In Good Company with Nicolai Tangen - HIGHLIGHTS: Geoffrey Garrett

Starting point is 00:00:00 Hi, everybody. Tune into this short version of the podcast, which we do every Friday. For the long version, tune in on Wednesdays. Hi, everyone. I'm Nicolai Tangjian, the CEO of the Norwegian Sovereign Wealth Fund. Today, I'm in really great company with one of my favorite people, Jeff Garrett. Now, Jeff is the Dean of the University of Southern California Marshall School of Business, and has an incredible track record. And I know him from when he was the Dean at the Wharton School. Actually, he was the first person I called when I got the job in the Norwegian Summer Wealth Fund to ask him, you know, what am I going to do?

Starting point is 00:00:37 Also, Jeff has held very important roles at Oxford, Stanford and Yale. So Jeff, big welcome. Hey Nikolai, it's great to be on with you. What's the number one skill a leader needs today? So, you know, I think the world of leadership is changing a lot. You know, for me, maybe it's a bit glib, but I would say we used to think about leaders as heroes

Starting point is 00:01:02 and now we need to think about leaders as humans. So I think my answer would be to be more human. Now, the increased complexity you are seeing in the world now, how does that change the leadership role? Everything is much harder, right? And if you think about the, I think what we're saying these days is that agility has become a very important skill, right? You can't just be on some standard operating procedures pathway because the world can, can change in an instant.

Starting point is 00:01:36 Um, so then that, that of course just begs the question, how do you develop agility? And for me, you know, there are two C words that matter a lot. And I think you embody both of these, by the way. The first one is curiosity. I don't you know, yes, there are a whole bunch of technical skills that people need to succeed in a technology enabled world. But you've got to be curious about broader stuff. And the second thing, the second C word for me is context. I think context really, really matters, you know, culture, history, language, all the things that that as I said, you embody as a person, those are

Starting point is 00:02:13 incredibly important to you can't, you can't think you know everything and you can't live in your own little world, you've got to be more externally oriented and really externally aware, I think. Where do you find curious people with a sense of context? Where do you find them? I mean, how do you screen for them? How do you?

Starting point is 00:02:35 Well, I mean, I think the admissions answer these days in higher education would be that we kind of use objective indicators, you know, test scores, grades, exam results. They're the first filter. But the reason that most of elite higher education now focuses on essays and interviews is that we really want to know the full person. So you're looking for more than test takers when you're looking for people who you want to be emerging leaders. I think this is also a one-two. What do employers want? Employers want people who on day one can do the job, but can grow into becoming leaders in year five or year 10. That's going to be hard to find if you just look at objective indicators.

Starting point is 00:03:23 Do you think CEOs are good listeners? Whether they are or not is... There's research showing that the higher up, the higher you are in the system, the more endorphins you get by hearing your own voice. It's something not great about that. Absolutely. And I think we just have to be, anyone in a leadership position has to be aware of that. You know, the thing that I've learned is that if I ask questions of anybody who works for me, they view it as a leading question.

Starting point is 00:03:57 If I throw out a thought bubble, people take it really seriously, even if I'm just trying to provoke conversations. So I think you've got to have a, you need to have some kind of balance between confidence and humility to make that work. And you know, one thing that somebody said to me 20 years ago with a kind of wry grin on their, on their face was something that, that just sounds right to me, which is if you're in leadership position, you know, there's a chance You're the smartest person in the room, but you should do everything you can not to show that Because if you just strut your stuff You're gonna crowd out everything else in the room. And so the collective intelligence doesn't increase

Starting point is 00:04:40 But it can I ask you Nikolai, I mean, you know, mean, you're in this world where you've got, you literally, as the podcast shows, you have access and real investments in the biggest companies in the world in every sector. I mean, what's the discipline that allows you to manage that? Well, I guess pretty much the same as you say, right? So first of all, I don't make investments myself. I have great colleagues. We have 700 people. So I've got colleagues who run it, very clear mandates, huge accountability delegation. And I agree totally on the

Starting point is 00:05:18 micro-managing point of view. It's just totally unbelievably destructive because you kill pleasure and you just kill the whole meaning of life. I just think it's one of the worst things you can do. So I just totally agree with you. So it's interesting that you responded there with very personal stuff as well as professional. I mean, I think the merging of personal and professional is something that's happening, particularly with younger people today. But I'm wondering how you think about that. I mean, I know from your personal background that you're you're super interested in really diverse stuff, right?

Starting point is 00:05:56 You have an art history degree. You have a psychology degree. Of course, you went to business school at Wharton. But how do you think about how do you think about your employees as full people? And are there any difficult trade-offs there? Is it positive sum? What's your approach? Well, for sure you need to look at them as whole people. You would love for them to continue to take education,

Starting point is 00:06:22 to expand the, you know, the skill sets. I agree, curiosity is, is, is really, really important. Now, one of the fun things by working with finance is just like the most interesting thing you can do. I think, you know, everything you eat and wear and drive is made by a company, you need to understand psychology, corporate culture, macro, defense, geopolitics, currencies, and it's all changing, you know, a hundred times a second. Jeff, we both have met many successful leaders. And when you abstract and think about what the best ones have in common, what do you find? So, a very successful CEO whose name I won't mention, I once kind of threw this

Starting point is 00:07:14 softball question to this person and said, what's it take to be a good CEO? And the person replied with a wry grin, oh, it's really easy. All you've got to do is be able to come up with a vision and communicate it really well, have a strategy and be in the room with all the strategists and be a good enough person that people want to go on the journey with you, right? So vision, strategy, implementation.

Starting point is 00:07:40 Easy to say, really hard to do, as you know, but I think that probably the people who are the best leaders understand those three elements and they should understand their own strengths and weaknesses, right? You know, I said, I think I now know about myself. I'm just not as good operationally as maybe I can be at some of the other elements, but I know operations and implementation is critical. So I've got to think about how to compensate for my own limitations there.

Starting point is 00:08:17 Now, you have worked in academia, well, most of your life, actually. What's the key to good leadership in academia? Is it different than running a company? So I think historically university leadership and corporate leadership were very different, but my sense is they're converging a bit now. So the key, I think, to understanding academic leadership is that there's no command and control. I can't tell people what to do. What there is in universities is an ongoing set of hearts and minds campaigns. You have to convince people that they want to come together

Starting point is 00:08:56 to do something. And, you know, when I think about that, I just have two words in my head, aspire and inspire. You want to have an aspirational vision that's motivating the people, and then you want to inspire them to get there. So, hearts and minds campaign, yes, command and control, no. And my sense is that the corporate world is moving a bit in the hearts and minds direction,

Starting point is 00:09:22 and that's because younger people are just different. They value meaning and purpose, not only in their personal lives, but in their professional lives, much more than prior generations do. And that creates a leadership and management challenge, right? That young people aren't going to do it because you tell them to do it. They've got to want to do it. They've got to buy into your vision. And I think that's a big challenge, but it's a good challenge because in my sense of the, it's hard to make change in universities because I can't just say, let's do this. But the flip side of that is if you make change, it's actually going to endure and probably work

Starting point is 00:10:06 because people wanted to go on that journey with you. And so, you know, my sense is again that that's the direction we're moving in the corporate world. I don't know how quickly and obviously it would vary by sector.

In Good Company with Nicolai Tangen - HIGHLIGHTS: Geoffrey Garrett

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