EntreLeadership - #79: Charles Duhigg—The Power of Habit

Episode Date: September 8, 2014

Why do we do what we do, whether in business or life? Pulitzer Prize-winning reporter Charles Duhigg believes it’s all because of the power of habit. On this week’s EntreLeadership Podcast, he explains why habits exist and how we can change them to transform our businesses, communities and lives. http://www.entreleadership.com Learn more about your ad choices. Visit megaphone.fm/adchoices

Charismatic, passionate, as integrity, humble, servant, faithful, inspiring, persevering, positive, flexible, driven. This is who we are that call ourselves leaders. Helping business leaders grow themselves, their team, and their profits. This is the Entree Leadership podcast. Now, here is your host, Ken Colman. Coming to you from the Music City, this is the podcast of Leaders by Leroy. leaders and four leaders. I'm Ken Coleman. So thankful to have you tuning in with us today. Coming up,

our feature conversation, this podcast is with Charles Duhigg, Pulitzer Prize winning reporter at the New York Times, and the New York Times best-selling author of The Power of Habit, Why We Do What We Do in in Life and Business, and I'll tell you this right now, this is one of the best books I have read in the last two years, mark it down. People ask you all the time, Ken, what are you reading? I'm telling you, I couldn't put this book down. It's fantastic. We're going to unpack it just a little bit coming up in our feature conversation. And we're also going to take a few of your emails. We call it Ken's Electronic Mail. And so we'll listen to some of the great emails. I'll read them to you and give you some answers. We love when you email us. You can always do that. Podcast at entreleadership.com.

And very excited to have local co-host coming in. As I've taken over this new gig, I have been purposeful to bring in Nashville residents, thought leaders and people that I admire and that challenge me. And I'm very excited to welcome as our special co-host this episode, local resident and bestselling author of Take the Stairs. He is Rory Vaden. Welcome to the Entree Leadership Podcast, sir. Ken, it's so good to be with you. You're looking good in person. It's so good to see you. What he's referring to is we have guested on each other's radio shows. Prior to coming here, the Ken Coleman show in Atlanta, and then of course the Rory Vaden show. We have enjoyed each other's company over the phone, and of course we've met in person,

but this is exciting, and we really are excited for you to be here, because you're a busy guy, you're all over the place speaking, you've got a new book coming out. We'll tease that a little bit later, and you've been here all day hanging out with the Entree leadership team, I'm told. Indeed, yeah, we're checking out some of the sales team and processes, and we're learning from each other, and back and forth, yeah. All right, so see, we're stealing you at the end of your consulting day. We brought you in the studio, so it is fun to have you here with us.

You know, we're talking about this book today, the feature conversation, the power of habit. And you certainly are no stranger to studying habits and how you challenge us. And this is interesting. I want to pull out something, Roy, and I want you to bounce off me on this here because I was thinking in preparation for this podcast. How could I challenge our listeners in this area of habit? And one habit I have observed in monitoring, if you will, interviewing leaders from all walks of life, is that there is a certain amount of hustle that has to take place. You know this better than anybody.

Sure. You know what I mean? We're not taking elevators or escalars. But the hustle, in the hustle, which is so necessary to get something off the ground and then to maintain it and then to scale it, hustle's huge. But what I find is that at some point there is a huge risk of plateauing. Because what happens is we're focused head down, hustle, hustle, hustle, whatever's right in front of me.

we just got to keep this thing going. And leaders don't take the time to actually look forward. Jim Collins called it the big, hairy, audacious goal, be hagg and good to great. And I see this a lot. And I think it's a real problem that you don't, listen, you've got to do what you've got to do, but you've got to be able to extrapolate yourself from the grind, the hustle and bustle and say, where do I want to be in 30 years? I mean, what's the ultimate reason that I got into this business?

And then Rory began to walk backwards and go, okay, if this is where, where I want to be in 30, 40 years, or the business in 30, 40 years, where do I need to be in 20 years? And then if that means 20 years progress, then where do I want to be in 10 years, and then five years, and then one year, and then boom today. And I think that's the perspective that really help people not to plateau. Do you agree with that? Well, yeah, I think it's a challenge for the entrepreneur, right? Especially when you first start, and it's what we'd call and take the stairs a harvest season and it is that season where you are all go no quit just like you got to do it and the danger of it and the risk is either you burn out or you're moving so fast you're never you don't stop to think

that's right just going going going it's a challenge the dichotomy of balancing the long-term vision with the short-term action and some entrepreneurs are the visioners just always thinking big picture and they're just a disorganized mess right can't do anything and then on the other hand you have what you're talking about. It's, I've got the blinders on, I'm just going 90 miles an hour, and I never stopped to look up. And it's a danger, not only to your business, it's a danger to your life. Yeah. It's a danger to your well-being.

It's a danger to your family. Yeah. And you start to alienate everything around for, and it's all in the name of, I'm working hard, I'm hustling. And there's not a right answer to it, right? It's like, I can't say it's one of those things you've got to listen in your heart. And you've got to listen to your business and you've got to listen to your family and you've got to try to find the balance of that dichotomy. Here's what's interesting, too, is our ability to have a peace in life is directly proportionate to the term of our perspective. Right.

And we often think that peace comes from having more money or having more success or having the next trophy or getting the next magazine write up. And so we get focused on today, today, go, go, go, next sale, next sale, next customer. but really peace is about having a longer term perspective. The longer term our perspective is the more sanity we have, the more... I like that. It's good. It's just a faith thing. And as an entrepreneur, the thing you always have to realize is that any problem in relation to today is a big problem. Any problem in relation to our lifespan, though, is a small problem.

And any problem in relation to eternity is no problem. That's good. We're really challenging those of you who aren't naturally gifted at looking ahead and thinking long-term to get that perspective. So here's the habit. I think we want to challenge you today to really get intentional. If you're not natural at it, get around people who help you think long-term and also think perspective. Why do you do what you do? And where do you want to be? And then how do you get there? And those kinds of things to pull yourself out of the fray. I think that would be great stuff. So good stuff there, Rory. All right, it's almost time for our feature conversation. with Charles Duhigg. But before we do this, I love this book so much. I pleaded on behalf of you people, because I am a man of the people and the brass, the powers that be said, yes, Ken, you can do this. Five free books, the power of habit. Five free books, we have five away.

Here's how you enter to win. Very simple. It's a drawing. Here's all you have to do to qualify. For those of you on Twitter, we want you to get out your old Twitter right now, whether you're on a computer, on the phone, take a note, do it later. Here's what we want you to do. You tweet this, ready?

The at-on-Trey Leadership, that is the handle, at-on-ray Leadership, podcast is a good habit. And put an exclamation point in there. Will you please? Maybe we'll give you an extra spot in the hat, if you will, as producer Eric Anthony pulls out the names. The at-on-Trey Leadership podcast is a good habit, exclamation point. and you are entered to win. We will do a random drawing, and we will reach out to you on Twitter

to let you know that you've won, and we will get you the free book. This is great fun. We'd love for you to enter, so please do that. All right, let's get right to it. Here is my conversation with Charles Duhigg. Well, Charles, it's a thrill to have you with us on the podcast. I'm a big fan, and we really appreciate it. Welcome to the Entree Leadership podcast. Thanks so much for having me on. All right, so I want to dive right in here, because this book is absolutely chalk full of incredible content. And I want to jump right into chapter two, the craving brain, how to create new habits. Because I think so many of us are always thinking, those of us who are committed to personal growth, where do I need to get new habits and things of that nature?

And so I want you to talk to us about this idea of creating new habits. How do we do it? Absolutely. And we can create new habits in ourselves, and create new habits in our customers or our partners. So one of the big insights of the last decade, and we're looking at the living through this kind of golden age of understanding the neurology of habit formation. The biggest insight is the structure of a habit. What we know is that a habit has three parts. There's a cue, which is like a trigger for an automatic behavior to start, and then a routine, which is a behavior itself, and then a reward.

And without that reward, your brain never really learns to latch on to a pattern and make it automatic. So one of my favorite examples of this is toothpaste. Right about a hundred years ago, most people in America did not brush their teeth. And then this marketing guru named Claude Hopkin was approached by an old friend who had invented a toothpaste named Pepsidant. And he said, look, I want you to help me sell this. And Hopkins at first said, no, look,

just like a dozen toothpaste out of the market. None of them ever sell. Nobody ever brushes their teeth. And this guy said, no, no, no, no, no. Just try with Pepsidence. So Hopkins says, okay, give me half the stock in the company, and I'll do it. And he comes up with this advertising campaign. What was brilliant about the advertising campaign

is he identified an obvious cue. He said, in all these ads that they put on walls all over the nation, he said, if you feel a film, that film means that you need to clean your teeth. That's just cute. He's triggering people to sort of run their tongue over their teeth, which half your audience is probably doing right now. Right. I did. I did instinctively.

Right. Exactly. But then, and this is the most important part, once people brush their teeth, there was some oils and chemicals in pepsidant toothpaste that made their gum. tingle. Now, there's nothing to do with gum tingling that makes your teeth clean. In fact, the reason why your gums tingle after you brush your teeth is because it's an irritant in the toothpaste that sort of irritates your gum. But it somehow created this reward for people. It made them feel like toothpaste was actually working, that it was doing something. And what they found is that people would use toothpaste to have it a couple of times, and they'd get used to that

tingling sensation, and then they would start to crave it. They would walk out the door, they'd be laying in bed, and they wouldn't feel that irritation on their gums that they'd come to expect. And because they craved it, it drove them to go brush their teeth more. Claude Hopkins created a toothbrushing habit because he identified a cue and a reward. And if someone wants to create a habit in their own life, create a habit in someone else's life, they have to identify what that cue and that reward is, and that will start the brain to craving that pattern. And it's the craving, Charles, that allows us to really break through and get the transformation, correct? Because now we want something as opposed to saying, I need to do this, now we want to do this.

That's the big difference. That's exactly right. And craving is actually kind of interesting because what craving is, is it's your brain anticipating a reward and not getting it. So if you show a five-year-old or yourself a candy bar, your brain will start anticipating what it tastes. like when it feels like to consume that sugar. And that's why when you can have a full breakfast in the morning, and then you walk past the snack table with donuts on it at work, and suddenly you're craving a donut.

It's not because you're hungry, is because your brain starts anticipating that reward. That's what craving is, and that's when behavior becomes automatic. Now, I want to pause for a minute, because I want to go further into this idea of culture creation, and you talk about that in the next chapter with a fantastic story we're going to get to. but you wrote in the book that belief plays a huge role in our ability to change our habits.

And so this idea of the cue, how does belief play into this self-awareness, self-creation of the cue and then the reward that gives us the breakthrough? How powerful is belief? Well, so belief is really, really important. And the reason why is it necessarily links to the cue or the reward as much as it to your ability to believe that you have the capacity? for change. So this is one of the things that they've noticed about how habits change is that the first rule is that you shouldn't try and extinguish a

habit. You should try and change it, right? You recognize what the cue and the reward are that they're driving a behavior, and you try and come up with a new behavior that seems to correspond to the old cue, deliver something similar to the old reward. That's how you change a habit. But what they noticed is that when people would change their habits, they would, things would go pretty well for a little while, and then there would be like a moment of crisis, right? Like

on you're trying to give up cigarettes and suddenly you have a really stressful day at work, or you have a fight with your spouse or something like that. And people would relapse into these old habits, except for some people. Some people managed to avoid the relapse. And when they went, they tried to figure out why. What they found was that those people, they just seemed to believe very, very deeply that they had the ability to change. Because they had somehow proven to themselves that once they changed their behavior,

it can stay changed. This is why belief is so important, is because, Belief essentially allows us to make it through those difficult periods, what are known as a reflection point, psychology. And the way you create belief is, first of all, you practice it. You find things to believe in. This is why, for instance, Alcoholics Anonymous encourages people to believe in a higher power, is because it's getting them to practice belief in something,

so that eventually they can believe in themselves. But the second, the most important and equally important way that you get better at belief is you try and change with a group. Because a group will help you believe in yourself, even when you're about to fall down, either through positive reinforcement or simply by creating examples, right? That guy, Jim, across the room hasn't smoked in two years,

and I think I'm smarter than Jim, so I should be able to give up cigarettes, too. This leads us beautifully into probably one of my favorite stories of the book. I'm a big sports junkie, and I love football, Charles. And Chapter 3, the golden rule of habit change we've been talking about habit change, why transformation occurs. You cite a story, an actual example of Tony Dungey when he was with the Tampa Bay Buccaneers. I want you to share that story because it is a wonderful illustration of what the golden rule of habit change is.

And really for the leaders listening in here today, this is a great example of how we can begin to make culture changes in our companies. Tell us that story. Well, the interesting thing about Tony Dungey is when he took over the Tampa Bay box, he had an interesting problem, right? The Buccaneers were a terrible team. Maybe at the time he took it over at one of the worst team in NFL history. And at that point,

the fashion among football coaches was to come up with really complicated playbooks, right? To have hundreds of plays that are memorized by your players, everyone's doing something complicated on the field. Tony Dundee took over the bucks and he said, look, I can't compete that way. Like, I can't get this team to memorize more plays than everyone. else. I can't have a smarter playbook.

So what I'm going to do is I'm just going to have a very limited number of plays, but I'm going to try and make them all habitual, automatic, so that we move just a fraction faster than everyone else in the field. So what he did is he took everyone into a room, and he said, look, I want you to figure out what are the cues that you normally play off of, right? And football, we call them keys, but what are the keys or cues? Are you looking at the other guy's feet? Are you looking at the quarterback's arm?

are you looking at where your opposing players is his helmet is pointing for a new habit? And I'm just going to teach you four or five habits. I'm going to teach you four or five plays. But I want you to drill it into your brain that as soon as you see that cue, you launch that habit automatically faster than thinking. And if you can move faster than thinking, you'll outplay the other guys because you'll be moving before they are. They have to make a decision.

You're already on the run. and as we know the bucks came really close to winning the Super Bowl under Dungey the year he left the next year with his playbook they ended up winning the Super Bowl and I love that because you talk about the process of the reward has got to stay the same

the cues do but you've got to change some of the process and you saw that happen I want you to unpack that a little bit more because I want our leaders out there that are listening to this to make sure they understand that formula of what Tony did as a process absolutely so this is the golden rule of habit change and this is kind of what i mentioned before is that

you can't extinguish a habit you can only change it and the way you change it is you keep the same queue and you deliver something that's similar to the old reward so if i'm an NFL player and i'm playing for the bucks i've been an athlete my entire life right i've learned some habits and i've relied on those habits to become good i i look for things like where the other players feed what what direction are they pointing where it's helmet pointing And then when I make the play, the reward I give myself is a pat on the back. I say, look, I might not have, like, you know, tackled the guy, I might not have won, but I did what I set out to do exactly right.

And I go to my coach, and my coach says, look, the play went off right. Maybe we didn't win. Maybe we didn't do great. But you did your role correctly. So a Tony Dunjie came in and said, look, let's pay attention to the cues, right? This is called cue awareness. most of us pay attention to cues or get influenced by cues

without even noticing what those cues are. And Tony said, I want you to write down for me a list of what you are looking at when the play starts. Are you looking at the other guy's feet? Are you looking at his helmet? What exactly are you looking at

that is your cue? Don't make it unconscious, make it deliberate. And then I'm going to give you this new behavior, and we're going to practice it over and over. And the way we're going to practice it is, and then we're going to jog the play. and then we're going to run the play.

And we're going to do the play over and over and over again with the cues and the rewards in place until it happens automatically and you don't have to think about it. And the reward that I'm going to give you is that every single time you do it right, I want you to take a minute and tell yourself, you did great.

Like whether or not we scored a point, whether we actually sacked the QV, no matter what happened, I want you to stop and I want you to say, I just did that right. because those are the same rewards that people used to give themselves, but they did it unconsciously, right? The player would be in the middle of a big play, and he'd say, oh, we lost the ball, it was intercepted,

you know, there was a fumble, but I did my thing right, I'm okay. But it was unconscious. They were giving themselves rewards without actually thinking about those rewards. And what Tony said is, deliberately give yourself the reward. I want you to deliberately pay attention to the cues.

I want you deliberately give yourself the reward. and we're going to practice that behavior in between over and over and over again until it becomes automatic. You don't have to think about it. You're looking at the queue even before you realize you're looking. You're patting yourself on the back, even before you realize you're patting yourself on the back, and you're doing the behavior in the middle so fast that you're not thinking about it. It's automatic.

That is so good. I want to move to chapter four because you entitled this chapter, Keystone Habits, Which Habits Matter Most? talk to us Charles about the habits that matter most to leaders. So what's really interesting is when researchers have spent a lot of time looking at how habits work, what they've discovered is that some habits matter more than others. Some habits when they start to change, they set off this chain reaction, it changes other patterns.

These are known as keystone habits. And a great example of this is exercise. When people start exercising, they often, habitually, they often start eating more healthfully. Right, and that makes sense. You feel good about your body, so it's easier to eat a salad than a hamburger in the cafeteria. What's interesting, though, is that these researchers, Oden and Chang and others, when they've looked at how people change when they start exercising habitually, they've also found that they start doing other things.

Like, for instance, people who exercise habitually, they start using their credit cards less. They do their dishes on average earlier in the day. They procrastinate less at work. And this doesn't really make any sense, because, there's nothing about going for a jog in the morning that makes you less likely to pull your Amex out of your pocket. Except that for many people running exercise is a keystone habit. When you start to change that habit, it sets up this chain reaction.

It changes other patterns in your life. And the reason why is because it changes yourself image. When you get to the front of the grocery store line, you think of yourself subconsciously as the type of person who goes for a run every day. And that type of person doesn't spend willy-nilly. They don't procrastinate it work. And so for leaders, the question becomes, how can you identify peoples or companies keystone habits and influence them?

And in Chapter 4, we tell the story of Paul O'Neill at Alcoa, one of the largest aluminum companies on Earth. And when O'Neill came into Alcoa, the company was in trouble. You know, had declining profits and problems in productivity, but he didn't focus on that stuff. What instead he focused on was improving work. worker safety habits.

Because O'Neill believed that worker safety for that company was a keystone habit, that if he could change how people thought and acted around worker safety, that it would set up a chain reaction that would make other changes seem more possible. That's exactly what happened. Within two years, Alcoa became one of the safest companies in America, and it also rose to the top of the Dow Jones Industrial Average. If you ask Paul O'Neill why, and I can go to the details of how he did it, what he'll tell tell you is that once people saw that you could change around worker safety habits, they

began to believe that they could be committed to a habit of excellence. Wow, right there. I mean, that is such a tremendous example. And for leaders that are listening, Charles, you said you could go into the details of how he did it. I want you to do that just a little bit, because I want to give our listeners a chance to try to identify their situation with this story, because they have to find those keystone habits which can ultimately transform the future of their company. Really interesting, right? So the question is, how do you identify a keystone habit

and then how do you change it? The trick to identifying a keystone habit is that it's a habit that seems to have some type of emotional self-identity core. So take worker safety at Alcoa. When Paulineal came into Alcoa, he didn't know anything about aluminum, really, but he toured all the plants.

And the thing he kept on seeing was aluminum plants are really dangerous. Right? The way you make aluminum is you put a bunch of powders into these huge pots and you arc electricity over it and molten metal comes up the other end. And he would talk to people and they would talk about being worried about their safety.

Now, Alcoa was already a pretty safe company. It was one of the safest companies in the industry. But it's a dangerous, dangerous business. And he noticed that when people talked about worker safety, they sounded emotional about it, right? They sounded concerned about their families and about themselves. Keystone habits are things that have emotions at the core of them. Because for a keystone habit to gain power,

it has to change our self-image of ourself. It has to be something that ties into our values. And Paulineal knew that worker safety in an aluminum factory, that that would do the trick. But then the question becomes, so how does he change the habit? And we go back to this thing, the habit loop, the cue, the routine, the reward. He instituted a new habit loop around the company where he said, look, this is what's going to happen.

If anyone gets injured, that's a cue, any injury whatsoever, whether someone, you know, gets killed on the factory floor to getting a paper cut. That's the cue. And the routine is, I want the unit vice president to write me a report, why it will never happen again, and what's been changed in order from learning from this. And the reward is, and I've got to get that report within 24 hours of the accident, and the reward is that the only people who are ever going to get promoted are the people who do this well, who bring down their worker safety. Here's the interesting thing, if you're a unit vice president,

and you have to write a report within 24 hours, you know, vice presidents are important guys, right? They oversee 16 to 20,000 people. So you need to be notified as soon as an accident. And they're going to get notified right away, you've got to start communicating with workers on the floor more frequent. If you're a middle manager, you don't want your... boss, you know, vice president talking to workers on the floor without you sort of inserting

yourself into that conversation, right? Because middle managers don't want to get left out. So they start communicating more with people who are on the floor and their bosses. And it turns out the 24 hours, if you want to write a really great report in 24 hours, that's not enough time. You have to start the report before an accident happens and then fill in all the blanks once it occurs, which means you've got to go find all the people with really great ideas and get them to stuff your idea box with suggestions that you look like a genius once you're

write this report in 24 hours, which means you have to start communicating with more people who have great ideas. Paul O'Neill said he wanted to change worker safety habits. What he was actually changing was communication habits. And that happened across the company in dozens of different ways. That's how a keystone habit creates change. It says that it's about one thing. It says it's about your values, about what you care about, something that has an emotional

core. But it actually sets up changes in other relationships. area. I want to move forward in the book because we've got entrepreneurs listening in here, Charles, and they want to grow their company. They started their company to solve a problem, and they believe they have the best solution for it, and they want to get that solution out to as many people as possible. And in Chapter 7, you talked to us about how Target, and, of course, other companies,

know what their customers want before they do. And this is huge. How do companies predict and then manipulate it? those habits. This is fascinating. Well, one of the most important things in the last decade is the big data revolution, right, that we can now use data to track how people behave, how people's habits manifest themselves. Target was great at this. Target wanted to figure out which of its customers were pregnant. And so what they did is they built this big pregnancy prediction model.

They would look at everything people bought, and it would look at what coupons they use. And they could predict based on about 25 changes in purchase patterns. whether someone was pregnant or not, even predict what trimester she was in. You know, what they found is that at the beginning of their second trimester, they start buying a whole bunch of prenatal vitamin. And they stop buying a scented lotion and start buying unscented lotion. And at the beginning of their third trimester,

pregnant women are much more likely to buy, like, cotton balls and washcloths. So once you look across your customer base and you see those patterns, you can say, ah, that woman's pregnant. I think with a 98% accuracy that she's pregnant and that she's in her second trimester. And Target said, this is great, because this means I can send them coupons, right? I know what their habits are.

I know they're going to be buying cribs and diapers and all kinds of stuff. I'm going to send them coupons for what I think they need. They sent out all these coupons to people who they thought were pregnant, and it was a total flop. Nobody used the coupon. And the reason why was because they thought it was creepy. In fact, in one case, I learned about the story of this on Father, who went into a target, and his daughter, who was 18 years old,

had gotten a whole bunch of coupons for pregnancy stuff in the mail. And the father's just completely angry, right? And he goes to the manager and he says, look, you know, my daughter's 18. She's getting all these coupons from you for, like, cribs and pictures of babies. It's like you're encouraging her to get pregnant. The manager's like, I'm so sorry, sir. I don't know why your daughter was getting this stuff.

He didn't know anything about the pregnancy prediction model. And he felt so bad that he called back a couple days later and he just wanted to apologize again. and he gets the dad on the phone and the dad is as well, actually, it turns out there's been an activity in my household I wasn't aware of, and I owe you an apology. She's due in August. So Target was so good.

Their computers were so good that they could actually figure out when someone was pregnant before. Her dad could. But this is the point is that her dad was furious to learn out, to find out that way. So what Target did is they started hiding what they knew. They noticed that one group of coupons, they sent out. The way the Target would do these coupon book lists is they would like put all the baby coupons in there and then they would test and they would just fill it up with like other

random coupons that they just chose randomly. And one of these coupon books had a whole bunch of baby stuff and then had a whole bunch of stuff about Super Bowl Sunday in coupons for lawnmowers. And they found that the women who got that coupon book, they ended up using it. And the reason why is because it didn't seem like Target knew that they were pregnant. It seemed like they had gotten some useful coupons about babies, but just the reason why it didn't. It didn't seem like Target knew that they were pregnant. kind of randomly. Because who on earth would put a coupon for diapers next to a coupon for Super Bowl Sunday next to a coupon for a lawn? Right? It doesn't look like you're predicting anything. It looks like you're just sending random coupons. Those women used their coupon. And so this is what

Target figured out, is that sometimes you have to hide what you know about people's habit. People get freaked out if they feel like you're spying on them. People can get freaked out if they feel like the pitch you're making is too personalized to them with things that you shouldn't be able to know. What you should do is you should sometimes be discreet about how much you know. But the other lesson I would say for entrepreneurs is that they also have to make sure that they're giving offering people the right reward. Yes. Right?

And this gets back to the target story. You know, there's a whole bunch of products out there, particularly online products, that make a lot of sense to the entrepreneurs' brain. why wouldn't someone love to get X? Why wouldn't they love to get a badge that they can put on their website? Why wouldn't they love to get a coupon to a store that they've never gone to before? And when you go and you talk to consumers, they say, I just don't want that.

That's not really rewarding to me. It doesn't trigger any habit because it doesn't have any real reward salience. Target thought that the reward they could give was saying, hey, we know you better than you know yourself, better than you've told us, and we're going to help you save money. But people said, that's not really rewarding to me. What I really want is I don't want to be creeped out.

I want a sense of comfort. That's right. And then I want savings. And so entrepreneurs need to figure out what rewards do their customers really want, and in what order do they want those rewards? Because if you're given something they want, but you're creeping them out while you're doing it,

it's not really rewarding. Wow, folks, that right, that down, folks. I'm telling you that right there is a huge payoff from Charles. It's fantastic. Charles, switching gears yet again, we can't cover the whole book in this conversation, but our leaders and you know all too well that crisis comes in all shapes and sizes. And you write about the power of a crisis, how leaders create habits through accident and design. And I think this is so relevant to leaders from all walks of life. How does crisis allow opportunity to shape habit?

Well, crisis is a really valuable moment, right? One of the things that we know about organizational habits, and organizations, companies have habits the same way individuals do. One of the things we know about organizational habits is that they're incredibly hard to change, particularly once an organization is over, is larger than about, you know, 15 or 20 people. And so when researchers have looked at this question, they've asked,

So when do organizations seem flexible? When are they most likely to change? And the answer is typically in the wake of a crisis. So think about NASA after the Challenger explosion. NASA is a huge organization. And for years, they had all these organizational habits. The head after head president after president had tried to change, and it failed miserably. And then there's the Challenger disaster.

And in the wake of that disaster, it's like everyone's suddenly, like shakes themselves awake and says, we got to change something, we got to do something better. And NASA transformed in about three years. All their organizational habits. The same is true in almost every organization, that if you look at good leaders, what good leaders do is that they seize opportunities, they seize crisis as a moment for change rather than just responding to the crisis. And in some cases, they actually create the perception of a crisis. in order to make people more flexible. Think, for instance, about Apple, how Tim Cook talks about Apple.

Tim Cook never says, like, Apple just had a great quarter. What Tim Cook always says is, particularly to his employees, is Apple is a year away from potentially being irrelevant. Apple could be out of business in five years. Now, that doesn't make any sense because Apple's one of the most profitable companies on Earth. But Tim Cook wants to create the perception of a perpetual crisis because he knows that that's how you make people flexible. That's how you

force them to look at their organizational habits and ask, is this making sense? Do I need to change it? What should I do differently? A crisis is not just an opportunity to respond. A crisis is an opportunity to change. Great statement. Charles, a final question for you.

As you researched and gathered and then wrote this book, curious to know, what's one thing that's top of mind when I ask, what did you take away from this book yourself, maybe that you didn't know or didn't expect to learn? I think the biggest thing I took away is that any habit can change. And this is one of the huge, huge insights from the research of the last decade.

It doesn't matter how old you are. It doesn't matter how ingrained a behavior is. Any habit can be changed. We have shown this again and again in laboratory and in real world. There are people who are 65 years old who tomorrow will start losing. weight and will keep that weight off for the rest of their life. There are people who have been smokers for 20 years who will quit cigarettes tomorrow and will never smoke another cigarette.

Habits are these little machines that we finally understand how they work. And once you understand how they work, you can change them. And I'm not saying it's necessarily going to be simple or easy, but I'm telling you that because of what we know, it's now easier. And any habit, no matter how ingrained, no matter how old you are, any habit, can be changed. Charles, I got to tell you, this book has been phenomenal for me and to challenge me. I know it will challenge our leaders as well.

And on behalf of our listeners and our entire team here at Andre Leadership, thank you so much for A, writing the book and B, spending time with us this morning. Thank you for having me on. All right, so there again is Charles Duhigg. I want to mention his website because he has a ton of resources here on the website. it's Charles Duhigg.com. That's D-U-H-I-G-G-com. Charles-Duh-H-H-H-H-H-G-D-H-H-G-G-com.

And, Rory, you know, having you in here is a lot of fun because you're a guy who, you really get this stuff. But would you hear a conversation like this, and we're talking about habits, and you know you're talking to an entrepreneurial leadership audience, men and women who strive to do work that matters, if you could share just one thing from Rory Vaden's experience, And from your heart, around this idea of habits or doing things that matter, what would you say?

I would say that the habit is powerful, right? I mean, that's what we're learning about here is that habits are so powerful. But regardless of how strong or weak your habits are, regardless of how long you've been in business, whether it's one month or one year or five decades, success is never owned. It's only rented. And the rent is due every day. The rent is due every day. I love that thought. Every day.

This is good stuff. And I want to talk real quickly because I want to tease this because we're going to have you back soon. And after the first of the year, Rory's second book, procrastinate on purpose. I'm actually looking at a copy here. Five permissions to multiply your time. And this is fun because you sent this to me early on. He said, hey, well, you endorsed it. And I gladly endorsed it.

Let's just do a little bitty tease here because I love this. This is not a time management principle book, is it? No, it's really not. It's really about how to multiply your time and how do the best leaders in the world create more time? Because if you think about managing your time, that's just doing things faster and more efficient. So that's okay. And you think about prioritizing your time. That's learning how to move item number seven on your to do list to item number one. That's great. Doing things efficiently is a valuable skill. Prioritizing the things that need to be done first, that's a valuable skill. But you know what has changed. of those things create more time. So that's what we're looking at is really the emotional side of time management and really how do we create more time or in this case we call it multiply your time. And I'm telling you it's really good stuff. So stay tuned for that. And Roy's going to hang with us here because it is time, Eric, for Ken's electronic mail. Ken's electronic mail. You've got mail. I'm going to do two email

here. This was really fun, Eric, because I love this one here from Brady Sanford, 19-year-old college student. Rory, he's a used car salesman. So he's a young guy out hustling, trying to sell cars cash. He makes a point here. He says, I love the podcast. Now, to protect the

privacy, because you never know who's listening, I'm not going to get into all of his questions. He's a young man from South Carolina. And here's the situation, Rory, and listeners. Basically, he is at odds, with the way that the ownership and his leadership is advertising. He has a bit of an ethical problem, maybe a little mixed messaging going on,

and this is a 19-year-old kid, let's be honest. That's not a bad thing. And the fact that you're thinking about this stuff, and it's really bothering. And, Roy, he's brought it up a couple times. And pretty much the owner is like, you know what? I don't see a problem. It's not even a gray area to me. And so basically, Brady says I would appreciate any words of advice that you would be able to share.

and Roy, you can tag on to this if you like, but Brady, my advice is this. If you have mentioned the issue multiple times, which you have, and clearly this is a violation of what you believe to be an ethical value, and this is just flat out wrong, then you've got to make a decision. Either you move on and you're okay with the fact that you move on because you just cannot live with your conscience, or you decide to stay and deal with it. And I don't think staying and deal with it is a good move here because it clearly bothers you enough to bring it up. It bothers you enough that it burns in you as this is wrong. And so I think

you got to make a decision to move on. What say you on that? Here's what I learned when I was in college. I sold books door to door for Southwestern Advantage and it was my first real sales experience and I got into situations where I could say anything to make a sale. And one of the things that I did, I did wrong, Brady, there was a time where I would say anything and I realized that you never get away from that horrible feeling from compromising your values. That's right. Your integrity is not for sale. It doesn't matter how old you are. Your integrity is not for sale. If you have that gut feeling, you've got to get out of there. All right, second email. Let's get to this. This is from Thomas Dutton. He's an NBA, so we like when we get these emails. Hello, I hope I can answer this.

I know this is a good one. Thomas writes in, hey, is it a good idea to not only have employees take the disc test and Sally Hogshead's test? Yes, thank you. but new hires prior to bringing them on to the company team. Emphatically, absolutely, I would do so. If you are hiring somebody, Rory, and you're going through an interview process, why wouldn't you have them take Sally's test? Because they need to know how you see them and how everybody else will see them. And so I'm for as many assessments as you could possibly afford and do efficiently,

because I think you've got to make the right hire, or else you're just, it's a crapshoot. Yeah, there's nothing more expensive than hiring the wrong person. So knowing who you're getting into business with is huge, and the assessments help. Plus, it really creates an element of they've got to work to get this job. There's some hoops you've got to jump through, and we take it serious about who we bring on. So I think, again, that's a no-brainer. All right, before we wrap up, I want to thank Rory, and I want to make sure you folks dive in to check out what he's doing, Rory-Vadenblog.com. That's R-O-R-R-R-Y-V-A-D-N blog.com.

I also want to mention our All-A-Ccess program. I know Rory's a fan of this. This is how you keep growing beyond podcasts, beyond our live events like the Entree Leadership One Day, the Entree Leadership Master Series, the Entree Leadership performance series. You can learn about all of those great events at Entreeleadership.com. but all access to 99 a month. And I mean, it walks you through every imaginable situation, more content that you could possibly imagine,

but it's really practical and to really help you out. So we do want you to check out those great offerings. I believe they'll save you 10 years and tens and tens of thousands of dollars in mistakes. Well, folks, that is going to do it for this edition of the Entree Leadership podcast. On behalf of our producer Eric Anthony and the entire Entree leadership team, Thank you for listening. We will talk with you again very soon.