Female CEO Describes View From the Top

Ellen Hancock has long been visible as one of the highest-ranking women in the technology industry.

Now that she has joined one of Silicon Valley’s most exclusive clubs--female CEOs--she is bringing that visibility to her new employer, Exodus Communications.

Exodus, an Internet systems and network management firm, has grown nearly fivefold since Hancock came on board in March. The Santa Clara company’s client roster includes such Internet luminaries as Hotmail, GeoCities, Inktomi and Lycos. Exodus hosts its customers’ Web sites, connects them to the Internet and offers custom services such as building and monitoring security firewalls.

Hancock earned her information technology stripes during a 29-year career at IBM, where she became Big Blue’s highest-ranking female executive. She came to Silicon Valley three years ago with the goal of running a company and worked at National Semiconductor and Apple Computer before Exodus.

After nearly three decades as a member of the East Coast tech establishment, Hancock said she has embraced--but is still getting used to--California’s free-wheeling environment. She spoke with The Cutting Edge during a recent visit to Santa Monica.

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Q: Now that you’ve been in the Internet business for eight months, have there been any surprises?

A: There are a lot of societal issues that you deal with when you’re working on the Internet. We’re spending a lot of time on eliminating spamming. We’re dealing with issues of hacking, and we’re dealing with issues of privacy. How do you handle privacy and yet still get the advantages that you want from the Internet?

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Q: How do you feel about the expectations customers have for infrastructure providers like Exodus?

A: They’re increasing. You’re very sensitive to the fact that you are holding a lot of people’s assets. When I went to work the other day and realized there was a blackout, I was not thinking about the fact that it would be difficult to get to work. I was thinking, “I hope the data center’s OK.” Suddenly, a light going off has a different meaning than it did before.

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Q: Do you think it would have been more or less difficult to rise to the CEO level if you were in another industry?

A: The technology industry is probably one of the better gender-blind industries. There’s been a massive amount of hiring into our industry, and therefore women are able to get good positions. And I think there are enough women supporting other women in our industry that we’ll go forward.

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Q: What is it like to work at a start-up after spending so many years at IBM?

A: I was fortunate in that I went from IBM to National Semiconductor to Apple. In very many ways, Apple is still an entrepreneurial company. Many of the management practices I learned at Apple hold very well for Exodus.

But Exodus doesn’t feel to me like a start-up. If this were a company with 20 people and no customers, it would feel like a start-up. But there are 500 employees and they had over 300 customers when I joined them.

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Q: On the whole, do you prefer a small company or a big one?

A: There are some aspects of a small company that are positive. When you make a decision, you can see it happen really fast and you have instant feedback. In a large company, the decision takes longer to make and the results are harder to see. In a small company, it’s easier to come to a consensus because you can get all the people who need to give input into the decision in the same room.

On the other hand, there is merit to well-disciplined larger companies. Larger companies can do some things for employees that the smaller ones can’t. And yet for the younger ones, to participate in an [initial public offering]--in some ways there’s an ability to make money that you can’t make in larger companies. On the whole, I [prefer] the big companies.

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Q: Why?

A: I can say, “We’re here on the East Coast, we’re all wearing suits, and I understand this meeting.” On the West Coast, I’m always trying to figure out what I’m supposed to be wearing. Is today the day for jeans? I’m still learning.

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Q: What are some of the other culture shocks you’ve found since coming to Silicon Valley?

A: You need to understand more about the venture capital community. It’s also fairly incestuous. Everyone knows everyone else.

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Q: Does that make you claustrophobic?

A: No. I love it. I think it’s great to go into restaurants and know at least a quarter of the people in the room. I love the information technology industry and the fact that it’s so clustered--it’s a very stimulating environment on the West Coast.

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Q: A lot has happened at Apple since you left last year. They seem to be in the midst of a turnaround. Do you think this is for real?

A: You have to applaud the team for what is, in fact, a financial turnaround. They’ve had several quarters now that they should be proud of. I also give them tremendous credit for their ad campaign. The recent introductions of the iMac and the Mac OS were both well-done.

My concern continues to be the fact that they’re in a niche--publishing and education--and that niche is getting smaller, and they have a less dominant position in that niche than they used to. I also worry that they have diminished their ability to do some things in the future. They reduced dramatically the R&D.; So I’m just concerned that except for their financial execution, underneath you don’t see the makings of a future success story.

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Q: Everyone in Silicon Valley has an opinion on the Microsoft trial. Do you think Microsoft is abusing any monopoly power?

A: I honestly am not sure the Justice Department has a strong case. I worry about the government getting involved in discussions companies are having about software and the Internet. In some cases, government regulation does not make sense, and what should not be included in an operating system I think fits in that category.

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Q: Are there any Microsoft business practices that you have heard about during the trial that trouble you?

A: I cannot fault them for any of the dealings they had with me. At Apple, I was involved in the patent infringement discussion with Microsoft. They used the cards they held, and we used the cards we held. And when a company has been that successful, it gives them a couple more cards.

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Staff writer Karen Kaplan can be reached at karen.kaplan@latimes.com.