HIGHLIGHTS: Geoffrey Garrett

0:01Hi, everybody. Tune in to this short version of the podcast, which we do every Friday. For the long version, tune in on Wednesdays. hi everyone i'm nicolai tangen the ceo of the norwegian sovereign wealth fund and today i'm in really great company with one of my favorite people jeff garrett now jeff is the dean of the university of southern california marshall school of business and has an incredible track record and i know him from when he was the dean at the wharton school actually he was the first person i called when i got the job in the norwegian sovereign wealth fund to ask him you know what what am I going to do?

0:38Also, Jeff has held very important roles at Oxford, Stanford and Yale. So, Jeff, big welcome. Hi, Nikolai. It's great to be on with you. What's the number one skill a leader needs today? So, you know, I think the world of leadership is changing a lot. You know, for me, maybe it's a bit glib, but I would say we used to think about leaders as heroes and now we need to think about leaders as humans. So I think my answer would be to be more human. Now, the increased complexity you are seeing in the world now, how does that change the leadership role? Everything is much harder, right? And if you think about that, I think what we're saying these days is that agility has become a very important skill, right?

1:29You can't just be on some standard operating procedures pathway because the world can change in an instant. So then that, of course, just begs the question, how do you develop agility? And for me, you know, there are two C words that matter a lot. And I think you embody both of these, by the way. The first one is curiosity. I don't, you know, yes, there are a whole bunch of technical skills that people need to succeed in a technology-enabled world, but you've got to be curious about broader stuff. And the second C word for me is context. I think context really, really matters. You know, culture, history, language, all the things that, as I said, you embody as a person, those are incredibly important too.

2:15You can't think you know everything and you can't live in your own little world. You've got to be more externally oriented and really externally aware, I think. Where do you find curious people with a sense of context? I mean, how do you screen for them? Well, I mean, I think the admissions answer these days in higher education would be that we kind of use objective indicators, test scores, grades, exam results. They're the first filter. But the reason that most of elite higher education now focuses on essays and interviews is that we really want to know the full person. So you're looking for more than test takers when you're looking for people who you want to be emerging leaders.

3:05And, you know, I think this is also a one-two, right? What do employers want? Employers want people who on day one can do the job but can grow into becoming leaders in year five or year 10. And that's going to be hard to find if you just look at objective indicators. Do you think CEOs are good listeners? Whether they are or not. There is research showing that the higher you are in the system, the more endorphins you get by hearing your own voice. It's something not great about that. Absolutely. And I think we just have to be, anyone in a leadership position has to be aware of that. You know, the thing that I've learned is that if I ask questions of anybody who works for me, they view it as a leading question.

3:57If I throw out a thought bubble, people take it really seriously, even if I'm just trying to provoke conversations. So I think you've got to have a you need to have some kind of balance between confidence and humility to make that work. And, you know, one thing that somebody said to me 20 years ago with a kind of wry grin on their face was something that just sounds right to me, which is if you're in a leadership position, you know, there's a chance you're the smartest person in the room, but you should do everything you can not to show that. Because if you just strut your stuff, you're going to crowd out everything else in the room.

4:36And so the collective intelligence doesn't increase. but can i ask you nikolai i mean the you know you're you're in this world where you've got you you literally as the podcast shows you you have access you have access and real investments in the biggest companies in the world in every sector i mean how can what what's the discipline that allows you to manage that well i guess uh pretty much the same as you say right so first First of all, I don't make investments myself. I have great colleagues. We have 700 people. So I've got colleagues who run it, very clear mandates, huge accountability, delegation.

5:17And I agree totally on the micromanaging point of view. It's just totally, unbelievably destructive because you kill pleasure and you just kill the whole meaning of life. I just think it's one of the worst things you can do. So I just totally agree with you. So it's interesting that you responded there with very personal stuff as well as professional. I mean, I think the merging of personal and professional is something that's happening, particularly with younger people today. But I'm wondering how you think about that. I mean, I know from your personal background that you're super interested in really diverse stuff, right?

5:56You have an art history degree. You have a psychology degree. Of course, you went to business school at Wharton. But how do you think about your employees as full people? And are there any difficult trade-offs there? Is it positive? Some? What's your approach? Well, for sure, you need to look at them as whole people. you would love for them to continue to to take education to expand the uh you know the skill sets uh i agree curiosity is is um is really really important now one of the fun things by working with finance is just like the most interesting thing you can do i think you know everything you eat and wear and drive is made by a company you need to understand psychology corporate culture, macro, defense, geopolitics, currencies.

6:47And it's all changing, you know, 100 times a second. Jeff, we both have met many successful leaders. And when you abstract and think about what the best ones have in common, what do you find? So a very successful CEO whose name I won't mention, I once kind of threw this softball question to this person and said, what's it take to be a good CEO? And the person replied with a wry grin, oh, it's really easy. All you've got to do is be able to come up with a vision and communicate it really well, have a strategy and be in the room with all the strategists and be a good enough person that people want to go on the journey with you, right?

7:37So vision, strategy, implementation. Easy to say, really hard to do, as you know. But I think that probably the people who are the best leaders understand those three elements and they should understand their own strengths and weaknesses, right? You know, I said, I think I now know about myself. I'm just not as good operationally as maybe I can be at some of the other elements, but I know operations and implementation is critical. So I've got to think about how to compensate for my own limitations there. Now, you have worked in academia, well, most of your life, actually. What's the key to good leadership in academia?

8:20Is it different than running a company? So I think historically, university leadership and corporate leadership were very different, but my sense is they're converging a bit now. So the key, I think, to understanding academic leadership is that there's no command and control. I can't tell people what to do. What there is in universities is an ongoing set of hearts and minds campaigns. You have to convince people that they want to come together to do something. And when I think about that, I just have two words in my head, aspire and inspire. You want to have an aspirational vision that's motivating the people, and then you want to inspire them to get there.

9:10So hearts and minds campaign, yes, command and control? No. And my sense is that the corporate world is moving a bit in the hearts and minds direction. And that's because younger people are just different. They value meaning and purpose not only in their personal lives, but in their professional lives much more than prior generations do. And that creates a leadership and management challenge, right? Young people aren't going to do it because you tell them to do it. They've got to want to do it. They've got to buy into your vision. And I think that's a big challenge, but it's a good challenge because in my sense of the, it's hard to make change in universities because I can't just say, let's do this.

9:59But the flip side of that is if you make change, it's actually going to endure and probably work because people wanted to go on that journey with you. And so my sense is, again, that that's the direction we're moving in the corporate world. I don't know how quickly, and obviously it would vary by sector.