Dave Ulrich: Culture and Leadership Principles for Young Entrepreneurs From the Father of Modern HR | E195

Dave Ulrich: Culture and Leadership Principles for Young Entrepreneurs From the Father of Modern HR | E195

Dave Ulrich: Culture and Leadership Principles for Young Entrepreneurs From the Father of Modern HR | E195

HR is widely misunderstood by several employers and employees. While many people think that HR strictly enforces internal rules and has no impact on an organization’s bottom line, that couldn’t be further from the truth. HR exists to create value in the marketplace through your employees and your organization.

Dave Ulrich came onto YAP to discuss the intricacies of HR and how business leaders can upgrade their HR practices, even if they don’t have a dedicated HR department. Dave is a Distinguished Fellow in the National Academy of Human Resources and the Co-Director of Michigan’s Human Resource Executive Program. He’s also the co-founder of the RBL Group, which develops custom leadership, HR, and organization solutions.

In this episode, Dave and Hala dive into the purpose of HR and how strong HR practices increase profitability. Dave explains the value of psychological safety in the workplace and how it can prevent retention issues like quiet quitting. They also talk about why CEOs need to have a strong understanding of HR and how they can cultivate engagement from their employees who are working remotely.


Topics Include:


– Purpose of HR

– How does HR impact the bottom line?

– What does HR consist of?

– Investing in an HR leader

– Keeping your employees working hard

– Combatting quiet quitting

– Psychological safety in the workplace

– Leadership as energy management

– Giving feedback

– Engagement in remote work

– Optimizing organization

– Understanding HR as a CEO

– The Leadership Code

– And other topics…


Dave Ulrich is a professor at the school of business at the University of Michigan. He has performed workshops for over half of the Fortune 200 and has spoken to large audiences in 90 countries. Business Week named him the #1 Management Guru and Fast Company referred to him as one of the world’s top 10 creative people in business. He is currently on the Board of Directors for Herman Miller, is a Fellow in the National Academy of Human Resources, and is on the Board of Trustees of Southern Virginia University.

He has published over 200 articles and book chapters and over 30 books. He has also co-directed research on over 40,000 respondents about the competencies required for successful HR professionals. Dave is fondly known as the “Father of Modern HR.”


Resources Mentioned:


Dave’s Website: https://daveulrich.com/


Sponsored By:


Connect with Young and Profiting:


Text Hala: https://youngandprofiting.co/TextHala or text “YAP” to 28046


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[00:00:00] Dave Ulrich: There's a single factor that I can use to determine how good a leader you are. How often does someone leave an interaction with you feeling better or worse about themselves? If you're a young entrepreneur, you meet with a lot of people, your employees, your customers, your investors, your suppliers, how often do they leave your interaction feeling better about themselves?

[00:00:21] I think the young entrepreneurs are the heads of HR. What you know and do as a young entrepreneur is manage people. We often get in our mind some of the Dilbert cartoons or the office show on tv, hr, the policy police. That's not it at all. HR is there not as a set of people, but it's a set of ideas to help you as a young entrepreneur create value in your marketplace through your people, through your organization, and through your work as a leader.

[00:00:54] Hala Taha: What's up, YAP fam. It's your host, Hala Taha, and you are listening to YAP, young and profiting podcast. The [00:01:00] number one education podcast and business podcast across all apps where we interview the brightest minds in the world and unpack their wisdom into actionable advice that you can use in your daily life.

[00:01:11] Thanks for tuning in and get ready to listen, learn and profit.

[00:01:27] Dave, welcome to Young and Profiting Podcast 

[00:01:30] Dave Ulrich: Hala, what a privilege to join you. I'm just delighted. Thank you so much. 

[00:01:33] Hala Taha: I'm so excited for this conversation. So YAP fam, I'm here with Dave Ulrich. Dave is university professor, bestselling author, a speaker, a management coach, and consultant. He's a professor of business at the University of Michigan.

[00:01:47] Also the co-founder of the RBL Group. He shaped the HR profession. He's known as the father of modern HR. He's also been ranked as the number one management guru by Business Week. He's been profiled by [00:02:00] Fast Company as one of the world's top 10 creative people in business. And he is also been recognized by Thinkers 50 Hall of Fame as one of the world's leading business thinkers amongst so many other accolades.

[00:02:12] And so today's episode is gonna focus on the importance of people within an organization and how to best lead our people. And many of my young and profiteers listening today are not in HR, but they are leaders within their own personal and professional lives and careers. So I think a great way to start off this episode and the topic of people management and leadership would be to discuss the purpose of HR within an organization.

[00:02:34] So Dave, let's start there. Can you tell us about the purpose of HR in your opinion? 

[00:02:39] Dave Ulrich: First of all, thank you again. What a delight to imagine in my mind that I'm sitting need and need with any of your young entrepreneurs and having a conversation with them. Here's the question I would start with, what does it take for your business to succeed?

[00:02:53] I'm an entrepreneur. I've gotta create products and services that customers value. What do you have to do to make that [00:03:00] happen? And one of the things we've discovered is you've gotta have money. You've gotta have financial resource, you've gotta have a product. But behind all of that is the people and organization.

[00:03:10] I would disagree a little bit. I think the young entrepreneurs are the heads of HR. What you know and do as a young entrepreneur is manage people. So HR is not about the HR systems. We often get in our mind, some of the Dilbert cartoons or the office show on tv, HR, the policy police. That's not it at all.

[00:03:30] HR is there not as a set of people, but as a set of ideas to help you as a young entrepreneur create value in your marketplace through your people, through your organization, and through your work as a leader. 

[00:03:44] Hala Taha: And I'd love to understand how does HR actually impact the bottom line? A lot of people think that it's just about internal and internal things, but it also impacts the bottom line and a lot of external factors.

[00:03:55] So can you tell us about that? 

[00:03:57] Dave Ulrich: One of the things we've discovered, I think HR has been a [00:04:00] legacy. There's a legacy of HR. It was industrial relations, union relations, and then the policy police kind of model of HR policy people. Today, that's not where HR is. Here's the issue. What drives a bottom line?

[00:04:13] Your customer experience. Does your customer have a good experience with your company, with your products and your services? Guess what the biggest indicator of customer experience is? Employee experience. Your customer experience. You gotta have a good product, you gotta have a good service. But once you've got that, do the employees who work for you create a great customer experience for your people.

[00:04:37] HR is about people. People are inside the company and people are also customers. And so the statistics show that employee experience is a lead indicator of customer experience. So one of the things HR does is it gives your employees a great experience and that drives customer experience. The statistics are amazing and nobody almost cares about that.

[00:04:59] Hala, think of [00:05:00] a company you enjoy going to either a restaurant, a store, an airline. Name a company you enjoy going to, 

[00:05:08] Hala Taha: Lulu Lemon. It's a clothing store. 

[00:05:10] Dave Ulrich: All right? By the way, I have to confess, I have not shopped at Lulu Lemon. What's the, by the way, the clothing has to be good. It has to be stylish, it has to be fresh.

[00:05:20] If you have bad clothing, nothing's gonna overcome it. Can you think of an employee who is really good at Lululemon, who happens to give you great service? He or she responds to your needs. They know your style, they know your fit. They know what you can do to be more successful. Can you think of one?

[00:05:35] Hala Taha: Yeah, the last lady who helped me when I went to the store.

[00:05:38] Dave Ulrich: That's the point. A company succeeds. One, you gotta have good fashion. If Lululemon has raggedy clothes, they're not gonna get you back. But a lot of companies have good clothing, they have good style. It's the relationship. Nordstrom is a classic example.

[00:05:52] Nordstrom is discovered that the correlation between employee attitude. How does the employee feel about working at Nordstrom? They have [00:06:00] hundreds of stores, and the customer attitude to get them to buy more is about 0.6 to 0.8. So if I'm a young entrepreneur, am I bringing in people who have great attitudes because they're the ones that are gonna drive my customer attitude and that drives profit.

[00:06:17] Hala Taha: Yeah. It's so interesting because nowadays anything can be copied. So business models can be copied. You can Google anything and recreate it. And so what's your differentiator? It's your people, right? It's the attitude they had for towards the company, the attitude that they have towards customers. That's what keeps customers coming back for more.

[00:06:36] And it's much cheaper to keep your existing customers than always try to find new ones because you're giving them a bad experience. 

[00:06:42] Dave Ulrich: By the way, I should quote you. That's exactly what the research shows, that if you treat your people well, however that gets defined, they will treat your customers who are also people, and they will then lead to profitability.

[00:06:56] And it's not easy to copy. What's the name? Lululemon. [00:07:00] Lululemon. What a cool store. I wish we could get it. And by the way, they're getting free advertising here.

[00:07:05] Hala Taha: I know they are.

[00:07:06] Dave Ulrich: But Lululemon can go get great fashion. They can find fashion design, and they can do it. But that woman who worked with you, who served you, by the way, we've also got bad experiences.

[00:07:17] We probably shouldn't share those, but so if I'm an entrepreneur, I've worked so hard to get money. I've built my business, I've built my products, I've tried to define my customers. Now my people represent my company. They are my company. If the customers get a good experience with those people, it'll drive our success.

[00:07:38] Hala Taha: Yeah. And that's why it's so important to learn about everything we're gonna talk about today because it's essentially how we can increase productivity, how we can increase employee engagement, what type of leadership skills that we need to be a good people manager. So can't wait to get into the nuts and bolts of everything.

[00:07:54] Dave Ulrich: Let me capture that with a headline. I gave a session a few months ago to a big company, it doesn't matter who to their [00:08:00] top hundred people. And I said, and this is the definition of where HR is. And it's not legacy HR. This is not the office, it's not Dilbert, it's not some of those old stereotypes. I said, what do these companies have in common to a group of a hundred senior leaders?

[00:08:14] Digital equipment may not even know who they are. Circuit City, Toys R Us, Eastman, Kodak, Gee, they all went broke. And I responded to them and I consulted for every one of them. And by the way, that's not a great way to begin your introduction for consulting. I took 'em all from a hundred thousand employees right down, and I said, let me tell you what we've learned in the last 10 years.

[00:08:36] HR is not about HR. HR is about helping your company succeed in the marketplace. All of those companies, for example, Toys R Us, 300,000 employees had great internal HR practices, but they weren't understanding how those practices affected customers. If you're gonna succeed, HR is not about HR. It's about helping your company [00:09:00] succeed in the marketplace.

[00:09:00] Here's a quick example. For an entrepreneur, you're growing your company, you've gotta hire someone. Very simple thing, you've gotta hire people. Will the people I hire create value for the customers? In fact, if the customers had a voice in who I hired, would they pick these people? That's the criteria. If I do training, if I do pay.

[00:09:21] Will these HR practices create value for my customers? One final great example is Southwest Airlines. We've all flown Southwest. They're a little different than the other airlines. Why? Because a Southwest flight attendant doesn't get hired unless he or she is interviewed by a panel of customers. 

[00:09:41] Hala Taha: Wow.

[00:09:42] Dave Ulrich: That's cool. So am I the employer of choice of employees my customers would choose. So as an entrepreneur, when you think about your people, and it's more than people, we'll get to that. Am I getting the people who my customers would be delighted to have on board. [00:10:00] That criteria, hR is not about HR.

[00:10:02] It's about success in the marketplace becomes so critical for an entrepreneur. What am I doing to manage my people, my organization, my leadership, so that our customers and investors will have a better experience? 

[00:10:17] Hala Taha: And I'd love to just tap into what you just mentioned. What is HR, aside from just managing people? Cuz it goes beyond just that.

[00:10:23] Dave Ulrich: It's so cool. Legacy HR was about human capital, which is people, okay. I'm gonna do this. I'm gonna make a fool of myself. And Hala, I'm gonna encourage you to make a fool of yourself with me. 

[00:10:35] Hala Taha: Okay? 

[00:10:36] Dave Ulrich: This is the way I like to describe the HR and I can give a lot of examples. My hand represents talent.

[00:10:42] These are my fingers. My fist represents the organization or the team or the culture. HR's job is to have great people. It's also to have a great team. And the third dimension is leadership. So when HR moves forward today we call it human [00:11:00] capability. Human is the talent. I'm an entrepreneur. Look at my people.

[00:11:05] Five people, 50 people. 500 people. Are they good? Look at my culture. My team, my workplace, and look at the leadership I and the next generation leaders demonstrate, and my forearms represent the HR systems that sustain it. So here's how I'm gonna make myself look stupid. And you two, if you could hold up your fingers, that's talent.

[00:11:26] That's people. We have great people. I've heard you say one of the greatest people you know is named Jason. He's phenomenal. He makes things work well. 

[00:11:33] Hala Taha: He's great. 

[00:11:34] Dave Ulrich: Then you have a culture. Culture is the team. Then you have leadership. That's what sign of respect in China. Then you have HR systems, your forearms, and then you do the HR dance.

[00:11:45] By the way, you're better at the dance than I am now. I did that to make myself look stupid. But if I'm listening to this, think as an entrepreneur, whatever it is, a fashion store, and let's move beyond those. It could be a restaurant, it could be a, it could be a lawn care service, [00:12:00] whatever. It could be a technology company.

[00:12:02] Do I have the right people that my customers think are terrific? Do I have the right culture, the right organization? Do my leaders, not only me, but those below me have the skills, and then am I building my HR services to sustain that over time? That's the issue that we see. Human capability, talent organization, leadership, and HR going forward.

[00:12:25] Hala Taha: Yeah, I love that. I think that was such a great example and such a fun dance. And for those of you listening in, you should check us out on YouTube if you wanna watch me looking really silly. So many of our YAP listeners, as they're entrepreneurs, they're small business owners, they're side hustlers, they're managing remote teams, and a lot of them can't afford a proper HR department.

[00:12:45] They can't afford C-suite executives, that need over six figures a year. And so I run a company that makes millions of dollars a year. I still don't even have a CHRO, probably next year I'll need one. And so I wanna understand what is the [00:13:00] bare minimum things that you need as a small business in terms of HR and what's the right time to actually invest in an HR leader?

[00:13:08] Dave Ulrich: Great question, and I'm not here to advocate to build a big HR function. That would be silly. That would be the old HR, that's the policy police who build complicated processes. If I were interviewing you or sitting with one of, I'm gonna say for the next few minutes, our listeners, cuz I feel like I'm connected with you.

[00:13:23] Hala Taha: Of course.

[00:13:24] Dave Ulrich: If I'm sitting needy with a listener, I'm gonna say, here's the three things you as CHRO, young entrepreneur, side hustler going have to manage. Do I have the right people? Are they competent? Are they committed? Are they engaged? Am I getting the people with the skills and the dedication to meet my customer needs quickly?

[00:13:43] Second, have I got the right team? The culture, the systems are my people working and we know what culture is, we'll dive into that. I know in a minute and third, what do I do? Or what do you do if I'm coaching you as a leader, that makes sure that your people and organization come [00:14:00] together to help your customers get value.

[00:14:02] That's it. And you say what does that mean? It means you hire people, you train people, you pay people. You know what? There's a lot of HR online services, and until you're a company of a couple of hundred people, by the way, people are gonna get really mad at me. Just go use those services. But the question you should be asking is, does my talent do my people?

[00:14:22] Does my culture, my organization, and do the other leaders, including me, have the commitment to help customers have a better experience with my product? That's it. 

[00:14:32] Hala Taha: Yeah. I love that. And one of our sponsors Just Works, is a great solution for everyone. 

[00:14:38] Dave Ulrich: Absolutely. I, again, I don't know which one that is.

[00:14:40] There's a lot of HR services and I know they're your sponsors. And so the more you say that, the happier they are, they're not gonna get as much press as Lululemon. But by the way, if I'm a young entrepreneur, I don't wanna spend a ton of my time on the HR systems, but I do wanna spend my time on people, organization and leadership.

[00:14:59] And in fact, what we [00:15:00] found, again, we do research on large companies often. We did studies of top companies for leadership. The companies that really had effectiveness, the CEOs, the senior leaders of these companies, spent about 20% of their time on what we're now calling human capability talent organization leadership.

[00:15:16] So in the back of your mind, simply be asking yourself the question, am I spending about a day a week? And I know it's not a 40 hour week, no entrepreneurs are doing that, but am I spending about 20% of my time thinking about who are the people I have in place? How am I getting them? How am I making sure they're having a great experience so that customers have a great experience?

[00:15:38] Am I building a team? Am I building the culture? Am I demonstrating as a leader? Would I promise my customers? We believe that takes about 20% of your time as an entrepreneur. 

[00:15:49] Hala Taha: We'll be right back after a quick break from our sponsors. This episode of YAP is brought to you by Justworks. Small business owners, you don't need me to tell [00:16:00] you that the hiring market is tough right now. Top talent has options and that means that you need to be more competitive and step up your game. Are you looking for a way to offer benefits just like bigger corporations do? I know I am, or maybe you're looking for an easier way to onboard and manage remote employees.

[00:16:17] Justworks could be the perfect HR solution that you've been looking for. Justworks makes it easier for you to start, run, and grow a business. There are cloud-based platform that enables managers and employers to quickly and securely access benefits, payroll and other HR functionality from anywhere at any time.

[00:16:35] They have an intuitive self-service user experience that makes admin tasks easier for you and your employees with 24/7 expert support, with Justworks, you have access to certified HR consultants who can provide tailored guidance and best practices for managing remote employees across all 50 states.

[00:16:52] They help you comply with labor law, payroll tax requirements, health insurance plans, they're like an angel for any [00:17:00] entrepreneur because who can afford a C-suite HR executive, Justworks can help you. And my favorite part about Justworks is that you have the access to the same benefits that were previously only available to large corporations.

[00:17:13] So think health, fitness, and financial perks, that's gonna make us so much more competitive to attract top talent. And their pricing is totally transparent. There are no hidden fees. You always know exactly what you're paying for and YAP fam, you don't have to do it all yourself anymore. Run your business with confidence with Justworks.

[00:17:31] Let them handle all the HR stuff. Take a look at Justworks transparent pricing by visiting justworks.com/pricing. That's justworks.com/pricing for details.

[00:17:45] It's getting cold out young and profiteers. At least it's cold where I am in good old New Jersey. And you know what it means when it's cold outside YAP fam. It means that everybody is back in grind mode. Things are busier than ever. And on top of all that, it's [00:18:00] time to start planning your holiday gifts. I hate to break it to you.

[00:18:03] And while it's tempting to put off holiday shopping, why not avoid all of that end of year stress and buy gifts to your team and customers before things get even crazier. Introducing today's sponsor swag.com. They carry premium brands like North Face and Nike and high quality products that your team and customers will actually want to use. And best of all, swag.com allows you to customize any product with your company's logo for a personal touch. In fact, they just sent me a beautiful, customized H2 Go thermal bottle. That's me tapping it right there. Super high quality. It has a wooden cap. It like makes that perfect noise when you close it.

[00:18:42] You know what I'm talking about. This little perfect bougie bottle noise. Guys, I finally have a bougie water bottle to carry around YAP fam. I'm officially an influencer and I have to say young and profiteers sending a gift to your customers or even your potential customers is such a great [00:19:00] marketing tactic.

[00:19:01] It's a great way to retain customers and keep you top of mind for people who are still making their purchasing decisions. swag.com can help you stand out from the crowd. In fact, I remember working at Disney Streaming Services and I was it girl in the marketing department, I was responsible for all the purchasing decisions in terms of any software we would purchase.

[00:19:22] And we had big budgets, deep pockets at Disney streaming service. And I remember come holiday time, we would always get sent gifts. People would send me customized gifts, customized teddy bears, customized cutting boards, you name it. And I have to say, all the companies who sent us gifts were always top of mind when it came

[00:19:44] purchase decision time. Those guys made their ROI on me for sure. swag.com looks awesome. You guys can take at page from my marketing playbook. And send your potential customers or your existing customers some nice customized [00:20:00] gear for the holidays. Keep them retained, keep you top of mind. And also send some swag to your team.

[00:20:07] That's a great way to make them feel appreciated. People are more productive when they're appreciated. Make sure you give them a great holiday gift, like swag.com hot chocolate kits, which I'm gonna customize in YAP branding and send to my team. YAP fam, you could just call me Santa Swag, get the best gift for your team.

[00:20:26] Go to swag.com today and get ahead on holiday shopping. Right now, I have a special offer to help you get started. 10% off your order, but only when you go to swag.com/yap. Again, that's swag.com/yap. Remember for 10% off. Head over to swag.com/yap.

[00:20:48] This is such a perfect segue. I literally organized my whole interview, talent, organization and leadership. That's how I organized it. So just so funny.

[00:20:57] Dave Ulrich: By the way. Thank you. What you've just done [00:21:00] is you've just validated our research. We go collect tons of data, , and what we find is thoughtful people. All we do in our research is put words behind what thoughtful people do, and you're obviously successful and thoughtful.

[00:21:12] Thank you. That confirms the research we've done. 

[00:21:15] Hala Taha: Yeah. Okay, so let's move on to talent. So there's these big trends going on. The great resignation, which I think everyone has heard about by now. People leaving their jobs, trying to find more purpose, becoming entrepreneurs. Then we have quiet quitting, which is basically people deciding to do the bare minimum at work.

[00:21:31] They believe that they shouldn't go above and beyond because they think that they don't get any rewards for doing so. And so obviously there's a huge problem with productivity in the workplace right now. People don't wanna work. And people wanna work less at work because they feel like they don't get rewards for it.

[00:21:47] It's this quiet quitting trend. So I'd love to understand how we as leaders can keep our employees working hard and going above and beyond. 

[00:21:54] Dave Ulrich: First of all, if your employees are leaving, if you have quiet quitting. By the way, those aren't new [00:22:00] topics. One of the things I love to do because of my history and age is show how ideas build on each other.

[00:22:05] We've talked about employee satisfaction, employee commitment, employee contribution for a long time. Employee experience is the underlying theory part of your job as a leader, if I'm coaching you, sitting need and knee with you, is to say, how do I help my employees have a better experience at work?

[00:22:22] We've all been in jobs where we had a great experience and we've almost all been in jobs where we didn't. What's the difference? You've had Daniel Pink on, by the way, let me just do a shout out. What a brilliant thinker around autonomy and some of the principles. We have a framework that's really, I love simplicity.

[00:22:38] We've said, as a leader, there's four things that your employees want, so they'll have a better experience. And remember, their experience will be a lead of customer experience. Number one, be safe in the world we live in today. Physical safety, making sure that the employee feels like I'm not putting you at risk.

[00:22:55] I'm not. I'm saying if you're sick, stay home appropriately wear mask [00:23:00] psychological safety. We care about you psychologically and emotionally. So that's one. Be safe. Second, believe, do your personal values reflect the values of the company? Our company has a set of values. This is what we believe in. We believe in.

[00:23:16] I'll just pick three. Random learn, listen, and profit. I've just picked three random values. By the way. They're on the board behind you, . If you don't believe in listening and learning and profiting, don't come to work at our company. It's not gonna work for you. But if you do, your beliefs will match our company beliefs.

[00:23:34] So talk to your employees about the value of values for them. Why do I do the job I do? Because it gives me a sense of meaning, a sense of purpose. Be safe, believe, become. I go to the employee and say, you're Gen X. You're Gen Z, whatever gen, even old generation like me. You wanna learn, you wanna grow. We will create a company where you can learn and grow.

[00:23:59] You'll develop [00:24:00] skills and opportunities you wouldn't have had elsewhere. Be safe, believe, become. And I think finally the fourth and perhaps most critical belong, we're gonna be a place where you, were a community. We're gonna listen to each other, we're gonna show respect, we're gonna be inclusive, whatever that word term means to you.

[00:24:16] So if I'm a young entrepreneur and I say, what is it I wanna promise my employees that will give them a better experience? Be safe. I almost think that's foundational. If you're not safe physically and psychologically, you're not gonna stay. Believe. Will our values as a company reflect your beliefs and values as a person become, are you gonna be able to learn and to grow and to develop new skills, have a growth mindset, a buzzword, and belong.

[00:24:43] Are we gonna be a place that we care about you? We show empathy. We show emotion. In general, employees who get those four things, be safe, believe come and belong will have a higher employee experience. And that's what I hope I can provide my people. 

[00:24:58] Hala Taha: I love that. And I'd love to [00:25:00] dig deeper on this concept of psychological safety because I think mental wellness is such a huge thing right now at the workplace, and I think a lot of people are spending time on that and investing in that.

[00:25:11] And it used to not be a thing at all. So how can we improve psychological safety within the workplace? 

[00:25:17] Dave Ulrich: Great comment. By the way. I encourage those really interested to read work by Amy Edmondson. I'm not gonna claim work. I've already given Dan Pink a shout out. Amy is really the, I've heard that there's a podcast princess who's.

[00:25:29] The maestro of podcast, Amy Edmondson is is the psychological safety princess. And I encourage people to look, but here's the logic. Psychological safety means I feel like my needs are being cared for. Somebody cares about me. If I were coaching, again, a leader, there's four E's I'd say you've gotta pay attention to.

[00:25:47] One is Emotion. Don't be afraid as a leader to let the emotion come through. Feel care. Two is Empathy. Let the compassion come through. I care about you [00:26:00] in a real way. My emotion, my feelings are not hidden. I think some of the old models of leadership hide those emotions. Don't let anybody see that you're vulnerable, that you feel, of course, I feel, and I have empathy, compassion.

[00:26:13] Third Energy people draw on leader's energy. They do what their leader does. And so as a leader, are you demonstrating energy? I ran a mission for three years for a church. A number of years ago and one month I decided that I would wear, I would button my coat every day. At the end of the month, all 200 people who reported to me button their coat every day.

[00:26:37] I didn't say a word. They copied me. They looked at me, they copied me. The next month, I unbuttoned my coat every day, and at the end of the month, they unbuttoned their coat every day. By the way, the third month I did a day on and a day off just to confuse people. By the way, I was trying to teach another lesson.

[00:26:51] But the model is, are people feeling my energy as a leader? Do they feel it? And then the fourth is make sure that my [00:27:00] people have that good Experience. The believe become and belong. So my job as a leader is to try to provide that mental wellbeing, empathy, emotion that's caring and compassion. I'm gonna give one example cuz it, this sounds like it's all flowers and roses and happiness.

[00:27:17] There are times when you as a young leader or old leader, have to make tough decisions. People make mistakes. Don't run away from it. Let me give an example. I was coaching a leader. It wasn't a small company, it was a big company. A senior leader, one of his employees made an egregious mistake. And I said to him, as a leader, before you contact that employee, talk to me.

[00:27:39] I'm your coach. And he said I'm ready to send an email. By the way, that's also a problem. But they were global. And so he contacted my email and he said, this is the email I've drafted. You made a huge mistake. It cost us millions of dollars. If you don't fix it, you're fired. And I said, stop. Don't send that email.

[00:27:57] And he said what should I do? Again, I love Hala's [00:28:00] simplicity. Three things start. I care about you, really simple. Number two, you have great potential at this company. Then you made a big mistake. It cost us millions of dollars. Do not hide from that. And then number three, what do we learn from the mistake so that you can get better?

[00:28:20] By the way, notice that's part of that caring for the mental health. I love that idea. Not only at work, but at home. I care about you. I think you have great potential. And then if there's some material you gotta share it. You did make a mistake. Don't get all judgmental. You made a mistake. You know it.

[00:28:37] I know it. What are you gonna learn? By the way, it was so cool with this experience. The leader I worked with sent that note out, called back 24, 48 hours later. He said, wow, I had a conversation with that employee I've never had before because the employee said, you've never told me you care, and that I have potential.

[00:28:56] I really wanna work with you. So even in tough times, [00:29:00] we have to make it work. And I'm gonna do a final addendum. By the way, you made a mistake. You opened me up and I'm talking, I've done a ton of research on leadership. I have concluded there's a single factor that I can use to determine how good a leader you are and it's gonna be so easy.

[00:29:16] How often does someone leave an interaction with you? Feeling better or worse about themselves? Stop and think about that. Hala, we've not interacted much. I can already feel your energy by the picture and your energy and your vitality. I'm feeling better about myself. If you're a young entrepreneur, you meet with a lot of people, your employees, your customers, your investors, your suppliers, how often do they leave your interaction feeling better about themselves?

[00:29:46] That's the criterion, a criterion of leadership. 

[00:29:50] Hala Taha: I completely agree. When I think of leadership, I think of energy management. I'm the CEO of 50, 60 people right now, and my job, I feel like my [00:30:00] main job, aside from being innovative and coming up with strategy, is to be the energy of my company and make, because I know however I feel, is how they're gonna reflect that back at me.

[00:30:10] So if I'm worried, they're gonna be worried. If I'm productive, they're gonna be productive. If I'm in a bad mood, everyone's in a bad mood, right? And so you have to be careful. And I love the advice that you gave about feedback. It reminds me of the sandwich technique that Heather Monahan talks to us about.

[00:30:26] And so I love that it's give a compliment up front, give the criticism, talk about how you can learn about it afterwards so that people actually improve. I think there's always two types of leaders. I think I'm in the first category, the first type of leaders. They just tell it how it is. I think my worst quality as a leader is sometimes I can be, I'm very busy.

[00:30:47] I'm running basically four different companies at the same time, and it's a lot. And so sometimes I can be a little rushed in my feedback and forget the sandwich technique and it's, I [00:31:00] always regret it every time. So it's so important to take the time to give quality feedback and not just spurt out what's wrong all the time.

[00:31:08] Dave Ulrich: If I could implant one little thing, not in your brain, but in the brain of those listening, you do this instinctively, how do I help this person who I'm interacting with feel better about themselves. By the way, that leads to the sandwich, it leads to a whole lot of things. Carrying empathy, emotion. You know what?

[00:31:24] And it can be very short. I post on LinkedIn quite a bit. Once in a while I lose it and I get snarky because somebody made a comment I didn't agree with. I've almost always gotta tell myself time out, even in those short bursts. Thank you. Express gratitude. I don't agree with you, and that's okay, but thank you for giving me another point of view that I'll think about.

[00:31:45] By the way, if I can get that little, and call it whatever you want, sandwich gratitude, positive psychology. I want people to leave an interaction with me as a leader, feeling better. I hope I make you feel better from this thing, so that I listen, learn and profit in an [00:32:00] appropriate way. 

[00:32:01] Hala Taha: Yeah, and I have to say that one of the tricks that I use to make sure that I'm maintaining good energy within the organization is that I really try not to give feedback like on text or email.

[00:32:13] I try to take Loom videos, so it's like a little app, it's for free. And I'll take video feedback. If I realize that I'm being mean in the feedback, I'll start it over and be nicer and then send it, because I know that it's like people will remember, like especially when you are the leader, they're gonna remember every word that you said.

[00:32:33] And if you made them feel bad, it could take weeks before they feel motivated again. And so it's very important to maintain that energy. 

[00:32:39] Dave Ulrich: And can I add an addendum? I'm sure it may have happened to you. It's happened to me. We make a mistake even with good intent. We try. We make a mistake. Don't run away from it, run into it.

[00:32:51] Make it a good apology. The repair becomes part of a relationship. Relationships are not always cheery. I made a mistake yesterday, by the way, in our company with one of our [00:33:00] employees. I goofed, by the way, if you're intentionally hurting people get outta the company. That's another issue. But we still make mistakes even with good intentions.

[00:33:08] I'm sorry I made a mistake. Here's what I did wrong. Here's what I've learned. Here's what I'm gonna do differently. I think when we run into the mistakes and make a repair a mistake is a fail. Carol Dweck, the goddess. The princess is the word podcast princess. She's the princess of growth Mindset.

[00:33:27] Failure is an opportunity to learn. And when we do as leaders make mistake, and by the way, if you haven't made a mistake as a leader, you're in trouble because you're not taking a risk. Of course, we make mistakes. Run into it. I'm really sorry. Here's what I did, here's what I feel. Here's how I feel about you.

[00:33:45] Here's what I've learned. And then the repair enables growth. So I just wanna throw that in there, that this is not about not making mistakes. That's okay, but let's learn from 'em. 

[00:33:55] Hala Taha: Yeah, totally. Everybody makes mistakes and if you own up, you actually see more [00:34:00] human, they'll probably connect it with you more.

[00:34:02] And it's a bonding experience at the end of the day if everybody like ends it happily. So I think that's a great point. So this energy thing is really important and a lot of us after Covid are now either partially or all the way working remote. My company has always been remote and I think that it's causing a real problem in terms of engagement.

[00:34:23] So I'd love to hear your thoughts and 2 cents on is remote we're good or bad for engagement and what we can we do to improve it? 

[00:34:30] Dave Ulrich: There's a long answer and a short answer. The long answer is we don't know yet. How's that for being an academic? We just don't know the long term consequences. Short term remote's not new.

[00:34:42] You say you've been remote for years. I've worked remotely for years. By the way, welcome to my office. I live in the United States in Utah. I'm a professor at Michigan. In fact, in our cri we happen to celebrate Christmas in our newsletter. The address I give is two A cuz I'm always sitting on an airplane in seat two A.

[00:34:58] In fact, I Mark, [00:35:00] just to give you a sense, you gotta have a sense of humor. I sometimes mark on the window a little note that I sat in that seat. My wife was traveling with me. She said, what are you doing? I said, I'm marking my turf. She said, there's five dots, and I said, I've been in this seat five times.

[00:35:14] Remote work's not new. It's not new. You've been remote. I've been remote. Everybody gets excited about where you work and how you work. Are you working at home, at Starbucks, in the office, in a car on the beach? Are you doing it face to face or digital? I believe those are the wrong questions. If I'm an entrepreneur, I don't care as much about where my people work or how they work.

[00:35:35] Here's what I care deeply about. What work are you doing and why is that work creating value for a customer, let me say that again. If you're working in Starbucks, but you came up with an idea that's gonna change our company's ability to work with customers better, I don't care if it was at Starbucks or Lulu's fashion or Lulu's Lemon, what I or on C2 A.

[00:35:58] What I care about is what are [00:36:00] you working on and why will it deliver value? And so when we focus engagement, not on location or place, but on what we do and the value it creates for our customer, that's that outside end customer logic. I think we're gonna have engaged employees. Our employees are not usually dedicated to the office.

[00:36:18] Ooh, I'm gonna leave because my office chair's too small. No, I'm gonna leave because I'm not doing work that I see the value of. So that's, I would shift the focus from where and how to I and what now? What does that mean when we come together? Let's not do work together. I could have done at home. That's almost obvious.

[00:36:36] Don't come to the office and do emails. That doesn't by the way, with Next generation, you're not doing emails anyway. You're doing Instagrams, you're doing Twitters, you're doing other systems. But when we're together, let's be together and make sure that we build the community, the belonging, believe, become belong.

[00:36:51] Okay. I think engagement is very possible. I'll ask a question. This is dangerous. You and Jason is on your team, if I remember right. Is [00:37:00] that right? 

[00:37:01] Hala Taha: Yep. He's my producer. Yeah. 

[00:37:03] Dave Ulrich: How often have you and he been in the same room? 

[00:37:06] Hala Taha: Like maybe 10 times, but we're best friends. You know what I mean? 

[00:37:11] Dave Ulrich: That's the point. By the way, here's my test again. If I'm, I love these simple tests. Did somebody leave feeling better? Here's my test. Are we building a connection? Energy is your word. Experience may be mine. Same thing. By the way, I'm gonna get emotional here and I'm not afraid of that cuz this has happened with people.

[00:37:27] I have an assistant for 34 years. We've been in the same city two years. But if my assistant called and said, Dave, I'm really struggling today. I need some help, I would stop and I would help her. If Jason said, Hala, I'm really having some struggles right now. Whatever they are, and we obviously Jason's not, but if he were, how quickly would you respond?

[00:37:50] Hala Taha: I would drop everything.

[00:37:52] Dave Ulrich: By the way, you have created an emotional bond that is not tied to boundary. The boundary of a company is not the space, it's the emotional [00:38:00] connection. By the way, as a leader, again, think of your employees. If an employee called another employee in your company and said, I'm really struggling right now.

[00:38:08] I need help, would my company employees be willing to put aside what they need to put aside and respond? Would they? Psychologists call this, by the way, there's all kinds of research on this stuff. A bid. We do that with, I don't know if you have children. We do that with our children. Our daughter called last night in another city.

[00:38:25] Mom, I'm really hurting right now. Wendy and I had to go to an engagement. Wendy said, she looked at me and said, call the people we're gonna be engaged with. We're gonna be late. And she then spent 15 minutes talking to our daughter. Now, my wife, who's back here is a great psychologist. By the way. This is not about me.

[00:38:42] It's not about you. It's about an entrepreneur. Am I building a set of people who have a culture? Of taking care of each other even at a distance. I hope we've got that. That's the litmus test.

[00:38:54] Hala Taha: And I think what you're really trying to say is that don't be afraid of bringing love into work. 

[00:38:59] Dave Ulrich: Oh, that's right.[00:39:00] 

[00:39:00] Hala Taha: I tell my executives I love them all the time. I don't know if it's appropriate or not, but it's the truth. It's like I care for them as people and I truly love them as my best friends. We spend so much of our lives at work. The people that we work with should be our friends and we should actually love them.

[00:39:15] Dave Ulrich: We should test that with Jason. You should call him at 2:00 AM this morning and say, or send him a note. Jason, I'm struggling. I need help right now. And see what, Jason, by the way, there's always scary to make fun of the technology person behind the screen is producing . I think we all get it. We wanna build relationships.

[00:39:31] Relationships are not just temporal. There is a time when you do need to come together. When you and Jason are together, it's not just, let's get together. What's the task? It's you get together. Jason, how are you? How's the family? How's your personal life? How are things going that you're willing and vice versa.

[00:39:47] But I think those relationships can be built across boundaries as well. 

[00:39:50] Hala Taha: 100%. And in business things are always ups and up and down and it's so much better when you have a team that just stays strong no matter if it's up or if it's [00:40:00] down. And I think it's really important. 

[00:40:01] Dave Ulrich: That's the piece. And I'm gonna transition you a little bit.

[00:40:03] Remember I had my stupid dance. If you're not watching.

[00:40:06] Hala Taha: Yes, it's time to talk about organization. 

[00:40:08] Dave Ulrich: That's it. You got organization than you got team. We've done research, and again, I love to base ideas on pretty solid research. We have tons of data over decades. What matters more to a company success? So I'm an entrepreneur.

[00:40:21] What matters more? Is it my people or my organization? Is it my fingers or my fist? If you're listening. The answer, four to one organization, you can have good people, but if they don't work well together as a team, the customer doesn't get value. One piece of data that I think people can relate to and it's sports and I apologize for sports, but this applies.

[00:40:43] I'll do two examples. Sports and movies. Michael Jordan, self-defined, probably best basketball player in history. We all of know of Michael Jordan. He won the scoring title nine times leading score in the league. Best person fingers, three times he did not win the [00:41:00] championship, so nine titles, street, no championship.

[00:41:03] He scored 36 points a game. Six times, he won the championship and he scored 29 points a game. Take a step back from that very simple case. Michael Jordan, best player leading score nine times until his personal scoring dropped 20%, 36 to 29. They didn't win when he made other people better. The team was more important than the individual.

[00:41:27] By the way, the same is true in movies. How often is the leading actor or actress in the movie that wins movie of the year and it's 20%. Let me say that again. The leading actor, actress is in the movie The Wins movie, the year 20%. How often is the director in the movie of the year? 80%. That's why, again, for those listening, I have my fingers.

[00:41:49] That's the hand I have. My fist leadership is the combination that leadership piece brings together people. So it's not just a great actor or actress, it's the ensemble. It's the team [00:42:00] that makes us successful. 

[00:42:02] Hala Taha: Yeah. So I'm gonna say quote directly from you. Individuals can be champions, but it's the organization that wins championships.

[00:42:11] Dave Ulrich: That's a great quote. Where did you come up with that?

[00:42:13] Hala Taha: It's yours, Dave. So let's talk about how we can optimize our organization. So you've got this concept I heard you talking about called morphology. Can you tell us about that? 

[00:42:23] Dave Ulrich: You're right. And you're gonna love me because I'm not gonna talk about it.

[00:42:26] Most people define organization as structure, and if I say to people, draw an organization chart, they draw the little hierarchy. It's a Christmas tree. Here's the boss. Here's who reports to her. Here's who reports to them. That's morphology, that's shape. And here's the takeaway. Organization is not structure.

[00:42:42] It's not morphology, it's not shape. Organization is your culture or your capability. Now, if I'm a young entrepreneur, that's okay, that's a nice theory. I don't wanna go back and go to school and learn a theory. Here's the application. A culture is what we're known for by the [00:43:00] customers who use our services.

[00:43:01] Let me say that again. A culture or an identity is not our internal values. It's what the customer sees as our brand in our identity. A very simple example, Disney, big company. It's not a young company. Some of you hope you can grow to be as big as Disney. Someday you may not. But what makes Disney so good?

[00:43:21] They've got a brand. We have grand. Our son finished his PhD. Mike, what do you want for a gift? He had four children at the time. I want to go to Disney. So we say, Mike, we'll go to Disney. He says, great, we're gonna go to Disney for a few days. His sister says, I wanna go to Disney. His sister says, I wanna go to Disney.

[00:43:38] Suddenly, 15 of us show up at Disney, 16 of us. Actually. Why? Because Disney has an incredible allure. It's got an incredible brand. You're gonna have the happiest time on earth. It's a great experience. And by the way, I was so distraught because the idea, dad, let's go to Disney to celebrate my degree. And family is a nice way to say, [00:44:00] dad, would you pay and three nights or four nights at Disney?

[00:44:04] Anyway, it's expensive. I was grouchy. I was grumpy because it's expensive. We have eight grandkids, some in diapers. We're walking around. We walked into a room and out walked a Disney princess and she reached her arms out. And my granddaughters turned. Our granddaughters turned around. Grandpa. Grandpa, she's real.

[00:44:24] Aww. And she's so beautiful. Grandpa, we love you. Aww. By the way, everybody goes, oh, that's sweet. No, that's not sweet at all because the next year we had to go to Disney again and again. And so last year at Christmas, there were now 18 of us went to Disney and spent three days. Look at what Disney has done.

[00:44:45] They've got great talent. They hire that princess who is so beautiful and look so good. They hire Disney characters who carry themselves well, but they've got a culture, they've got an identity. We're gonna make this a happy place for you. And [00:45:00] Disney charges a lot and they're successful. So that's abstract.

[00:45:03] I'm an entrepreneur. Here's my question. What do I want my company to be known for by my best customers in the future? At your company? And you have a lot of companies, what do I Hala? The CEO, the founder of these companies, want my company to be known for by my customers so that they'll keep coming back.

[00:45:24] Like Disney. What is it? I want people, when they see me, what do I want? 

[00:45:28] Hala Taha: Innovation dot. We're the most innovative. 

[00:45:31] Dave Ulrich: By the way. That's, if that's your brand in the marketplace, use that as a criteria to hire people. I wanna hire innovative people. I don't wanna hire people that aren't innovative. I want that to be my culture.

[00:45:43] I wanna pay people for that. I wanna train people. I wanna encourage that. And now, and then by the way, I come back to you as a leader. What are you doing to model innovation and imagination? Because when you identify that outside identity or [00:46:00] brand and you bring it inside with talent, leadership and organization through your HR systems, hiring, training, pain, those again are just the routines.

[00:46:08] When you do that, you have created a culture that creates value for your customer. 

[00:46:15] Hala Taha: Yeah, and I'd love for you to kinda go deeper on this concept of identity. Maybe give us some examples of some big companies and what they're, it's very simple and I feel like people need to understand it. 

[00:46:26] Dave Ulrich: It is such a simple idea.

[00:46:28] I was gonna ask you for, name a company. Let me ask you. Name a company you admire, just the company or two you admire. Amazon. Amazon is terrific, by the way. Amazon, I don't know if you're like us, Amazon. UPS has already tracks in the road because they're here so often. 

[00:46:44] Hala Taha: 100%. Yeah. 

[00:46:45] Dave Ulrich: What does Amazon wanna be known for?

[00:46:47] Hala Taha: Putting a smile on people's faces, right? 

[00:46:50] Dave Ulrich: They put a smile on face. Why? What is it that causes, by the way, I'm Hala. I could get, I could go to a lot of websites and order products today, Amazon used to be the only [00:47:00] e-commerce business. Now there's a lot of sight. What is it Amazon does that puts a smile on your face?

[00:47:06] Hala Taha: It's fast. 

[00:47:07] Dave Ulrich: That's it. It's fast, it's reliable, it's efficient, it's low price. By the way, if it's high price, you're not gonna play. But it's efficient, it's predictable. By the way, if that's the Amazon desired identity, that causes me Hala or me, Dave and I love Amazon because you can buy products sitting in C two way.

[00:47:25] On an airplane, you can buy products anywhere. What do I need to build into my organization? By the way, this is really counterintuitive. I want the customer to see me as reliable, fast, efficient, and low priced. Do I want an organization that's loose or tight? Very organized, very tight, very disciplined.

[00:47:45] Why? Because that's what's gonna cause the customer to come back. By the way, people sometimes get mad at Amazon. They have a tough culture. They're pretty strict. They're pretty tight. Why? Because the customers are buying the product. And that's why Amazon needs that. [00:48:00] You talk about your vision is imagination, innovation, creativity, whatever I word you want to use.

[00:48:05] Theirs is about reliability, predictability, price, you're gonna have a very different way of managing. Amazon is stripped by the way. If you're abusive of people, there's no excuse. Let's just be clear. If Amazon ever abuses people, They had 14 leadership principles. The 15th is we will treat our people with respect.

[00:48:23] If you're an abuser at Amazon, you're gone. So that's not an issue. But we are gonna be strict because there's a customer out there some way to, somewhere today, there's a million of them. We're gonna say, I need to go buy this toy for my child, or I need to buy this shirt or this outfit. I'm gonna go on Amazon.

[00:48:38] Because they're easy, they're reliable, they're cheap. Bing. And that's what Amazon builds. So when they hire their new employees, I'll finish off with Amazon. I had a friend, a college student who got hired in the warehouse, and they're pretty tough. You work pretty hard, or truck drivers, you work hard. His first day was all about customers.

[00:48:58] Who are the customers of [00:49:00] Amazon? Who are they? What do they want? Why are they buying from us? And he said, he got ahold of me. He said It was really weird, Dave. The first day I didn't even do anything. I didn't package anything. I didn't do anything. All I tried to learn about was customer. Because that's what Amazon is trying to create, a customer service that puts a smile on your face.

[00:49:19] Hala Taha: Let's hold that thought and take a quick break with our sponsors. 

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[00:53:29] Again, you can check out their transparent pricing by visiting justworks.com/pricing. This episode of YAP is brought to you by Lightstream. YAP fam, let's take a minute and talk about the importance of having a good credit score. Your credit score determines whether you get approved for loans and the rates that you pay.

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[00:55:36] So I think that this is a really great idea. It's think about the identity that you want externally for your company and let that be the guiding force for everything, for who you hire, for your values, for the type of environment that you have. It's just a very simple way to look at things. So 

[00:55:52] Dave Ulrich: I love this and you gotta be thoughtful because what you think your identity should be shouldn't be someone else.

[00:55:57] Let me give your own our entrepreneurs for the [00:56:00] next few minutes A test. Let's say you have a team. How many direct reports do you have, Hala? Who will report, you may not be structured that way, but

[00:56:07] Hala Taha: probably like 12 people. 

[00:56:09] Dave Ulrich: Super. You got 12 people. I did this at Domino, so imagine how I was doing it with you.

[00:56:14] I did this a number of years. They had 14 people. Here's the exercise I gave each of them three. Three by five cards. What are the top three things we wanna be known for by our key customers in the future? So you've got 12 people. Everybody writes down three answers. You've got 36 cards. Dominoes had 14.

[00:56:33] They have 42 cards. Sort those into common piles. Dominoes, we wanna be known. And they're different from you obviously for quality, for good people, for good service. Super. By the way, find out of your 36 cards. So imagine again, 12 people. Don't you share yours first. That would be terrible cuz then they'll all repeat it.

[00:56:55] That's not good. But what are the things you wanna, we should be known for by our customers? You got [00:57:00] 36 cards. Let's say the first pile had 10, the next had eight, and the next had six. That's 14, that's 24 out of 36. Those are the three biggest piles. You have a 67% shared mindset. Notice where I got the 67%, you had 36 cards, 10 said the same thing, then eight, then six.

[00:57:21] That's 24 outta 36. And by the way, it's not 67, it's 60 to 70%. It's not that precise. By the way, I'd say to you, that's not good enough. You need that answer to be 80%. You need to have a unity among your direct reports of what it is you want to be known for. We did that at Domino's. Quality service value.

[00:57:41] Then we put that in customer terms. What do we at Domino's wanna be known for? What's quality mean to the customer? Hot, fresh, tasty. Pizza. What does service mean? Delivered on time. What does people mean by friendly people who drive safe? So suddenly we've got this identity [00:58:00] quality. By the way the abstract words don't mean very much quality service people.

[00:58:03] And don't hot, fresh, tasty pizza delivered on time by friendly people. Then we screwed up. We didn't go to the customer. Now you probably don't eat a lot of Domino's. Pizza. I've eaten Domino's in my life. Somebody sitting there at night saying it's Friday night. Am I order Domino's, Pizza Hut, little Caesars.

[00:58:20] Is it the quality, the service, or the people? No, it's price. It's price and value. When you begin to ask that question. Again, Hala, with my 36 items, my unity, go to your customers. What is it that causes you to pick us? And at Domino's, by the way, I'm now making another confession. I confess a lot that I do.

[00:58:42] We didn't take quality service and people to the customers to find out what they valued, which was price and value for money. That's so obvious, but that's what it is we wanna do to create that identity in the marketplace. 

[00:58:57] Hala Taha: Yeah, and if anybody's really interested in [00:59:00] customer surveys, we actually interviewed the guy who invented NPS Fred Reichheld, on the show.

[00:59:05] So you guys can check out that episode. So why don't we talk about leadership cuz we have about 10, 15 minutes left and I really wanna make sure we talk about leadership. I heard you on an interview and you were talking about how now a lot of HR leaders are better fit to be a CEO of a company than marketing and other like business development leaders and things like that, which is totally counterintuitive because it used to be that HR was like this outsider at the table.

[00:59:37] So I'd love to hear like why the qualities of HR are important to have an as CEO. 

[00:59:42] Dave Ulrich: One of the things that I hope I keep coming back to is we have pretty good data. This was with Korn Ferry, Ellie Fisher great data. Here's what they did. They have profiles and everybody has seen a leadership profile.

[00:59:53] You do a 360 do you set goals, you engage people, you get things done, you build teams. We did a [01:00:00] profile of CEOs based on Korn Ferry data. I give them all the credit in the world. These are CEOs. Then we took that profile from a very big data set at Korn Ferry, CHROs, CFOs, chief Financial Officers, chief marketing officers, and chief IT, and we took their profile.

[01:00:18] And we saw which profile was the closest to the profile of the CEO. By the way, we also said, we wanna take the top 20% of performers in each of those four categories, hr, finance it. So the top 20% of HR CHROs had the profile closest to the CEO, by the way, that shocked me. I would've thought it's marketing or finance.

[01:00:42] And then we had to sit back and say, I love data that tells a story. What's the story? You started with it brilliantly. You said, why are we worried about, I'm gonna call it human capability, not just people, but organization leadership. Why do we worry about human capability? Because it's a differentiator.

[01:00:58] Our competitors can copy our [01:01:00] financial system. They can copy our products and services. They can even copy our technology. It's tough to copy our human capability. Talent organization leadership. By the way, that's the data. You can't run away from data. Our explanation is CHROs. Who know the business. If you don't know the business, you're not gonna be a CEO, obviously.

[01:01:20] But if they know business finance, marketing and they differentiate their success through the skills of leadership, setting goals, managing others, they have a right to be CEO. And I think we're gonna see a lot more CEOs coming out of the HR space. We see it at General Motors today. We see it in other companies.

[01:01:40] Hala Taha: Yeah, 100%. And like we were just saying, a lot of small business owners, they're really wearing dual hats for a long time as CEO and CHRO. That good, like right now, I think that's what my dual responsibility is at my company. 

[01:01:54] Dave Ulrich: By the way. Yes. I wish. I thank you for emphasizing that. That's the point.

[01:01:58] Until your company gets a [01:02:00] threshold, and I don't know the threshold, it could be a hundred, it could be 300. I don't need a full-time HR person. I can contract for some of those administrative things. You are the CHRO.

[01:02:11] Hala Taha: Yeah. Which is why we had you on today, Dave, because everybody needs to know about this.

[01:02:16] So let's talk about the five general leadership competencies that you talk about. You call them the leadership code. I thought it would be fun to do quick style quick fire style, and so I'll name out these characteristics and then you tell us why it's important to have in a leader. So the first one is strategist.

[01:02:32] Dave Ulrich: If you don't know where you're going, nothing will get you there. You gotta have a sense of direction. What do I aspire to? Vision, mission, goals, whatever term you wanna use. If you don't know where you're going, you might as well not get started. 

[01:02:44] Hala Taha: Love it. Executor. 

[01:02:46] Dave Ulrich: If you can't get stuff done, you live in a world of fantasy and vision.

[01:02:50] It's a video game. You've gotta be accountable, you've gotta be disciplined, you've gotta get stuff done. 

[01:02:55] Hala Taha: Talent manager. 

[01:02:56] Dave Ulrich: Leaders succeed through others. The four E's, [01:03:00] empathy, emotion, engagement, empowerment, experience, compassion. You've gotta make sure that your job is building. The next gen is helping others.

[01:03:09] Hala Taha: Human capital developer. 

[01:03:11] Dave Ulrich: If people don't leave their interaction with you feeling better about themselves, you've not built the next generation. 

[01:03:17] Hala Taha: Totally agree. Personal proficiency. 

[01:03:20] Dave Ulrich: Circle it. Circle it. If I had the privilege out of someday of coaching you, I would end every session with this question.

[01:03:27] What are you doing to take care of yourself as a leader? If you don't take care of yourself, your own energy, your own space, your own emotion, you can't care for others. And so we just had a session yesterday with a bunch of senior leaders and I ended the afternoon with that question. And it gets into your identity.

[01:03:45] You wanna be seen as inventive and as imaginative. What are you doing to live that? And are you caring for your physical, personal, social, emotional, and spiritual needs? Find the way to take care of yourself. And I think that's very personalized today. [01:04:00] It may be shopping, it may be exercise, it may be maybe scripture study, it may be prayer, it may be meditation.

[01:04:07] It may be socializing. I hope it's not just drinking and it may be stupid stuff. In the nineties when I was getting stressed, I would watch two episodes of Seinfeld. I have no clue why, but it calmed me down. It was just such a nothing show and silly. So I just, by the way, I'd love to ask you, your listeners have listened to you for years.

[01:04:30] What do you do to take care of yourself?

[01:04:34] Hala Taha: I love to workout. I do trampoline workouts. I have a mini trampoline in my apartment and I do lots of different workouts like that. I love spending time with my loved ones. And I totally agree with what you're saying because it goes back to this energy management thing.

[01:04:48] If you don't feel good on the inside, you're gonna make bad decisions in terms of how you treat other people because you feel crappy and you're in a bad mood. So you always wanna elevate your mood cuz it's trickles [01:05:00] down to the entire organization. 

[01:05:01] Dave Ulrich: Listen to yourself, by the way. And we all get overstretched.

[01:05:04] I've been there, we've all been overstretched. And especially in today's mental health. A few days ago I found myself getting snarky. I snipped at somebody. And when you see as a leader yourself doing that, go into your room, sit by yourself and say, what do I need to do? And again, it can be exercise, it can be nutrition.

[01:05:22] Lately I have found I go sit outside on my patio and read a novel for an hour. By the way, that's not what anyone else would probably do. But you've gotta recognize as an entrepreneur, of course, you're gonna be pushed to your extreme. If you're not being pushed, you're extreme. You probably won't succeed.

[01:05:37] But you've gotta find space to care for yourself so you can care for others. That's the personal side. 

[01:05:43] Hala Taha: Yeah. And so you probably didn't expect this, but I heard you have a leadership code 2.0 of emerging competencies. So navigating paradox, risk without recklessness, and meaning maker. Is there anything you wanna share about these ones?

[01:05:58] Dave Ulrich: I'd add the other one personalized. [01:06:00] Paradox. You know what? The world we live in is paradoxical. We love to have simple answers. Manage paradox. Get rid of it. Should I be long term or short term? Yes. Should I be top down or bottom up? Yes. Should I care for people or competitiveness? Yes. The tension of paradox creates innovation, meaning maker, we've talked about it.

[01:06:19] Your job as a leader is to make others meaning happen for them. Personalization is the one I'm seeing lately. Can I help other people build their identity? I'll tell a story and I know we're running on time. I'm coaching this woman who's incredible. She was born in the Philippines in a hut, went to school at age six, didn't know how to read and write.

[01:06:39] I'm gonna fast now. Really quickly. 12 years later, graduated top of the class, went to a US university, valedictorian, went to Harvard, speak six languages fluently. Got a joint graduate degree at MIT worked in the Russian embassy, was senior executive in Microsoft running Asia. Unbelievable. And by the way, you've met these people on your [01:07:00] show.

[01:07:00] Let me just be clear. I'm not one of them. This rags to Rich's story is just amazing. She became the president of a university with 40,000 students. Everybody wants DR. Two Menez to tell her story cuz it's so compelling. When I coached her, I was counterintuitive. Don't tell your story. By the way, she's proud of her story.

[01:07:21] She should be. It's an incredible story. Here's your job as a leader. Can you help 40,000 students create their story and it's not gonna be yours. Let's go talk to a student. It's a mother. One of the stories, and it just feels so emotional. It's a school with just an incredible school. She started, it was a school, she got married young, had some children.

[01:07:42] At age 28, she's coming to school part-time with two children pregnant and her husband passes away. Oh wow. At age 31, she gets her degree and she talks to the president of the university, Dr. Toez, and she says, thank you for creating a school that allowed me to care for my [01:08:00] children and now I have a degree and I will care for my family.

[01:08:04] She's not Dr. To, her story is not the same, but she's created her story. By the way, my be of all the entrepreneurial leaders, I'm gonna say it again probably for the fifth time. Make sure people lead feeling better about themselves. Help them create their identity, their story, because that's what true leadership is.

[01:08:22] Am I helping others create their story that works for them? 

[01:08:26] Hala Taha: Yeah, and it all starts with every single interaction that you have with an employee, whether it's on Slack, whether it's in a meeting. If we all just think about that, can I make this employee feel better after this meeting rather than worse, then you're incrementally making progress and there'll be a big ripple effect over time.

[01:08:44] Dave Ulrich: By the way, you just made me feel good and bad. We were for the group of students last night. And I said to them, email me a question. They said, how old are you? And they said, we're on Slack. And I said, I don't even know what Slack is. And you just mentioned Slack, so you've made me feel like I better go learn some of [01:09:00] the later technology.

[01:09:02] Hala Taha: Slack is just like a messaging tool where you can message people all day at work. 

[01:09:06] Dave Ulrich: I know. And I did. It's Instagram and I'm gonna learn it. I'm gonna learn it . 

[01:09:12] Hala Taha: Awesome. This was such a great conversation. I'm gonna end this conversation with a couple questions that we ask all of our guests, and then we do something fun at the end of the year.

[01:09:21] So the first question is, what is one actionable thing that my listeners can do today to become more profiting tomorrow? And profiting doesn't have to just mean money. 

[01:09:31] Dave Ulrich: Find somebody you're grateful for and tell them, thank you. 

[01:09:34] Hala Taha: Ooh, love that. Short and sweet. And what is your secret to profiting in life?

[01:09:41] Dave Ulrich: Just have fun. 

[01:09:42] Hala Taha: Why? 

[01:09:43] Dave Ulrich: Because if you're having a good experience at whatever you're doing, even if you succeed or fail, you're gonna learn from it. Enjoy the moment. Savor that moment and think about what's good. I could give you a long answer, but just the first thing that comes. We did a book called Why of Work And the seventh Dimension of success at work is [01:10:00] Enjoy the job, have and job work is sometimes a four letter word.

[01:10:03] It's not always easy, it's sometimes tough. Have fun. I tried to make jokes today. I tried to have fun. If you're having it, people will leave the interaction feeling better about themselves. 

[01:10:13] Hala Taha: I completely agree. And I have to say that we spend so much of our lives working, why not pick something that is fun?

[01:10:19] And to your point, remember that life is not just about work. And if we can make work fun, then we get to learn in the process have a more enjoyable life. 

[01:10:27] Dave Ulrich: So I'm gonna ask you a question before you end. 

[01:10:29] Hala Taha: Yeah. 

[01:10:29] Dave Ulrich: Cause I think a lot of people end with your question. You've done dozens and dozens. I look at the list of people you've interviewed.

[01:10:35] I'm just spell. What's a message you hope your listeners get as they listen across all these outstanding discussions? What? What would you say? I'm now repeating the question back to you. What do you hope people get? 

[01:10:48] Hala Taha: I hope that people start to realize that life is limitless and that literally every single goal that they want is achievable.

[01:10:58] If they believe in themselves, if they [01:11:00] put in the hard work, if they keep learning, and like I said, if they really, truly believe that anything is possible, so that's what I want them to learn. 

[01:11:08] Dave Ulrich: I love the, I wrote down the word limitless. Thank you. That's very helpful for me. 

[01:11:12] Hala Taha: Thank you. Of course. Dave, thank you so much for joining us on Young and Profiting Podcast.

[01:11:17] Where can our listeners learn more about you and everything that you do? 

[01:11:20] Dave Ulrich: I'm on LinkedIn a lot. I know you've done a lot of linkedIn folks. Somebody said, Dave, you must have a team of five people. I post every Tuesday and I respond to comments. I love LinkedIn as a global water cooler. I don't care where the comment's from, but I love to learn.

[01:11:36] LinkedIn has become my platform. 

[01:11:38] Hala Taha: Amazing. So you guys have to go check out Dave on LinkedIn. He also has tons of books. We'll link them in the show notes. Thank you again for coming on the show. 

[01:11:46] Dave Ulrich: Thank you.

[01:11:46] Hala Taha: That's a wrap YAP fam. The father of Modern HR, Dave Ulrich. I hope everybody tuning in took notes because the things we talked about today are not just relevant for HR leaders. They're relevant for all leaders. [01:12:00] And contrary to popular belief, HR is more than just policing employees and workplace etiquette.

[01:12:06] HR is not just about HR. It's about helping your company succeed in the marketplace. And the goal of any good company is to be profitable, right? And that means you need to have happy customers who continue to buy and who recommend you to their friends. Dave says the biggest influencer of customer experience is actually employee experience.

[01:12:27] And as leaders, we have a responsibility to bring positive energy into our organization. Our main job is to manage the energy of the company, in my opinion, because people are going to mirror that energy. And something that personally stuck for me in terms of what David talked about in this episode was to try and make people feel better.

[01:12:48] Every time you have a conversation with them. Remember people remember how you make them feel. They don't necessarily remember what you said or how you said it. They remember how you made them feel. And [01:13:00] so when you are a leader, a lot of people that work with you or work for you, Look up to you, right? And those little interactions mean so much to them.

[01:13:10] And so you have to make sure that you are giving feedback out of a place of respect, and that you are looking for the good in people and don't think twice to give a compliment. It's super easy as leaders to get so busy that we only focus on telling people what they're doing wrong and pointing out all the problems, because of course we're moving really fast and we wanna make sure things are better.

[01:13:34] And so we're like, Hey, that was wrong. Can you fix that? Hey, I saw this mistake. Can you make that better? But the thing is that we forget to call out the things that are going well. Because we're so busy. But you need to step out of that and realize that people will be more motivated and will do better work when you appreciate them and when you're not only looking for the bad and you're also looking out for the good as well.

[01:13:59] The other thing is you wanna [01:14:00] make sure you're giving feedback in a way that's not condescending. It's totally okay in an everyone's best interest to tell people how to improve themselves, but make sure that you do it in a way that is sensitive and patient and make sure that you highlight where they shine equally as well.

[01:14:17] And don't be afraid as a leader to let the emotion come through. Let people know that you care about them in a real way. Too many people are against showing emotion at work, but you spend a third of your life working. So it's okay to love your employees and your coworkers. And I'm not saying being inappropriate or having a romantic relationship.

[01:14:36] I'm talking about having real, genuine friendships and not thinking of it as just a work relationship. Because when the people that work for you feel cared for and feel safe, they're gonna feel more motivated and they're gonna work harder, and they're gonna be more loyal. And this is something you can keep in mind, whether you're a student at college working on a team project, or the CEO of a company.[01:15:00] 

[01:15:00] Dave also said that as an entrepreneur you should be spending a day a week, or 20% of your time thinking about the people on your team. This was certainly a wake up call for me because I definitely don't spend a day a week thinking about my team. I'm not thinking about are they the right people? How am I recruiting them?

[01:15:16] How am I making sure they have a great experience, and how do I improve the culture? This definitely made me realize that I need to spend more time in this area. And the other thing I don't want you guys to forget is that individuals can be champions, but it's the organization that wins the championships.

[01:15:32] In fact, according to Dave, organizations deliver four times more business results than talent. Think back on the story that Dave told about Michael Jordan when his personal scoring average was at an all time high. The team wasn't making the championships, but when his score dropped 20%, his team started winning.

[01:15:52] And that means that when he started working with the team better and made other people better, the team succeeded because [01:16:00] the team is more important than the individual. The team is stronger than the individual. Individuals can be champions, but teamwork definitely makes the dream work. Another huge lesson for me is that organization is not structure.

[01:16:15] It's not your org chart. It's not about who reports to who your organization is, your culture or your capability. Your organization is defined less by hierarchy and more by the capabilities it possesses or what the organization is known for in the market. It's really your brand. So for example, Marriott is known for service.

[01:16:35] Disney is known for guest experience. Google is known for innovation. And when focusing on organization as capabilities, the goal is to identify those capabilities or shared purpose that will add value to customers and investors. And then you wanna embed that in the organization. So how do you embed something like innovation into an organization?

[01:16:55] You hire the right people. Once you know what you want your [01:17:00] organization to be known for in the market and what differentiates you, you need to proactively recruit people that are gonna help you differentiate because they embody that quality. So if you wanna be innovative, you wanna make sure that you're hiring people who are creative, who are thinking outta the box, who have had previous experience showing that they are innovative people.

[01:17:20] Or if you wanna be reliable, focus on recruiting, organized, structured, timely, and responsible people. So that is a really important lesson. Whatever you want your company to be in the marketplace, you need to make sure your people match that. And I think that was definitely an aha moment for me. The last thing I wanna leave you with is a question to ponder.

[01:17:40] It's the question that Dave said he would ask at the end of every session with me if he had the chance to coach me. And that question, what are you doing to take care of yourself as a leader? Because if you don't take care of yourself and take care of your own energy and your own space and your own emotions, you cannot care for others.[01:18:00] 

[01:18:00] Thank you guys so much for tuning in to another episode of Young and Profiting podcast. If you enjoyed this episode, be sure to share this episode with your friends or your family or on social media. I love it when you guys tag me in your story. Show me that you're listening. I'm at yapwithhala on Instagram.

[01:18:16] I hope you guys are all following me. I'm also on TikTok at yapwithhala . We're on YouTube, so if you enjoy to watch these podcast episodes, definitely check us out on YouTube. Our videos are amazing. Shout out to my video production team and if you guys learn something new, drop us a five star review on Apple Podcast or your favorite podcast platform.

[01:18:36] Big thanks to my YAP team as always. Without further ado, this is your host Hala Taha signing off.

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