Glenn Gow, The Scaling Executive Coach and host of The Scaling Executive Podcast, interviews Aviatrix Chairman, CEO and President Doug Merritt on the leadership habits that scaled Splunk from $220 million to more than $3 billion in ARR.
When you measure your team on daily learning habits instead of quarterly targets, performance follows as a byproduct rather than a goal. Doug Merritt, Chairman, CEO and President of Aviatrix, holds this view based on six years leading Splunk as CEO, a run in which annual recurring revenue grew from $220 million to more than $3 billion and headcount grew from roughly 1,000 to over 7,000 employees while the company completed a full cloud transformation as a public company.
Merritt has spent more than three decades building and scaling enterprise technology companies. He started as a telesales rep at Oracle, co-founded and led Icarian from one employee to 240 before its acquisition in 2001, and held senior roles at PeopleSoft, SAP and Cisco before joining Splunk as SVP of Field Operations and later becoming CEO. He now leads Aviatrix, a cloud network security company building what it calls the cloud native security fabric.
This episode is for CEOs scaling past product-market fit who are tempted to grade their teams on quarterly outcomes instead of building the daily habits that actually produce those outcomes.
Key Takeaways
- Doug Merritt led Splunk as CEO for six years, growing annual recurring revenue from $220 million to more than $3 billion and headcount from roughly 1,000 to over 7,000 employees while completing a full cloud transformation as a public company.
- Merritt treats quarterly and monthly goals as stretch targets rather than required outcomes, arguing that most goals “aren’t meant to be hit” but exist to push direction and improvement.
- At Aviatrix, Merritt runs daily, weekly and monthly review cycles built around feedback rather than performance grading, because unvarnished feedback exposes whether messaging, prioritization and customer engagement are actually working.
- Merritt argues the primary obstacle to enterprise AI adoption is not the technology itself but human change management, specifically employee fear that AI will replace their role.
- Aviatrix already uses AI to auto-generate documentation and unit tests directly from code and to run first-pass diagnosis on most support interactions, while keeping human oversight in place.
CEOs Should Measure Daily Learning Habits Over Quarterly Outcomes
You will feel pressure to grade your team on whether they hit this quarter’s number. Merritt argues that pressure points you at the wrong measurement. He cares far more about the daily rigor behind the number than the number itself. “I care so much more about the daily rigor and the daily process and the learning and curiosity orientation than I do the actual results,” he said.
The reasoning holds up against his own record. Splunk did not hit every quarterly target during Merritt’s six years as CEO. What it sustained was a consistent operating rhythm: disciplined training, honest review cycles and constant incremental improvement, a rhythm Merritt credits directly with the company’s growth from $220 million to over $3 billion in ARR. Merritt compares this to a football team chasing a championship. The team that studies film, reviews communication between functions and refines its play calling every week is the team that eventually wins, not the team that simply declares the Super Bowl as its goal. “The championship is a byproduct of the work,” he said.
This reframes how you should read a missed quarterly number. A goal that gets missed by a team that is genuinely improving its daily habits is different from a goal missed by a team with no operating discipline at all. Merritt’s rule: track direction and daily rigor first. Let outcomes, including revenue and headcount growth, arrive as the byproduct.
How CEOs Build a Feedback Culture That Treats Failure as Learning
Scaling companies break down when people stop telling you the truth. Merritt’s fix is to remove the word failure from the vocabulary his teams use to describe missed attempts. “You need feedback, constant feedback loops, and you’re never done learning,” he said.
He builds this through structured review cycles that operate at three levels: daily, weekly and monthly. These cycles are not the performance reviews or quarterly business reviews most CEOs already run. They exist specifically to surface unvarnished feedback on whether the company’s messaging is landing, whether prospecting is prioritized correctly and whether the team is capturing real signal from customers. Merritt frames the starting question for any CEO trying to build this discipline directly: “What daily review cycle do you have for yourself and within your function?”
The harder part, Merritt says, is authenticity. Review cycles only work if people believe it is genuinely safe to say something is not working. He points to Splunk’s cloud transformation as the proof case: a multi-year period he treated as constant experimentation, where every attempt was logged as a data point rather than a verdict on the people who tried it, and the company completed the transition as a public company without losing the operating discipline that drove its ARR growth.
How CEOs Should Lead Internal AI Adoption Inside Their Companies
CEOs are moving fast on AI tooling right now, and Merritt is no exception. Aviatrix already auto-generates documentation and unit tests directly from code and runs AI-first diagnosis on most support interactions, with human oversight still in place behind each step. Merritt reports these tools have shortened the time engineers spend on documentation and freed the support team to focus on cases that need human judgment. But Merritt is clear that the technology is not where most companies get stuck. “The challenge I don’t think is the technology. It rarely is. It’s human change within an organization,” he said.
That human change centers on fear. Employees worry AI will replace their role, and that fear slows adoption more than any technical limitation does. Merritt’s response is to build the infrastructure for peer-driven learning: influencer programs where early adopters help peers, shared repositories documenting what someone just accomplished with AI, and structured ways for people like a CIO to spot where a win in one part of the company applies somewhere else.
Merritt does not treat this as a straight-line rollout. He describes AI adoption inside a company as “a very zigzaggy line,” which is itself useful framing for a CEO expecting a clean deployment curve. The technology will keep improving on its own. The adoption curve depends entirely on how deliberately you build psychological safety around using it.
What CEOs Can Apply From Doug Merritt’s Approach to Scaling
| Principle | What it means in practice | Named evidence from this interview |
| Process orientation outperforms outcome orientation | Measure the daily rigor, learning cycles and curiosity of a team instead of whether it hits weekly, monthly or quarterly targets | Merritt credits this operating rhythm with Splunk’s ARR growth from $220 million to over $3 billion and headcount growth from roughly 1,000 to over 7,000 across his six years as CEO |
| Feedback must be safe before it is useful | Build daily, weekly and monthly review cycles focused on unvarnished feedback rather than performance grading, so problems surface instead of getting hidden | Merritt points to Splunk’s cloud transformation, a multi-year period he ran as constant experimentation, as the proof case for a feedback culture that let the company complete the transition as a public company without losing operating discipline |
| AI adoption is a human problem before it is a technical one | Treat employee fear of being replaced as the primary adoption barrier, and build peer-to-peer learning programs rather than relying on the tools alone | At Aviatrix, this approach has shortened engineering time spent on documentation through AI-generated docs and tests, and freed the support team to focus on cases needing human judgment instead of first-pass diagnosis |
Quotes from This Episode
- “But most goals actually aren’t meant to be hit.” — Doug Merritt, Chairman, CEO and President, Aviatrix
- “What daily review cycle do you have for yourself and within your function?” — Doug Merritt, Chairman, CEO and President, Aviatrix
- “It’s a very zigzaggy line.” — Doug Merritt, Chairman, CEO and President, Aviatrix
- “The challenge I don’t think is the technology. It rarely is. It’s human change within an organization.” — Doug Merritt, Chairman, CEO and President, Aviatrix
- “You need feedback, constant feedback loops, and you’re never done learning.” — Doug Merritt, Chairman, CEO and President, Aviatrix
Frequently Asked Questions
How should a CEO measure whether their company is really scaling well?
Doug Merritt, Chairman, CEO and President of Aviatrix, argues that a CEO should measure the daily rigor of a team’s learning habits rather than whether it hits its weekly, monthly or quarterly numbers. He credits this approach with Splunk’s growth from $220 million to more than $3 billion in ARR during his six years as CEO, treating that revenue growth as the byproduct of consistent process discipline rather than the goal itself.
How do you build a company culture where employees feel safe giving honest feedback?
Merritt builds this through structured daily, weekly and monthly review cycles that focus on feedback rather than performance grading, so people report what is actually working instead of what looks good. He removes the word failure from how his teams describe missed attempts, framing every result as a learning input that feeds the next review cycle rather than a verdict on the person who tried it.
What is the biggest obstacle CEOs face when rolling out AI internally?
According to Merritt, the biggest obstacle is not the technology itself but human change management, specifically employee fear that AI will replace their role. He addresses this at Aviatrix through peer-to-peer learning programs, influencer networks of early adopters and shared repositories that document AI wins so other teams can apply them, treating adoption as a psychological safety problem rather than a deployment problem.
Executives Work with Glenn Gow to Scale Their Companies and Careers
Glenn Gow is The Scaling Executive Coach. He coaches ambitious executives into the CEO seat and CEOs into successful exits. Glenn helps leaders scale their companies by scaling themselves first. If this conversation was useful, you can apply for executive coaching with Glenn Gow or apply to be a guest on The Scaling Executive Podcast.
