When Dallas Clement was finishing grad school at Stanford University in 1990, he sent job applications to two cable industry giants; a friend also suggested using an executive recruiter. That headhunter set Clement up for an interview in Atlanta at Cox Communications, where he was soon hired. “Quite frankly,” recalls Clement, “I hadn't ever heard of them.”
His two dream cable employer picks disappeared in mergers long ago. Now 18 years later, Clement is senior VP of strategy and product management at Cox, the nation's third-ranked multiple-system operator with 6.2 million residential and commercial customers.
Clement graduated from Stanford with an M.S. in engineering-economic systems. “I'm a gadget guy who likes to know how things work, but I'm also practical in terms of what is affordable,” he says. That's a handy background for a man who decides what product enhancements—whether improvements in e-mail or parental controls for TV channels—to pile on cable's triple-play foundation of digital video, voice and broadband.
“Dallas is a rare example of someone who can grasp the nuances of the technology and also put together a business model for implementation of that technology,” says Richard R. Green, president and CEO of CableLabs, the non-profit research arm of the cable industry that studies ways to integrate technology.
Clement sees the job of business development becoming increasingly complex. “In the 1990s, it was all about execution and simply getting digital video, digital voice and high-speed to as many homes as possible,” he says. “Today, the challenge is prioritization of initiatives. What service enhancements will add to the triple play and how can we do it efficiently? We can't be effective if we try to do everything at once.”
With consumer expectations high and plenty of competition in the marketplace, Clement says the cable industry needs to introduce new features, services and products with greater efficiency so “collaborative efforts are necessary to win.” He says the DOCSIS protocol for cable modems is one example that has served the industry well. Up next is the Tru2way cable industry specification for interactive television applications, which allows consumers to purchase video devices at retail that plug-and-play on cable networks nationwide.
As competition comes from every direction, especially satellite TV and telcos, it's a challenge to find the right balance. “I think people can be too reactive these days to competition as opposed to sticking to their strategy,” Clement says. “If your strategy is sound and you execute well, you will be better off versus reacting to your competitors' tactics. The biggest challenge is to define what your differentiation is in the marketplace and stick to that.”
A big part of that comes in dissecting hidden motives of rivals after they subtly signal their long-term strategies. It's one of Clement's particular strengths. “In a discussion about a product announcement from another company, he will look at it not only from the product side, but what it might do for them beyond what meets the eye,” says Steve Necessary, Cox Communications VP of video strategy and product management. “He'll look at what the new product will set them up for as a second and third follow-on activity.” Necessary is one of four executives who report to Clement, and each has a sector of product responsibility. With Necessary covering video, the other executives fan out for oversight on data, voice and wireless.
Clement hasn't always been the gadget man at Cox. From mid-1995 through 1996, he held finance posts at the cable company's parent, Cox Enterprises, where he worked on more than $10 billion in cable acquisitions and his finance skills were tested. This includes helping arrange the sale of Teleport, the first large-scale local telephone exchange to compete with the Bell phone giants, which Cox and its two cable partners sold to AT&T. The AT&T stock that Cox received was used to help fund acquisitions.
Putting Down Roots
Back when he was scouting for jobs out of grad school in California, Clement was comfortable with the prospect of putting down roots in the South at Cox's Atlanta headquarters because he grew up in Florida. He's proud of the Cox corporate culture of paternalism that was in evidence when it kept employees of its New Orleans cable system on the payroll after Hurricane Katrina washed away their jobs for a time. “That's our culture,” he says. Today, he lives in Atlanta with his wife and four daughters, the youngest of whom is also named Dallas.
His tenure in finance during the 1990s involved more innovative work than some would think for a corporate treasury executive. A $1 billion Cox investment in what became Sprint PCS was valued at $8 billion at its peak. To finance the slate of acquisitions, Clement monetized the Sprint PCS stake through a number of innovative structures including several convertible securities. “When you do $10 billion in financings, they can't all be plain vanilla,” Clement says.
Clement views those finance days as not so far removed from new-products duties today. “I enjoy getting closer to technology and being more operationally focused,” he says. “That's been great. Where it's similar to my finance background is this: If you think about what made Enron go under, Enron got in trouble because it did not understand all the risks associated with its various financing structures. You have to ask a lot of questions. I learned to ask a lot of questions when I was treasurer and we were working on our $10 billion of acquisitions and financings. I'm not uncomfortable asking all the basic and naïve questions now of vendors to help make Cox products successful.”
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