There’s an old adage about never meeting your idols. A stark warning that their public persona, or erudite Twitter musings, might not gel with their private reality. That you may actually find your idol is actually just another human being or, worse, has “feet of clay”.
Let me end the suspense right now.
Tom Peters is 100% the same in person as he is in any other medium.
Completely unambiguous and wonderfully loquacious. Frustrated and yet optimistic. Twinkle-in-the-eye amusing and cut-to-the-quick scathing. A die-hard quant and a humanistic empath. Perhaps best known for his landmark book “In Search of Excellence”, the first of many focused on “Excellence” a concept Tom contends is the single most critical requirement of any leader in these current turbulent times. Tom’s been called “The Red Bull of Management Thinking” which is wonderfully apt. He’s absolutely an acquired taste but, let me tell you, the jolt of energy from spending time with him is undeniable.
I had a rare opportunity to chat with Tom recently about his latest book “Excellence Now. Extreme Humanism” and his oldest frustration – business’ fixation with the figures rather a focus on the humans.
And, amidst the one-liners and stories (he has hundreds of both), Tom explained why 37 seconds might just be the most impactful time any leader spends with their people today.
HB: Tom, Excellence is a word you’ve been championing since 1982 when “In Search of Excellence” was first published. On a scale of 1-10 how “Excellent” do you think the current business environment is?
TP: <Laughs> Today? By my reckoning, the average Fortune 500 company, a three out of ten. The average member of the SMB world, a seven.
HB: Almost 30 years ago “In Search of Excellence” was published and, in many ways, your narrative, your crusade even, hasn’t changed. Aren’t you frustrated that you still need to be admonishing business leaders about fundamentals like humanity in business?
TP: Two-word answer. Of course. In the new book I make that incredibly clear. You know, I’ve written 19 books, but the dirty little secret is they all say exactly the same thing. And that's actually a pretty honest statement, so you're right, it is frustrating. It's incredibly frustrating in terms of the overall situation, but there are two perhaps mitigating factors.
One is that given what I believe about change in general, if Tony Robbins walks into an audience of a thousand people, his expectation is to change a thousand lives. If I walk into an audience of a thousand people and four people walk out of the room, determined to do something significantly different, that's a good day's work.
The second thing is that we act as if the world of business is entirely comprised of the Fortune 500 and the FTSE100. And, by “we”, I mean those folks that someone in the business media anointed as “management gurus” or whatever. The reality in the U S is that only 7% of us work for the Fortune 500. That means, based on my deep mathematical skills, 93% of us don't. 93% work for Small-Medium-Businesses. I don’t know the UK or Canadian numbers, but I have to imagine they must be similar.
And, truth is, it’s those SMB’s that are the real change makers. It’s actually the thousands upon thousands of British Canadian, American, French, Swedish, Norwegian, Japanese middle-sized companies that are doing exactly the sorts of things that I'm talking about.
So, sure I am frustrated as hell, but that’s also why those SMB organizations have been my focus and passion rather than the Fortune 500 that we seem to idolize.
HB: I’m glad you used that word, Tom. Idolize. Do you think that half the problem is we idolize the “wrong” business leaders? Jeff Bezos, Elon Musk etc. The “Innovators” and the “Disruptors”
TP: Your question requires a much deeper answer, but the flippant one is that Fortune magazine covers the companies that buy their ads. Simple. Sure, that's a little cynical, but it's also a whole lot of true. Your bigger point is exactly right though. You and I were chatting about your own Enron experiences earlier Hilton and there’s a great example. We lionized Jeff Skilling, the CEO at Enron, we lionized the Jesus out of Jack Welsh conveniently forgetting that Welch's first nickname was “Neutron Jack”. And the “Neutron” part was because, when Jack left a building, the building is still standing, but all the people are gone.
One thing we have not said, which is all the things that you and I are discussing that are not good in business and in society, are literally accelerating at the speed of light with the saturation of social media.
100% that's all Mark Zuckerberg who, as I’ve said frequently, is not one of my most favorites of the 7 billion people on earth. Basically, he’s built a business run on clicks and a recognition that when you create division, you get more clicks. I was reading a paper recently where, apparently one of Facebook’s senior developers said to Zuckerberg that creating this divisiveness was good for clicks but not good for humanity and Zuckerberg blew him off. If your business is all about the clicks, and you don’t care about the consequences, why would you change?
I’m quite active on Twitter as you know (that’s a classic Tom understatement. His 170K Followers are treated to a daily rapid-fire barrage of opinion, debate and admonishments) and there was this exchange a year ago where somebody said Elon Musk is one of the two greatest people in the world. In my response I said, and I think this gets to the heart of your initial question, I admire some of the things that Mr Musk stands for. And I respect him almost, but not quite as much, as I respect a second-grade teacher, a talented, committed second grade teacher who changes the life of 20 kids a year for 25 years. That's greatness, as far as I'm concerned. Those are the people we should be lionizing.
I’ve said this for years, and it relates to my first book “In Search of Excellence”, but I couldn't give two shakes about the letters that I got from Fortune 500 CEOs. But I have kept to this day, 40 years later in a box, the ones I got from school principals and fire chiefs and the one I got the number two guy in the Episcopal diocese of New York city, those are the ones I treasure the most.
HB: What? Let’s back up a little. The number two guy in the New York Episcopalian church?
TP: Sure. <Laughs> He’s a priest and has became a very close friend. We became friends because he sent me a copy of his dissertation from Notre Dame, where he had used “In Search of Excellence” as part of his religious dissertation. The thing is that book, and the other 19 I’ve written, is really about one simple objective - focusing on developing our fellow human beings. What the hell is religion, any religion for that matter, about if it’s not that? That was our connection and it’s grown into a great friendship.
HB: We’re having such a great chat here, Tom. At the risk of blowing up your blood pressure, we’re back at another topic that I know perplexes me and pisses you off. This bizarre notion that focusing on people is the “soft stuff” and it shouldn’t get the same attention as the “hard stuff”, the numbers etc.
TP: <Pauses> I'm not thinking about how I answer that question. I’m thinking about how much of my sailor's language I want to use. (Tom served 4 years in the US Navy during Vietnam) In my latest book I talk about my four quantitative degrees from engineering to business. I'm well educated. But if you want to be able to understand the concepts in my books, you have to present me with a signed graduation certificate from the fourth grade, which in the U S means you’re aged nine. That’s it you have to be nine years old. Why? Because all the stuff we learn at nine is the stuff we seem to forget when we go into business.
You said it yourself. You know the basic stuff, take care of people, be a good person, behave decently and all kinds of incredible magic happens as a result. There's a guy I speak about often, John DiJulius who owns a set of salons, and he's a customer service guru.
He has this brilliant one-liner that I think is about 99.45% accurate.
“Your customers will never be any happier than your employees”
I lead a two-day seminar recently and at the end a participant came up and told me “I haven't learned one thing new in the last 2 days” So at that point I was about to shoot myself. And then he said, it is the best seminar I've ever attended. He said it was, and I loved this term, a blinding flash of the obvious.
All this stuff we know we ought to do, but we forget it when we start looking at spreadsheets or whatever the hell else it is. That's exactly what this is.
A blinding flash of the obvious.
Make products that are cool instead of cheap, take care of people incredibly well, focus on your community and sustainability and be a caring, compassionate and inclusive leader.
That’s it. But here’s what pisses me off. All the things I'm talk about, the people stuff, the design stuff, the soft stuff, that's also the very best way to make money too. And yet that’s not the stuff that gets the focus. Incredible.
HB: Yip. Hard not to shake your head at common sense that’s so uncommonly practiced. There has to be a reason though. Particularly because, as you said it, we know this stuff when we’re nine.
TP: Reasons plural. It’s never as simple as just one thing. Here’s my Top 3 reasons in no particular order. Business schools. Milton Friedman. 90-day analyst calls.
I did an op-ed piece for the Financial Times a few weeks ago. It was reasonably sober because people had told me to calm down. But the unsavory thing that I said was I would be very happy if we closed down every business school in the world. In it I said business schools typically emphasize stuff like marketing, finance and quantitative rules. The “people stuff” and “culture stuff” gets short shrift in virtually all cases. I had this wonderful conversation which really brought it home. The person I was interviewing said, “I went to medical school and I spent somewhere in the neighborhood of 300 hours looking through a microscope. An activity which I have never done once since I got out of medical school. I did not get 30 seconds of how to lead a team. I am now leading an ICU in an intensive care unit at one of the biggest hospitals in the United States of America. And I'm winging it. I have no education for it at all.” There’s the problem.
Then on my scale of evil people, very near the top up there with Mr. Facebook, is Milton Friedman. In 1970, he wrote a famous article in the New York Times which said business has no responsibility other than to make money for shareholders. That thinking lead to a ripple effect of the most terrible kind. If you want a hard number of Friedman’s opinion, in 1970, 50% of corporate profits went to the owners and execs and 50% went to employees and research. By 2015, which is 45 years later, 91% of corporate profits went to stock, buy backs, executive pay, dividends on share, share from shareholders. And 9% went back to the people in the business. I mean, I can’t stress this enough, I want to use my sailor's language words and find a set of terms much stronger than disgusting.
The 90-day analyst call is equally terrible. This is a silly statement and I know it's hyperbolic, but no other factor has contributed as much to American inequality as the 90-day analyst call. I said that’s a stupid statement and a historian would rip me into shreds, but directionally it’s correct. It really is the antithesis of everything I talk about, which is thinking for the long-term, investing for the long-term, considering humanity and the morality of our businesses. It is strictly a financial line in the sand that drives so many short-term behaviors as defies logic.
HB: Put that way Tom, hard to argue those. If those are the forces that are holding organizations back from the “Extreme Humanity” you talk about in your book, what are the counterforces that businesses and leaders should be practicing and lead with then?
TP: There’s several. Some I learned early in my career and some that have come to life more recently.
Here’s one that, as a quant and data guy, really gets me because there’s a ton of research behind it. 37 seconds. That’s the time of direct continuous eye to eye contact that a doctor should aim for when delivering news to a patient. 37 seconds. 37 seconds of human-to-human contact, of human empathy, of concern. When that happens, and this has been proven, the patient heals faster, hospital visits are shorter, the likelihood of complications goes down significantly. Healthcare, particularly here in the USA, isn’t set up to do that. Back to that school chat earlier. This isn’t how our doctors are trained. They’re trained to pay more attention to charts, checklists and X-rays not the patient, the human being, right in front of them. That’s insane.
Another I learned early when we were researching “In Search” and we had the opportunity to visit HP out in Palo Alto. They were much smaller then, but they practiced this thing called MBWA – Management By Walking Around – which I’ve preached about ever since. Getting out of the corner office, go mingle and connect with the people in your business, the front desk, the folks building your products, meeting your customers. And the size of your company at makes zero difference. If I'm doing MBWA, as the president who is chatting with the 27 year old engineers in the engineering space in Mountain View or wherever, I don't think I'm going to be as distant from the ones who are in Germany or Singapore because of hanging out with real people, appreciating their problems, appreciating the stupid things that our finance people just did that make their life more difficult.
Again, real real simple human connection stuff but how many leaders do you think practice it today?
Not nearly enough I’d say.
My final one, and this came to me recently from New York Times columnist David Brooks who wrote a wonderful piece, and did a TED Talk too I think, about virtues. In it he contrasted what he called resume virtues and eulogy virtues. The resume virtues are what school did I go to? What was my grade point average? Where did I go to work? How many times did I get promoted? And eulogy virtues, of course are, what do they say about you at your funeral?
I have this slide that I use in my old PowerPoint days of being on the road; it’s a tombstone and on the tombstone is Joe Smith, 14 million, $732,611 and 14 cents net worth on the day that he died when the market closed. And my comment is nobody ever had their net worth on a tombstone. What people ask – and that’s been the undercurrent of our chat today and what I see in the world around us with COVID – is how did Hilton or Tom take care of people? How did they help others? What did they do to improve the lives of those they loved and those around them?
I challenge every person who attends my talks or seminars to ask themselves one simple question every day – “how are your eulogy virtues today?”
Again, 20 books and thirty years talking, travelling, speaking and raging about this stuff, but it’s the stuff we all know at 9 years old.
HB: Just brilliant Tom. Resume virtues versus eulogy virtues. Thank you. I have to end with a brief personal story about this interview. When I told my family, I was talking to a famous author, my daughter asked if they were more famous than Stephen King. My wife jumped in and said, absolutely he’s as famous as Stephen King. It’s all about frames of reference mate. So, thank you for your time and your trademark candour. It’s been a real privilege.
TP: <Laughs> Wow, Stephen King. He’s a damn good writer, even if he does write all those horror books, and, from what I’ve seen, he’s also a damn good person who cares a lot about the same things you and I have been discussing. I’ll take that.
Find out more about “Excellence Now: Extreme Humanism” including where to buy your copy, here.
