problems to make it behave as the users expected.
SandHill.com: Can you give me an example of a design aspect you had to change?
Brent Frei: Sure. A simple example is a spreadsheet column with a date field for when tasks are due. It turns out that there’s no hard and fast rule for how people want to do that. Some people don’t want to put a date in because they don’t have a date. Or the date may be “sometime next week” or “Mary’s going to tell me in five days.” That breaks the paradigm of what a date is. So we had to go from strongly typed data to loosely typed data and let people type anything they wanted in those fields and then had to figure out how to handle that.
When we solved the hard problems related to the user feedback, the application just surged. People got very excited about it and the business took off.
SandHill.com: Does Smartsheet just make tasks easier than in a spreadsheet, or does it have functionalities that are not possible to do in a spreadsheet?
Brent Frei: It’s the latter. For example, spreadsheets really are not very good at tracking hierarchical data. So if my client is Company ABC and there are 10 things I’m going to do with Company ABC, I can do some unnatural things with columns to show these 10 things are actually children and Company ABC is the parent. But with Smartsheet, you can just make them children, and there’s a little expand/collapse functionality that connects a family of information so they all travel together in that document. That’s not possible in a spreadsheet.
Or you can attach a document to a row to keep information centralized and associated with a specific line item. You can send a row from Smartsheet via email to your client with that document attached. They can make edits to it, click on submit, and it all gets populated back into your Smartsheet. You get an email confirmation of what they said, but the data is already tracked and you don’t have to worry about filing the email somewhere or copying/pasting it somewhere. While you could share the entire sheet with your client, you can also only send them a row – you decide. That never has been possible in a spreadsheet.
And we’ve even gone as far as to include crowdsourcing as a source of information. For example, you can actually share a cell from your Smartsheet to find information. You could share the cell with a question, send the cell up to the Amazon cloud, and the crowd-sourced information will come back and populate right in that cell in your Smartsheet. That is something that no one could possibly conceive of being in a spreadsheet.
SandHill.com: Have you found that there are certain vertical industries or horizontal processes that are more interested in this as early adopters, or is it across the board?
Brent Frei: It turns out that it has more to do with the person involved and their particular pain point rather than an industry. It’s someone in HR who needs to do candidate tracking, for instance, or someone in the IT department using it for systems deployment.
For example one of the very largest video-sharing sites in the world called us and said they needed a Smartsheet to manage their interaction with enterprise clients advertising on their sites. We helped them orient the way they tracked data a little differently. They went from 68 columns wide in a spreadsheet to 10 columns wide in a Smartsheet, and it made it a lot easier to use with their clients.
We target people’s pain points and serve up a version of a template that feels like the problem they’re trying to solve. It already has the columns organized and a little bit of workflow built into it, so they should be able to look at it and realize it will help them organize their work.
We market it primarily as a collaboration tool that is designed to manage any kind of project or process. A good example is a company called Populous, which is an event management and architecture firm. They’re one of the companies organizing the upcoming Olympics in London. Think about all the people involved — everything from caterers to volunteers to contractors. The likelihood that any one of those groups is going to go learn a special tool for this one project is zero. But the likelihood that they will understand and utilize something that looks and feels like a spreadsheet is extremely high.
SandHill.com: Is this a SaaS model? And is there a free trial?
Brent Frei: It is entirely SaaS and only online. There is a 30-day free trial. We’ve organized it such that if you’re the person who creates the sheet and is in control of it, you can share it with as many people as you want for free. So there is no cost to collaborate with as many people as you like.
SandHill.com: Is there a mobile version?
Brent Frei: Mobile is an important aspect. A lot of market-leading tools are not well suited for mobile products yet, so we’ve actually seen our mobile version become a big reason for people moving to Smartsheet.
A few weeks ago we had an interesting occurrence with a big retail customer. Even though their network was down, they all used their smartphones to access Smartsheet to conduct their status meeting.
SandHill.com: It seems to me that if people buy this as a way of solving their own pain point, there could be many versions of this in a corporation and the company may not realize who is using it.
Brent Frei: That is exactly the case. We got a call from a big drug discovery company that realized there were six different groups in their company using Smartsheet, and they wanted to talk to us about rolling those together under an enterprise plan. That is increasingly occurring because of the bring-your-own-applications challenge.
Typically when that happens, the new applications coming in the door don’t have any provisions for IT to do important things like integrate with security and with other systems. So we now provide IT with all that administrative infrastructure in an enterprise version. In fact, most of our product releases these days focus on features targeted for enterprise users.
We’re also focusing in a big way on how projects or processes managed in Smartsheet can talk to each other so an entire organization can coordinate and collaborate if they want to. And not just people can collaborate, but data within one sheet can link to data in another sheet without having the traditional problems when you try to link spreadsheets together.
SandHill.com: Do you believe that Smartsheet will eventually replace Office applications?
In the grand scheme of things, Microsoft Office is not going away. People will have a copy of it on their desktop for a very long time. But with the increasing prevalence of mobile access and the increasing importance of people collaborating remotely via tools, I believe that most of the growth will occur with applications like Smartsheet.
Brent Frei is the executive chairman of Smartsheet.com. Before co-founding Smartsheet, he was CEO and co-founder of Onyx Software Corporation, a customer relationship management (CRM) software company. In his 10 years at Onyx, he oversaw the generation of $600 million in direct revenue, a consistent top five ranking among CRM vendors worldwide. In 2001 Brent was recognized by the Smithsonian Institute as a “Pioneer in Technology” and was awarded Dartmouth College’s Thayer School of Engineering Fletcher Award for lifetime achievement. Brent also held roles at Intellectual Ventures, Microsoft and Motorola.
Kathleen Goolsby is managing editor at SandHill.com.