Sanjay Merhotra is one of the co-founders and the Chief Operating Officer of SanDisk Corporation [NASD:SNDK], the Sunnyvale, CA-based manufacturer of flash memory storage products that are used in a wide variety of electronic systems and devices. The $4.15b market cap company is seeing a big surge in its stock price ($59.10 on August 5, ‘03), when the industry itself is reeling under tremendous market pressure. How has the team led the company?

Beginnings
I grew up in Kanpur and went to school in Delhi. I always dreamt of studying in the U.S. and after high school I applied to universitites here. But I needed a year more of school education to qualify for admissions and so joined the BITS at Pilani. After the first year, I tried transferring credits from my engineering school, but the universities in the U.S. would review my application for freshman term. I continued at Pilani for a year more and then transferred successfully to UC, Berkeley. And in 1979 I completed my masters from here.

On Industry Experience
I think I have been fairly successful at planning a strategy and then working the plan. Even at Berkeley, I wanted to work at Intel. Rather than rushing to interview with them, I was careful to schedule Intel the last, while I picked up some good experience with other firms. Needless to say, this paid off and I joined Intel.

Intel spun off the non-volatile memory technology into a startup unit called Seeq technologies. I joined my senior from Intel at Seeq and spent close to 6 years in a startup environment.

After Intel, I worked at IDT, Integrated Device Technology in the area of EEPROM memory design. And before SanDisk, I consulted for for Atmel Corporation in the area of IC design.

On the Founding of SanDisk
SanDisk was co-founded by three of us, Dr. Eli Harari, Jack Yuan and myself. Harari was a senior to me at Intel and we had built a very good rapport. Over the years, we had maintained our contact, and in 1988, we thought it a good opportunity to work as a team in founding a company for flash memory products.

Most important to our success has been the clear definition of roles. Harari was an experienced technology professional who brought in a keen sense of business acumen. The other two of us were technology experts. Harari has played a phenomenal role in sourcing funds for the startup, defining our business models and adapting our products to the demanding changes in the market.

We went IPO in 1995; a very significant measure of success of SanDisk. It certainly impacted the culture at the company. The pressure to deliver quarterly expectations certainly enforced a higher level of responsibility, accountability and improvements in the business processes of the company.

On Leading An Enterprise
Markets are changing in a second. As a company we need to be agile, adaptable and yet remain accurate in our predictions. I think a good dose of paranoia is a good thing for the company culture. While we are sure of our products and technologies, being slightly paranoid helps us remain true to our goals. I expect my team to understand clearly understand responsibilities, the importance of follow-up, and the necessity to be able to adapt a plan according to situations.

If I recognize a member exhibiting excellence, it is important to get out of his or her way and let the person continue the rich contribution.

On Motivating the Troops
Mistakes are a human trait. What is good in mistakes is the learning. We strive to keep the errors low, but at the same time recognize the importance of encouraging people to take risks. There are times when the company goes through tough times, and it is a pride at SanDisk that our human resources turnover has been near zero. We share common visions with our teams, and recognize their talents.

On His Management Style
Integrity is probably the most important element in running a business on the right track. Harari and one of the Intel leader, Andy Grove are excellent motivators from whom I have learnt a lot.

Grove was a person with an eye on the future and could share the excitement of that vision with his team. At SanDisk, we consider ourselves in the first innings of the World Cup. We are young and have a large market potential. Unless the troops are good, leaders would have a tough job expanding the business.

Even when we recruit people, we look for traits that show us that the person is in the game for the long term. We look for tenacious employees, who share that bit of paranoia with us...(laughs).