Invest Like the Best with Patrick O'Shaughnessy - Jack Clark - Grateful for Everything, Entitled to Nothing – [Invest Like the Best, EP. 215]

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Starting point is 00:02:07 their website, www.mptomco.org. Some of MIT's best partnerships have been initiated during challenging market environments. Matimco looks forward to hearing from you. Hello and welcome, everyone. I'm Patrick O'Shaughnessy and this is Invest like the Best. This show is an open-ended exploration of markets, ideas, methods, stories, and of strategies that will help you better invest both your time and your money. You can learn more and stay up to date at investorfield guide.com. Patrick O'Shaughnessy is the CEO of O'Shaughnessy asset management. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of O'Shaunacy Asset Management. This podcast is for informational purposes only and should not be

Starting point is 00:02:56 relied upon as a basis for investment decisions. Clients of O'Shaughnessy asset management may maintain positions and the securities discussed in this podcast. My guest today is Jack Clark, the head coach of the University of California varsity rugby team. Jack has one of the highest winning percentages not only at the collegiate level, but in sports history, winning an incredible 90% of games since he started as a coach in 1984. That includes a 98 game winning streak from 1990 to 1996 and 115 game winning streak from 2004 to 2009. In our conversation, we drive into how Jack builds high performing teams, the shared vocabulary he creates across his organization, and his work with companies applying what he's learned

Starting point is 00:03:38 on the field to operating businesses. Please enjoy this conversation with Jack Clark. So, Jack, I've been so excited to do this with you since first becoming aware of some of your ideas on building teams a few months ago, sort of consider you the John Wooden or pick your famous coach of the rugby world, having sort of an unparalleled career in terms are winning championships. I know that people always look at outcomes and wins as the thing that's held out, but we're going to talk all day today about the process, about building teams, about cultivating individuals on those teams, and how that could be applied in all areas,

Starting point is 00:04:13 not just sports, but in business and in any leadership position or team that you might find yourself. I think to orient the audience, it would help just to hear a thumbnail sketch of both your playing career, which was illustrious, that also then your very long coaching career. So I grew up in Huntington Beach, California, played four sports. I was probably a better football player than anything and accepted a football scholarship to University of California, Berkeley, and enjoyed my time playing football. But when football season was over, somebody'd come tap you on the shoulder and say, hey, it's rugby season now. We've been playing rugby at Cal since 1882. So there was this great migration of football players heading to the rugby paddock as soon as the season was over.

Starting point is 00:04:55 And I did it and I loved the sport. It seemed to be a combination of all the things I loved. Basketball, football, played the sport passionately for a while, had a cup of coffee with the Philadelphia Eagles and got straight into the national team and had an injury pretty early in my career, which prohibited me from a longer career, went into coaching pretty early. I don't know if I even knew what I was doing at the time. I shuddered to think about my earlier coaching instructions, but we had some success.

Starting point is 00:05:25 right away and I fell in love with it. At first, I did it as a bit of a side hustle from a business career where I was a banker. And then I just went full time, I guess in 1990. I started coaching in 1982 as an assistant, became the head coach in 84. And then just went full time in the sport. It was giving me more satisfaction than making money. It was a great fit for me, I guess is what I'm trying to say. And I've been coaching this whole time now and spent some time coaching the national team and spend some time coaching the All-Marine team, but always coach my Cal team. One of the things that is so interesting about your philosophy of teams is building what I'll call like a value set that the team, the players you live by. I want to go through the specific value set.

Starting point is 00:06:15 I'm sure that not all value sets are the same. We'll talk about how to strategies for creating one that fits the organization as well as yours specifically. But before we even go into the five pillars of yours, I just love to know how you alighted on this concept of wanting to have pretty rigid, standard, recurrent values and how they were developed in the first place from the coaching level down. Over time, it's a pretty interesting laboratory to be coaching every day, a group of young people. And they teach you a lot. You kind of stumble on to stuff together, if you will. And as a coach, you become the custodians of that.

Starting point is 00:06:47 I mean, they all leave after four years. I'm left to continue to kick the can up the road. So all of those lessons start to accumulate. It occurred to me at one point that it's cynical, I suppose. What I saw from a lot of my colleagues was slogans on the gym wall, if you will, what they said they believed in by way of mission and values. It was pretty wooden. It wasn't used every day.

Starting point is 00:07:14 It just was catchy. It didn't take much research to see the exact same thing in the corporate sector, where it looked good in a deck and it looks good. in the annual report, but if you pulled 10 employees over and said, what are the values this company, they would stumble all over it. And they wouldn't really know. I guess I just start thinking, well, what you believe in, what you're willing to fight for by way of your values, they ought to be used on a daily basis as a system. You ought to process all of your human transactions and your organizational transactions, business transactions should be processed through your values so that you're

Starting point is 00:07:50 making value-based decisions as best you can. You've worked with a lot of very famous corporate clients thinking through this concept. I'd love to go through some of yours because I think there's so much richness and depth to each of them. And of course, I think the place you have to start is with selflessness. Why is this the value that you mentioned first? Again, it's one of these words that if you just say it, everyone's like, yeah, sure, be selfless. So breathe some life into that principle for us in terms of what it means specifically to you and how you use it on a daily basis. We say team first, self-second. We say that is a declaration that that's how we're going to make decisions. And you can imagine if you were a part of a team or an organization that was committed to

Starting point is 00:08:30 making decisions for the team first and the individual second, if you found that out, it's your first opportunity when you thought you had a grievance of your own or you wanted attention to something you believed in. You can see where that would be troublesome. I want to say it up front. I want to say this is how we make decisions. and people self-select whether this is the right organization for them. I mean, the first lens that's going to come down is what's best for the team. And that doesn't mean that we're cold to the individual. I mean, we love each other.

Starting point is 00:09:02 If somebody stumbles, we're going to pick them up. If somebody's got something going on in their life, we're going to do their work for them. We're going to put their arms around them. We care deeply about each other. But from an organizational standpoint, we're going to make decisions by what's best for the team. And by and large, people gravitate to that. it's good to be part of something bigger than yourself. What are some ways that that often manifests across the various teams that you've coached?

Starting point is 00:09:25 What are some episodes that would be a good example of someone acting with a team first rather than themselves first? Selection, playing time, those kind of things come up. If you believe that only can look at that situation through your own lens of why am I not playing, why did I not get selected to play, why am I not getting right playing time, why do I not have that territory, right, why do I not have that client? How come I'm not getting funded my budget the way I want? I mean, and if you can look at it over the hole that, wait a minute, we're trying to build a team here and that decision went against you, but you can embrace it.

Starting point is 00:10:01 Basketball coach Pat Riley, now at GM, I guess. He has a book, The Winner Within. It's another coaching book. There's a chapter called The Disease of Me. Riley lays out the disease of me as if it was a real disease. He talks about the symptoms that you. you have. It was a laugh out loud moment. You get to symptom six, whatever it is, and it's constant feelings of underappreciation. A great excuse to ask about what you've learned about gratitude and entitlement. I developed a mindset is what I've labeled it. I see it as this archway in my mind that you walk through to get to what you really believe in. We say grateful for everything entitled to nothing. I've been saying that long enough now where I walk into offices and I see it

Starting point is 00:10:46 up on the wall and a lot of times it gets attributed to me, which I really appreciate. But it's all over the Silicon Valley. It's in some places in New York. And I love the idea that people appreciated. But I think what it says is there isn't enough gratitude for people to understand that how many people have helped him get where they are. And then, of course, there's just far too much entitlement. Certainly in athletics, there's too much entitlement. And it seems, Patrick, that when you really do believe in the mantra that I'm grateful for everything and I'm entitled to nothing. One of the things that happens, you just get more resilient. You don't think you're owed something. You get busy trying to achieve. And it's just a better way to go through life. I love it. I think it's just as a system setting,

Starting point is 00:11:31 an incredibly powerful thing. It also relates to another one of your principles. I kind of jump out of order here, but the idea of merit. You mentioned earlier, what is putting the team first mean and things like playing time and basically demoting your own interests in favor of the team's interests. Everyone wants to be a meritocracy. So what have you learned about what it means to actually be a meritocracy on a team? When you really study the best teams, it jumps out to me that the currency that's exchanged between the team members is performance in the moment. It's not what you did last year. It's what you're doing right now. It's not your potential. Potential is a pretty good thing to have. I mean, it wouldn't be good if somebody said you had no potential. You just can't dine out

Starting point is 00:12:17 on it very long. At some point, you've actually got to do something. And I think seniority is a good thing to have. It's good to have experience. But that experience has to be monetized as performance now. Just this concept that this meritocracies is a beautiful thing. It's not who you know. It's not what color your skin is. It's not what religion you are. It's not any of the boxes we try to put people in. It's, what are you getting done right now? Don't get drunk at the Christmas party and do anything stupid. You're good to go another year. Well, that's the exact opposite of high performance teams. How they work is getting it done right now, performance in the moment. That is the meritocracies. What are some of the tactical ways that that's deployed through coaching? What are some things

Starting point is 00:13:00 that you do that might be difficult to do that like a new coach might not. not naturally do to reward merit and emphasize merit. You measure everything. You publish what you measure internally. You celebrate success. You acknowledge performance. We sometimes think that it's okay to get off the mountain at some point and wander around a plateau for a while because we've been doing pretty well. And one of the true things about sports and I think about business, you're either getting better or you're getting worse. There really isn't anything in between. And no one ever tells us that. But that is the truth. I mean, you mentioned John Wooden at the beginning, and one of his pyramid to success items was this notion of performance over results. Results track performance.

Starting point is 00:13:42 It's not the other way around. So put all of your energy into your performance, and the results will take care of themselves. And, of course, you say that in a public setting with business people, and somebody's going to clear their throat and say, coach, that's great. But here at XYZ, we got to win. Telling a coach that, I mean, we win half our games, we get fired, right? I mean, coaches get fired more than anyone else. So I get the idea we have to win. I completely appreciate it.

Starting point is 00:14:08 But it's not a value. It's even a poor goal at the end of the day. Just put all your focus into your performance. And there's different ways we have to measure. We have to create that internal competition. Constant performance improvement, which you've already kind of alluded to, is another one of your values.

Starting point is 00:14:23 What I love is how you breathe life into these things and make them daily systems, not just an idea. Measurement is one piece of that. Maybe we can zoom in on rugby. most specifically, like, what is the state of the art today and how has that changed through time for that constant improvement on a team? And then we can talk kind of higher level about how it could apply outside of rugby. But in rugby specifically, what does that mean today? Basics, fundamentals, no matter how talented you are. I mean, they say Beethoven played scales and he was brilliant,

Starting point is 00:14:53 right? What would make a rugby player think that they wouldn't have to go out and perform very routine fundamentals over and over again so that they hone them and they can do them under pressure. You can't make it up. You can't talk yourself into it. You can win a game you shouldn't have won. But when you really know that your skills are tighter now than they've ever been, your fitness is better than it's ever been, your knowledge of the game is better than it's ever been. It's a powerful concept to think about getting better and to improving. If we're not going to get better, what are we doing? And that's one of the things we want to measure. We've talked a lot about the first three values, those being selflessness, merit, constant performance improvement.

Starting point is 00:15:36 Toughness is one that sounds maybe like it is especially specific to sport, but I just find it to be a general principle that is important. You mentioned the word resilience earlier. What does toughness mean to you? How much of that is physical versus mental? What is the definition of toughness that you convey to your players? There is a bit of overwhelming force. in rugby certainly in most contact sports where technique and I suppose physical prowess and a certain degree of physical toughness wins the day. I mean it's zero sum one person wins one person loses in those moments. You see businesses that are like that. They're dominant in the marketplace. They want to keep their position. But the kind of toughness that I regard as a value is mental

Starting point is 00:16:21 toughness. Get knocked down nine times, get up 10. Just keep answering the bell. just keep getting up. I'm a big believer in having an organizational glossary. I was looking for a definition for mental toughness, Patrick, for years. Then one day, I stumbled across a book. I was reading about a cricketer. I know very little about cricket. But this happened to be one of the best cricketers in the world. And at one point, he laid out this phrase, the ability to focus on the next most important thing. And if you really think about, you don't have to access mental tough when things are going well. And this seemed like the exact key thing. To have the discipline to go, what is the next most important thing? Something bad just happened. What's the next most important

Starting point is 00:17:06 thing I have to put all of my energy and all my focus in? And to be able to do that, you are indeed mentally tough. Because we would want to live in that moment that would just happen that wasn't good, what's it going to mean today? And did I just lose the game? But having this discipline to go to the next most important thing and stay in that moment and stay where your feet are, how some people say it. I find it to be a really, really strong attribute. Is there a person that stands out in memory? It could be someone you coached or someone you know or someone you don't know that embodies the sentimental toughness that you ascribe to?

Starting point is 00:17:39 I coachy young man named Mark Bingham, United Flight 93. Storm to cockpit probably saved our capital that day. He did it with a few other players. I mean, you can imagine that, okay, the plane's been hijacked. You don't have any other information of what was happening that day. But the word, because cell phones are working, starts to seep in, that these planes are crashing into buildings. And you've got to do something. How about having a clear mindset that you're not going to be paralyzed in that seat, that you're going to get up and do something?

Starting point is 00:18:12 You're going to use your head, get some other people organized with you. You're going to go try to wrestle some degree of control out of that situation. I see it all the time. I see people having that ability to go to the next most important thing and go live in that moment. Yeah, the story chokes me out for sure. Hard to leave that story and move on. The idea of glossary is fascinating to me. And I just love the system of values.

Starting point is 00:18:39 We have one left to go. Leadership will come back to in a minute. But this idea of a glossary is fascinating to me. When did you first create the glossary? How long is it, how is it used creating a shared language and agreeing on definition sounds incredibly valuable. I almost think I stumbled on it in a cynical way. I started hearing people use buzzwords over and over again. It would have been rude, but what do you mean when you say that? I think you're just using that phrase mental toughness. I started again experimenting in the laboratory with my own team,

Starting point is 00:19:12 asking them, what's the definition of something? You can imagine you're 10 people in and you've got 10 really good definitions, but they're different. And in some ways, they're defining it, not just slightly different, but entirely different. Within a lot of organizations, a lot of teens, we just go ahead and we keep using that language knowing that I'm meaning it one way and you're hearing it another. There's never going to be any alignment, organizational alignment, without that shared language, without that nomenclature where when we say something, we all know, at least in this shop, what we mean by that. I guess you mentioned leadership. That's probably one of the best ones. I mean, you go in the bookstore and there's 40 meters of books on leadership and they're all probably correct and they're all talking about it differently. And I started thinking that my view on leadership was so dramatically different than most people's. I think there's a conventional wisdom around leadership that it's the minority leading the majority. That doesn't sound that powerful. That sounds like the team I want to play against.

Starting point is 00:20:15 You just kind of unpack it sometimes over a period of time. You study it and you think about it and you talk to others about it. It seems to me that it was very rank-based leadership was. The person with the best business card became the leader. The head coach is the leader. The person in the corner office is the leader. The star player is the leader. The seniors are our leaders.

Starting point is 00:20:37 And none of that resonated with me. I mean, it all seemed wrong. The hard part was to think, well, hold on, is chain of command. important. And to me, it's critically important. I believe that once we decide an approach to something that we have to get busy executing, thinking you've got a better idea all the time, and we go nine different directions because everybody thinks they're a leader and they've got a better idea. That's just mutiny. That's not being a leader. Patrick, was this idea of leaving authority intact, chain of command intact, and asking those people, just don't hijack leadership.

Starting point is 00:21:11 Just be the boss. Just have all the authority. Don't take leadership with you. Leave leadership in the middle. So everybody can access it. The definition for the glossary comes out of that, the ability to make those around you better and more productive. It doesn't have to do with you're the star player. It doesn't have to do with you're the head coach. It doesn't have to do that you've been here longer than everyone else. You're a senior.

Starting point is 00:21:34 You know how it works. It is this notion that we all have a responsibility to contribute back to the middle and to make those around us better and more productive. Now, that's the team you don't want to play. that team that has a lot of authorship into who we are and we all feel this responsibility to each other. And sometimes it's just the best leaders have this huge toolbox where they can pull out the right tool for the right situation. And some other leaders have less tools in their toolbox because they've had less time on the job. But nevertheless, it doesn't change our responsibilities. We have an obligation to make those around us better and more productive.

Starting point is 00:22:10 What did you learn across your career about successful recruiting, like the actual process? Let's say we've identified somebody that you think you want for reasons X, Y, and Z. And then there's a conversion. You convert some, you don't convert others. What goes into that conversion ratio? Like, what do you think are the reasons you win when you win and maybe lose when you lose? Well, I think if you're really being honest with people, you can sometimes scare them away. What's Berkeley like?

Starting point is 00:22:35 Berkeley's a little gritty. People from all over the world, you can draw a parallel to us and cross the Bay of Stanford. This is a beautiful place. You can walk for a week and you can't find a guy. gum ramp around the ground. Harmony. Berkeley, both three blocks the wrong way. You don't have to do anything wrong.

Starting point is 00:22:51 I think if you're really honest and you lay it all out, I mean, people, oh, geez, classes are difficult here. No one's going to hold your hand. Merit scholars feel like they're drinking out of a fire hose at some point every semester. You get out of your power zone and you're humping for the first B of your life because you've only gotten A. Please give me a B minus. And when you lay all that out, because it's true, some people are going to elect for an

Starting point is 00:23:14 easier path. We have conditions that we operate under. It might be your value sets. It might be your policies, but you can't violate any of those. It'd be unconditional. So the financier Warren Buffett, I read on time where he says, I won't work with anybody I don't like, trust, or admire. Wow, there's some conditions for you. I wish there was a more scientific way to assess this. But I want to know who's got that non-cognitive grit. You've got a good 40 time, a good hand. You're good students. But who's going to really grind? Who almost needs that?

Starting point is 00:23:50 Almost gets a smile on their face when it really, really gets difficult. Who can go into that dark closet and just grind when it's hard? In my sport, it probably means a love of the game. Probably took me a while to make that as a marker in talent identification and recruiting. If you love the game, it's going to get you through a lot. A lot of people play sports because they love the attention. They're good at it. love the crowd. They love to see themselves on TV and their name on the back of their jersey.

Starting point is 00:24:19 Other people, they love it. I mean, you give them a day off and they're back out on the field. I was like, what are you doing? You got a day off for a reason. Get off the field, but it's their happy place. I guess if I could know who's got the non-cognitive grit, who loves it, who has the ability to care about the things that are important to them, the people they're doing them with and the entity they're doing it for them with. I think that would be the three legs of the stool for me. It reminds me of the, I can't remember if it was Federer or Djokovic that when asked said about some other player, said, well, I knew I was going to win. Like, you could just tell they don't like hitting the ball.

Starting point is 00:24:53 I like to hit the ball. And so I'm always going to have that fire in my belly because I just love it. That can separate you at the highest levels. Speaking of highest levels, so if you look at your career record, basically 90% win rate, which I'm sure is the highest in the sports history, most national championships, the collegiate at a national level, when you did lose. So there was 10% that you didn't win. What do you think was most shared in common of those other teams that bested you when they did?

Starting point is 00:25:21 I understand you don't know the systems that created those teams like you know your own system, but from the outside looking in, what tended to be shared in common of those high-performing teams that did manage to be your teams? Don't ever forget the talent matters. It took me a while, to be honest. I think I started building teams right away and almost had this elite view of give me any group and I'll make a team out of them. that's not really true. I mean, the fact is, you might be able to get that group higher than they should go,

Starting point is 00:25:50 but you're going to need some ballers. You're going to need some talent. I think when we've been beat, we've been beat by a better team that played better on the day, give their coaches credit, but really give their athletes credit. They had a lot of talent. You have to work with the individual. You can't, as a head coach, just think about the team and the strategy of the team and what's going to be our technical approach to play to our strength,

Starting point is 00:26:12 and all of these assets that are out there can be improved. And we forget that sometimes. What we should really be doing is, in addition to building the team, we should be helping every one of those individuals get from where they are to where they really want to be as individuals. Now, at this stage, I'm really interested in what people can do. What are the things that they can do anywhere, any time, what are their strengths? And how do we build a blueprint for their success as an individual based on what they do on their strengths. And it doesn't mean that we're not trying to slide a few liabilities into the

Starting point is 00:26:49 strength column. It doesn't mean that you're trying to ignore what people don't do well. We have to continue to improve. But we can improve on our strengths as well. Constant improvement can also be your strengths and just taking them to the next level. So I spend a lot more time talking about strengths in the last half of my career than I did the first half of my career and modeling out an approach to the game for every individual and then try to build a team. Spend now maybe half my time on the individual and half my time on the team where I was probably 80-20 for the first half of my career. You mentioned Mark Bingham earlier, and I'm sure that's one of the answers to this next question. When you think about pride, what's an episode that stands out in memory, I'm sure there are many,

Starting point is 00:27:30 where you were especially proud of one of your teams? What do they do to generate that pride? And what's your take on pride, generally speaking? that it's possible to be proud of something and be prideful about it, even if it's really, really hard. I coached a young guy one time and didn't plan all the big games, and I know he wanted to. And, you know, when I had my kind of exit meeting with him, and he's getting, he's going to graduate and leave. I was dreading it, Patrick. And he said to me at one point, he said, coach, this has been the hardest thing I've ever done. And my heart fell. And this kid clears his throat and says that I wouldn't trade for anything.

Starting point is 00:28:09 And I went, I think we're proud of what we earn, what's hard, what's difficult. I don't think pride is a shiny object. I don't think it's the easy stuff. I think it's the hard stuff. When I've been most proud of my team, we won a championship and against a team we weren't supposed to beat. They had a lot more talent. You imagine the final whistle, there's a bit of jumping around, there's a bit of celebrating.

Starting point is 00:28:35 But when you get close to the players, I can see their faces. A few guys were crying, and they weren't crying because they wanted to cry. They didn't have any defenses left to be cool. It's that moment where they've given full measure. They've given everything they have to give. And to actually see that up close and to know that they did it for their university, but they really did it for each other. When you see team come together like that, we could have lost that game.

Starting point is 00:29:03 And I think I would have been equally as proud of those faces. We happen to have won the game. But it's moments like that where you go, wow, I mean, it's amazing what people can do together. How proud I was of them and how proud they were of each other. Incredible. I'd love to transition the topic a bit. It's great hearing about the team setting. Fact is, me and most others never got the chance to play a sport at that level.

Starting point is 00:29:28 As you mentioned, the physical talent, you kind of have it or you don't. A lot of us haven't had this experience of, such intensity around work and outcomes on a team. But we all work. We're all in some form of business or some form of nonprofit, whatever is that we do, on our families, et cetera. What are the most interesting ways that what we've talked about, you see translatable into the world beyond sports? So when you're working with companies or whoever else, what are the aspects of this way of thinking about teams that are most portable? Well, we get it wrong in sports. is making a case for what we do is how I think about your question. And I think sometimes in

Starting point is 00:30:07 the sport we think, well, we work hard, we compete, walk by the library at 1130 a night, see all those kids in that library. You think you're working harder than them? I guess what I'm saying is working hard, being competitive, having busy days, that's not proprietary to sport. I mean, anyone who cares and is on their own little mission is doing that. The interesting thing that's proprietary to sport. And I know we're maybe trying to transition away from team, but it's the concept of team. I work on a world-renowned research institution, quite oftenly regarded as the finest public school in the world. And I'm telling you, team isn't taught anywhere on our campus. Nowhere. Is the ROTC have a team thing? Yeah, I mean, might you work with another student on a

Starting point is 00:30:51 project and there's some kind of collaboration? Sure, but that's a long way away from team, as I know it. And is it happening in intercollegiate athletics? Sometimes. But this notion of team, as they say, you know, our athletes all have 10 years and 10,000 hours. I mean, they're an expert in team now. I hope they know that. I hope they all know how valuable that is. If I took a step back, I'd say, team's important to me because we're not one bright person away from solving anything. Pick up all the difficult stuff, disease and the environment, all the things that are going to be difficult to solve. And it's going to be groups of people with shared values, they've got their nose pointed in the same direction, they're going to go get it done together. I believe team is critically important, and yet it's not taught anywhere. And, of course, to your question in business, what's the first thing that happens is you go public as an individual, you graduate, you get through grad school, and now, okay, I'm ready, I'm an individual, they're going to plop you on a team straight away, and you have no

Starting point is 00:31:54 idea how to operate on that team. The real proprietary advantage that I know my players carry with them is this deep and fundamental understanding of team. They know what a good teammate is. They know what a bad teammate is. They know why their team was good and maybe why their team didn't succeed. They have a really acute understanding of team. They take that into their families. They take that in their communities and they take that into their workplace. What have you seen when you've gone into work with The list of companies is, we don't need to go through it, but it's impressive, certainly high-performing companies as measured traditionally by whatever earnings or sales or profit margins or however you want to do it. What have you found most interesting shared in common across some of these impressive companies

Starting point is 00:32:38 in terms of ways that they can still yet improve more? They're almost doing so well despite not having gone far enough on a certain attribute. What do you see as areas that companies can be shaped up more? In culture, it's difficult to scale it. Most companies started pretty small. You knew everybody that got onboarded. Everyone knew what we believed in. And over time, you don't even know who gets hired and onboarded. And it's just hard to scale culture. There's a need. There's a need to do an audit, the same way you would do a financial audit to do an audit on your culture, to really ask yourself the really hard questions. When you're working with businesses and this idea of culture becomes so important, have you seen it change? Have you seen a company where, it's big, there's lots of divisions, there's problems. If you have seen a change towards better culture, what has that looked like? It's always been people with the authority want to do it. It never happens because somebody in the middle of the organization has an idea that,

Starting point is 00:33:39 wow, I'm seeing some things that we could fix organizationally that would really help our bottom line and it help our retention of our people. Therefore, they push it up. It almost never happens. It has to be the people with the most authority in the company believing it's the right thing to do. It'll be good for the company. It'll be good for their products, their clients, and it'll be good for their employees. Until they believe that, it typically doesn't happen. But it can happen pretty quickly. If we spend as much time on what we really believe and what we're willing to fight for

Starting point is 00:34:15 as we spend on financial forecasts, our financial forecast would be a lot better. I love that. What do you think about other coaches and what you've learned from them, especially if it's different from how you've done things? You've mentioned a few coaches already and some of their ideas, Pat Riley and Wooden, et cetera. Are there other coaches that you've observed in your sport or others that you've learned a lot from? Yes. I'm involved in coach development and coach education. I love to work with other coaches. And that exchange is very powerful. When I was a younger coach, I would shadow coaches. would sometimes ask them if I could come in and just be a fly on the wall for a couple days.

Starting point is 00:34:57 Then I realized it was easy for him to say no. So I just start showing up and knock it on the floor. Since I'd come a long way, it was a little hard to turn me away, I suppose. Learned a lot. I heard Bo Schembecker, the great football coach at Michigan, tell a story. And he was talking to a group of reporters. He was saying, he was explaining to them about recruiting. I'll remind your listeners that football teams play each other typically one autumn Saturday a year.

Starting point is 00:35:26 And Bose comments, the reporters, were if you really wanted a player and you didn't get them, it's not that big a deal, they'll only beat you once a year. And I thought, okay, all right, you know, that's pretty good. And then he says, on the other hand, if you get the wrong player on your team, they'll beat you every day. I can remember, I wrote it on my arm because I didn't have any paper. And I haven't forgot it to this day. You can get by with just about anybody. But if you get the wrong person on your team, they're going to beat you every day.

Starting point is 00:35:54 Coaches are typically very generous with what they think and what they believe and why. It's a good thing. Are there other aspects of what I'll call organizational behavior, broadly speaking, not just teams or companies, but just generally, that you are especially fascinated by personally that we haven't talked about? I mentioned it briefly, but this idea of non-cognitive grit. I mean, I see your grade point average. You're right.

Starting point is 00:36:18 That's a good SAT score. But who can grind? Who here needs to grind? You're happiest when it's hard and difficult. I wish we could bottle that. We'd do okay. We'd never work another day. I think there's bonafide social scientists that are on to it.

Starting point is 00:36:34 I'll be looking forward to hearing about it. I'm interested in joy and love and caring and all that stuff. I mean, I came to all that pretty late. I can remember doing a deep dive. with the Marine Corps and the drill sergeant, who literally was up the six of these recruits night and day. After they get through their crucible and they're called a Marine for the first time, and we'd be over in a tent having a warrior breakfast. And they would talk about this guy who had driven them harder than they ever wanted to be driven with,

Starting point is 00:37:08 and they'd use words like love. It's very interesting to me, that concept that the people that care about us, and they want what's best for us, and they're going to demand the best from us, those are the people that are going to be closest to us. Pat Summitt, the late basketball coach at Tennessee, uses the saying that people won't care what you have to say until they know you care about them.

Starting point is 00:37:30 It's kind of an interesting thought to me that once people know you care, they're going to listen to you more. But what I found in working with coaches one-on-one is that the real secret sauce that a lot of coaches have is they very authentically care. There's no make-believe in it. They very authentically care about their student athletes. And once that transaction happens,

Starting point is 00:37:53 they use the fact of that person knowing how much they care about them to continue to raise the bar. I imagine there's a lot of managers and coaches that care about their people that run successful. It's a great close relationship, but there's no real success in it. What I find is interesting is when that caring is leveraged, to where now, because you know I care about you, I get to coach you hard to be your best,

Starting point is 00:38:19 and I'm going to continue to raise the bar, and there's no animosity in it because this person cares about me. It's a little bit of that drill sword. I love the combination of caring and demanding, or caring, like allowing you to demand more of somebody. It's a counterintuitive, but cool thing. Well, this has been so much fun. I've learned a ton. I think everyone listening will recognize something they can do better and certainly want to participate in some of these values or define their own. I have two closing questions for you. The first is back to where we started, which is, again, around this creation of a value set. I think the most important takeaway, at least for me, is values can't be something on a wall. It's got to be an operating system, not some empty declaration.

Starting point is 00:38:57 With that in mind, what else do you think is important for companies to consider if I was a new company creating a value set for the first time? What advice would you give that you've seen work? I think just to double down on this concept, you make sure they're complementary, make sure what you believe in is never contradictory. And I think sometimes that happens where, well, if you really believe in that, how do you believe in this? It's about describing it. It's about saying, this is what we mean by this value, and this is what we don't mean even, to make sure everyone understands what it is that you're saying to take that extra step. And then defense post it. That's a football coaching term. I have to admit, Patrick, I've never really built a fence,

Starting point is 00:39:38 but apparently you dig a hole and you walk a few feet, dig another hole, and then you dig another hole. And I guess fence posting your values would mean that you had to keep talking about it. You don't do it one time. You don't go on a retreat and say, here's our values. Or I want to show everybody and go to our website. No, you've got to keep talking about them. You've got to measure yourself against your own values. When people are examples of your values in a very positive way, we have to celebrate that success.

Starting point is 00:40:05 We've got to make note of it. People gravitate to where the love is, right? And so it's important that it becomes a daily, weekly, usage as opposed to we're going to create them and they're very thoughtful and they really do represent what we believe and then we just leave them alone until the next monthly meeting or the next quarterly meeting or maybe the next annual meeting. That can't be. You've got to use them every day. I love that. I love fence posting. It reminds me my friend Brent who says people will start hearing what you're saying when you get sick of saying it. Just repetition matters. Consistency matters.

Starting point is 00:40:40 This has been so much fun. I have a traditional closing question, I ask everyone the same question at the end of my discussions. The question is, what is the kindest thing that anyone's ever done for you? I have a lot of gratitude in my heart for a lot of people. The kindest thing anyone has ever done for me, I think allowing me to coach me, allowing me the trust and the space and the vulnerability for me to coach them. It's a gift. You kind of wake up every day and slap my hands together.

Starting point is 00:41:11 It doesn't work because I'm a good coach. It works because there are people that allow me access to them, that allow me into their hearts and into their minds. And that's probably the thing I'm most grateful for and probably the kindest thing anyone's ever done to me. I mean, anytime someone calls me coach and allows me to coach them, get them from where they are to where they want to be. And there's some dragging and bushing and pulling and all that typically.

Starting point is 00:41:39 I'm really grateful for that. Fantastic. I absolutely love it. So enjoyed our conversation. Jack, thanks so much for your time. It's a pleasure to meet you. Okay. Cheers, Patrick. If you enjoyed this episode, you can sign up for a new email newsletter sent out each week called Inside the episode. Each week, I condensed that week's episode to my favorite big ideas, quotations, and more. I've been recommending books to members of this email list for years, and we'll keep doing so in this weekly email. You can sign up at investorfieldguide.com forward slash book club.

Invest Like the Best with Patrick O'Shaughnessy - Jack Clark - Grateful for Everything, Entitled to Nothing – [Invest Like the Best, EP. 215]

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