the whole world of ideas. A gentleman in Greece named Aristotle talked about this in the 4th century BC saying that in order to get to new ideas, you had to have conversations. My name is Katrina. And I'm Steve. And we are curious about how changing conversations can change organizations. Yeah, and together with our community of transformation nerds, we're exploring how to leverage conversations to make our workplaces more fit for humans, but also more fit for the future. We'll use our podcast series to do just that, while being in conversation with business and thought leaders who have interesting perspectives on the topic. So, without further ado, let's start the conversation. Professor Roger Martin is a writer, strategy advisor, and in 2017 was named the number one management thinker in the world. He is also former dean and institute director of the Martin Prosperity Institute at the Rotman School of Management and the University of Toronto in Canada. He's written a number of books. His newest book is Where More Is Not Better? Overcoming America's Obsession with Economic Efficiency. And his previous 11 books, I'm not going to list them all, but the one that's inspired you the most, I think, is Playing to Win, which came out in 2014. He's written 28 Harvard Business Review articles. Huge welcome to you, Roger. Oh, thanks. Today's podcast episode will have a specific edge also compared to some of the others that we are putting out. And this one has more of an edge of strategy and strategy execution and the intersection of that with conversations. So what we'd really like to do here is get concrete on maybe a specific case where we can explore the conversations that happened before and then the intervention and then how the conversation is going to be. And how the conversation has resulted on the other side. And before zooming out and just kind of discussing this more generally. How does that sound for you? Works for me. I'm okay. Super. Okay, we've just done a big intro with many things that you've done. But what else should we know about you as we go into this conversation? Well, I guess I've sort of dedicated a career because I like it to helping people drop and cease using models for their behavior, what they're doing that don't get them the results that they want and pick up models that do. Because what I've noticed is that often when people fall in love with a model. Here's how to do this thing. When it doesn't work for them, they often do more of it harder. And I often say, well, why don't you ask the question? Was that a bad model in the first place? Oh, I love that. Do you? I love that. Yeah. Yeah. Just zooming out and trying to see something differently. So that you can do something differently. Yes. Our starting point, I think should be here, because I think you've mentioned this thought, maybe three, four or more times to me about having read this book several times and seen something new. So playing to win and your experience. Could you tell us a little bit about that? Oh, yeah. It's one of my, it is my favorite strategy book, no doubt. And I've read it three times. And the first time I read it, I fell in love with the simplicity of the five questions that you have to answer in doing a strategy. And I thought the book was all about that. And then I applied it for some years in different cases. And then I came to realize that the beauty of the book was actually that it, helped me think about strategy as imagining the future. So it was a very creative process of imagining the future. And then I thought the book was all about that. And then I actually reread it only three months ago because I was doing a project. And I realized that really the book is about changing conversations or thinking about strategy. as a conversation. And it's a beautiful case of, in this case, Roger and A.G. Lafley, in my view, identifying a broken conversation that needed to change for them to get to where they wanted to go. And it just changed my view on the book. And I just thought, wow, there's something powerful about conversations in this context. Did you see that from the start, Roger? Are we just catching up with you? Well, I mean, there's a bit of that, which is that the stuff we put in the book on changing the conversation that P&G we put in because we felt was important. But I don't think we emphasized it as much. And so I can well imagine that Stieg would have focused on other things and many other readers focused on other things and only came back to see that. So I think that is more central. That resonates with me because we didn't say upfront strategies about conversations. But it is something that is pretty near and dear to my heart. Though I got to say, as with most kind of new interesting thoughts, it isn't, right? A gentleman in Greece named Aristotle talked about this in the fourth century BC, saying that in order to be a new in order to get to new ideas, you had to have conversations. The book, although they didn't actually write books, then they wrote stuff that got compiled into book is called rhetoric. And which now sort of has a bad meaning. People talk about empty rhetoric as sort of just arguing for the arguing sake, not Aristotle did not see it that way. He saw the conversation between people is what helped kind of bring to the the four. And it was the best idea, the best idea, the best idea, the most compelling argument for creating something that we do not now have. It wasn't this solo kind of expedition where somebody thinks in his or her own head, kind of, whoa, what could we do that's different, that's better than now? He didn't believe that. He believed it was the back and forth where I say to you, Katerino, well, what about this? We could do this. Now here's my argument for why that would be a good idea. And you would come back and say, well, yes, but what about this, Roger? Could we do it this way or not? And then we'd go talk to Stieg and add his voice to it. And in the end, we'd come up with a joint view of what's compelling enough to try, right? Because trying something new, that is not easy for anybody to do. So it has to be compelling enough to be motivated enough to try. And Aristotle felt that that was a product of conversation. It occurred to me, though, that we should probably say the five questions out loud, because there might be somebody listening who doesn't know what those questions are. Would you do the honors, Roger? Sure. So what we say in playing the way, AJ and I say that there are these five questions that have to be answered together and fit and reinforce one another. The first is, what is our winning aspiration? Second is, where are we going to play? Where on the potential playing field will we choose to plop ourselves down? How will we win where we've chosen to play? How will we create a better value equation for the customers than our competitors? Then what capabilities? What capabilities must we have in place must we have in place to win where we've chosen to play to meet our winning aspiration? And finally, what are the enabling management systems that will enable the building and maintenance of those capabilities that will enable us to win where we've chosen to play to meet our winning aspiration? Now, I've been a little bit pedantic in repeating that chain, but I am because they have to fit together and reinforce one another. A strategy could be done by any reasonably smart, reasonably smart 11-year-old. If you could do one box at a time. What makes strategy a little bit harder, although I never want to claim that it's super hard. I've tried to make strategy kind of simplified enough that anybody who works hard at it can do it. But the hard thing is those things have to fit together. And the beautiful thing about it being a question is that that invites for a different conversation. It is an invitation to a real conversation. And I think it's nice that it's beautiful that that's the way it comes out because that invitation does something also to an organization that we are looking at a question that we together need to figure out. Could you, in the case of just leveraging Procter & Gamble, could you say what was the conversation that was broken there that needed to be fixed? You've used one of my favorite terms, this corporate theater thing, which I think is something everybody knows what it is, but it's everywhere nevertheless. But which conversation was broken? Well, it was the conversation between people who headed up the businesses at Procter & Gamble. So they have these hair care, laundry care, home care, baby care, etc. And those presidents are running multi-billion dollar businesses. And once a year, they would come forward to the head office group, the CEO, the CFO, the head of R&D to present their strategy. And it was a day-long session. So you'd say lots and lots of time for conversation, right? You got a whole day. But what would happen is the group, let's just say baby care. So baby care, you know, pampers, diapers, etc. They would come forward, etc. They would come forward and they would have worked for months and months and months, hundreds of person hours, thousands of person hours probably, to put together a slide deck, which they would present for hours on end. And there was even a habit of creating little slide loops, three, four, five loop slides that anticipated any question that might be asked and said, well, funny you should ask. And then you whip out that presentation and go through it. So even though notionally, this was about the business unit president having a conversation with the CEO and whoever the CEO's kind of most senior colleagues responsible for guiding the overall corporation, there was no effective conversation. It was broadcast. It was, it was, it was, it was, it was, it was, it was, it was, it was, and what was supposed to happen in the, in the theater is we do our lines because we practice them. We've gone through the presentation a million times. We practice them. We do our lines. And what was expected back was, was something relatively pro forma, either, oh, isn't that lovely? Or I have this question, ah, funny you should ask, slide loop. That's the question, funny you should ask, slide loop. None of those are really a conversation. Right. It's not a conversation, right? It's not a desire to hear on the part of, in this case, baby care, right? It's a desire to make sure your point of view prevails. So that, that was the problem. The problem was you had a bunch of exceedingly intelligent people at corporate head, uh, head office, including the CEO, uh, who were put in a position of adding zero value. And if they tried to add zero value or more than zero value, right? By saying, well, I like what you've done, but have you ever thought about maybe trying this? The answer would be, yes, we thought about that and we will dismiss it whether, whether or not, whether or not that is, that is true. So, so you spend a day essentially having no added value through a conversation. Uh, and in fact, you could have, you could have just sent them the, sent them the, the deck and, and your, and your, and your talking, talking points. And, and that was that. So we, we just said, well, that's a waste of, uh, a waste of time. And I did a, did a funny, you'll like this, a funny, uh, kind of analysis of it. I interviewed the six or so people who, from, from, from corporate to say, what do you think about the process? Uh, and I viewed, interviewed the dozen or so business unit presidents and say, what do they think about the process? And, uh, the business, the business, uh, unit presidents said, well, we, we kind of hate it because we do all of this work and all they kind of do is ask these nitpicky kind of questions. Uh, and, uh, all we try to do is get in and get out. Uh, but because, you know, proctor people are very dutiful, they were saying, but it seems to be valuable to them. And so we're okay with it. I go talk to the, to the six, uh, the senior people and they say, well, we hate it. They, you know, they come in and they know they don't want us to say anything other than, oh, isn't that lovely. Uh, and so there's no real useful, uh, interaction, but they seem to get a whole lot out of having done the work and, and, and preparing for it. So, so we're okay. Cause it makes them feel good. So it was. What about, what, what, what did you then, uh, what was the conversation you then installed? What was, what was the design of, of, of, of a conversation that, that they needed? Well, what, what, what, what we did is, is we, we said, Hey, you know, do your, do your slide deck, uh, but send it to us a week in advance of the meeting. Um, we, AG with, with, uh, with my, uh, us working on together would issue them three to five. And it was usually three kind of interesting questions that we thought were worth, were worth discussing in the meeting. Uh, and that's what the meeting was going to be about. They should assume that we'd have absorbed their, their, uh, slide deck. And we wanted to talk about those, those three questions. And we forbade them from coming into the meeting with more than three new pages of material total. Uh, now in the first year we did it, they came with like lots and lots of material trying to definitively answer the questions, right? To make sure there wasn't a conversation. They had a definitive answer to the questions. And we had to insist, no, sorry, this is going to be a conversation. And they mainly insisted in the first year. Can't we just do a quick run through of our presentation, the, the presentation? And we said, no, we've, we've read it all. We've read it already. We're, you know, we're, you know, reasonably smart enough to read your stuff. And, you know, if your stuff is thorough, we'll read it and it's, and it's, and it's clear. And so we had to fight back this tendency to keep with the, with the theater, but we made it a day of intense conversation about these questions. And it was, you know, it was, you know, the smartest strategist in Brocter & Gamble, AG Lafley having, kind of saying, gee, I'd, I'd like to think about, think about this with you smart person on, on, on diapers. So, so, so, so what does it take for a leader to hold space for that conversation? Because I've seen similar conversations where they very easily with good intentions turn into a little bit of a policing exercise. So, so what are the capabilities and the mindset of leaders to hold space for that conversation? Well, the, the, the main thing is, is, I don't know if mindset is exactly the right word, Steve, you can, I'll explain what I mean and then you can tell me what, how, what you would describe it as. But it's harder for some, one kind of leader than, than the other. So I, I generally see in this respect, two kinds of leaders. There are set piece leaders and a set piece leader, you would know because they want everything to be, like a Shakespearean play, right? Which is, everybody knows their lines in advance. They all give their lines. And at the end, you have, you have a result that was predetermined. It's not unlike international diplomacy, right? When, when, when the president of the U.S. meets the president of China, and then they have a, like, last press conference, it's not as though, voila, look what we came up with during this. All the diplomats worked on everything in the background and the final communique is written before the plane ever after, ever left the U.S. for China or vice versa. There are CEOs who love life to be that way. Um, they typically find this, uh, one, uh, scary, two, kind of impossible, and three, having no merits whatsoever. The other kind of CEO is the read and react, uh, CEO who, who just want to get in, get into something, hear what's going on, uh, and, and then read what's going on. And, and react accordingly, take the conversation wherever it goes. They have no preconceived idea of where it will end up at the start of the conversation. AG is, got zero genes of, of, of, of set piece, uh, and is 100% uh, read and react. So this was perfect for his, his personality. I guess mindset too, but it's sort of, you see what I mean? You get sort of, partly mindset, but partially just sort of inherent, uh, personality. Now I try to encourage set piece CEOs to give read and react a try because there are, there are just unfortunately terrible consequences of set piece CEOs, right? Everybody's on edge all the time. Am I saying my lines right? Oh, I forgot my lines. I mean, uh, you know, it's, everything is stilted. You do not have any conversations. There, there, like, there are no conversations when you go to see a, Hamlet, right? People can't freelance and come up with something in the middle. There are the lines and you say the lines and you fall and you die or you, you kill someone or, or, uh, uh, or, or, or the like. Um, so it's more that, Steve, it's, it's convincing, convincing, uh, CEO of the great benefits of, as you, you use the term yourself, leaving space for conversation, as opposed to taking up all the space with something that set piece. We talked about this in, in, in, in, in another conversation, this thing about making friends with the unknown. Oh, that's good. I like that. So, so this thing about, can you actually be in a conversation where you enter it and you can be okay with the fact that I don't have the answer and, and, and, and, uh, many leaders, myself included, uh, fall into the trap. Sometimes of thinking that I should have the answer to everything. Therefore, I'm too fast at labeling things. I'm too fast at my, in my thinking and, and, and, and, and my choice making. Whereas, so, so does it resonate with, make friends with the unknown? What do you think when I say that? No, no, I like that. I, I, it, I like it a lot. It's very, it's very evocative. Um, and, and I, and I do think, um, that for me, the, for me, the key is being, being exhilarated by that possibility. Uh, right. It's just being curious. You know, if, if we open that door that everybody says, do not, do not open that door. Do, do not open that door. It's never been opened. Uh, and Lord knows what will happen. Uh, life as we know it on the planet may end if you open that door instead of saying, Hey man, if we open that door, we might find something kind of like really cool behind there. It makes me think about something. Yes. This thing about, uh, we have this saying where we say, we shape our conversations and then they end up shaping us. Yes. The same goes for organizations, by the way, that they are shaped by the conversations they have, but also by the conversations they won't have. Yes. So, so, so in most organizations I can think of, there are certain conversations that they simply won't have. Yes. What do you think about? Oh, no, I, I think, I think so. And I, and I, and I believe, uh, uh, somebody can fact check me on this. I believe that was first said about architecture. We shape our buildings. Yes. And then their buildings shape us. Uh, they, they make us more formal or they make us more informal, collaborative. Um, so I, I, I like your application to, no, I like your application to, to, uh, to conversations. I, I think to be practical, uh, what I try to do is, is to get leaders to be willing to have, conversations in spaces that aren't that far from home, right? To see, to see the joy in it and then point out the exciting things that we found, uh, on that journey. Um, I also try to model the behavior myself, right? Which is, which is to, to simply refuse to come, uh, to a, a client meeting with a, a firm view of where I need this, meeting to have, have gotten to so that I can at least, uh, kind of illustrate it. As you know, I used to, I used to be, uh, monitor company in the, in the olden days. And, and I did an odd, an odd thing with, with, uh, my case teams, which sort of freaked them out, but it was what it was. Cause I came to the conclusion that it stilts a conversation with the client when you get too many logical steps ahead of them. Right. So, so any kind of work on any project is, uh, a long, long set of logical steps where you start with sort of a, uh, what do we do here and build a way of thinking about it, add data. It's many logical steps that finally get you to say, you know, I think we should do, uh, X. And typically consultants, you know, get that problem. They do maybe interact with clients some, but then kind of are inclined to go away. They like being in their, in their own office, talking among them. And in that process of talking, they go many logical steps. So let's just say it's 20 logical steps to get to the answer. They go eight. Then they go to the client and present the, the conclusions they're at. And the client is like, well, I don't know about that. I don't know. Well, it's because they didn't go through those eight logical steps. Now consultants, many of whom are too arrogant for their own, uh, good sort of say, well, it's because they're not as smart as we are. Uh, right. But no, they, they just didn't have a chance to go through the eight steps. They could have gone through the eight steps and, and, and, and been right there beside you ready to go figure out what's nine and 10 and the like. Because of this, I banned thinking away from the client. Right. I said, I, you are banned from thinking about the project when you're not with the client. None, no, no meetings are allowed, uh, back at the, back at the office. I don't even want thinking. I don't want slide writing. I don't want memo writing. That's all away from the client. We must do it with the client. And that sort of freaked, freaked them out because they're like, but then we won't be ahead of the client. Right. And so then they'll think we're stupid. And of course, this is a model. We were talking about models earlier. The model is unless we're ahead of the client, they will think less of us. You're enforcing a real conversation. Yeah. Yeah. And instead they think so much more of you. They say, gosh, this is great. I like you. You guys are really smart. What I love about this example as well is that you brought in quite, quite a simple rule, quite an easy to understand rule that then, uh, shapes what is to follow. Um, how long did it take? Cause you, you said in the first year they tried to slip in more slides. So how long did it take? And, and what were some of the tricky parts? Sure. Two years. I would say, I would say we did this for 2001 cycle. And I would say it wasn't until 2003 that people were, it sort of calmed down. They, they, they worried that there would be some kind of a gotcha, right? Because there was more gotchas before when you were coming in seemingly perfect, right? Uh, if something was wrong, then the senior people would, would be, would be inclined to say, listen, like, I just don't agree with you. So it was gotcha. Um, so they were still worried about gotcha. Uh, they were still worried that they would be perceived as not having things buttoned up. And unless you had things buttoned up, you wouldn't be, you know, kind of promotable to the net, to the next level. So I would say it took, it took about, uh, about two years. But the interesting thing to me is how sticky it's been. So when they got over that hump, they just liked it a whole lot more. Uh, and it's continued to this, to this day. So when you sort of free people up from having to engage in something that is sort of more unnatural than natural, I think it's then hard to go back to, uh, to set piece. Um, but it took a while. So you've been working deeply with integrative thinking and the whole idea about prototyping. So did you, did you need to install new capabilities for all these leaders to be able to, work in a new way and, and, and, and own a new language for how to engage? That's a, I mean, there's sort of a yes and no to that, to, to that. So, so, um, a key was AG, who is, is sort of big time brilliant on a, on a bunch of dimensions. Um, and, and he and I had talked a lot before doing this about the concept of integrative thinking. Though I wouldn't say he, I ever like taught him that we just, we just sort of hung, hung, hung out, uh, uh, together. Um, I think it's, it's improved, uh, by sort of, uh, uh, adoption of, of integrative thinking as, as if you will, a mindset, right? Which is, and, and the very, very core that I say of integrative thinking is, is simply, uh, being able to say to yourself when somebody disagrees fundamentally with your point of view, to have the first thing that comes to your mind is, interesting? What must they be seeing that I don't see? As opposed to, uh-oh, uh-oh, we got a disagreement here. We got a problem, right? If instead it's, it's intrigue, uh, then you're away to the races. Like everything after intrigue comes more naturally than not. The challenge is getting to intrigue. Like, hmm. Hmm. Because the, the, the true integrative thinker at his or her best is saying, okay, person has had different life experiences that have gathered different data that I've never seen that he or she has seen, or that person has a different thinking process. We may have similar data, but that person has processed the data in a different way to come up with a different solution. I have to have that, or I'm, or my answer is going to suck. And by the way, he or she should have what's in mind because mine is obviously different than, than his or hers because, because we've come to a different, uh, different point of view. So let's figure out how to get both of those, uh, out. If you have that as your, your goal, what I say that is that's mining difference, right? It's viewing it like a gold mine. It's like difference is a gold mine. And what you want to do is mine it for everything it's got, as opposed to difference. difference is a problem. It's just flat out a problem. We got to, we got to get rid of this difference by me crushing it. Yeah. Yeah. If you can somehow define your strategy process as a series of conversations and then you, you, you design those conversations and you create a space for real conversation. that's when you can create something magical. Yeah. If it gets a little bit rigid and, and, and, you know, these faces and so forth, sometimes you lose it a little bit to the format and you end up thinking that strategy is that as a slide deck. Yeah. Yep. Yep. Strategy masquerading as a slide deck. There is a lot of that that goes on in the world. Yes. Thank you, Roger. Thanks for having me. I always love doing stuff with implement. What are we going to take away from this conversation? Steve? Oh, there, there, I think there was a lot. Thanks to you, Roger. Um, for me, the big one is that reminding oneself that strategy is a creative process of imagining the future. And my own experience is that very rarely strategy processes feels like that. Uh, so that's a big reminder. And then also this asking myself how, how, how, how curious am I to outliers? Am I to outliers? And to why are people reasoning differently than I am? Am I really curious? I think a lot of us are losing our curiousness, uh, over time. Uh, we know so much, right? Uh, so this was a good reminder. Thank you, Roger. Yeah. And I think what I'll be taking away is he, he talked about this example where everybody thought the conversation sucked, but they thought that the other people didn't think it sucked. And I think that's a good reminder. that's just a really great invitation that if you think a conversation sucks, challenge it. So I'll be taking that with me. And, uh, thank you very much for today. And thanks for listening, everyone. Thank you.