ALISON BEARD: I’m Alison Beard.
ADI IGNATIUS: I’m Adi Ignatius, and this is the HBR IdeaCast.
ALISON BEARD: Adi, I’m not going to lie, I am getting pretty exhausted by all the changes we’ve seen in the media industry over the course of our careers, especially now with the advent of AI and a new strategy at HBR that’s built around connection as much as content. I feel like I’m having to learn an entirely new business, and that’s exciting, don’t get me wrong, but it’s also extremely hard.
ADI IGNATIUS: I feel the same thing. I think everybody in every industry is pretty much feeling the same thing right now. And this is before AI even completely lands and transforms our business even more. So this is what we’re doing. We are constantly reinventing our businesses.
ALISON BEARD: And for anyone struggling like we are with this period of transformation and uncertainty, our guest today has good advice on how to break out of old patterns holding us back and really embrace the idea of continuous change for ourselves and our organizations.
ADI IGNATIUS: So I love that because I think it’s easy to say, and leaders say it all the time, we have to continually experiment, continually change. Everybody has to adapt. Easy to say; very hard to pull off. So if she’s got a framework, I’m all ears.
ALISON BEARD: So the guest is Nilofer Merchant, a former Apple executive, corporate consultant and author of the book, Our Best Work: Breaking Free from the Invisible Norms That Limit Us. And I talked to her about some practical ways for both individuals and teams to thrive in ever-changing environments. That includes things like normalizing discomfort, rewarding people for building new competencies rather than just showing confidence and modeling constant curiosity. Here’s our conversation.
I’d love to talk today about this idea of adapting to continuous change, which requires curiosity, rethinking the status quo, trying new things. That sounds great and logical in theory, but in practice, it’s extremely hard for individuals, for teams, for organizations. So what is the biggest hurdle preventing many of us from just understanding that this is the new normal?
NILOFER MERCHANT: Yeah. So here’s the thing, change management in the management discipline is you decide where it is you’re going, you tell other people very clearly, you communicate it extremely well, and then you reward and acknowledge the work that’s actually happening. It assumes that one group or party ends up directing the others. And my observation is that that’s actually not change. That’s actually control because when you have true change comes choice.
What we’re describing in the change management literature is actually a subjugation. It’s us telling other people and directing other people to do things. And what we want instead is the ability to actually decide together. And when I say that, most people think, “Oh, you’re describing chaos.” And I’m actually not describing chaos. What I’m describing is a difference between accountability and ownership.
So accountability says, Alison needs to know where we’re going to go and she’s going to tell Nilofer and Nilofer gets to participate in that or not. That’s to some degree her choice. But if she needs employment, she’s going to participate. But as soon as Alison takes her foot off the gas, Nilofer’s going to go ahead and do whatever it is she wants to do, which is why no change management stuff actually sticks. It’s because we only do it as long as someone’s forcing us to do it the way it’s been done. But if we have an ownership model, a collaborative model, then we’ve actually decided the horizon together and then you’ve got my commitment, I’m on board. And so as long as you’ve got me engaged, then we’re going to go do it. And even if you move on, I’m still committed to it because I decided it with you.
ALISON BEARD: So what’s the first step for a leader in trying to move from that old way of doing things into the new way?
NILOFER MERCHANT: Collaboration is co-laboring. You have to actually decide together what it is you want to do. But before we can even do that, we have to be okay with not knowing. We have to be okay with, I don’t know the answer, you don’t know the answer, but we can actually build the answer. And for any of us, I don’t know about you, but I was trained in MBA programs and at work that my job was to know and be confident in that.
I’m noticing actually that the role of work is really changing with AI because it’s not about knowing. And in fact, it started changing when we had really good access to search because it wasn’t then about, did I know more than you? It was about, could I find it out? Could I gather up that data? Could I form an insight? And now the knowing and the data part is almost irrelevant. It’s the, can I formulate a new question? Can I have a new take? And those things are so inherently about discomfort because we get to sit in the unknowing for enough time to go, “What is it I don’t know?”
I tell the story in the book about Orangetheory. Right before they make you do something really hard, like an all out, they’ll say to you, “It’s 90 seconds. It’s supposed to be hard and you’re supposed to get uncomfortable in order to grow.” And I feel like that’s the sentence we all need to say to ourselves at work of, if we’re coming up with a new insight or we’re doing innovation or we’re doing growth strategy, it’s supposed to be hard, but we have to be willing to go into that discomfort and trust that at some point we will figure it out. Sitting with that is the maturity that we need every leader to have.
ALISON BEARD: This requires patience though, right? So in the Orangetheory, they can say, yes, it’s going to take 90 seconds, but a leader might not know how long it’s going to take and the team members might think to themselves, “But I have all these deliverables that I need to get going on and still perform.” So how do organizations, how do teams find that right balance?
NILOFER MERCHANT: I’ve done this kind of change management work inside companies. So let’s just describe an ordinary scenario. It’s when teams normally try to solve things themselves first, then they often hire a big firm, one of the big three, to come in and help them and get that PowerPoint slide. And then they’re still stuck because they still haven’t figured it out.
And at that point, they are more desperate than ever. And typically that was when I was hired, my team and I were hired. And we come in and we’d say, “Actually, can we invite people throughout the organization to come and participate with us? Because I’m sure that if you haven’t solved it yet, it’s not because you’re not trying hard enough. It’s because somewhere in this, we don’t understand the situation and if we don’t understand it, we can’t solve for it. So somewhere in this organization, someone can actually help us.”
And I think every CEO looked over at me like, “Can I fire you now?” Because they thought I was not taking it seriously enough that I wanted to talk to more people. And I was actually saying, “No, no, no. The reason you’re broken is because I am taking it seriously enough. I believe that there’s some missing piece.” So we have to actually get people in a room together and I’d call that process an invitation to play where I’d actually have them write an email to people and say, “Anyone who wants to come help us solve this problem.”
And in that first couple weeks of process, people would share stories of why customers were calling a lot or why sales metrics weren’t being met or whatever else. And then about two weeks in, three weeks in, four weeks in, some period of time, but not indefinite there was always this epiphany that would happen where someone was describing something and it was the equivalent of looking at an elephant in the room and somebody was saying, “This is shiny and smooth.” And the other person’s saying, “It’s hairy.” It’s just like they were describing different things, but as soon as you put the pieces together, you’re like, “Click.”
And there’s this moment that would go around the room and the CEO would always look over at me like, “Oh, we didn’t know the answer.” And I go, “Yeah, and what does that take?” I go, “You’ve been working on this for a couple of years.” And I look at my watch and I go, “That took three weeks. That took four weeks.” So it’s never an indefinite thing. The thing is, are we willing to go slow in order to go fast and are we willing to understand that the comfort of believing we already know the problem is actually the reason why we’re not moving forward.
ALISON BEARD: And that goes to the point of rethinking the status quo. It’s really difficult to break people from the structures that they’re used to, the business models that they’re used to, the ways of working that they’re used to. So in your experience, how do you get people to abandon their resistance to changing what feels normal and right to them?
NILOFER MERCHANT: So the difference to me is the difference between competence and confidence. So most often our organizations are rewarding the fake it until you make it behavior. We’re reinforcing the person who shows up with the most amount of confidence at the table, but that’s not allowing for us to have the actual competence. So if we don’t know the answer, why aren’t we willing to say we don’t know? And if we essentially lie and create a form of fraud with each other, that’s not going to allow us to hook up and actually create the ideas that matter.
I should back up and share this. So innovation, there’s three things that have fueled innovation that all the management theorists for like the last hundred years, Drucker, Mary Follett, to Amy Edmondson and Bob Sutton. Every person agrees there’s three things that drive innovation. One, that we have access to new and novel ideas. Two, that those ideas are joined together in a way that allows them to become real and robust solutions. Three, that we’re solving the problems of tomorrow, that we’re solving meaningful problems. And confidence is to say, we already know the idea. Confidence is to fake it and not actually show where those ideas need further development. Confident is to say, we actually believe where the market’s going. When actually all those three things are about curiosity and uncertainty and change. And so we need to lean into those three Cs and let go of the knowing and the data driven and the confidence models that we’ve been taught. And the shift will allow us to collaborate and create innovation. But more importantly, in this world, if you notice that knowing and speed and confidence and data driven are all the things that AI does really well.
ALISON BEARD: Sometimes wrongly.
NILOFER MERCHANT: In fact, the data, Alison, is really interesting. I just read a piece of research that Karim Lakhani did out of Harvard and a group of other people. So I’m locating it to one person, but it was actually six or seven researchers. And they said, AI allowed people, especially junior people, to do things 12% faster, 25% more, but it got the answer wrong 19% of the time.
And I’m like, “Okay, so are we valuing speed and the appearance of progress or are we valuing insight, ingenuity, collaboration, creativity, all the things that actually lead to growth and innovation?”
ALISON BEARD: Right. So when you’re thinking about how you need to change as a team, as an organization, obviously there are some things that you’re going to want to keep and preserve because they have been working well, and then there are going to be things that you need to get rid of. So how do you work with leaders on determining which changes will make meaningful progress while retaining some of the status quo that has been helpful?
NILOFER MERCHANT: I think it’s more about thinking about, where are the different things that we do every day that we could go, “Oh, this is a place for us to improve.” So that’s one. And then the second one is really being practical about we need to figure out how to do more innovation and the places where we’re not seeing the growth we would like is to actually go, “How do we come together around that? How do we invite people to play?” And start doing strategy and execution in a different way than we’ve ever done, which is to say, “What is it we want to do? ”
And that creative process. I did a bake off with a team once where they had $2 million to spend and they were having this conversation about, “Oh, we should spread peanut butter style across the organization or we should invest it in one place that’s already working.” And I said, “Well, actually, rather than assuming we know the answer, why don’t we invite everyone into an idea-athon like a hackathon, but with an idea thing and just see what’s worth investing in.”
And we set up some rules for the teams and we said, “You don’t have to work in your discipline. So if you’re a finance person, you can go over to the cafeteria and work with them, whatever you want to go do, but you have to form teams.” And so we set up a way for people to do that. And you have to come with the sizing. So we assign finance people to help with that, and then you just have to show us the possibility. So pilot it in some way so we’re not just talking theory.
One team came together with this idea about if they could make people go use the stairs instead of the elevators at lunch, they would improve the 10,000 steps thing. And they were just excited about that because they personally were trying to improve their health. Interestingly enough, the way they sized it was they actually called the insurance company and said they could get a 5% benefit if they did this set of protocols inside the company. And so saved the company money. And it turns out, by the way, that 90% of the ideas that were submitted in that idea-athon were things that did not require … Did not require incremental dollars or self-funded. And there was all this latency in the system that was innovation at different levels.
So wherever people caught, whether it was a systems change or a process change or a human behavior change or all the way up to a market change. I think that’s the kind of thing we need to unlock. When we say, let’s access new and novel ideas, the data says that we eliminate between 50 and 70% of them, that they either self silence or we ignore them.
ALISON BEARD: It sounds like you’re really talking about the democratization of change, which also sounds really difficult to manage. So in practice, do you have an example of a company that you’ve worked with that has managed to corral that kind of change management that you’re talking about, bottom up change?
NILOFER MERCHANT: You know I want to share this story and I’m going to tell the CEO’s name but he’s no longer in the role so I can do it and he won’t mind. So when I was working with Adobe, one of the things that they were stuck on is they were losing a large portion of their education market to a competitor, Macromedia. And basically every kid that was coming out of design school was coming out loving Macromedia tools and not Adobe’s tools, which is a big risk to their future design market. And we figured out that over 50% of Macromedia’s revenue was coming from education. So we figured if we won education, we actually defeated the vendor in a really interesting way.
So we talked to customers and said, “Why are they picking the vendor?” We talked to the product team and said, “What would you build if you could build?” We talked to the sales team and said, “What is it you need in order to win over contracts?” We’re just moving all the levers, trying to figure out what the go to-market strategy would be.
And at that point, Bruce shows up with a book called Execution, which was a book that was saying basically if the reason we’re failing at work is not because we don’t know the strategy, it’s because we’re not executing well. And he handed this book out to everybody. And the book basically said, “Listen, if things aren’t executing well, it’s because you’re not telling people clearly enough, you’re not rewarding them enough, et cetera.”
And I said, “Isn’t that interesting that we’re making the assumption that strategy and execution are two different things and that they come from two different parts of the organization and that this side can then tell this side that they’re not working hard enough.” When in reality, strategy and execution are … Especially nowadays with the world moving so fast, is more one and the same. It used to be a thing you could plan and then you’d hold a 20-year arc.
And Rita McGrath many years ago, I want to say 10 plus years ago, showed the research that said strategy was holding a five-year arc. And of course that data was far less for any industry that was touched by information, which by the way is everyone. So it means that we’re not holding onto any kind of arc so now we have to think much more iteratively, adaptively.
And so him handing out the execution book was really saying, “Hey, I’m doing a great job and I’m doing a great job because we and the C-suite know what’s going on and you guys aren’t doing well.” And I just looked at the project we were working on because we had gone to him and said, “Hey, we figured out that 50% of the market was coming from education. So if we fix the education solution, we actually win there, we win the whole game.”
He funded it because we brought him the idea. It changed the entire industry because Adobe became the player. And that was a perfect example of what happens when you stop thinking in the siloed model, which is what we do within an organization too, with strategy and execution being two different silos and we start thinking collaboratively and go, “Oh, these are one and the same.”
ALISON BEARD: Yeah. Absolutely. I think today that arc is shrinking so much that strategy just has to be dynamic. Rita actually presented on this at one of our recent virtual events and I have a colleague at HBR who I think put it really succinctly like, “In this environment, you need to do strategy with us, not to us.”
NILOFER MERCHANT: Exactly.
ALISON BEARD: Yeah. It was just so succinctly phrased that I said, “Yes, that’s exactly right because strategy does need to be changing all the time. And so you need the people on the ground to help you conceive of it.”
NILOFER MERCHANT: I have a whole chapter around the idea with. Because the world is so complex that we can’t assume that any one party knows enough. We have to assume that we’re missing pieces of information and that gives us the opportunity to go, “What is it I need to ask in order for me to fill in pieces of information rather than what is it I already know?” Our role also as leaders is to be co-creators in that process because if we listen well, other people can hear themselves more clearly. So listening becomes an act of co-creation.
ALISON BEARD: We have covered curiosity, listening quite a bit on this show, but is there any particular advice that you would give to leaders about how they need to approach team members from their direct reports to the people working in directly customer facing jobs about how they need to show curiosity and how they need to listen?
NILOFER MERCHANT: It’s actually a practice I’ve done for years. And what I do is before I go into any meeting, I prime myself by asking, what is it I don’t know? And I start to write down questions that I could ask that would get to that. And I make sure I’m not just asking factual questions, but what was the history of this and why are we so … Whatever it is, the set of questions that we can unfold more. And I do that as a way of teaching myself to be so much more curious when we’re in a room, any meeting, we can go, “What is it that I can be asking that will help the room develop more intelligence?”
Which is different than being smarter. Smart is like what we come into the room with, and there are multiple forms of smart, whether it’s kinesthetic or intuitive or data driven or whatever. Oh, lots of different ways of smart. And then what I want to do as a leader is to figure out how to become more of the glue. So how do I build intelligence in the room by having people hear each other and figuring out where are the possible gaps between people.
ALISON BEARD: In this era of continuous change, when you’re trying to rethink the status quo, when you’re trying to be curious, when you’re trying to ask questions, when you’re trying to find the gaps, the end goal though is to be competent at that new thing that you should be doing. But is it even possible when things are moving so quickly?
NILOFER MERCHANT: I think the goal is to be ever better at solving the problems and needs of today. And so what I want to do is think about growth as a curve for myself. And the way I get good at change is to actually practice changing. So I don’t need to know tomorrow’s problem. If information’s readily available, it’s not our knowing, it’s our ability to shape the question, it’s our ability to shape the team, it’s the ability then to tap into those new ideas. It’s the ability to connect those ideas together. And I can get really good at the process mechanics of leading and I can handle anything if I can get better at the process mechanics.
So if I know how to tap new ideas, I’m going to be one of the best innovators. If I know how to build teams who can actually come together around things. And so what I actually want to do is trust that no matter what situation you helicopter me down into, I can actually go, “Oh, I know how to orient. So I think we’ve got to change our perspective of competence from the do I know enough to, can I lead in this adaptive culture?
ALISON BEARD: Yeah. It does though for people who have become experts in their profession, it does seem daunting. So how do you get people to shift their mindset from, “I am an expert and I know how this business or function works to I’m ready to be learning every day?”
NILOFER MERCHANT: It’s such a beautiful question because it’s the question of our time. Organizations have been focused on reinvention for quite a while. And so we think about it as being out there and now we’ve got to figure out how to think about it as being in here. And when I say to leaders … I had a leader recently who’s been at major tech firms, run a nonprofit, so run one of the top 150 companies in the world, and she said to me, “I’m worried at my age, I’m not relevant anymore.”
And I said, “Define relevance for me.” And she was thinking about it as, “I’m not young enough, I don’t know the AI world enough, et cetera.” And I said, “Well, if you think about it as those things, you’re still centering outside yourself.” And today, what we can actually do is center in that spot in the world, only we stand, that function of our history and experience and visions and hopes, and that ability to add value wherever we are. So she brought wisdom to the table. She had just people dynamics. She understood change management. And I said, “Those actually turn out to be incredibly relevant.”
And so we end up learning so much of what we’ve been learning is that we need to know something out there and maybe what we need to do is learn how to center correctly on the value that we can create and to believe that we are capable of learning and growing at all times so that we can be elders in wisdom and actually bring forward the leadership that we need. And if we’ve defined leadership, it’s probably the most important attribute right now. So this is a time for leadership, but it’s not coming from a place of knowing. It’s coming from a place of deep curiosity.
ALISON BEARD: And when it comes to the team dynamics, we’re describing an environment where there’s dynamic strategy making, you’re needing to upskill all the time, you’re needing to be innovating with your processes, with your business models. How do you do all of that and not burn out? It does seem frenetic. You said chaos before, but I get that it’s controlled chaos, but it still probably does feel chaotic when you’re in it. How do you motivate people to embrace this new model where you’re never really going to be competent, you’re constantly going to be learning? How do you keep people going through constant change?
NILOFER MERCHANT: One thing you can do is signal that our job is to sustain ourselves. So it was Shonda Rhimes, for example, sent out a note to all of her people and said, “Even if I send you notes at 2:00 in the morning, your job is not to respond to the note at 2:00 in the morning.” In the bottom of all of her emails, “You respond when it works for you.” And what she’s trying signal is-
ALISON BEARD: I love that.
NILOFER MERCHANT: Yeah. Right.
ALISON BEARD: Shonda. She’s great.
NILOFER MERCHANT: Shonda’s amazing and such a creative soul. And what she’s saying is, “Listen, if our job is to be this creative, change management people who are full of curiosity, we have to have the spaciousness to do so.” So don’t look at my email patterns as what you need to do, figure out what works for you. And I think that norm is a beautiful one, which is, okay, then evenings are evenings and you can actually have downtime. Workout time is workout time, go take care of yourself. Make sure you see your friends, make sure you take care of yourself, and that is your responsibility is actually a nice way of a leader actually signaling that that matters.
And we probably shouldn’t reward the people who are constantly on Slack because that frenetic energy of being online all the time when the company’s going through firing and stuff is a behavior I keep seeing and keep getting reported back to me. And it’s the person who’s so terrified of losing their job that they’re constantly on and they think they’re somehow adding value, but what they’re actually doing is creating noise. So a team lead can go, “You know what? That’s actually not what we’re looking for.” We’re looking for our creative resourcefulness, not always on.
ALISON BEARD: And in your experience, what are the key motivators for people who embrace this new way of thinking? Who say, “Yes, I’m going to be constantly adapting.”
NILOFER MERCHANT: I think every leader wants to innovate and I have yet to meet one that doesn’t say, “Gosh, I’m interested in high growth and high innovation.” And they don’t see what’s actually stopping them from doing it. I think our motivation is 100% aligned around we want growth, we want innovation, we want to do the right next thing. And then what we’re stuck on is old norms of things that we’re just so used to doing, that knowing behavior that we’re so used to rewarding is old. And so it’s not that we want to do it’s just that we’ve inherited it. And what we have to remember is just because we inherited it doesn’t mean it has to be our legacy.
ALISON BEARD: Is it possible for an individual leader to do this with their team if the organization is not moving in that direction, if the organization is still clinging to old norms?
NILOFER MERCHANT: Every time I’ve done change in organizations … And I helped Nokia exit to Microsoft and Semantic defend against Microsoft and Adobe to expand its work, I’ve done this over and over again. And in every situation, we didn’t get a top down edict. What we had was a team that worked really well and our team succeeded and everyone looked over like we had had a good lunch order and said, “I want some of that.” And so I definitely think this is about team leadership and whoever can do that and then teams of teams leadership because when we create the change that we actually know works, other people will look over and go, “How’d you just do that? And can you come over here and help us do it? ” And I think that’s how we’re going to create the change, is that organic invitation to do our best work.
ALISON BEARD: Are there any daily or weekly or monthly practices that you would encourage teams to engage in to ensure that they are being adaptive and not reactive?
NILOFER MERCHANT: I think the big thing is to think about the way they’re approaching meetings. I just think that’s such a practical way of approaching because all of us are in meetings all the time and to go, “Are we using our energy and time together to generate new solutions to old problems?” Because most of the time, most meetings are regurgitation of what we tried to solve three months ago and we just haven’t closed that loop and we don’t move on.
I once went on sabbatical. And I was off for 12 weeks and I was so excited the day I got back, sat at my desk at 6:00 AM, cleared all my emails, and then I was like, “Let’s go.” And I went to the first meeting and they were having the same exact conversation that they’d been having when I left. And I was infuriated because I was like, “Oh my God, what has happened here?”
But that actually turns out to be more normal than not. And so I want us just to look at just meetings because we could sit there and go, “What is it we’re not doing well here?” We can actually start to see it ripple effect because it’s the microcosm in which I want people to understand that that’s where we’re not getting new and novel ideas, that’s where we’re not generating new solutions. And it’s mostly because we don’t understand how to manage those well. So if we could do that one thing alone, we’d see change.
ALISON BEARD: Yeah. I would add that the next step is to have those idea meetings, make sure the meetings are about new ideas and solving problems, but then actually make sure that you do something after the meetings to move in the direction that you’ve been talking about.
NILOFER MERCHANT: Exactly. And we know how to do that. The funny part is … Bob Sutton has that beautiful knowing, doing gap work that he’s talked about. And this is not necessarily about that. This is us saying, “We’re going to try a new norm. We’re going to actually look at the behavioral ways in which we’re entrenched and change those things.” And if we can just see, “Oh gosh, we have this pattern of behavior where we mostly talk at each other” because we think the underlying norm is about confidence and we have to elicit more confidence, more talking than, okay, we’re going to focus instead on competence and measure ourselves by whether or not we’re actually solving real problems.
And these are all intangibles and right now we’re mostly measuring tangibles. We’re measuring efficiency, speed, output, but we’re not measuring creativity, curiosity, ingenuity, collaboration, and all the things that Amy Edmondson’s works points to, which is about how do we create safety and teams so we can do new ideas? Those are all emergent qualities. So as leaders, we need to step into that place of, I can create the structures, which is actually almost like building an architecture of a building. I can create the social structures that will allow us to do the work that we need to do.
ALISON BEARD: Well, Nilofer, thank you so much. It’s been such a pleasure talking to you. I really appreciate it. And the book is terrific.
NILOFER MERCHANT: Thank you.
ALISON BEARD: That’s Nilofer Merchant, author of the book, Our Best Work: Breaking Free from the Invisible Norms That Limit Us.
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Thanks to our team, senior producer Mary Dooe, audio product manager, Ian Fox, and senior production specialist, Rob Eckhardt. And thanks to you for listening to the HBR IdeaCast. We’ll be back with a new episode on Tuesday. I’m Alison Beard.
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