Gary Hamel - The Future of Management Part 2

Welcome back to part two of this brilliant book in this brilliant series with our guest, Gary Hamel. You're very welcome back. Glad to be back. We're getting awesome feedback, man. And I don't know if people can see on the shelves there we're getting on through the tome of work and Gary's in the midst of another, yet another HBO article that may be. Out by the time we publish this episode, but I wanted to pull out a few threads.

I, really said the last day wouldn't go near the case studies, but I can't resist. So I'm gonna just pull a few threads at the case studies because. These are companies that have advanced but still hold true to their original DNA.

And the first was Gore, and I thought I'd set you up, Gary, to tell us a little bit about your findings of Gore with the following little excerpt from the book, which is, there were a lot of questions to answer when Bill Gore. And his wife went to create a new DNA for a company, new management structure. They asked questions like, could you build a company with no hierarchy, where everyone was free to talk and with everyone else?

How about a company where there were no bosses, no supervisors, and no vice presidents? Could you let people choose what they wanted to work on rather than assigning them tasks? Could you create a company with no core business where people. Would put as much energy into finding the next big thing as they did into milking the last big thing. And could you do all of this while still delivering consistent growth and profitability?

Many people will say of their companies, they are, they're not possible. They're not mutually exclusive. It's a zero sum game. But Gary discovered that it is possible not only with his own clients like Haier, but with Bill Gore and Co back in the day. Yeah, I think probably Gore was one of the first companies that really attracted a lot of attention from people around the world who were saying, Hey, is there another way to manage a large complex organization?

Obviously, most of , our viewers, our listeners will know gore from Gore-Tex, but they make about a thousand products including medical products that are used inside the body, particular kinds of fibers and so on for stents. They make fabric that goes into the spacesuits of astronauts.

And it all started with a fairly simple technology where Bill Gore then working at DuPont, thought we could use this in a more creative way than DuPont was doing and said, let me build a company, but I don't want to build a usual company. And by the way, we'll see this theme over and over again. Aidan that most of these kind of post bureaucratic pioneers were created by people who didn't have management experience. And by the way, that, that could mean that things could have gone horribly wrong.

But once in a while, it means you have the chance to do something quite new and unexpected. And that's the case in Gore. Now all of these companies the, any management model bureaucracy or human ocracy, whatever it may be, they are inherently fragile, right? I mean, they're entropy exists in our world and without a lot of diligence and a lot of thought these things can collapse and and , every system has potential vulnerabilities. And of course, the goal is not simply to replace.

The vulnerabilities of bureaucracy being vulnerable to power, moving too much at the top and too little innovation and unins uninspired employees. The goal is not to just replicate a different set of of kind of vulnerabilities or disadvantages in a anti bureaucratic structure. And that's that's easy to do is to end up with something that's ill disciplined or chaotic or not very efficient. So all of this.

In any organization, you are constantly walking a tightrope between different ways, things that can go wrong, and so I never wanna make it. Sound like one of one of these companies has invented the perfect management model and it's like, set and forget and it's just gonna produce these amazing results. Always you are managing a set of tensions to keep things in, in line and on kind of the straight and narrow.

But let me start with, has been written about them. I don't know if there's , as if they're growing or as vibrant as they once were. They're privately held companies, so that's a little bit difficult to know. But I spent quite a bit of time at Gore talking to people, just trying to understand the gestalt of the place. And, and Aiden, one of the, one of the really interesting first experiences they put me in this room.

I, I would guess about 10 or 12 people from Gore that were there to just let me interview them and have a conversation. And now usually in those meetings, I can pretty quickly suss out. Like, who's really in control. , And then I will just like shamelessly suck up, right? Like I, whatever they speak, I like listen intently and so on and so on. And it was disconcerting 'cause I had no idea like who was important and who wasn't. There was no apparent deference.

And and so as these people were handing me their business cards, I did notice that on a couple of these business cards that had the word leader. It didn't say, vice president just said like somebody's name and leader. I asked the group, I said like, how do you become a leader at Gore? They said, well, like your colleagues ask you to lead them. I mean, quite literally. And when that happens enough, you can put this title on you, but like, nobody appoints you as a leader.

And the designation of leader comes when people think you're worth following. And so a lot of the conversations at Gore were about how do you, how do you build genuine followership? But, but then I asked, so I asked like how do, how do you become a leader? And some person said, well, if you call a meeting and other people show up, like that's a good sign. Like you're probably on the right track because nobody has to go to meetings.

And so that was one of the first kind of oddities , that I, you noticed there is that. You're not a leader because somebody fails to distinguish the word vice president from leader and says, this is our leader. You're not a leader. You're a leader because people generally think you have ideas and you know how to mobilize people and you know how to organize things, and they wanna follow you. The second kind of very interesting thing is they made a big distinction.

commitments versus assignments. And of course in most organizations, if you're sitting somewhere in the middle, you get an assignment and you often don't have a lot of choice in that. And at Gore they, , the companies run in relatively small businesses. A couple hundred employees is the maximum size and they'll split it up. They do that. So everybody believes their voice matters. All of your colleagues or most of them, you can easily go to anybody on that team cross-function. So they want that.

That very strong sense of community is important to them. But within that, and so basically everybody understands the business, right? It's small. You're interacting with other functions. I. you have a line of sight to everything. So people pretty much know, Hey, here's our priorities, here's what needs to be done, and here's what the challenges are. And so people commit to each other to get things done.

And so at any point in time an associate will have a list of, here's some of my priorities, here's what I'm working on. But those never come from a manager. It comes from the teams talking about. Well, like, this seems to be important. We need to grow our sales over here. We need somebody to take on building this new channel. Like, Susan, will you do this? And she says like, yeah. Okay. And again, the philosophy behind this is commitment is highly correlated with choice.

And if you don't give people choice you can get compliance, but you're not gonna get commitment. And so that is a deep, deep principle. And also that every commitment is voluntary. You can say no, there's little penalty to saying no to something now if you do it continuously, but , in the moment, there's not, and what's interesting , about the culture?

Every CEOI meet, pretty much, two of the things they would all like to see more of is collaboration and entrepreneurship. So they want more lateral connection, more ideas flowing and so on. And they also want people to take more initiative and it's very interesting that , the Gore model. Drives exactly those two behaviors.

I think we talked about in our previous episode, so I won't go , do go too deep now about their performance management system and their compensation system where everybody gets rated by a group of peers. And on the question like, how much value did you add this year? And it's not like some elaborate HR kind of nonsense. It's a simple question like, how much value did Gary add versus all the other people in our team. And that kind of drives, drives your compensation.

So if you think about that, all commitments are voluntary. And yet I know that at the end of the year, my peers are gonna rate my performance. So the behaviors that creates is first of all I don't have a set of KPIs. I don't, it's not like in, in so many organizations. And I think this is so toxic. Aiden and an employee negotiates a set of targets or is given a set of targets from their boss, the idea is if I just meet those, I expect to be rewarded. Like, check, check. I did all these things.

That's what we agree. That was my kind of implicit contract and I should get rewarded. That doesn't happen at Gore. There's no kind of top down KPIs, so what people are asking, they know at the end of the year the question's gonna be, how much value did Gary add? All year long, Gary is thinking to himself, is there something else I could be doing that's gonna make a bigger impact? So people are not trying to meet a static, top down goal.

They're paying attention to the environment, they're paying attention to what's going on in the business, and they're asking themselves is given my skillset, is there somewhere where I can have a bigger impact? And if so, that's where I need to migrate. So that's a very, I think, positive and powerful incentive. Now at the same time as I said, I can say no to requests, but I have this little dialogue inside of my head. If somebody comes and says, Hey, Gary, we go back to my example.

There's this new channel. We should have a presence here. We don't have anybody like to go out and build that. Will you do it? I can say, no, there's no compulsion. No, nobody can give me an order. But again, I know at the end of the year, my peers are gonna look at me. And so you have these two really positive. Motivations. One is to say yes and to be helpful, and frankly, to take on more rather than less.

So even though there are no top down orders or commands, you're not gonna find any slackers at gore. But simultaneously people are proactively thinking all the time, not, how do I satisfy my boss and tick a box, how do I align my skills with things that will make a substantial business difference? , That's just like gold if you're inside of an organization and you can get that to happen. So those are some of the real cores that I think distinguished score. We, I think we mentioned before there.

Their emphasis on kind of innovation. They've been at different times. They've been called the most innovative company in the world. I think a fast company once gave them fast Company Magazine gave them that title. Are they still that way? I don't know. But it's clear they believe that innovation comes from the bottom, not the top. At any time you'll find hundreds of people there working on dabble time projects.

Everybody has a certain amount of time they can work on anything that's interesting to them, and that's where most of the innovations come from. So again will this work in every industry, in every context? I don't know. But when you look at it, you certainly see some things. That are important deemphasizing hierarchy continually reinforcing the belief that innovation can come from anywhere. And they have all of their internal mythology, their stories about this.

A guy who is using a particular Gore product a keen mountain biker coded the cables on his mountain bike to, to repel dirt. And very successfully said, Hey, maybe we could use this for guitar strings. Well, there's a kind of strange connection and turns out you could. And so they end up producing one of the world's most successful guitar strings. So you continually reinforce that with stories like that. everybody has a responsibility to innovate.

They co-locate factories close together rather than going to the cheapest location in the world. They believe that the rapid diffusion connection of ideas is important to innovation. they'll build clusters of plants that are making and some might be doing industrial things, something might be doing medical things, but they locate those plants together because they want all this cross-fertilization going on. So I think that's another part of that model.

If you do have an idea that's interesting to you, there's very little approval. The real approval is can you find some people to give you their dabble time to work on your idea? And if nobody wants to volunteer to help you, probably not a good idea. So, I think it's a wonderful model filled with wonderful principles. And the, when I was with them, now this is a couple decades ago, I think they were about three, 3 billion yeah, about $3 billion in revenue, about 10,000 associates.

So sizable business and in some highly regulated industries. But. Management Renegade with a lot to learn from them. So if any listener, reader, like get on the web there, a lot of cases have written about Gore. Some may be older, but they're filled with kind of wisdom and I would really go check that out. Great memory, man. You covered lots of that chapter there. There was one thing I found really interesting.

And, and like you, and you've written about this DNA and nature and how nature mirrors organizations, even the structure of an organization can look essentially like the non hierarchy of the worldwide web. One of the things I discovered was ants. Certain species of ants will have an ant that's almost like a stem cell that will change role as it goes through its lifecycle. And I loved what you said about gore. You said people have sponsors instead of bosses.

And I thought here about how detrimental or productive it can be. For you with your first experience of your first boss. So if you went into Gore and then left and went to a traditional organization, you'd really, really struggle. And this little excerpt. I'd love you to expand upon, you said, new recruits are hired into broad roles as HR generalists, business development leaders, or r and d engineers, rather than into narrowly defined jobs.

And to help newcomers navigate the organization and find their niche, each is assigned a starting sponsor. The sponsor's not your boss. The sponsor is somebody who's, who's actually responsible for trying to find the best fit between your capabilities and the needs of the organization. And so often now.

Occasionally people do get hired into very specific roles, but often it's not, they see somebody as a set of technical abilities or marketing abilities that I that this person's clearly world class could be useful to us. And so again, one, I, I had this early in my career, I'm sure other people have if, if you report to a boss who doesn't really appreciate your talents or, or, or is working on something that you're simply not, like, you just feel like completely stuck that your life is.

Under the control of this boss who probably doesn't wanna give you up and but, but, but the, the, the sponsor is somebody says, like, Gary, you, I know you're doing a great job and they love you, but I think you should go check this thing out over here. So they're looking out for you and looking out for the organization, right? They're trying to find. A role where you're, the marginal return on your talents is the highest. Rather than just get stuck somewhere.

And , so a new employee, at least at the time I was doing this research. Would often audition in several different teams. They'd be there for two or three or four weeks and the team had to say, yeah, this, like, Gary's great, we'd really like Gary to be part of our team, or, or not. And again, back to, I talked about that example Whole Foods, I, it's like, to me it's like so essential to have an organization where your peers choose you. Right?

Many, many decades ago when I interviewed at the London Business School and a few other schools. The choice of hiring me is not made by some dean somewhere, , or the, the principal. The choice was made by my peers a majority of them. Now, they still wanna hire me 40 years later, you have to ask them, but at the time, a majority said, yeah, Gary would be a good addition. And you find the same thing at , at Gore. It can be so detrimental.

And if you're a truth speaker, if you speak truth to power or you call out the inefficiency of an organization, you can just be turfed out and even what you said there was. For example, you're in a team. You call out these problems and your boss is, becomes a ceiling, and then your choice is, well, I've got these golden handcuffs. I better shut my mouth here and put my brain in my drawer and just do what everybody does. And then you wonder why the organization's not innovative.

I think there's a big point there too, Aidan that kind of multilayer top down power structure. I. That creates these large asymmetries in, in, in form of power, I just think has so many negative side effects that we typically just ignore. And you just mentioned one, right? It's very hard.

If I'm sitting on a team at Gore, and this was also, at least when I did my research at Google's through a Google, you, if you'll find there where there's very little, there are very few stat status differentiators. Very little hierarchy. There's a lot of hierarchy now in Google, by the way. But at the time. People are quite free to just like argue and have a different opinion and say like, no, I don't think that's true.

But if you're in a meeting where somebody else is controlling your career, the ability to dissent or argue or be honest, just like people start to self edit like crazy. I think , that's one thing. The second thing which you were mentioning a little bit of gore. You start to have people who are just doing what the manager asked them, rather than maximizing their potential impact because that they're in that power relationship with that particular person.

You also find, we've talked about this, that then so much of the energy becomes about climbing up that pyramid rather than simply doing the best thing or creating value. So I have somewhere a long list of these things, but we just take those multi-layered power structures for granted. But. And most of us, we don't wanna live in an organization where you just feel perpetually like you're powerless, at least with respect to, to your boss, the people around you.

But you know, many people, that's how they feel at work. And man, what awful way to live. And it's exhausting. It's so exhausting. It's like masking, if you're neurodivergent masking and how much energy that uses up. I feel so sorry for, and I did work in organizations like that. I just couldn't drink the Kool-Aid. I had to leave, but I felt so sorry for people who were.

Really good people, really great ideas, but just had to stay or felt they had to compelled to stay because of those golden handcuffs again. But I know Google, you mentioned it has changed a lot. Even, for example, here in Ireland, we have a huge Google facility. I. And it's massive now. And you, you said, and I thought this aged quite well, you said the jury is still out on whether Google's founders will succeed in their quest to build a company that can outrun the future as of writing.

So again, two decades ago, Google still derives nearly a hundred percent of its revenue from ad supported search. With a few non-search products have, having made strong showings, Gmail, Google News, and Google Maps for instance, many others have received a lukewarm reception from users. They have managed to get a few new products out there. Google Cloud being one that's huge for them, and I thought that aged very well.

But I'm using it as a segue to talk a little bit about Google. Yeah, well again, I haven't been close to Google in a long time, but what, what I think you see there though a little bit what I said earlier, you see people like, like Sergey Brin and Larry Page, the founders co-founders. Who very much understood the environment that created Google, right? Because in Silicon Valley, for every Google, there's a hundred or a thousand companies that never became that successful or successful at all.

And so they understand there's this, like, this ecosystem here where you have to try a lot of things and not all of them are gonna succeed. And one of the, one of the folks I talked to early on then when I was doing my research was Marissa Meyer, super smart woman, Stanford graduate employee number 20 at at at Google. Went on for somewhat ill-fated run at Yahoo as a CEO there.

I dunno what she's done since she had the same spirit of we're gonna launch a lot of things and most of 'em are gonna fail. You find the same thing at Amazon where Jeff Bezos says. If you call it an experiment, it means it's more likely to fail than succeed, right? It's not a pilot, it's an experiment, and we're gonna do thousands of them. So they had that ethos, and I think it came out of that understanding about just the ecology of innovation.

And you have to kiss a lot of frogs to find your prince or princess. But again, when you have a success as, as large and as singular as Google search became. It's very hard to preserve that spirit when everybody is just like trying to grow the core as fast as possible, feed that beast. I talked about something similar at Hewlett Packard when they became lords of the printer business. That kind of sucked all the innovation out of the rest of the company. So it's super hard. You, can start with.

With the right intentions, but it's super hard to keep that as you scale up and if you're not , very mindful of it. , I think I mentioned we, I might mention it again, , so forgive me, but I, I think it was about 15 months , or so ago mark Zuckerberg , at Meta at Facebook. Was, he could see how the company become very bureaucratic, 10 or 11 management layers.

And he made this point, he said, you don't want a company where you have managers, managing managers, managing managers, managing managers, managing the people who are doing the work. I was like, yeah, no, that's a bad idea. But what was very interesting is something else he said a few years earlier, about a decade earlier. Where he admitted, he said, I know we're constantly at risk from big company disease.

Maybe he didn't use that phrase, but he said most companies, they get big, like they lose their mojo, and he said, I don't think it's gonna happen at Facebook. because we talk so much moving fast and breaking things. I think there's enormous, naivety in that statement. In that if we just keep talking about these things, right then somehow they will be embedded in the organization. They're not, I. What gets embedded is the systems, the processes, and so on.

And so unless you are super explicit about thinking about what kind of compensation structure what kind of internal network, lateral linkages how how are we going to distribute power, who gets it, and under what circumstances? Unless you're thinking like super, super thoughtfully about those things. You just end up being overtaken by bureaucracy because it's a default setting so you don't it's talking about rhetoric and culture and exhortation not gonna protect you from those things.

You have to be super explicit about it. And I think that's probably where Google missed it. I think they had the right impulses, the right instincts. And some of it for sure still exist there, but they probably mistook talking about it for actually really thinking hard about what kind of architecture, systems, processes will make this capability of being fast and innovative, something that's truly in our DNA.

As opposed to a distant memory that we bring out once in a while to remind ourselves what we used to be. I mean,, I saw something similar when, when Carly Fiorina, who had ultimately run for president in the United States. I think when she was CEO , at HP at Packer, he'd come from a telecommunications manufacturer, Lucent, I believe. But she sent around like a little document on the rules for the garage because HP famously was invented in a garage in Silicon Valley.

And and so this was like lovely rhetoric, the same kind of thing be small, be fast, whatever. But you don't change anything by sending around a little memento to the past. What they never did was like the hard work of, okay, let's re-engineer our whole management model in a way that kind of allows us to do things to harness those advantages at scale. The ones we had when we were a few hundred people, rather than a hundred thousand people.

I. I'm always so disappointed when you hear these stories 'cause it's everywhere. I mean, working in organizations and having the courage to actually go and here's a new product for us. I believe this is a place where the company can win and then you're punished for that. Or worst you're jettisoned for that. It what happens. A lot of people or you're frustrated outta the company and as you said, in.

Competence paced competition when we talked about that, that most companies are developed by a disgruntled employee from a different company, so why not engage those people? And I just think that's the biggest cruelty of all of this. I. Well it is, but it's, it's just. It's not inevitable because you, we can find organizations of large scale who haven't fallen into those traps. Not very many, but some of them are out there.

It's not inevitable in some cosmic sense, but it's inevitable if you don't really take this work of management innovation super, super seriously. Let me share, I just pulled up a quote. This is a very interesting quote. From a guy named Praveen Seshadri, I'm mis mispronouncing it, but he was an entrepreneur who had built an interesting business that he sold to Google. And he sold it to Google in 2020. And he stayed on, I think for three years.

But when his retention agreement expired, he left , this was what he found in Google in 2020.

He said like mice, like mice, Google's employees are trapped and a maze of approvals. Launch processes, legal reviews, performance reviews, exec reviews, documents, meetings, bug reports, triage, OKRs H one plans followed by H two plans, all hands summits and in Venable. Reorgs, he said Very few googs. Come to work thinking they serve a customer or a user.

It's a closed world where almost everyone is working for other Googlers, and the feedback loop is based on what your colleagues and managers think of your work. Hmm. know, I don't know if that's true maybe he was just disenchanted or frustrated or wanted a crap on them on the way out the door, like all that others like, but. But it doesn't sound unusual to me for what you'd see in a large organization. And I wanted to pull something that they had strived for because.

This is the problem is that as you go up that S-curve, you become more like , that quote, rather than actually what you talked about and what you had found there. When you interviewed people in Google, you talked about their desire to have a continuous company-wide conversation. So I'd love you to share with about this, regardless of Google. I'll use Google and the quote here to get us started.

But you said in hierarchical companies, communication pathways are primarily ver vertical rather than horizontal. And information systems are built first and foremost to move data from the front lines to the top level decision makers. Google's executives don't lack for data yet the lateral flow of communication within the company is even denser than the vertical flow. This is no accident Google.

Has invested heavily in building a highly networked organization that makes it easy for employer employees to share ideas, poll peers, recruit volunteers, and build constituencies for change, all of which require a lot more than a good email system. And you talked about some of the systems that they had in place there. I know you've worked massively with Haier to implement some of this.

We'll talk about that again later, in Humanocracy.. But for a Google perspective, what did you find then compared to what you found with that quote today? Well, of course, I don't know what exists today, but I think Aiden, the critical thing is not just whether you have lateral technology and lateral systems. Most organizations today, they have slack.

they may have some kind of idea markets they have chat functions across the company, so, you can reach anybody in the company probably fairly easily and so on. So I think at the time Google was investing in that probably ahead of a lot of competitors today, I think most organizations have something like that.

Probably the deeper question is, what do you think that thing is for. What do you use that technology for? And a lot of it is just a search function. People are saying, Hey, is there anybody out there who can help me with X? So you're trying to find a particular kind of expertise. It's often used to problem solve, Hey, I've run up against something who can help me? Who can help me with this? It can be a bitch session where. There's maybe a lot of whining and so on going on.

And then a huge amount of it today is just using project work where you got a team of people maybe co-located around the world and they're just constantly on Slack or something else, and that's just the way the work gets done. So the questions, are you actually using that in a discipline way? To track what's changing in the world, right? You, think of how easy it is today to tag something and how you can share things and you can, I, I think they call it taxonomy, right?

Where you can people tag things and this is interesting, and then it becomes viral. You think about a large organization, we have people around the world often the people at the center don't know what's going on. having a system where somebody at the others says, say, I saw a new release from a competitor in China. This is what it is, and they tag it and then that's available. Every employee across the world can see that.

So you build a collective intelligence system that can monitor the entire world, where everybody can see what's happening, where you can put that picture together. There are ways of doing that today that you couldn't have done 20 years ago Now. How many companies have that? I don't know. Not very many. Probably similarly today we can do open strategy. We've talked about this before.

I won't go here deep now, but Google had some processes , led by the CEO and others where you'd bring young people in and you'd have these really robust debates about what else should we be doing? They would occasionally kind of crowdsource big questions down to the organization. One of 'em at one point was like. How do we catalog and give people access to uploaded video. I, that was probably before YouTube was a thing. I don't know.

But, and so, they were trying to engage the periphery of the organization, the core and these kind of conversations. But at some point, if you're doing that. With old technology, you simply can't scale that, right? It's like you, you can't get enough people. But we have a lot of experience of doing that at scale and bringing tens of thousands of people together and getting the best ideas to the fore. So it's not, the technology is usually not the limiting factor here.

I. The limiting factor is either a senior group that's not very curious or one that wants to hold onto their power and doesn't want to admit that there are a lot of people out there who may have better ideas than they do. Or who frankly just don't know how you use online tools to do things at scale. Variety of reasons, but yeah, the tools are not really it's the spirit behind them and this idea we have to have.

The best insights from the best people wherever they are, and we need to make sure those are getting to the fore that other people can corroborate or not based on their own evidence. The things that we see collectively as emerging and gaining speed. We need to be able to pay attention to those. We need to be able to interrogate the entire organization. What do we do about that? What, how do we turn this into an opportunity? It's just like shocking to me that so few organizations.

Yet are using the tools in that way. 'cause you clearly can. You then move to solution mode and you highlight a couple of things.

And I thought was really interesting where you talked about the limits of language and how innovation or reinvention needs new language, and it reminded me of that Wittgenstein quote, the limits of my language mean the limits of my world. And what you said was even our languages held hostage by our paradigms. Consider, for example, how thoroughly the notion of hierarchy has infiltrated the lexicon of management, chain of command.

Pyramid, boss, subordinate, direct reports, organizational levels, top down, bottom up, cascade. All these terms connote a formal scale of power and authority. Indeed, managers have as many ways of talking about hierarchy as Eskimos have about talking about snow. Yeah, I think and obviously the language. Is just a reflection of the underlying kind of architecture belief system that we have.

And I think I, I spend an entire chapter in this book basically saying and we talked about this a little bit with respect to maybe orthodoxy or dogma with respect to products and technology. But it's equally important when you think about how we manage right there. I, I just hear over and over again, I hear people say things in organizations.

As if, like aphorisms and , they take as if like they're, they, they're written on commandments like in stone somewhere, and that they exist independent of just the way we chose to build our organizations. I think one, one of the examples I took, and we did this as an experiment in, in a bunch of organizations , where I'd ask people. What, what are the 10 things you believe most deeply about, let's say change, or you could say strategy, you could say employee motivation or something.

And by the way, this is a really , interesting exercise to do , and maybe an important one to do. Ask your colleagues, okay, pick some important topic and ask them like, what are the things you believe most deeply about this? So when we'd ask this about change, the typical kinds of things that would come up is somebody would say, well, it typically takes a crisis to provoke. Like real deep change. Okay. Or you need a strong leader to drive change.

Okay. Or change starts at the top and you go like, well, okay. All of those things are true in the sense that they accord , with our reality. Yeah. Most organizations don't change until they've had a long period of substandard performance, a crisis of some sort, and then you do a strategy reboot often. The only way to get deep change is you bring in a strong leader, a new leader who has no loyalty to the past and feels free to like, do really hard things.

And yet it, it tends we think that until the guys at the top get it, nothing else can be done. And then you go like, okay. None of those things are true in any absolute sense, right? They're simply true of hierarchical organizations where the power to initiate change is at the top and where there's a lot of learned helplessness everywhere else. I. And where there are poor systems for understanding how the world is changing and responding to it. Yeah. Then you're gonna end up with a crisis.

Only somebody at the top is gonna be able to get this thing done. And so once, you find something that's true, you have to say, is this inevitably true in every context forever and in every system, biological, human, physical that we can imagine? Or is this just something that we've that. That we've inherited. And I think just very seldom, know, are we thoughtful in that way?

And I will tell you one of the things I learned, and maybe we'll come back to this in a different context Aiden, but, and forgive me again if this is something I've said in another way, but in a world of AI and instantly accessible knowledge and information, it is impossible to know more. there's always somebody who has better information can know more about any topic than I can. But the value comes not from knowing more, but from knowing different.

The value comes from when you can step outside the dominant paradigm and go like, why the hell is that? Is it that way? one of the examples I have in the book, which is really quite a fun one, it's an older one, but quite a fun one is 2, researchers at a hospital in Perth, which literally is like the end of the world. Were both frustrated. One I think was a hospital one, one was an internal medicine guy other one, a pathologist. And they were frustrated at their patients suffering from ulcers.

And of course, the received wisdom among gastroenterologists were ulcers are the product of stress and booze and so on. And these guys just said, really, it's, it is like that all there is. So they started a culture take cultures outta the guts of their patients. And to see if anything would grow in those cultures.

And and the answer was apparently no. But then over one long weekend one of these cultures is left unattended and the guy comes back Barry Marshall and Robin Warren, what are the names? It comes back over a long weekend and there's something growing and they find this little ew shaped bacteria. So like, could that, that be the culprit? So these guys like hatch a brew of this and drink it themselves, and then become quickly be like.

Very unwell and so they said, yeah, this is, and so they started to treat this in a different way and they could watch these ulcers disappeared. Well they went to, to present this at a big conference and they basically got pulled from the stage, like that the existing mental models were so out of sync with what they were found, finding that people literally, you couldn't see the data that was just in front of you.

The good news is ultimately this changes the practice of medicine and these two guys win the Nobel Prize. But it just it tells us how much work I. We have to put in to challenging what we already believe our own confirmation biases. And , I always tell people when you hear something that you literally think , this is crazy, I disagree with, and some of it is like, so obvious, you can just say, okay, that's like nuts. But take some time to ask like, under what circumstances might this be true?

Or what evidence is here. But the tendency we all have just as like, well, that doesn't fit with my worldview. Like, I'm just gonna dismiss that is like so high and so deep. And that's that's the primary reason we're stuck. We're all drinking the same bureaucratic bath water. We're not drinking the ulcer juice. I, I was, man, I was telling you before we came on air, I went down so many rabbit holes based on stuff like this. So I went then reading.

I like, I don't have any extra time to read the patterns of military revolutions, the book that you mentioned in there, and how about the long bow and how the technology changes, but that doesn't change how you go into war and how when lives depend on it, we still cling to these old orthodoxies based on power and status quo, et cetera, that it's so pervasive and that's what I, just want people to listen to this because you don't spot it when it's you. I mean, that's the problem when it's you.

And, and, and the other thing you have to ask, and it's hard, is like, does, does this belief that I've held onto for a while, does it serve my self-interest in some way? Because that's when you really have to be careful, right? So if you assume that , I'm in my position because I'm the smartest person and I'm the best qualified, and so on. And that's why we have a hierarchy, that it's a reflection of who really has the skills, the expertise, and they get ahead.

Like if you hang on that belief, well it might be true, but you may believe it simply because it makes you feel good. So we have a lot of self-soothing assumptions in our organizations. , And the higher you are in the organization, the more likely to fall prey to those things. 'cause they are, they are beliefs that reinforce your position, your privilege, and so on. So you gotta be.

You gotta be particularly careful when you see a belief that, that that makes you feel good to believe it or makes you feel more important to believe it. Those are the ones you have to be particularly suspicious about. Gary, there was a table I wanted to share because you move on to when you're in solution mode there, but just a nod of the hat to a couple of the case studies you cover in there.

There was a, a company called Rite-Solutions and Jim Lavoie, and what I loved about that case study was the language he changed. So he brought in. Systems for Innovation. One he called, he used the marketplace basically to, in, to change the language about how people thought about innovation, the spas deck, the Bio Jones and savings bonds within the organization.

There's a great case study in there and, and I encourage people to get the book to read about that, but I wanted to share this diagram this table that you share in the book because it's the principles of modern management and you look at different elements here and maybe we don't have to go through them all, but maybe pick and choose at a couple of them here for, and we'll have a little bit of empathy for people who are just listening, which is the majority of the show.

we'll get at this, I think much deeper when we talk about human ocracy, and I'll try to explain a little bit why, if you want to do anything, if you want to build an organization that's in any way fundamentally better than the one you have now, I. You have to start , with new principles, not new practices, not new structures, not new processes, but you have to go like very deep back to principles.

again, this is kind of part of our inheritance, a set of principles that developed in the industrial age. Again, with the purpose of producing very compliant employees and very efficient organizations. But principles like specialization you put like with like in an organization and you disaggregate jobs into small, repeatable components.

Standardization that you just put a high premium on doing the same things over and over again on, on perfect replicability alignment, where you know, you want everybody with the same targets pushing in the same direction. Hierarchy that, you know, the way you manage complexity is you simply have a hierarchy of managers with ascending decision rights. Elaborate systems for planning and control. So control is a hugely important principle.

Control over tasks, over budgeting, over resource allocation regularity and predictability and operations. And then finally, this belief that we're mostly motivated by extrinsic rewards. Pay for performance. None of these things are wrong, right? Like, none of those are all like really, really good principles. And we'll talk about this again, I'm sure. Collectively though, they create an ideology and that really has control at its center.

And the dilemma with any ideology is if you're not careful, at some point it slips the balance of common sense. Or you just take it past the point of like logic. And I think that's what's happened. And so my view is you only beat one set of principles by having a better set of principles. we'll come back to this, but you have to understand that those principles of specialization, standardization, control, goal alignment, they are deeply marbled into every system and every process. In fact.

If you look at the processes of most organizations, they are built on and serve those principles, those goals, and trying to find systems or processes that serve any other goal or be something is like really hard, they simply don't exist, which is why we end up with these very lopsided organizations that are very good at discipline, control, alignment and not very good at anything else. Those principles, they're like DNA, right? Or they're like, the water you drink, they're just everywhere.

Mostly unnoticed with no powerful ideological rivals. And so they just predominate and our organizations therefore, are very unbalanced and highly capable in some ways, and entirely incompetent in others. When I was looking at them, I, I thought about stuff like, regardless of the workplace. We, start this socialization in school. Parents do it, we do it as parents done it myself. I'm guilty of some of those things where you're forming the mindset of this is how it's done in the world.

This is how you operate in the world. And then we wonder why our organizations are like that. And again, so pervasive. . People track like creativity and basically it falls off a cliff once you start school because when your child preschool, whatever, there are no stupid questions. Dad, why is this sky blue? Well, let's think about that, right? But you go to school and there're stupid questions and there's stupid answers, and nobody wants to be humiliated.

And I think it's the same in organizations. There's this pervasive fear that there, if I ask the question that's a little weird or a little strange, like, somebody's gonna have an answer and make me look stupid. And so people do not challenge these old beliefs. Like, why do we let managers assess , the performance of employees? there's a lot of good reasons not to do that, but it can be very intimidating to ask that question.

'cause you just assume, well, somebody's really thought this through and No, no, no. Most of the things that are there are not very thought through. And, and if you look at all , these elaborate corporate processes, we've scoured the literature, we know the research. There's almost no corporate process where a majority of people think it adds value. And yet we keep like out there like dancing naked around the campfire, hoping something's gonna happen, right?

again, it's, it goes back to, well, if you are a. Rabble rouser. If you're the person who thinks differently, it doesn't often end well for the whistleblower and it's so, so difficult. I thought I'd share, share one last diagram and I'll just highlight one thing, which is so so important.

And again, even as a parent, I see this, that if your child has a purpose, if they feel they have a purpose that they own, they don't wonder, they don't then do things you don't want them doing. And you talk about the importance of this. From change initiatives, you say people change for what they care about in the final analysis. There are no adaptable organizations, only adaptable people.

While a company's management processes can either imp plead or encourage adaptation, it's the willingness of individuals to change that ultimately matters. Most books on change start from the premise that people reflexively resist change and have to be manipulated, browbeat or cajoled into abandoning the serenity of the status quo. Gary has a different view. He believes most people, most human beings, welcome change for all our reactionary tendencies.

We are always looking for new experiences and new challenge, but purpose is at the heart of that. Yeah. Somebody gave me a good analogy once they said, Gary, when you talk about the purpose, it's about like having a son that pulls the little shoots out of the ground. Right. And nourishes them and whatever. And I think again, there's been a lot of talk about purpose over the last few years and became kind of.

fairly politicized, I think, and it got merged with all the ESG stuff and stakeholder capitalism. But, and some of those ideas have a lot of merit. But I think I. You put, putting some vague social do-gooder thing on top of a corporate's purpose is not, I mean, it's something that has to come from inside and has to be deeply felt. I I talked about Whole Foods.

I don't know if they still have that purpose, but they used to talk about whole Foods, whole people, and whole planet and so we wanna create foods that like your grandmother would recognize and are not. Now I think, what do we call 'em now? We don't call 'em engineered foods, highly processed foods. Right. Which we're learning are like super bad for us. So, no, no, we're not gonna do that. We want whole people. We wanna worry about your nutrition and how that affects all of your health.

we eat, super powerful drug. then finally a whole planet take care of the planet. And they didn't do that kind of belatedly as a, so to some outside pressure group, they did that because John Mackey co-founder and those early employees, this is what they believed. And so, and, and they attracted people who cared about that. And I think. As we've talked about before, you have to have a purpose that has enough stretch in it, that it continues to encourage you to change and do more.

And again, that purpose is not shareholder wealth, and it's not some vague thing about making the world a better place. It has to be specific and yeah. And the reason I would say this Aidan, is maybe a final thought. You'll know if your organization has a purpose, partly by whether they can articulate it or not, and by the way, whether people can articulate it without having to go back and look at something. If you just ask people like what are we here to do?

And everybody has the same answer, that's a pretty good sign. The other way you'll know if it's real is if you can say, where have we done something really hard? Or sacrifice something for the sake of that purpose. And that's where you find that most organizations, they haven't done that.

They have something that is out there somewhere often about customers, but then you find they're only too happy to screw the customer over if so yeah, I mean, again, you shouldn't have to say any of this, but again, it's a testament, but in, in fact, let me go back one little, an anecdote. Frederick Winslow Taylor often gets a bad rap. The father of scientific management and. Spent a lot of time, as you might say, de-skilling work, but also trying to make it better.

He would study for hours, somebody shoveling coal to understand like, what's the best way to do this? But but he thought in a kind of lovely puritan way, he said, to waste an hour of human labor is iniquitous. Like, if you couldn't find a simpler, easier way for human beings to do something, why wouldn't you do that?

And so we can look at that and maybe there was some self rationalization going on there, but you can look at it and go like, yeah, this is the guy who like turned everybody into automatons. But you can also look at it, say, here's a guy who said like we want human work to make a difference and to raise our productivity. And the fact today that we're producing 20, 40, 60 times more output per hour than we did a century ago is like un flipping believable.

a lot of his work had a deep purpose behind it. And today we live in a disenchanted world. I. Where very few people really have a purpose and very few people think about it. 'cause why would you think about it when you spend all of your time entertaining yourself to death with your smartphone, right? Why think about anything more important or bigger or anything else because you always have something at hand to distract you from hard questions and metaphysical concerns.

But the end, we end up living in impoverished lives and impoverished organizations. It's massive and we will get to it. I wanted to share more, but I'm gonna, I'm gonna leave it there. 'cause Gary beautifully finishes the book and I pulled out a little excerpt just to tail the book.

'cause we started with this, the book starts with the end of management and I, I pulled a little line just from chapter seven where you said, it turns out we haven't reached the end of management. We really can reinvent the way big companies are structured and run. There isn't any law that prevents large organizations from being engaging, innovative, and adaptable, and mostly bureaucracy free. Even better. It really is possible to set the human spirit free at work, so no more excuses.

It's time for you to buckle down and start inventing the future of management. Beautiful lines, Gary, and it's a brilliant book and again. Beautifully fits in, and it's a pleasure to go through chronologically how your own ideas formed, how you studied. 'cause there was just so much research in all these books, the interviews that you did, et cetera. And there's tons, by the way, for people interested of articles. Gary wrote from Fortune HBR, still writing for HBR.

There's tons and tons of articles out there. You can find them all. I highly, highly recommend them. Gary, for people who wanna find you and find some of those articles, where's the best place? LinkedIn is a pretty good place. Just put up an article there on, elon Musk and Doge and what they may be doing right and wrong. So please find me on LinkedIn, ask a question, connect I'll occasionally post on x as well, so you can find me there under prof, hamel, and emails. I'm just gary gary hamel.com.

So yeah, if something sparks your interest, you wanna go deeper you want some more resources, always happy to help out. Author of the Future of Management, Gary Hamel. Thank you for joining us. A pleasure, Aiden.