The Bregman Leadership Podcast
Episode 195

Rishad Tobaccowala

Restoring the Soul of Business

About

Get the book, Restoring the Soul of Business, from Amazon here:

Learn more

Website: Rishadtobaccowala.com
Bio: Rishad is the author of Restoring the Soul of Business: Staying Human in the Age of Data, published by Harper Collins. Additional writings can be found on the Re-Inventing blog. He was named by Business Week as one of the top business leaders for his pioneering innovation and TIME magazine dubbed him one of five Marketing Innovators.

Video

Transcript

This transcript is unedited.

Peter:
We have with us today on the podcast, Rishad Tobaccowala. He is coming to us from India. He’s in India right now. So, uh, really appreciate him calling in. The book that he has written most recently is restoring the soul of business, staying human in the age of data. He is the chief growth officer at PLU. Publicists group a, an advertising communication firms with 80,000 employees worldwide. He’s been hailed by. Time magazine is one of the top five marketing innovators. He’s been recognized by business week is one of the top business leaders. Uh, and he has uh, experience with companies like Facebook and Google and Apple and Pixar and Starbucks. He talks about them in the book, Netflix, dominoes. So I, you know, as I always like to do on this podcast, I’ll be speaking to him both as a thought leader, uh, as well as an executive and someone who, you know, within his own firm works to, uh, put his ideas into practice so that it’s not just theory, but it’s, you know, the challenges of being a leader and putting important ideas into practice. Rishad, welcome to the Bregman leadership podcast.

Rishad:
Thank you very much. I’m honored to be here.

Peter:
So Rishad, I want to start you talk about restoring the soul of business. And I want to start with, uh, the idea of soul, uh, in business or the soul of a business. And, and I, one of the things that caught my eye about this book is that when, uh, over the summer I was on vacation with my wife and an Island, uh, called Madeira Island off the coast of Morocco in Portugal. And we were staying at a vineyard and it was this sort of in that was also a vineyard. It was run by family members. The family were out there, all of the family members were picking grapes. It was the harvest season. And I was in a conversation with the woman who was part of the family who, um, ran the end and, and operated the vineyard.

Peter:
And the conversation we had was she didn’t want to change the soul of this. And like, there’s like, it’s like there’s a million hotels out there that you can stay at and really luxury hotels and nice hotels and hotels that have strong brands and franchises and you know, you know what to expect, but they lack a soul. And there was something about this in and this family and the way they operated this that felt soulful to Eleanor, I and Eleanor, me and we, but we were in later conversations about saying, what does it mean for a business to have assault? What does it mean for a house to have a soul? What does it mean? You know? And, and there’s a lot of criticism of business as a structure that gets given too much personality. Meaning a business in effect is a corporate structure that has the rights of a person in many ways. But you know, should it have the rights of the person cause it’s, there’s people working in it, but the business itself is not a person. And so I’m really interested in, in, you know, eventually we’re going to get to some very specific keys that you talk about around, around bringing and being soulful as a business and bringing solar to the business. But I want to start with like what do you mean by soul? What does it mean for business to have a soul?

Rishad:
Perfect. So I am looking at the soul of a business, uh, combining two things. A spreadsheet had a story. So most businesses today have become intensely spreadsheet a data driven. And I believe businesses need to have spreadsheet a data. Think as those are things like profits and losses and employees and deliverables and the underlying economics. And I believe that businesses that do not have underlying economics are unlikely to succeed in the medium or long term.

Peter:
So let me just pause you there. I agree 100% with you about that, right? A business can, can’t succeed without having the fundamentals. But you’re saying that’s part of the soul of the business.

Rishad:
Yes. So part of the soul of a business is the spreadsheet. And however, what people have decided is to only focus on the spreadsheet. And my belief is the soul of a business is the spreadsheet plus the story. So the story of a business is the following, very much like the innuendo to, first of all it’s the talent or the people who work in the business. The second is the culture, the heritage and the pedigree of where the business came from. Third is the emotional feeling that it leaves its customers and consumers or people with. And so successful businesses combine the story of the soul. So let’s say something as simple as airlines. You look at two businesses, United airlines and Southwest, and you basically say they are the same category. 80 to 90% of what they do is mandated by government exactly how they should do it.

Rishad:
They fly exactly the same aircraft. One business doesn’t really much better than the other business, both on the economics of the business. But as well as where you want to fly if you had a choice. And to a great extent it’s combining the story of the spreadsheet is the soul of a business. And we have either become intensely spreadsheet businesses in today’s data driven world or we basically forget the spreadsheet and then we really don’t have a soul of a business. We have a [inaudible]. Okay. So to a great extent, the end you went to had an underlying economics that I have no doubt that while their margins may have been either lower or could’ve even been higher, they were margins to be had. So they were running a business. So that’s what I mean by, so it’s spreadsheet plus story, not just the story.

Peter:
So why is the spreadsheet an important part of the soul? Like if I think of a human being, I think we’ve got like the soul and we also have like physical functions and we have structure and there’s like other parts of us, we’re not all soul where we’re physical beings with salt. Unless you, you feel, and you may be right. I’ve no idea that we’re all soul. Like the physical nature of who we are as soul and that might, that might be what you think also.

Rishad:
Yeah. So what I basically believe is the soul is a combination of things. It’s not one thing. So for the human being, I believe the soul is this very interesting combination of physical, mental, and emotional. And when they’re in sync, that is what a human being to a great extent is. And if you take away one of those three, you something much less interesting. So you could be mentally fantastic and emotionally wonderful, but you don’t look after yourself, so you’ve got to die. Right? And so in many ways the physical nature of a human being could be the equivalent of a spreadsheet and the mental and emotional part of the human being is the story.

Peter:
Interesting. So it’s not, you’re not saying that the soul lives in the body, you’re saying the soul is the body and that the soul is the umbrella that holds everything about existence that a person is. And you think the same thing about an organization.

Rishad:
Yes. And, and, and successful businesses have been like that, but more recently they’ve tilted. So they have sort of floated away from their body and they think that’s what’s up.

Peter:
So what’s the difference? You talk about story and, and, and you have a section in the book fusing story in spreadsheets. So it’s like bringing these elements of the soul together. What’s the difference between story or brand like or brand and soul? Like is brand soul. Cause people can construct brands that you know, in some ways betray who they are as a company, but they’re doing it for marketing purposes and is how, how is, how is brand either either soul or not soul.

Rishad:
So the way I look at it is the bread is a component of the soul, but it’s not the soul or it’s an expression of the soul but not the soul. So maybe that’s better. It’s an expression of the soul but not the soul. So think about it as if soul is the story, the emotion, the culture and the people of an organization. The brand is basically a story or an experience that they deliver. To an individual, which therefore basically is both a trust Bach, which you say, when I interact with this particular company, I get this kind of experience. Right? But that experience has been delivered by the company. So for instance, my sense is that Apple, the company is not the same as Apple. iPhone. iPhone is an expression of the soul. It’s one. So the brand is an expression of the soul, but it’s just a component. And because storytelling and brands I believe are part of storytelling and experience are one component. But the other parts of it, the culture, it has some components, but not all of it. The talent, the talent obviously works on the products, but the talent is not the product, right? So you don’t, you, you, you, you do not confuse Southwest the airline with everything Southwest, including herb Keller and everything else.

Peter:
Right. You say in the book, and this is a quote, a central premise is that successful individuals and confirms and firms can never forget the importance of people, their emotions, the culture of the organization and what cannot be measured. [inaudible] my experience is everybody says that not everybody does that. And, and my question to you since you’re in this business is if you can’t measure it, how do you make a case for it in a way that convinces people that they should devote time and energy to it?

Rishad:
So I think a couple of things. The first is many of them can be measured, but they are measured differently. And once you measure them, you will find that companies that do better on some of these scoring, both soulful elements end up doing better on shareholder return, market share gains and everything else. So let’s look at some of the orange soft measures, right? A soft measure is employee satisfaction. It now has been proven of these are investors who basically say that employee satisfaction is a leading indicator of market share performance and brand and stock performance. And that is measurable.

Peter:
I would argue that that’s become a hard measure. Meaning, you know, people do like, I don’t know, a single large company that doesn’t do some form of employee survey, right? So what about the things that you can’t measure?

Rishad:
So here’s the things that they, that they can’t measure. And what I mean by measure, it just means how all of those interact. So for instance, look at the following you, you can measure employee satisfaction. You can measure now increasingly corporate reputation, right? You can measure, uh, another component, which is sort of what do people think of the culture of the company. So that’s some, some combination of corporate reputation and people, but those have always tended to be thought of as soft, vicious, yes, they’re measurable, right? But they’re not the same as profit costs efficiency, which are very much driven and go directly looks like into the bottom line.

Peter:
Right? And what you’re arguing is, and what I think you could argue is that those might be leading indicators where as profit and revenue and, and, and uh, you know, those are lagging indicators, right? They tell you you’re doing something right.

Rishad:
Yeah, yeah. There’s a lagging indicators. But what we tend to basically do is we try to then not recognize the connection. So for instance, you have a profit margin problem. You therefore decide one way to solve the problem is cut your costs. You cut your costs in such a way that it increases your profit margin on one end, but at the other end, you’ve done it in such a way that it impacts your customer satisfaction, your employee satisfaction, and the culture of your company,

Peter:
right? Which has been, you know, this long conversation about short term versus long term. Like short term. You can impact your profitability in a way that ultimately longterm, uh, hurts it.

Rishad:
But what is happening today is a, because of the real pressures of the marketplace, which is, you know, outside of a few companies, there seems to be an emphasis to focus on the short term. That’s what people management things they should focus on. The short term, there is an emphasis on speed and there is an emphasis on data because data becomes a common language, right? So data is the common language that you and I can understand when we put up charts in France or in almost every country that uses, let’s say, the Roman numerals, everyone can understand those, right? Right. And those don’t need elegant forms of trans translation to translate into Mandarin or anything else. A number is a number is a number. Right? Right. My basic belief is at the very same stage, see what happens when someone like a Disney goes to the market. Cuts its margin in order to launch Disney plus it stock goes up. Right? Okay. So in the old world it was basically, so my thing is actually the market is much sharper. It’s bottle CEO’s fame. It is right markets, no. But markets know when you are faking it where you’re basically saying I can’t make the number and I’m pretending I’m doing a longterm investment. Are you doing a real long term investment or not? And so what is basically beginning to happen, whether it’s Amazon on one end, Adobe on the other end, no successful company that I know of doesn’t at times have to take massive cuts to near term revenue and near term metrics. But as long as they have a plot in a plan and then they can explain it, the markets actually support them. Right? And so a big part of it is markets are not as stupid. Sometimes as the CEOs think they are.

Peter:
You, you talk about, um, [inaudible] how to lead with soul. You have these five elements, right? Honesty, empathy, humility, inspiration and vulnerability. What I’m so, so you’re sort of defining soul in a way or you’re defining, you know, like a soulful business is one in which the leaders are honest, empathic, modest, inspired, and, and vulnerable. Okay? So my question to you is how, like help us, let’s say there’s a lot of leaders listening to this podcast help, help us all, um, bring more honesty, empathy, humility, inspiration, and vulnerability into our lives and into our leadership. What suggestions do you have for us to restore soul into our businesses or bring more soul to our lives?

Rishad:
So leading with, so is the chapter that sort of wraps up is one of the wrapping up chapters of the book. And I just noticed this morning that the ft pursuit of the, uh, the financial times person of the, uh, was Satya Nadella and such. Adela, who’s the chairman or the CEO of Microsoft has created almost, uh, he inherited a company with $185 billion of market cap and six years later it’s 1 trillion, one of market gap. So with the exception of um, Tim cook, he has created more value than anybody else. And what are some of the things that he’s done for number one, he’s known for empathy, right? He drives that. Uh, and so there’s an entire chapter in my book called have more meetings. And in that I talk about how to have meetings with empathy is second thing that is known for is a growth mindset.

Peter:
So I’d give us, give us a quick, um, a snippet on how to have meetings with empathy. Give us one thing we can do that would help us have meetings with more empathy.

Rishad:
Do you have many meetings with more empathy? You need to do three things. The first is you need to basically listen to the other person and put yourself in their shoes. Number one. Number two is you need to tell them about how you were in a situation like them. So then there’s sort of a residence, but third and most importantly is you want to frame everything through their eyes or through their mindset. And that is a big part of it, which is I am listening to you, I hear you and I can see you. Yeah, that’s, that’s a big part of empathy. A second part of it is of of this soul is people who have, who upgrade their mental operating systems. So upgrading the mental operating systems, a subcomponent of that is a big part of what I mentioned and which is a big driver again, in such an [inaudible] turn around, which is, he calls it the growth mindset, right? He says you need to have a learning mindset versus a know it all mindset. And so how do you upgrade your mental operating system? I keep reminding people that today most of us are using an Apple phone, which has its 13th version of the operating system and most humans haven’t even got to the second version of our operating systems. So how do we upgrade? So what is, you need to basically to have, so you need to continuously improve. To have. So you need to have P empathetic.

Peter:
So let’s, let’s pause for a second on that. Cause I think it’s a great analogy, right? So we’re on, you know, we’re on iOS 13 right? So it’s our 13th operating system. What do we do as human beings to upgrade? Like how, how do we even begin to think about upgrading our operating system? What’s the process?

Rishad:
Three. There are three ways to upgrade the operating system. The first is wherever people, when real operating systems are upgraded, people work on it every day for a year. If you think about it, right? So my proposal is that everyone should spend an invest and hour every day learning new things or learning purely learning. So you need to invest in learning. So we didn’t go from iOS 12 to iOS 13 with no work. There was probably two or three years of engineering work, right? They probably are working on 13 1415 so that was number [inaudible].

Peter:
And do you have thoughts about what people should be learning or learn? Anything you want to learn as long as you’re learning.

Rishad:
So I believe you can learn anything you want, but the suggestion I have is whenever you hear of something at work that you do not understand, write it down and go investigate it. Second is if you see something that you feel interesting about or passionate go participate in that. So one is basically simply don’t run away from things you don’t know. Spend time growing your skillset is. Second one is to try to do one new thing a day, which is very different learning. You pay attention to things which are different. So to a great extent when you travel, when you fall out of your itinerary is when you really start traveling because you’re very aware of what’s going on. So whenever you go to a new place, look at things differently. You actually are alive and you’re learning. So I try to do one new thing and may go to a new restaurant, walk up in a different way, do one new thing, meet one new person.

Rishad:
That’s very important. Investing one hour of your time learning and try to do one new thing. Both of those are doable. They don’t cost a whole bunch of money. They bought two of them. The third one is, you don’t do this every day. You do this once in a while. It is highly difficult, but it is more important in today’s polarized world than ever before, which is build a case for the exact opposite of what you believe. So if you believe something, build a really strong case as to why you are wrong. And, and if you can’t do that, that you really know why you’re right. Okay.

Peter:
And those are great. Those are sort of great thoughts. Um, you, you talk about problem bosses, right? The narcissistic God, the micromanaging Fiddler, the Oscar aspirant, the double agent assassin. So first of all, what I’ll say is nobody thinks they’re those things, right? We all know people that we think are those things, but none of the people who are those things think that they’re those things. And what I also wanna say is like, part of our souls are, we probably have aspects of that in ourselves, right? So there’s a way in which I am the narcissistic God and the micromanaging Fiddler and the Oscar Spirent and the double agent. So there’s, I’m always a little suspect of externalizing the internal things that, you know, we might struggle with, with ourselves looking at someone else and saying, you know, you’re, you’re so narcissistic and that’s evil and I’m going to kill you off it conceptually or through gossip.

Peter:
Um, the reason people are these things are deep seated, right? Someone who’s the, you know, who comes shows up as a narcissist and we all know people who are leaders and organizations who are narcissists. In fact, I think there’s more, you know, of all of these things. I think there’s more narcissists as leaders because that’s something narcissists want to do is they want to become leaders. And of course, they’re not all narcissists. They just have certain tendencies. Um, and, and like I said, we have those same tendencies. Like we wouldn’t be, um, human if we didn’t have some element of ourselves that connects with all this. But my real question underneath this is, what do you do about it? Like, if, if you have a boss that you think is narcissistic, what do you do?

Rishad:
Right? So the first is I agree with your opening statement, which is that externalizing and creating these four types of people and say, go one of these people, is it exactly the right way to go? Which is why if you notice the way I set it up is he is the good stuff, you know, vulnerability, et cetera. There’s the good things and these are the bad. And then I make a statement, which is everybody, every one of us has a good boss in us and a bad boss at us. And depending on the situation, either how much sleep we’ve had, the pressure on us that particular day and our mood, we can suddenly dial up the bad boss and dialed out the good boss. Okay. Without us knowing it. So a, we have to be aware that when we describe the bad boss, he or she is us, right?

Rishad:
We have that in us, right? But we also have the good boss. But if we can basically dial up the good boss 70 80% of the time and dive down the bad boss, 20% that makes us good. Now that’s the opening statement. Based on that, it becomes very easy to engage within our sisters because in effect, some percent of our time we are not assessed to [inaudible]. Right. And the way we do it is we call ourselves out when we are narcissistic to the narcissistic boss. Hmm. Okay. And so what happens is if you criticize somebody, they are likely to be defensive. If you, however, make an example of yourself, right? They’re much more likely to listen. I always, when I try to get a client to change something in what they’re doing in business, I never talk about their business or their category. I talk about another business and another category, and they begin to see the common commonalities and they say, wait a second, that could happen to me.

Rishad:
I said, possibly should we think about what we do? If that happens, what’s this? You suck. Right? Right. But, but the other thing I try to remind people is some bosses are beyond redemption. Maybe 10 15 20% okay. Small percent but, but they are 20% is a pretty high percentage. Yeah. To sit 10 15 minutes. But still the whole idea is if you’ve got five bad bosses that you could really fall, you still only have one path. Right. Because that’s so, so, but it’s still that, that particular stage, my recommendation is you try to get a new assignment. Okay. All right. And if you can’t get a new assignment, you leave the company. Because the one thing I’ve learned is corrosive bosses corrode completely. Right? They corrode everything around them and they corrode everybody around them and you can’t save it. You’ve got saved the person.

Rishad:
So I made a statement recently and because of the, the place we are in the country, some of my good friends basically said, Hey, you’re talking about politics, you shouldn’t talk about politics, but we understand what you’re talking about. So I basically described a certain United States precedent as it third, right. And that anybody that was working close to him was like toilet paper. They got soiled. Okay. Right. That regardless of who you were, your reputation would go down in flames because you would go in saying, you can solve for this. But eventually that, Whoa, that stuff. So,

Peter:
right. So there’s, in some ways there’s a certainly narcissism –

Rishad:
– but like a toilet paper in your cleanup –

Peter:
And in a way there’s a certain narcissism in trying to save in trying to be the person who can resolve a situation, right?

Rishad:
Yes. And so what basically happens is my belief is when you have people like that, the only thing that can go wrong is yourself. There’s nothing you can do to save the situation. And so in that area, I suggest to people that they should leave because of this day, next to a corrosive boss, the boss said could to change. They’re just going to get more corroded.

Peter:
Right. Rishad we’ve run out of time. It’s such a pleasure to talk to you. I think this is a sort of deep, um, uh, topic requiring a lot of thought. Uh, you know, in terms of ourselves as individuals and where, where our soul is, and then the businesses that we’re working for and where the soul of the businesses. So I really appreciate you coming to the show and, and speaking about it, we’ve been talking with Rishad Tobaccowala, restoring the soul of business, staying human in the age of data. Reach out. Thank you so much for being on the Bregman leadership podcast.

Rishad:
Thank you very much.

Leave a Reply

Your email address will not be published.