At the recent Sierra Ventures Annual Reception, Carl Eschenbach, CEO of Workday and former Sequoia Capital partner, sat down for a fireside chat, sharing his perspectives on navigating a fast-evolving tech landscape. 

Here are some key takeaways from the discussion, focusing on how businesses can stay resilient, leverage AI effectively, and scale innovation.

Embrace Change and Pivot with Purpose

One of Carl’s most powerful messages was the importance of adaptability. He shared stories from his own career, from VMware to Sequoia and now Workday, emphasizing that a willingness to embrace change has been instrumental to his success. When he first joined VMware, he was skeptical of virtualization’s potential, but he soon recognized its disruptive power. Years later, the shift to venture capital at Sequoia presented new challenges, yet he welcomed the opportunity to learn and adapt.

For today’s entrepreneurs, the lesson is clear: adaptability is essential in today’s dynamic market. Whether it’s evolving customer needs, new technologies like AI, or shifts in the global economy, leaders must be ready to pivot with purpose, looking for ways to innovate and remain relevant.

Simplicity scales, complexity doesn’t

Carl discussed a significant challenge for larger organizations: internal complexity. He emphasized that simplicity is key to scaling innovation. In large companies like Workday, where many teams juggle competing priorities, focusing on simplicity helps reduce friction and speed up decision-making.

Carl advised leaders to think carefully about what not to do. It’s common to feel the urge to tackle everything, but scaling innovation requires clarity and focus. For Workday, this approach has meant choosing key areas to innovate, including internal processes, customer offerings, and go-to-market strategies, while ensuring the company’s core strengths are not diluted by spreading resources too thin.

This advice applies to startups and enterprises alike: prioritize clarity, avoid unnecessary complexity, and double down on initiatives that offer the most value to your business and customers.

AI as a Catalyst for Business Transformation

Artificial Intelligence (AI) took center stage during the chat, with Carl highlighting how it’s transforming industries and Workday’s own journey with AI. Workday’s new AI platform, Illuminate, is designed to use machine learning to automate background tasks, allowing employees to focus on strategic, high-impact work. For example, Carl explained that AI agents are already automating recruiting processes, business optimization tasks, and even expense reporting, illustrating how AI can streamline operations.

He described the future of AI as a transition from tools to intelligent agents that work autonomously in the background, handling routine tasks and empowering teams to achieve higher productivity. Workday’s vision includes AI co-pilots, transforming how employees interact with technology to get work done more efficiently.

The lesson for businesses is that AI isn’t just a trend; it’s an essential tool for automating routine tasks and freeing up human capital to focus on more complex, creative, and strategic efforts.

Data Is Essential for AI Success

Carl was candid about the importance of high-quality data in AI’s success. At Workday, the scale of their data—800 billion transactions annually—allows them to build powerful AI models with curated, contextualized data. He stressed that AI’s real value is derived from data integrity and context; without these, even advanced AI solutions can produce inaccurate results.

This insight is crucial for any company looking to adopt AI. Effective AI relies on structured, quality data, and businesses that manage their data well can leverage AI to drive meaningful outcomes. Data quality is as important as AI technology, and companies must prioritize data governance to get the most from their AI investments.

Advice for Founders: Resilience and ROI Are Key

Carl’s advice to AI startup founders was particularly timely. He spoke about the inevitable ups and downs in any market cycle, advising founders to remain resilient and committed. He urged startups to focus on creating solutions that deliver real, measurable ROI for customers.

He noted that in an environment full of new technologies, only those solutions that solve critical business problems and prove their value will thrive. It’s not enough to create a “nice-to-have” product; founders must focus on must-have innovations that customers depend on for business outcomes.

For today’s entrepreneurs, Carl’s advice is a reminder to stay focused on delivering real value, especially as AI solutions become more widespread. He emphasized that companies that can demonstrate a clear ROI will be the ones who succeed in a competitive landscape.

Carl Eschenbach’s insights at Sierra Ventures’ Annual Reception offer a valuable blueprint for leaders navigating today’s evolving tech landscape. From embracing change and simplifying innovation to leveraging AI effectively and building data-driven solutions, the conversation highlighted strategies essential for future success.

As businesses continue to integrate AI and navigate new technological frontiers, the lessons from Carl’s journey at VMware, Sequoia, and Workday offer a reminder that adaptability, focus, and measurable impact set great leaders and organizations apart. Companies that follow these principles will be well-positioned to lead in the age of AI and beyond.