Dr Dani: [00:00:00] Hey Peter. 

Designer Peter: Hi Dani. 

Dr Dani: How are you? 

Designer Peter: I'm fantastic, thanks. How are you? 

Dr Dani: I am great. What are we talking about today? 

Designer Peter: Today, Dani? I'm excited about this one as ever, but just a little bit more excited than usual. Today we are gonna talk about performance without buzzwords, doing what matters better. 

Dr Dani: I already know why you're excited about this.

'cause you have this ongoing struggle between productivity and performance is your favorite word. 

Designer Peter: Yeah. I much prefer performance than productivity, but there's another reason I think we're both excited. Dani, you know what? Tell the listeners why 

Dr Dani: I know we have a very awesome guest with us today.

And Craig, welcome to the Design Thinker podcast. 

Guest Craig: Lovely to be here, Dani, and thank you, Peter. Thank you for the opportunity. 

Dr Dani: Do you wanna tell our audience just a little bit about yourself? 

Guest Craig: Sure. My name's Craig Steel. I'm the principal and founder of a [00:01:00] company called Vantaset, which is essentially a specialist performance transformation company.

So we, we help organizations enhance the performance of their business or their workforce course. Awesome. 

Dr Dani: If we're gonna talk about performance, Craig is the guy to do it with. Really excited to have you on the podcast today, Craig. 

Guest Craig: Thank you, Dani.

Yeah. 

Designer Peter: Our podcast structure that we've got, Craig is, as I'm sure we talk about what to begin with and we might delve into some definitions. That's my favorite thing to do. Give us a bit of a foundation and anchors to, to build on. Then we move through to. Why is this important?

The and then finish off with how we might actually do some of this. So bringing us back to, performance without buzzwords and doing what matters better I'll maybe I. Help us out by breaking that down into, first of all what is performance like from your point of view?

What is performance? That's a big deep question, isn't it? Yeah. 

Guest Craig: [00:02:00] Yeah. It is, and you get straight away into two things. So first of all, it's around, the contribution or the extent of a contribution of a person or multiplied by people. And then of course there's the outcome of that.

So what benefit or difference that makes to an organization. So typically in a, in an organizational setting, we'll think about performance as the outcomes. So what an organization is actually producing the value that it gets from that effort. But if we zero that back down into, say, the workforce, then it's really about the extent of a person's contribution and what difference they're making to the business.

So I, I think those things are always in balance. It's just where the narrative comes from. So if it's coming from, say, an internal perspective around the workforce, it's who are our people? What difference are they making? What is the value they're producing? If you're looking at it from, say, a market perspective, it's much more around how is that company doing?

Is it profitable? What's its return on, say, investment or asset? [00:03:00] And equally around the sheer value of that business. So that the ultimate outcome being, is it actually adding greater value to the shareholder who owns that business?

Dr Dani: So as you're describing that, what's coming up for me is it feels like we can look at performance from multiple different levels, right? So one level is as an individual in an organization, how am I contributing? Then from an organizational level, how is our workforce performing? And then at a market level, how are we performing in the market?

Guest Craig: Yeah. E exactly. And I think it's important that it's dissected that way. Otherwise it, it becomes one of those things where you can be chasing numbers but not necessarily creating any improvements. So sometimes it's, I find it helpful to almost work back. And that is from the high level, say from a private perspective or a private shareholder perspective, is how is their asset doing?

Is it delivering value, a good return on their investment? Because if it's [00:04:00] not the market's at risk, right? That organization is at risk. So I think for every shareholder, what they're wanting to do is to make sure that whatever they're investing in is delivering a really good return. And there are good long term prospects to encourage them to want to continue to invest.

As you get closer into the organization, say, putting yourselves in the position of a ce, then of course what they're wanting to do is to maximize the value of their existing assets. So both people plant whatever it is that they're able to leverage the opportunity that makes. Or offers I should say, and therefore be able to provide a really good return on that effort.

So it's not just about the investment, it's actually on the effort. And of course, if you then go narrower or delve dive down slightly deeper, then you start getting into teams. So what is the the impact or the extent of contribution from a particular team? And are they really clear about what success looks like?

Because that's critical for the team to be able to understand, the [00:05:00] context what they're trying to deliver, the reason why they exist within the organization. Going one step further, of course, comes down to the individual. So any individual within an organization, by and large, wants to add value, not just to retain employment but because they typically want to be relevant to an organization.

So if we can create the dots or join those connections right the way through, then we've got the possibility of being able to build a successful enterprise. And that of course goes right across into the public sector where, we have public services that are critical to the country and we want the same thing.

We want great outcomes for the market or for New Zealand. We want leaders to be able to utilize those who are in there and the assets that they've got to be able to deliver those great outcomes. But you also want people to really love what they do and be feel like they're making a difference in their work.

So from our perspective as performance specialists, we tend to start with the end in mind of what does success look like for the organization? What does that [00:06:00] then require for the organization? And then what must your people become to achieve it? So we get a really clear line of sight, right?

Dr Dani: Something that I find that people usually mix up is the difference between performance and productivity.

Guest Craig: The interesting things Dani the number of organizations that we've had the privilege of working with going into deeper discussions where it's almost one of those things where you can say, look, do you want to ensure that your people deliver what the shareholder's asking for?

Do you want them to do what they are going to be remunerated on? Or do you want them to do what the company needs to be successful? Because more often than not, those three are completely disconnected. So even though you assume they're the same invariably than not, and that's one of the reasons why I think there's so much tension in business because everyone almost instinctively knows that what they're doing isn't necessarily going to be the answer.

They're told to keep their head down, you can just do the job that they're paid to do, rather than doing what the [00:07:00] company really needs. So when we think about it from our perspective, the idea around performance there is a translation into productivity because we want people to be more productive.

But what we're really trying to say is to be more effective and impactful. So how can we ensure that our customer base or the the stakeholder is getting really good value from that investment and effort. And so for staff, even if you look at it from their side, that's what they desperately want. We so often hear people talking about employees today don't really do this, and they don't dig deep.

We don't find that, in actual fact, what we find is most people want to give it their all for an organization that they believe in, but they want to know that their work is making a difference. The worst thing for them is turning up and doing a job that they think the organization sees as being irrelevant.

But because of the way we typically manage efforts, then that's often where it defaults to. 

Dr Dani: I think a lot of what you're saying [00:08:00] resonates just from even my experience in organizations, Craig. 'cause as humans we have a deep fundamental need to be useful. Like it's 

Guest Craig: Absolutely.

If we don't have 

Dr Dani: that purpose, it literally means we won't get out of bed like we need this. 

Guest Craig: Yeah, totally. 

Dr Dani: I've also observed if you observe a, an employee that starts in an organization they show up with passion and excitement and enthusiasm, and then you talk to that same person nine months, a year, 18 months, two years later, and you can almost see that's just tapered down.

Guest Craig: Yeah, absolutely. And it's it's not uncommon. And that's the tragedy. And we see it all the time where companies go out of their way to try and find the most suitable people. Look what we would often say, the best people that we can. So we bring them into the organization and that kind of promise, that initial engagement gives people this much greater sense of self.

They look at it and they think, maybe this time it's gonna be different, so maybe this time I'm [00:09:00] gonna be able to make a difference and be really relevant and everyone's gonna love it. But usually what they find is as they become more entrenched in the organization, they just become part of the machine.

The organization no longer sees them as this really unique special person that they're brought in to make the company better. The company gets to a point where it's just about managing the resource and it destroys people. And that's the tragedy, right? So it doesn't work for the organization, but it's so demoralizing for staff.

And when you've got managers in the middle who can see it all playing out, but feeling like they haven't got the lever to make it different it, it just becomes even more problematic. I completely agree, Dani. I think every employee wants to know that their life is relevant to the community that they're serving.

They want to give it their all, but all they really want is to be enabled to be successful, right. To have an impact. So that's why I think when you start to really unpick this performance and productivity thing, we need to be clear around what success looks like. It's not just how many widgets you can produce.

[00:10:00] It's what's the outcome of that effort. So if staff don't really understand that and the organization hasn't got a mechanism to bring that to life, then eventually it just defaults into it. Just producing widgets and widgets of course, in a manufacturing thing is really vital. So I'm not trying to undermine that, but in a service business financial services or whatever it might be the widget just becomes doing the job rather than seeing the impact and the difference that you are making in your job.

Dr Dani: I also see that playing out lots in organizations where it's almost like busyness is rewarded versus actually delivering something that's gonna have an impact. We reward busyness, but not impact. 

Guest Craig: Totally. Yeah. Yeah. We see it all the time, and again, I think it's really a consequence of a lack of clarity.

So part of it is, managers are under a huge amount of pressure to ensure their people are productive. And that's, look, [00:11:00] that's demanding things like the return to work, right? We feel like we have to see our people. We have to know they're doing the things that we need them to do. 'cause there's no other way of being able to really judge whether they're being impactful.

But for staff, it, it's just this almost counterintuitive thing because they don't want to be seen to have time on their hands. But in actual fact, you want staff to really think about the outcomes they need to deliver. So how can we ensure that people have the context to understand exactly what that is so that they can use the time they have to deliver those outcomes.

Because like you say, Dani being busy is not automatically going to translate into good performance front. Think it could be the absolute opposite. Yeah. More. 

Dr Dani: Yeah. Sorry. You 

Guest Craig: completely 

Designer Peter: agree. 

Dr Dani: Peter's nodding away. Oh, yeah. And smiling over there. 

Designer Peter: Absolutely furiously nodding away for to both in for, from good and a bad point of view.

You're describing a situation I've been in a few times in organizations and roles where the beginning, [00:12:00] it seems like the promised land and i'm being hired to make an impact. And then as time goes on, as Dani and I would call it you get stuck in the sludge. Yeah.

You become assimilated into the organization and yeah. It yeah. Almost institutionalized. Yeah. Yeah. Yeah. And have to, it's a different kind of battle, which is why I really enjoy, these sort of conversations about this subject and talking to somebody who has expertise and helping organizations do the opposite, wake up and see what's happening and, yeah. Starting to fix itself. You mentioned clarity there Craig without getting too much into the how just yet, but yeah, it's a, what you're describing, you said is a function of an absence of clarity.

Guest Craig: I think so Peter, the problem that we see is that if you look at an organization, say the executive or the directors or whoever it might be, depending 

Dr Dani: on 

Guest Craig: the nature of the organization, they spend their lives typically looking at the intent of the organization. 

So [00:13:00] whether that's on behalf of shareholders or on behalf of the government or whoever, it's so they spend their time delving into that, and by and large, what we find is that most of them do a really good job most of the time.

Sometimes there can be differing views, there can be differing points of context or information that feeds into it. So you can put the right ladder up against the wrong wall. But it doesn't happen a lot. Typically capable people who understand the sector, the industry, they wouldn't be involved if they didn't.

But the difficulty for them is how do you translate that to staff? The way through the organization. And often what happens is because people think, look, if we get the balanced scorecard people don't need to know. 

Designer Peter: So 

Guest Craig: they don't need to know that level of clarity. Maybe our senior managers do, but the others don't.

All they need to know is the piece of the plant that they're running or the job that they're doing, and as long as people are kept productive then we're obviously going to be able to leverage the capability to get outcomes, but it just doesn't [00:14:00] work. At the end of the day, what we want people to do is not just understand what their job is.

Understand the outcomes that they need to deliver to enable the company to deliver on its vision. And if we don't get that all we end up doing is defaulting to a management practice, which is about just trying to keep people productive. So that's where things start to go wrong. So when we talk about clarity, what we are saying is every person needs to have an ownership stake in the vision or the aspiration.

That doesn't mean to say that they're going to be invited to contribute to the formation of it. We're not talking about that. It's not about a democracy. But what we need to be really clear about is if people don't understand the intent, we cannot expect them. To be able to really engage. And the reason for that is because they won't have the context to do that.

So often we look at the behavior of people and we think that's an indicator as to who they are. Rather than saying, actually people's behaviors are more often than not a consequence of a lack of strategic clarity. So what we end [00:15:00] up doing is policing the behavior rather than looking at the mechanism that's causing it.

So if you've got a really large scale organization, say you've got a couple of thousand people, right? You could have, 99% of those people who are brilliant fits, they might have all of the capability and expertise to fulfill their roles. And I would argue more often than not That's right.

Because HR these days tends to do a really good job and are helping organizations identify talent and secure them. But what happens is when companies bring them into the business, it defaults into the management of the resource. So instead of people being empowered or enabled to deliver on the intent, they become a workforce or a resource that has to be managed.

And it is tragic because for staff, they suddenly feel like they're not trusted. So there is no relevance to the organization, and they feel resentful about that as anyone would. But the organization often looks at their [00:16:00] behavior and thinks why don't these people do it? Why aren't they already engaging?

It's what have you got to engage with? If it's just about the job it's just a transaction. That there is nothing that is really material that's going to give way to something that is much more profound and that the organization is going to be able to leverage. So it's this whole thing where we look at it and we say, look, every company is gonna become the consequence of its people.

At the end of the day, the culture that an organization creates will determine what that business produces. And it will be nothing to do with the technical capability of its people, right? Because that's generally never where the issue is. The issue is with organizations trying to figure out how to engage people on a really deep level.

I don't mean the spiritual level, right? It's not about a cult, but getting people into a mode where they feel like they can make the difference to this business. 

Designer Peter: Yeah. Yeah. 

Guest Craig: Rather than on one of 2000 or whatever it might be. What difference can I make? Yeah. 'cause that's the alternative.

Designer Peter: Yeah. [00:17:00] I love that. And you was gonna enjoy this conversation, Craig. You've got my brain fired up in all sorts of different things.

It sounds like in your experience and from your external point of view and from Dani and i's internal point of view, being in organizations, often senior leaders their performance. You know what you've helped me start to think about is performance and productivity is something that we can think about up and down and across the org, the whole organization.

And they're starting to think about the senior leaders. It sounds again, they're like human beings like everyone else and they're doing their best to perform, given their circumstances. But perhaps there's something about their focus, which means they're, I dunno, maybe being productive because they are, doing tasks that are effective.

And driving the organization towards meeting some, let's say some of those balanced scorecard measures or metrics. But perhaps there's something in the system and in that is not helping them perform the best. And in this situation to see what you're seeing.

Guest Craig: I completely [00:18:00] agree. Because it starts from the very top. 

Designer Peter: Yeah. 

Guest Craig: So for the organization to understand its intent, right? What does success look like? What are we trying to do? What are we trying to deliver? What are we trying to become? What's the market opportunity, right? So getting those things right should then inform the structure of the organization.

So every organization needs to get that strategy absolutely clear so they can figure out how to configure the business because the structure is simply there to enable the organization to utilize its assets to deliver a particular outcome. But what's interesting, of course, when you really look at this is strategies evolve, but structures tend to stay almost true to the original intent.

Now, this is the way we are structured. We might have different people come and go and what have you, but fundamentally the idea of the structure tends to remain. So it remains in place. Different people can come and go, but once you've got that structure then what you can do is you can sit there and say, so what does it mean for [00:19:00] marketing or for operations or for sales, or whichever the function is.

So in other words, what is the purpose of our marketing function in the context of our vision? So what is it that we need them to produce and therefore, what must they become? And so if you get that level of clarity coming through, then what it means, say for the GM or the the director of that function, then they're in a much better position to be able to understand how to mobilize their people.

But if that doesn't happen, then what you tend to get is you get this disconnect between the cohorts. And what happens is it breaks down and becomes more about the individual personality and running a function. So they've got no leverage. So they have to almost use their personality to win the loyalty of their people, which completely disrupts the organization.

So what we try to encourage companies to do is to say, look, when you're thinking about your own leaders, when you're thinking about their success, view [00:20:00] it through the purpose of the role. So in other words, what is the outcome that their team needs to deliver? And then assess their performance against that.

So in other words, you.

To say to leaders, we will essentially judge or assess your leadership based on what you enable your people to produce. And so when you get that, that kind of mode or that that modeling in place, suddenly leaders become absolutely focused on ensuring their people are successful in the context of the strategy, because that's what they're gonna be assessing against.

And if you do that, if you adopt that and you embed that throughout every level of the organization, then you flip what are otherwise we would call largely broken structures that become politicized 

Designer Peter: Into 

Guest Craig: high performing work groups. 

And because they're all aligned to the common good, the common intent, then suddenly you start to get a movement within the business where every person becomes compelled to want to make the difference 

Designer Peter: because 

Guest Craig: they know that the organization wants them to be successful because that's how the company is [00:21:00] gonna be successful.

But conventional constructs, they don't allow that. It's more about the apportioning of a person. So you grab a person, you put them in the box, issue with them, with KPIs and say you are responsible for producing them. But if they are not deeply connected to the intent of the organization in its entirety, they become meaningless.

And so that's what we get into the drive around productivity, just saying, Hey, we want you to be productive. Go and do this job. And I might be reasonably well suited. I may never be as good as you guys, but I'll probably wander off and sit there and go how's that making a difference to what we are doing over there?

In fact, I can't even see it. Why am I doing it? So what's the point? And I don't see other people really giving it their all. So I start to think why should I? And it and that is what I think organizations are grappling with. And incidentally I'm not suggesting for one moment that this is just.

The fault of the executive? No, I think [00:22:00] executives are coming into organizations that are not configured for success. They're configured to manage the resources to, to manage or mitigate risk. And so they are trying to do everything they can with a broken system to try and optimize the performance or impact of their people, but they're just not being helped by the system.

And so you multiply that across an entire organization and you can see why everyone is disgruntled, mid-level managers are just burning out fast than I've ever seen.

Because they're carrying the burden. So they're sitting there going we know something's wrong, but how do we fix it?

And for staff, they're sitting there going obviously the company doesn't think much of me because of the way they're behaving. So it destroys the integrity of the relationship and suddenly we've got no leverage.

It is, it's an enormous issue, Peter. It's not something that is patchy in some organizations.

I think it is absolutely broken. However, there are companies and many companies around to their absolute credit [00:23:00] that have tried to offset the entrenched modeling that's in place. 

Designer Peter: And 

Guest Craig: because they've got great leaders and they've got fabulous products or whatever it is, they've managed to offset much of the inconvenience or the impediment.

But by and large, for most companies, they don't have that. They haven't got that. So they can't see the lever for driving change. 

Designer Peter: Yeah. Love it. So it is great to hear that there's somehow we would call 'em bright spots being fans of chip and Dan Heath the bright spots.

So there's some bright spots out there who are leading and showing that is possible. Oh, absolutely. There are. And 

Guest Craig: look, without question, and even in the companies that are really struggling, there're, there're a little miracles taking place, where you've got a really stunning leader who believes in the wisdom of what the company's trying to achieve.

Designer Peter: Yeah. And 

Guest Craig: despite the system 

Designer Peter: Yeah.

Guest Craig: They're working their magic and staff love it and they're into it. And actually we see this across the public sector where you've got really difficult systems [00:24:00] but some fabulous people who are absolutely giving it their all. But the problem with the public sector, of course, is we just don't hear the thousands of really successful stories.

Or we ever hear of, the failures. Yeah. But I think it is every bit as much of a problem in the public sector as it is in the private sector. 

Dr Dani: I wanna go back to something you mentioned, , something that I always talk about is most modern organizations, even though we call them modern organizations, still fundamentally operate as they were factories.

Yep. 

Designer Peter: Yep. So 

Dr Dani: Find it really interesting because we're in the, it's the 21st century. It's all about the knowledge economy. Yet we hire people as though we are in the knowledge economy. Bring them into this factory system and we treat them like a factory worker, a resource.

Guest Craig: Yeah, absolutely. 

Dr Dani: So I think that is the shift that you're talking a lot about when we say we've gotta change the way that [00:25:00] organizations operate, it's that fundamental belief that. People that we hire, our employees are not factory workers. They're actually knowledge workers that need to be engaged and connected to the purpose and the, the vision of where we're trying to go because they're showing up with expertise, they can help the organization get to the place they want to get.

But we haven't set the conditions for that to happen 

Guest Craig: without Question Darling. And look, that is right across the board. Yeah. And you know what, I can see people at different levels grappling with it. Intuitively people know something is wrong.

So the number of CES that I've spoken to over the last, maybe four or five years in particular, where you know that they feel like they're trying to do everything that they can.

To build a better business or to deliver better outcomes, whether that's in the public or private that is going on. But the conditions the configuration of their organization is what they're up against. The, their people are not [00:26:00] the problem. It's the system. And yet what's happening is everyone's being blamed for the consequence of that problem.

And so people are being blamed for it, but in actual fact, they can't fix it. It's not, they don't have the mandate to do that. And it's not something that individual leaders can do. So they can offset the conditions to a degree within their own work group, but that almost demands that people work outside the system.

Designer Peter: So 

Guest Craig: if you look at really successful teams within an organization, the ones that are the most successful are the ones that have been the rules that have retained to focus on the intent. 

Designer Peter: Yeah. 

Guest Craig: And so what happens is you end up in this really high risk scenario where a chief executive might see that group over there run by Sarah, and we know she's almost working outside the system, but if she's getting the results we think of Sarah, other people will interpret and say, why is Sarah able to get around the rules?

Yeah. I can't. Yeah. But so then there's no consistency in that modeling or that [00:27:00] configuration, but, I think it's one of these things that we perhaps best see when we start thinking about startups as an example. So one of the reasons people really love startups is because they're not typically bureaucratic.

There's usually an absolute single point of focus that means something to the founders, and as they bring people in, they get excited, not just about what the company's trying to do. But about their opportunity to play a part in helping them achieve it. So that's a really rich experience for the individual, and that's what they love about it, right?

It could be in any sector, but it's the fact that they feel relevant and we make a difference. But as that company grows, what tends to happen is that entrepreneurial spirit starts to break down because the numbers start to get to a point where the company starts to think we have to now manage the resource.

Designer Peter: So 

Guest Craig: they start to almost dismantle the thing that made it magical in the first place because of the [00:28:00] pursued risk, rather than retaining that spirit around high performance. So this is also the reason why a lot of a lot of really successful corporates and others have looked at the startup kind of cultural or mentality and say how do we bring some of that into our business?

But what happens is often when they do, they come up against these policies. Or these processes that are all designed to minimize the risk, right? Or create guardrails and you end up with this internal conflict because you're asking people to be something different than the organization is set up to be.

So it's in direct contrast with the kind of the organizational structure and the bureaucracy that's embedded. Now, my view and having had thousands of these sort of conversations over the years is it's never the intent of the executive to put constraints around their workforce. That's not what they're trying to do.

It's just that they've typically inherited guardrails or policies and it's really difficult to [00:29:00] change them. How do we say, elevate the mode or the mindset within our workforce so that they understand the guardrails are not there as just zero net controls. 

Designer Peter: But that there 

Guest Craig: really is enablers of success.

So we've got a policy, it's not about stopping you doing things, it's really trying to say, in our 30 years of experience, this is what we've found to be the most efficient way to do something.

So if we can turn those historical things from policies into performance enablers, then we can start to leverage them in a different way.

In other words, we don't have to completely change every facet of the business to bring a new spirit into it. But what we have to do is to start to create some discretion where people understand that what the organization's trying to get them to do is to think right, to think really clearly about the outcomes that they believe their role could contribute to the success of the firm.

And if you can mandate that. You are actually saying to people, we want you to think we've employed [00:30:00] you because of the skill or the inside of the capability. What we want you to do is to help us succeed. We didn't employ you to do a job. We employed you because we thought you could make a difference.

So if organizations can instill that, it just liberates their business and it can completely change it. You may have exactly the same people, but the way that they think about the organization, their interest in the organization, their passion to try and help it succeed can be completely different.

But it takes a lot of courage for a CE to do that. Yeah. And they need to know that if they're going to do that one, that they can embed it, that they can hardwire those changes into the organization and it's not gonna expose the company to undue risk.

Designer Peter: That risk word's come up a couple of times.

Craig and I'm gonna do it. Dani, go back a little bit. ' It sounds like it's the one, one of my, and this might be a bit too deep, meaningful, there's something about human nature that means that we find ourselves in [00:31:00] these repeating patterns. Like we're in these systems that we've created, human beings have created, and once we create them, it seems really difficult to evolve them to something that is as you're describing, harnessing everyone's collective intelligence.

And I think the word that the risk word caught my attention just a moment ago around the organization growing. So a startup, which has a great culture, great systems, processes that harness people's desire and ability to. Be asked to generate an outcome and get together and generate that outcome, versus once it grows, they get told to do a job and stick to that job.

And it sounds like from your perspective and your experience, it, because as the organization grows the risk, it's the perceived risk. That's what comment. Perceived risk. The perceived risk of letting more and more people letting, let's say my language, the perceived risk of allowing more and more people and more and more groups to do that.

Is too great to, I guess the same size, same, senior leadership team same size, the senior leadership [00:32:00] team. Is it Our brains inability to cope with that kind of. Letting go or the size of the risk or the, it's the, is it a Dunbar's number thing where the number of people involved is just beyond our kind of immediate comprehension?

Guest Craig: I think. I think it's all of that to a degree, Peter. The other thing that I think happens is senior leaders are the, they're expected to minimize risk, right?

And if you think about an organization, whatever the size of it is, every person that you have is another potential point of risk. If we sit there and said to the chief executive of that company over there, and it's got 250 people, just as an example. And we said to that person, do you trust your people? 99% of the time they'd say, of course I do. So then you go, so why do you treat them like this? Why do you manage your organization like this?

And often they feel like they've never had the permission or the opportunity to really examine [00:33:00] the effect of their systems, right? So we put in systems because we are wanting to try and enhance efficiencies. 

Designer Peter: So that 

Guest Craig: in itself, in to an extent mitigates risk. But the thing that's really interesting about risk is if you want people to take absolute ownership and accountability, take the guardrails away. Because this is a scenario where you see people sitting there saying, look, we didn't get the right outcome, but I followed the policy. And so if the policy becomes the overweighted point. Then what you get are people working through the checklist of the policy. As long as I do this, as long as I do that, as long as I can say I did this. And it's yeah, but what about the outcome? It's what do you mean the outcome? I've just gotta follow the process. Yeah. Yeah. And so it takes courage from a, an executive leadership team to be able to sit there and say to people, look, it's not about us just pulling everything away. It's not about dismantling the [00:34:00] infrastructure, but it's about looking at it and saying, what are we really trying to achieve?

What does it mean for each of us? What is it that you need to be successful or to deliver those outcomes? So what we can do is we can reorientate the organization. And when you get that, you actually start to instill a spirit in the business. Where people start to sit there and look at it and go, actually, here is an opportunity for me to make a difference.

Designer Peter: So 

Guest Craig: going back to that original point that you made Peter, about the sort of the more humanistic piece, right? If you look at that dimension, every human being wants to be relevant. It's just fundamental. And so if we look at that and understand that our con our our organizations will be a consequence of our people, and that's true for life for an individual, right?

We are the only common denominator in our own lives. So our life is a direct result of us. You magnify that over an organization and you could sit there and say, look, company B will be a [00:35:00] result of the people that they've got running it. And that's not just at the senior level. That's right.

Throughout. And if you need any proof on that, all you need to do is look at the Fortune 500, right? 

In fact, I saw a statistic the other day that said something like 48%. The Fortune, 500 companies from the year 2000 no longer exist.

Now, you cannot tell me that those organizations that are amongst the very best in the world did not have the capability or the talent to be able to succeed in their industry.

That is not the issue. The issue is inherently culture. It's what it has become as a result of its perception of risk. And so you get into a mode where you just cannot modify, you cannot enhance, you can't modernize because the very things you're putting in place are designed to keep it as it is.

Dr Dani: Goes back to some of the traditional, things that we know about organizations, like the system will function exactly how it was designed to, [00:36:00] and the irony of this is that organizational theory will tell you, and in practice we see. Resilient organizations actually resist change really which is why it's so hard. So one of the reasons that some of these larger companies that have been around for 150 years, the reason they've existed for 150 years is because they're quite resilient. But with that same resiliency comes an inability to Yeah. 

Guest Craig: Inflexibility. Yeah. That resilience thing.

Dani is really fascinating. We examined this in a huge amount of detail in the sporting sector, which was where our work originally started. And what we try to talk about is less about the concept of resilience, which often means infers a rigidity. This view around the strength of mind.

But in actual fact, it's all about people's capacity to perform. So when we are thinking about this from an organizational perspective, which I know you guys do this is really zeroing into a [00:37:00] lot of the deeper understanding around design thinking is you are trying to design an organization that enhances the use of capability so that we can realize the benefits that it offers.

But because of the way that the base construct works, what almost happens is you end up with two teams. So the institutionalizing of these systems means that you end up with two different camps. So that is the owners of the company and those who are responsible to them, senior manager, and then the workers within the company.

And so what we end up with is this sort of opposing position. And so as soon as you end up with that, and I would argue that's where most companies invariably find themselves, what happens is people think that you have to extract more from the other party to do better rather than leveraging the capability of everyone in order to improve your outcome.

So part of the idea around the system [00:38:00] is understanding the significance of it so that we can think about how would we rewire this organization if we were to start again. So it's not throwing the baby out with the bath water, it's looking at it and saying, you've got all of these magical people who can do some extraordinary things if you enable them to.

So if that becomes the mode or the motive, the motivation, then what is it that you want them to do? What is it that you need them to do, and how do you therefore need to configure the business to ensure that happens? So this is why, our view around the role of CEEs going forward, right? It is absolutely about creating a new era for their business.

So very few CEEs today have the luxury of being able to assume that the structure that they've got is gonna see them through it. It might see them through their immediate tenure, but it could absolutely set the next person up to fail. So somewhere along the line, executives have to have the courage to really examine that and not see their people as [00:39:00] a risk, but see their people as the secret to the organization's success, right?

If you can get into that sort of mode, then when you start thinking about what's possible through the likes of AI or what have you, suddenly things can be different, right? Where you can look across your organization and go, wow, we've got four and a half thousand people and it's because of us and who we are and what we were becoming, that we can succeed, not, I've got four and a half thousand people that I'm having to pay, and I know there's some huge challenges for those making the big decisions, but that's often we get to, we see our people as a cost.

Rather than the point of difference, and therefore we get into the mode of managing risk, and that's what ultimately destroys cultures. It's not easy for those at the top though, right? No, it's it's an absolute nightmare. I've seen so many people in those positions who are looking at this knowing it was never a result of their efforts, but they're the ones having to manage it.

Yeah. 

Designer Peter: Yeah. You mentioned I can tell Dani's got a question, [00:40:00] but I'll jump in after and you go next, Dani. Courage. And so I completely agree with you, Craig. Having, Dani and I both worked in organizations and, four senior leaders and, sat in exec meetings and helped them prepare for boards and, whether they're privately owned or publicly owned, we're all part of a capitalist system that has, demands.

Be beyond reason. We'll not go too deep there, but I'm curious about where you have worked with CEEs who have found that courage to, to start to do this work. Where what, where do they find that courage?

Guest Craig: Yeah. It's an interesting question, Peter, and one that we've we've examined for decades.

Look I think it's twofold, right? There are some people that are just born that way. 

Designer Peter: Yeah. 

Guest Craig: Something about them that either causes them to believe that either one, they've got a job to do or someone needs to do it, and it's just so happens to be them. Others who believe that they've got, have got the ability to influence the way people think and behave.

And through [00:41:00] experience, they've developed the confidence and subsequently the courage to do that. So that's one camp. There are other people, I think, who found themselves in a situation where they can see that the organization requires something more from them. 

So they are looking at this organization, they, they've inherited it.

They may have been promoted from within, they may have come from outside. But if you look at all really significant events globally and historically, it's really been led by one person who has chosen to believe despite a lack of evidence.

Something has caused them to believe that something needs to happen.

And as a result they do that. And some people thrive in that world. Others find it terrifying. But it's a matter of being really clear about the purpose. So what is the purpose of their role and what is it that the organization really requires of them to succeed long term? Not just to see out their term, but an actual fact to set the organization up.

But a key to that, Peter, I think, is [00:42:00] one, having a really strong relationship with the chair or the board, where the chair in the board believe in that person and they back them to the health. And sadly, that's a very difficult market for people today because of all of the pressure on boards. That often the conditions are almost working against the parties, but secondly for the the CE to have the opportunity to be able to build a team that they really believe in.

Now, that doesn't mean to say that they should just go, who is there should be gone. I just wanna bring my own people from where I was before. I don't mean that. What I mean is that the board will back decisions if they believe they need to be made so that there is the backbone within that leadership team to drive the change.

Because so often what happens again is sees and hear leadership teams and they're looking at their people and some of them may have been there for years. They're not seeing that evolve, and so therefore they can [00:43:00] lose faith in them and it may not be a result of them. It may be that they were never given permission before, so it's not automatically indicative of their capability.

But often the conditions that they've operated within in the past. So if we can get those things right, in other words, the chair really believing in the ce, backing them to the hilt. They have a critical role to play in making sure that the strategy is sound, the investment piece is right.

But equally then the CE being able to build a leadership team who will stand next to them and actually and act on the request or on the decisions that are made, realizing they might not always be popular, but that is always about the bigger thing, right? The greater good. And that's how do we ensure that this company has a future?

Because we've got a whole lot of mouths to feed, right? We've got stakeholders that we need to deliver outcomes to and no one's just gonna automatically be our friend and forgive us for all the things we get wrong. We have to get things right. [00:44:00] So I think if you can get those things in place. Every company would be more successful.

Designer Peter: Thank you. Go on Dani. 

Dr Dani: So I have a comment and then a question. So one of the things that I have uncovered in my research, these leaders that do end up with the courage. I think absolutely you're right. Like that trust from the board backing them, and then also having a leadership team that backs them.

But in terms of attributes, what I have found is, or what the research has found, , one of the things that differentiates those types of leaders in all other leaders is this willingness to be wrong. 

Designer Peter: Yeah. Yeah. 

Dr Dani: And 

Designer Peter: Yes. 

Dr Dani: Like you see it and they're very open about it, right? They're , this is where we should go, and they will say it, I might be wrong, and if I am, let's learn from it. They don't have a fundamental need to be,

Guest Craig: I look that's really interesting. I've never heard it framed that way, Dani, but I would completely concur with that. And I think what happens is when you [00:45:00] get the right engagement at that exec level, that's what naturally occurs, right?

So the CE will be sitting there saying, what I want are a team of experts who collectively can guide the ship that can make it better than it was before. So invariably, every one of them will be more capable at certain things than the ce. So even though you want a CE to be a good generalist, by and large.

Actually, you would naturally appoint people who've got the skill sets or the insights or the experience, whatever it might be, to be able to add greater value to the thinking that would otherwise exist. So I completely agree with that, Dani. Totally agree. Nice. 

Dr Dani: So my question is this, and this is something I've heard this a few times now at Leadership Tables, and the question is this, there's a lot of talk today about AI and how it's gonna eliminate [00:46:00] all the jobs and we're all gonna be unemployed and it's doom and gloom and the robots are coming for our jobs and whatnot. But what I'm hearing at leadership tables is almost a dismissal of we don't have to invest too much in our people because they'll become irrelevant.

We don't have to focus too much on performance. Yes. If AI is gonna focus, yeah. 

Guest Craig: Yeah. Yes. A nightmare of a situation. So we can't deny that there will be truth in certain roles where AI is going to create such huge advantages that we may not need the number of people to do the same amount of work right there, there is no doubt that's gonna happen.

The problem that I see is when leaders get at whatever level, get more excited about technology than their people, I guarantee they have lost the game at that point, because you lose the [00:47:00] room. If you lose the engagement of your people, you haven't got anything. So what I would say for everyone is absolutely look at technology and we should, and we need to be productive.

Our people are the key in every scenario, we may have fewer of them, we may have a different makeup, but if we lose the engagement, the aspiration, the drive, of our people, we have not got any points of difference. So it's trying to get people in senior positions to sit there and say, it's what we enable our people to become,

that's what matters. It's not who do we employ? If you look at a sports team, that doesn't matter what sport it is, take the All Blacks as an example, they're not only constantly headhunting, but we may bring people in. They don't just drop 'em and say, do your job, once they have them, then they look at the talent that they've brought in, and what they're thinking about is how do we now enable that person to be the best they can be in their position, in the context of [00:48:00] the game plan that we're adopting.

So it is not about just employing great people, it's about what we turn them into. So we have to be really cognizant of that conversation and sit there and have conversations with our people around what different, say technologies and things could make not cause 'em to believe that they are secondary to the technology.

You absolutely destroy the integrity of that relationship. And then we are forced into a situation where all we will be doing is trying to manage, the risks that we are seeing the behaviors that we think are, or indiscretions, the things that are suddenly intolerable or just not acceptable.

That, that's where we get to. 

Dr Dani: When I was starting my career, the thing to do at the time was offshore everything, right? Yes. We offshore everything and then it, . It gave companies an advantage for about that long. Yeah. And then everybody outsourced everything.

And [00:49:00] then it wasn't an advantage anymore because everybody was doing it. And then of course we discovered that outsourcing everything wasn't the magic bullet cause if you take a crappy process and you outsource it, it just becomes a crappy process done somewhere else. So I think this is just a repeat of that. It's just that now we're doing it with more advanced technology. 

Guest Craig: And I think that's right. And the idea around outsourcing, what mean, we, as a small company, we do lots of outsourcing. 

Designer Peter: But 

Guest Craig: the reason we do is be because we are trying to get, as an example, world class capability that we can't immediately access.

Yeah. So a lot of the roles that we've outsourced them, not because they are perceived to be low level roles internally, it's because we can't immediately access the expertise or the capability to be able to do it. Yeah. So I think for organizations, there will always be times and places where that is absolutely the right strategy.

But I think the big point that you make around that Dani is, or that you possibly are alluding [00:50:00] into, is that culturally right. We need to be, again, really mindful of that because even our partners or our suppliers, we want them to be part of us. So we want them to adopt the same mindset, the same view, the same passion, the same aspiration, so that we are all on the same page.

But if we don't get these things right, the chopping and changing, all that really says is that we don't have the capability within, so people somehow feel like they are deficient. In some way, but if it can't be explained, then it's actually we are the problem. The organization sees us as the problem, and if it keeps chopping and changing, we can never build confidence within the organization.

Because it's interesting, like when you really examine the piece around the engagement bit around staff engagement, which for us in very simple terms is a consequence of a person's sense of strategic relevance. So how relevant I feel I am in this business. Now that is a leadership thing, [00:51:00] right? So it is how do we get the strategy really defined and get leaders that are bringing that to life, contextualizing that at every level of the business so that what we are doing is we are mobilizing the people.

We have to be able to enact on that strategy to be able to execute. But if we don't have the right configuration, the right structure, the right mechanisms, we can never do it. So any effort on the leader's behalf to either mitigate the risk or improve circumstances means that they then invariably operate outside the system.

And what that creates is a collection of five steps. So one of the reasons why organizations can never execute is not because the strategy was wrong, it's simply because they couldn't mobilize their people in a coordinated fashion to deliver it. And we then suddenly look at our leaders and we think what's wrong with them?

Why couldn't they do it? Do they not have the capability we put them on a leadership course? [00:52:00] Or whatever it is, communications course. We think that somehow it's going to miraculously make up for the gap in the system. 

Designer Peter: It never 

Guest Craig: does, it doesn't mean to say it's not a useful investment. So I'm not suggesting it isn't.

But we are looking at the wrong things to provide the solutions. So rather than organizations say, looking at their people, looking at their behavior, looking at their level of engagement and understanding that is symptomatic of the organization and the way that it's managing its resource, right?

If we understand that and we recognize or believe that we want to change, we have to change the system, right? We cannot ask people to work in and around the system. And in fact, this isn't, it's something that I'm quite passionate about. So as an example, what we have seen is a proliferation of HR systems,

and by and large, most HR systems are really good, right? What they enable HR teams to do [00:53:00] today is greater than it ever was at any other time. But the problem is a lot of organizations are using them almost as the quasi mechanism as, or the conduit. Between employees and the business. And so the relevance of leaders is breaking down as a consequence of that.

And they can never be a substitute for leadership, right? But they're a system of record. They're not a system of engagement. So by default, what's happening, our organizations are trying to improve their performance and productivity using systems that designed to mitigate risk. Manage resource.

So you end up using the wrong system for the wrong purpose, rather than saying you want a really good HR system. And as I say, the vast majority on the market are brilliant. They do exactly what they should do. But what we need is we need leaders to sit there and say they will never be the thing that causes people to connect and aspire to be better at our business.

Dr Dani: That 

Guest Craig: is going to be around the strategic framework [00:54:00] and leadership. You get those things right and suddenly you potentially have a formula to be successful. 

Designer Peter: I'm gonna try and build on your your example there. Going back to the All Blacks Craig, and think about, what makes the All Blacks successful is, the leaders of the team off the field. And, the, their strategy.

What doesn't make an individual all black successful is what mean, what would in the All Blacks case, what would the, a sports teams case? The the analogy of the HR system I don't know whether it's

Guest Craig: the sort of management of it. I'm not qualified to talk about exactly what the All Blacks do. Yeah. Darren Shand would be the guy to speak to on that, or any of the coaches. But the thing that is really clear right, is that we've got this wonderful feeder, it's the national game.

So we've got this kind of wonderful theater that brings participants into the sport. We've got kids that are growing up looking at the best [00:55:00] in the world and, and emulating and dreaming and all that sort of stuff. So they go through a really good pathway. We've got fantastic coaches at every level of the sport.

Wonderful participation. So it's all great. It really works. So the athletes themselves though, what is different is they are forever striving to be better at what they do. So the internal drive is the thing that enables 'em to succeed input from coaches, guidance, advice, support, all of those sort of things.

But it's the internal drive. And so we often have leaders who will sit there and say to us, and in fact I've had people say this to me for, 25, 30 years, where they say, it's all right for you. You are used to working with world class athletes. But what I always try and say is, yes, but if the All Blacks manage the team, the way you manage your business, they would not be successful.

Designer Peter: Yeah. 

Guest Craig: And so you have to get into this mode where what they're really trying to do is they're trying to say, let's put together [00:56:00] the best collection of players. So it might not automatically be the most talented person at that time in a position. But they're trying to build a configuration.

A team that's capable of winning, but it's the spirit of the mode around constant improvement. Is the principle driver. So there's something that they feel enormously proud of, upholding the jersey and all that sort of stuff. And it, and you could speak to any of them and they would be able to tell you that.

Yeah. But more than anything, what's happening is people are being inspired by what they see in their teammates to be better themselves. Yeah. 

Designer Peter: Yeah. 

Guest Craig: Now, if you bring that into a business, right? We can see that in startups. So you can see that kind of culture of aspiration being the principle driver. So not only what could this company become, but what do we need to be?

And so people see those that they're working to trying to be the very best that they can. Giving it their all. And that inspires them to want to do the same. [00:57:00] But as we start to look across the broader business community, we do not see that happening as the norm. They become absolute outliers.

So what that's suggesting to people is that they are simply working on a transactional relationship. So we've employed you for your skillset. So bring you in, put you in the job. We're gonna hold you accountable to delivering those outcomes. That has nothing to do with the potential of that person.

There is no reason for them to want to grow and add greater value because the organization is not thinking that way. Simply thinking about them filling a position in a moment in time. 

So if you get that on mass, you can see why you can completely suppress the aspiration of thousands of people, not just, one or two, but the entire organization could come to believe that they don't really matter.

All the organization wants us to extract more from 'em. They don't fundamentally believe in them. They're just simply there to do a job, and this is the reason why [00:58:00] we think, or we really believe it's, it is so difficult for senior leaders to turn their organizations around. Because they're up against this history.

They're up against the machinery, the bureaucracy. And that's what I mean about courage. It takes huge courage for a leader to sit there and say, what could we become if we really put our minds to it? So rather than just staying true to the things that are in there, look at it and say, what is it that we could achieve when we look at the talent that we've got?

It's a totally different conversation.

Dr Dani: It's, that's brilliant, Craig. It's not just a different conversation. It's different framing, different mindset. It's a whole different, totally different, yeah. It's a whole different game, 

Guest Craig: yeah, absolutely. And it's magical for staff to get into the mode where that's what's being asked of them. And it is so interesting, we've had the privilege to work with organizations where leaders have said, I've known those people for, 20 years and I never thought they would change. And it's no, because you are making your decisions [00:59:00] based on your observation of their behavior.

That is a consequence of your leadership. That's the problem. 

Dr Dani: This has been such an awesome conversation and I think we've covered the what and the why and some and the how. Yeah. But one of the things that we like doing on our show, or that's important for us on this podcast is giving people, , if I wanted to get started on this path.

What are some practical things that leaders can do?

Guest Craig: Look, single most important thing is be clear about your intent. What are you trying to achieve? What are you therefore need to become? If you can lock that down right, then you've got a position to start with. From there, what you need to do is look at your people, and I don't just mean, observe the behavior, look at them and think about their behavior as a consequence of the way you're running the business.

If you want to see a change in them, change the way you operate. If we can join that up or get that correlation in place, it can change everything, but sadly, it's not typically what happens. But that would be the [01:00:00] immediate things I'd suggest. Dani. 

Dr Dani: Love it. They're very practical, tangible, good places to start.

Awesome. 

Designer Peter: Fantastic.

Dr Dani: So we always wrap up with what's one thing we're all taking away from from this conversation? And Craig, as our guest today, you get to share first. 

Guest Craig: Lovely look. I feel like I'm starting from a slightly more advantaged position, Dani, and the fact that you and I have had a couple of conversations in different contexts, I look, I love the fact that this is what you guys are really into. That the idea around design thinking is far more than the way we often think about it, and that there can be some really powerful insights that can come from that type of work to not only reframe conversations, but to actually redefine the way organizations think about who they are and the way they work.

So that's what I will take [01:01:00] away from this is just a huge reinforcement that's what you guys are about. So thank you. 

Dr Dani: Thank you Craig. Yeah, thanks 

Guest Craig: Craig. 

Dr Dani: I absolutely, one of my pet peeves is I think we've bastardized design thinking we're failing to see its potential and how it can actually help us set, tackle some of these bigger problems, which is why we do what we do. To really showcase that, right? It's not just about post-it notes and feel good activities, that it actually delivers some pretty tangible outcomes.

Peter, 

Designer Peter: I thought you were gonna do that. Thank you Dani. Thank you Craig. Those are a really wonderful conversation. It's always difficult at this stage for me to choose one, one thing, but I will do my best.

Conscious, this is probably down to recency bias 'cause it's one of the last things you said, but I'm gonna cheat and do take two actually. I think that insight into asking a leader, asking ourselves to look at our people and probably our own behavior and see them as a result of [01:02:00] our leadership, whether that's self-leadership or leading a group of people.

So that's a great perspective to take into a courage someone we're working with to do. And then I'll finish with this really, I think, inspiring, simple question that cannot unlock so much. And that's what could we become, what could we become? And that automatic flipping from looking at things as they are now to imagining the future on constrained magical.

So thank you for that. Craig. Dani, 

Dr Dani: you stole mine. Peter. I'm very obsessed with these, what I started to call magical questions. Know these questions that seem very simple, but carry a lot of weight and it is. What could we become? So I love that question because it helps elevate and look outwards a little bit and dream a little bit.

Yeah, I agree. 

Guest Craig: And it's interesting, isn't it,

Dr Dani: I love it. So that's my, I'm gonna add that question into my question bank, so thank you. Brilliant. [01:03:00] Thank you so much for making the time to to have this amazing chat with us

Guest Craig: oh, you're very welcome. Look, thanks for having me. It's been really lovely to chat with you and keep up the wonderful work. 

Dr Dani: Thanks, Craig. 

Designer Peter: Yeah, likewise. Thank you, Greg. Same to you. Thank you. See you time. Bye. 

Dr Dani: See you time. 

Bye.