Atlassian CEO Mike Cannon-Brookes Reflects on the Unfolding of the SaaS Landscape

Today, I’m chatting with Mike Cannon-Brookes, co-founder and CEO of Atlassian.

Atlassian is a backbone for countless organizations, providing essential tools like Jira and Trello that help teams coordinate, manage projects, and create shared knowledge bases. As Mike explains, all of Atlassian’s products are essentially different facets of a unified core platform, which influences both the company’s structure and the development of its products.

This positioning places Atlassian at the forefront of how AI is transforming workplace dynamics. AI tools could potentially analyze existing systems and streamline processes, making the transition to Atlassian’s platform less appealing. Alternatively, if the concept of the “SaaSpocalypse” holds true, AI might automate the creation of these tools, threatening the very existence of companies in this space.

Mike has plenty to say on these topics. We delved into the significance of design, the role of human users, how AI is actually driving greater engagement with Atlassian’s tools, and what the future might hold in a few years.

AI has also impacted Atlassian itself. Like many tech firms, Atlassian underwent layoffs earlier this year, with Mike noting a need for a different “mix of skills.” I asked him what that mix looks like and how AI is reshaping the landscape of running a software company.

Mike was refreshingly candid about AI’s limitations, even challenging views from peers like Cloudflare’s CEO, who suggested that AI could eliminate certain roles. This conversation was engaging, especially since Mike joined from Atlassian’s headquarters in Australia, leading to a deep discussion about organizational structures at 5 AM his time.

Let’s dive in: Atlassian CEO Mike Cannon-Brookes.

Mike Cannon-Brookes, welcome to the show!

Thanks for having me!

I’m excited to chat with you. Are you in Australia right now?

Yes.

So, it’s tomorrow for you. What’s on the agenda for tomorrow?

It’s a beautiful day here. Looks like it’s going to be fantastic.

Given the current AI landscape, I feel compelled to ask what’s coming up tomorrow, and I think everyone understands the urgency behind that. Atlassian is buzzing with activity, and there’s a lot happening with your products and the broader SaaS landscape.

Let’s start from the top. People know Atlassian and Jira. I began my career using Trello. How would you describe Atlassian today?

Atlassian is a platform that empowers businesses to collaborate and manage work across their teams. We connect business and technology teams to tackle complex challenges on a unified platform, catering to any tech-driven organization.

For companies where software and technology are core to their competitive edge, we provide a comprehensive platform that facilitates collaboration on content, project management, and the sharing of knowledge across all business functions, from strategy to operations and service teams. Our platform has grown significantly.

As we consider the nature of work today and how it might evolve with AI, I’ve always viewed Atlassian as a company that creates tools to help teams plan for tomorrow. Jira exemplifies this; while it doesn’t handle software engineering directly, it organizes large teams of engineers, manages tickets, and prioritizes tasks.

I used to be a Trello user, and my goal is to avoid enterprise software altogether. I see that as a sign of success—just being an iPad person in first class. I’m working on it, but I’m not there yet.

There was a time when I was managing editor at a publication, and my daily routine involved checking Trello to ensure everyone was on track. I’ve always seen Atlassian as a suite of products designed to streamline company processes.

AI is shifting that perspective. Has your view of Atlassian evolved? Is the pace of change accelerating due to AI?

Understanding work at various levels—individual, team, and organizational—is central to what we do. It’s less about tasks and more about processes. A business operates as a system of interconnected processes, and our effectiveness in executing these processes defines our success. While the fundamentals remain unchanged, the way we manage and analyze these processes is evolving.

We think of Jira as a human reference point for work. It’s interesting because, as you noted, work isn’t done in Jira. Developers, marketers, and finance teams don’t live in Jira. Instead, it serves as a collaborative workflow engine that helps teams understand their activities and those of their colleagues. AI and automation will enhance the speed, reliability, and quality of these processes.

However, it’s crucial to emphasize the human elements—judgment, intuition, and creativity. Our goal is to ensure that users can easily grasp what’s happening at any level of their organization. Whether it’s tracking sales exceptions or engineering outputs, understanding these dynamics at scale is challenging.

A key feature of your tools is their legibility and user experience. For instance, having a comprehensive dashboard to monitor sales exceptions or task completion is vital for managers. The software Atlassian provides enables businesses to coordinate more effectively at scale.

The impending shift suggests that perhaps these databases won’t be accessed by humans anymore, or they’ll be integrated into more synthesized systems, with AI generating insights at various abstraction levels. I know you have a product called Rovo, which seems to represent a new direction for Atlassian.

What’s the vision here? What does the future look like?

AI will undoubtedly enhance many processes, automating significant portions of workflows. Currently, most businesses have established processes, and AI can streamline around 80% of certain tasks. For example, if a customer requests an extension on a payment term, AI can generate a readable document to facilitate that request.

However, complex exceptions will still require human intuition and judgment. While AI can handle a large volume of straightforward tasks, the need for human oversight remains. Businesses will discover new ways to scale and improve quality with AI, often in unexpected ways. It’s not solely about efficiency; it’s also about enhancing the quality of outputs.

The business must still track metrics like the number of exceptions processed. As workflows increase in volume, understanding these dynamics becomes even more critical.

I’m curious about the so-called SaaSpocalypse and where you see tool providers like Atlassian fitting in as frontier models potentially take over more capabilities. There’s a belief that AI will eventually manage entire businesses autonomously.

You seem to envision a different trajectory, where tools become smarter and more capable through AI, while still relying on human judgment. Do you think a frontier model could truly run an entire business?

If a frontier model could manage an entire business, it would likely be a simple operation. Most businesses are complex, involving global regulations, compliance, and human creativity. I believe we’ll see an increase in knowledge workers and developers over the next five to ten years, as the demand for competitive tasks rises.

The bar for competition will continue to elevate across industries, and while some tasks may become automated, the need for human ingenuity will persist. History shows that technology doesn’t eliminate jobs; it transforms them. AI is just another technological advancement, similar to spreadsheets or online shopping.

Take the banking sector, for example. When mobile banking emerged, many predicted the demise of bank branches. While some branches closed, others adapted and evolved their services, leading to a resurgence in physical locations. The same will happen with knowledge workers; their roles will adapt and grow in importance.

I’m eager to explore how this evolution will unfold, especially in the context of enterprise software and SaaS. How do you see Atlassian’s relationship with businesses changing as new technologies emerge?

I’d say we currently have around 12,000 to 13,000 employees globally. We operate under a “Team Anywhere” model, allowing employees to choose whether to work in the office or remotely. About 60% of our team comes in three days a week or more, while 25% work entirely remotely. We’ve embraced a globally distributed structure since our inception.

Our organization is functionally structured, with a matrix system in place. We have a Chief Revenue Officer, a Chief Financial Officer, and two Chief Technology Officers overseeing different product groups. Our products are organized into collections built on a single platform, with a significant portion of our R&D focused on that platform.

Do you use the Atlassian platform to manage Atlassian?

Absolutely. We run entirely on our platform. I used to say we were the top users of our strategy and operations products, and while we’re not anymore, we still rely heavily on them to track our business goals and performance.

How much do you personally engage with your products?

A lot!

What’s your top feature request for your teams?

My primary request is for consistent UI design. I’m a stickler for design and want to achieve a cohesive experience across our platform. I spend a lot of time using our products, and I’m always looking for ways to enhance consistency in design.

I use Dia, our web browser, extensively. I believe around 96-97% of Atlassian employees use Dia regularly. We’re building a browser tailored for knowledge workers, and it’s continually improving. Keep an eye on it!

I want to discuss Dia further, especially considering its acquisition. But first, can you clarify the distinction between the platform and the products that operate on it? It seems like there’s a foundational layer of capabilities, with products expressing those capabilities in various ways.

Yes, that’s exactly how we view it. We’re building a unified R&D platform that encompasses everything from AI integration to automation and compliance. Customers expect a consistent experience across all our applications, whether they’re using Confluence, Jira, or any other tool.

We aim for seamless operations and processes across applications. For instance, if I open a Confluence page within Jira, it should feel like a Confluence page, but still be accessible within Jira. Each application must fulfill its specific role without compromising the overall user experience.

The combination of these elements presents significant design challenges. For example, our chat tool, Rovo, is highly regarded among enterprise chat products. Customers often ask why we outperform other well-known brands. It’s not just about foundational models; it’s about how we integrate and enhance user experience across our platform.

I often say that understanding your organizational structure can reveal a lot about your challenges. The tension between having products designed for specific tasks and a platform with core capabilities is well-known.

How do you navigate the trade-offs between product teams wanting different platform capabilities?

We have a few strategies in place. First, I’m a platform-centric CEO, which means I prioritize platform development. It’s essential to approach trade-offs with a platform-first mindset, ensuring that we invest the necessary time and effort to make it work.

Secondly, we place a high value on design. Our Chief Design Officer reports directly to me, and we have a significant investment in design and user experience. In the AI era, this focus is even more critical, as the quality of design will differentiate us in the market.

Lastly, we’re not afraid to reorganize to solve problems. For instance, our internal IT and engineering functions now report to our Chief People Officer, which may seem unusual, but it aligns with our current needs as we adapt to AI.

This leads me to your Chief People and AI Enablement Officer. You recently laid off about 10% of your workforce, and you mentioned a shift in the skill mix needed for the company. What prompted this decision, and how did you adjust your systems to make it effective?

The tech landscape has shifted, and the environment we’ve operated in for a while—continuous hiring and growth—has changed. We can no longer simply hire to fill gaps; we need to be strategic about our skill mix.

We have internal programs to facilitate this transition, particularly in our AI and enterprise sales areas, which are growing rapidly. We’re still hiring in those sectors, but we must manage the overall organization carefully.

The focus is on mutual learning and adapting to new technologies rather than traditional training programs. We’re committed to becoming leaders in AI product development, and that requires a rapid and strategic approach.

Many CEOs have noted that the value of senior talent has increased, as judgment and expertise become more critical. How do you see the roles of designers, engineers, and product managers evolving in this context?

It’s easy to oversimplify these roles. While there’s a blending of responsibilities, the need for specialized skills remains. We have more product managers and designers writing code than ever before, and this trend extends to other roles as well.

The ability to collaborate and understand each other’s roles enhances the overall quality of our software. Designers are creating working prototypes, while engineers are engaging in design discussions. This cross-pollination increases the quality of our products.

Building platforms is becoming increasingly important. For example, our design system is a crucial part of our strategy, enabling us to scale and maintain consistency across our products.

I often joke that this show is fundamentally about organizational structures, and we’re on the brink of some of the most unusual structures in history due to AI.

Recently, Matthew Prince from Cloudflare discussed eliminating measurement roles, suggesting that AI could take over those functions. Where do you stand on this? Are you embracing traditional organizational structures, or are you exploring more radical ideas?

I know both Matthew and Jensen Huang well, and I take a more measured approach. While there may be instances of broader teams, scalability and consistency are vital for effective management.

I believe we’ll see more blending of roles, with individuals becoming more generalist. Product managers may take on marketing and engineering tasks, while finance professionals might engage more with legal aspects.

However, I don’t think this will eliminate specialized roles. Instead, it will create broader teams with a mix of skills. The focus will shift toward output-bound roles, where creativity and initiative drive success.

AI is a technology, not a product. It’s about enhancing experiences without users needing to be aware of the underlying technology. Just like how AI improves photos on smartphones, the goal is to create seamless, enjoyable experiences for users.

What’s next for Atlassian? What should people be looking forward to?

We have a major conference coming up in about ten days, where we’ll announce exciting new features across all our product collections. Expect to see innovative AI capabilities that enhance user experience without requiring users to understand the technology behind them.

We’re also launching Dia and introducing new features for our Teamwork Collection and Loom. There’s a lot to look forward to!

I’d love to have you back soon to discuss the future of enterprise software, as I’m confident it will evolve significantly in the coming year. Thank you for joining me today!

Thank you for having me!