Your Ego Is Costing You Everything - Keith Ferrazzi

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1:08You've got to co-create. You've got to expand that team. We're in it together. It doesn't matter your position. Think about the organization a little flatter. Don't think about it so ordinate. I tell people we work with each other. You work with me. You don't work for me. It wasn't like I was having the lunch with the person, Keith. Okay, what's Keith going to do for me today? It's the opposite. What am I going to do today for Keith? Very few people in the United States claimed that people had their back. In fact, 50 % of Americans said that no one had their back when you defined it as four things.

1:40Number one, somebody that would always tell you the truth when you didn't want to hear it or whether you did. Somebody that cared about you. Somebody that was generously trying to support you out in the world even when you weren't around. and somebody that had butt-kicking accountability to you and holds you accountable. Intimacy, generosity, candor, and accountability. Welcome to Open Book. I am your host, Anthony Scaramucci. Joining us now, one of my favorite authors, Keith Ferrazzi, fellow Italian-American, number one best-selling New York Times author. New book out, Never Lead Alone, 10 Shifts from Leadership to Teamship, which is such a great title.

2:19But listen, man, you've written five amazing books. I was introduced to you by book, by the way. I read Never Eat Alone, which I thought was one of the best networking books that I've read in my life. And I've shared it with all of my salespeople, my children. I'll tell you what I told people about Never Eat Alone. And this is not the flattery. I really mean this. I said, hey, you want to add$10 million to your net worth? Most people say, yes, yes, I do. Okay. Go out and buy Keith Ferrarzi's book, Never Eat Alone. Because if you read the book and you follow the principles in that book, you're going to build a network of success, which is going to lead to great riches.

3:04So I had some great mentors like Mike Milken. I worked for Mike for a few years. And he taught me what really breeds loyalty in people is health, wealth, and children. Health, wealth, and children. And you take a look at Mike's career and what he's done for people with prostate cancer. You take a look at how he has, of course, lived his life helping other people get rich. And just this idea to be there for people's most important intimate moments like helping a kid get an internship, et cetera. And if you can wrap all of that with authenticity, that level of generosity with authenticity, you'll have a rich network that's uh that's there for you and you for them forever well i i think i think it's very well said and uh mike milken you know we all if we meet mike milken we all have a mike milken story by the way and so i met mike milken for the first time in 2009 i asked him for help on my conference in las vegas and he gladly accepted my invitation to come speak he gave one of the best speeches ever coming out of the global financial crisis uh we've been friends since that period of time.

4:13And he's helped more than one of my friends with health-related issues, prostate cancer, but other health-related issues. He would be the go-to person for me in so many different situations. And so, and it's something about Mike. Yeah, go ahead. I'll tell you my Mike Milken story. We'll swap them. My Mike Milken story was, he's an incredibly busy man. And I was hired as the CEO of one of his portfolio companies in the computer game space. and when I would want time with him, I could never get through his admins because he was booked up with Rupert Murdoch and all these other individuals. So what I would do is I would send her a message and I would copy Mike and I would lead with, I know Mike probably doesn't want to get up this early, but I'd be happy to show up anytime, four o 'clock, five o 'clock, et cetera.

5:05And I always got that spot to show up at Mike's because Mike is the hardest working human in the world. And he would never say no to a meeting, particularly if somebody dared to say, I don't think Mike gets up that early. So that's how I always got on his agenda at 4.30 in the morning. Love it. I love the story. And, you know, he has helped so many people here on Wall Street as well. And, you know, I will say this about Michael. He's an innovator. And when you're an innovator, you're taking risks. And some people are trying to shoot at you at the same time. You got to deal with that. Throughout history, that happens.

5:41But I love the fact that we both have that connection as well. So I was excited for a moment. I really wanted to hear your perspective on this new book relative to high-performing teams in financial services. So I spent, after I wrote that book, it was really a book, Never Eat Alone was a book about how I developed success. It's how I became the youngest partner at Deloitte, how I ended up going and working for Barry Sternlicht as the chief marketing officer at Starwood Hotels in the early days, had a sales over there. But when I left and I went for Mike and then we sold a company and had a little bit of money, I started this research institute because I fundamentally believe we were spending not enough time looking at high-performing teams.

6:24And I've now spent 24 years researching high-performing teams. And what does it make, what makes a high-performing team? I sat in Jeff Bezos' team and watched how that team wrestled ideas to the ground with data and with a challenge culture. I've gone deep with Jamie Dimon in terms of understanding how he's built his team. And I've extracted a set of practices. And it is my belief that a high-performing team, it's not what the leader does per se. It's what the leader gets the team to do. So the leaders, we talk about leadership. Leaders give feedback. But how do you get a team to give each other feedback?

7:04How do you get a team to hold each other accountable? How do you get a team to lift up each other's energy? So this book is the curation of 24 years of research on how do leaders get teams to step up 30 % and meet them in leadership. And I was curious about financial services. Like I said, I've talked at Jamie Dimon's level at his executive team. He was very quick to say, my teams have to have each other's back. They actually have to care about each other. They have to tell each other the truth. They have to push each other higher. And if you walked into one of his meetings, notoriously, you know, in an argument, if you obviously know who Jamie Dimon is, but if you didn't, you wouldn't know who the leader was because the team was wrestling the ideas.

7:47And I'm curious what your impression is of financial services in general and whether or not you see that degree of teamship or because Jamie does it, it's so unique, which has allowed him to be so, you know, so breakaway. Well, I mean, a couple of things. I would say that I think Steve Schwartzman and his team did a lot of what you describe in your book. At Blackstone, Larry Fink did a lot of that at BlackRock. If I'm really thinking about the different teams that I'm close to, I really try to incorporate a lot of the lessons that you have in your books into my team. one of the things that you talk about is team ship i mean the subtitle of this book and i've really tried to do that in my little organization you know i i i listen we we we punch over our weight at skybridge i think we've got a couple billion under management we've i'm able to write books do podcasts i'm able to have these uh public speaking events i'm able to do conferences is primarily because I have a good team and I'm able to delegate authority and empower people.

8:56I think one of the things that you talk about that I love, and certainly Jamie Dimon does this, Jeff Bezos certainly does this, is trust. You're delegating, but you're also delegating to people that you really trust. And then if something goes wrong, you're not castigating anybody. You're not putting blame on people. It's almost like you're sharing the credit, Keith, but you're You're absorbing the pain of a bad decision, which further empowers your people to be more independent. You know, and that's stuff that you write about. But you've got something in all five of your books, if you don't mind me saying this to you, and I'd like you to react to it.

9:37All five of your books are, we're in it together. Okay, never eat lunch alone. The person you're eating lunch with, you're going to help them. And guess what? They're going to help you. We're in it together. never lead alone well guess what we're in it together okay it doesn't matter your position think about the organization a little flatter okay don't don't think about it so ordinate you know when i read uh you know never eat alone i remember i was right around the time i started skybridge uh it was you know i think you wrote the book almost 20 years ago and i remember 20 year anniversary this year yeah so there you go so i tell people we work with each other.

10:17You work with me. You don't work for me. That's a concept that comes out of all five of your books. But your first book, even though it was about networking, it resonated with me that I was in the network to help. It wasn't like I was having the lunch with the person, Keith. Okay, what's Keith going to do for me today? It's the opposite. What am I to do today for keith if i'm more importantly and more importantly what can we create together and that's that's the power right and i lived that's your brilliance if you don't mind and again i'm not i didn't i didn't invite you on just to praise you but i i invited you on because i want my people i want my podcast listeners to get your gestalt i want my podcast listeners to hear your theology about this.

11:08So let me walk you through the next book after Never Eat Alone. The next book after Never Eat Alone was about building that broad network. And there's no question, the germination of all the core essence of relationships are the key to your success. How do you create massive productivity through the relationships that you have in your life, personally and professionally? What I then did was I started studying, if a broad network is powerful. What happens when a small group of people are disproportionately important to you? And I went and I studied AA programs, YPO forums that transformed and created Charles Schwab's business from, you know, just a little brokerage house.

11:46And all of a sudden his tech buddy said, hey, there's this internet thing you should look at. And that was his YPO forum that created Schwab to the next level because he had a group of people that had his back. And so I wrote a book, who's got your back. And I started studying the disproportionate impact that small groups of people have on each other. And what we found back then was that very few people in the United States, which was 15 years ago, claimed that people had their back. In fact, 50 % of Americans said that no one had their back when you defined it as four things. Number one, somebody that would always tell you the truth when you didn't want to hear it or whether you did.

12:22Somebody that cared about you, somebody that was generously trying to support you out in the world, even when you weren't around, and somebody that had butt-kicking accountability to you and hold you accountable intimacy, generosity, candor, and accountability. So what we found was that that was so rare. And then I started creating a diagnostic tool for businesses. And I found that those things were not present in teams. the average team on a scale of zero to five has a scale of 1.9 relative to can we challenge each other in the room when it's most risky to do so and then i started tracking the correlation between teams that had low candor scores midwest nice companies that have more politics because they're so damn polite now i don't mean polite to be disrespectful but i mean when you usually polite in business usually means in so many businesses that i'm not going to tell you the truth to your face i'll tell it to you behind your back and that's bullshit and so we started laughing i'm early in my career i get it i was a total conflict voider earlier in my career need to i tell people you can be tough but also nice but you got to tell people hey it's not working here's why it's not working you know because if you don't do that then you're you're you're in this sort of sclerosis you You know, but but so you talk about having somebody on this one.

13:45Go ahead. I'm going to stay on this one, because this is probably one of the most erosive elements of business, conflict avoidance. And so what I realized was there are very few cultures that hired for candor. Ray Dalio did, you know, and he wrote his book Principles about it. Bezos did and they and they continue to do so at Amazon. But very, very few people hired for the resilience of candor. I would have never gotten hired. I was always conflict avoidant, et cetera. So what, what I realized was we could create new practices that would bring this kind of candor to life, just simple process and practice.

14:21Cause it would, right. What I, what I want to focus on as an industrial engineer was the practice process and practice changes culture. It's not difficult. I created something called a stress test and it's one of the most powerful tools. And instead of having somebody in your team, give a report out of their progress or report out of an initiative. You tell everybody in the room, we're not going to do report outs anymore. We're only going to do stress tests. A stress test moves from, we are all deciding that we are going to help this person be successful. That's a stress test versus a report out where we're passively listening to somebody's status.

14:58So the person gives their status. They said, okay, here's what I've achieved. Here's where I'm struggling. And it's important that they announce where they're struggling. And here's where I'm going next. You could do this to a sales rep. Once a month, your sales reps stand in front of their peers and say, last month, here's what I did. Last month, here's where I struggled. Next month, here's where I'm going. And then the team goes into groups of two. Now in groups of two, psychological safety goes up 85 % versus in a big room. And they open up a document and they say, here's what you might be missing.

15:27Write it down. Here's an idea for you. Write it down. Here's where I'd be willing to help. Write it down. What we just did is we turned the culture that you want to have into a simple assignment and people do it. So in a room of 12, four people will have the courage to be heard. But when you do these breakout conversations and you actually write stuff down, 100 % compliance happens. And now the person gets a full breadth of candor. The team can actually give that criticism. I'm doing this right now for a major global CPG company that's in decline. And we're gonna turn this company around just by the team stepping up and making sure that everybody is stress testing supply chain.

16:12Everybody is stress testing IT and our progress on AI. Everybody is stress testing the particular business, the line of business, call it whatever it is, you know, confectionaries. So this idea of doing a simple practice can be game-changing. And the book is full of 37 of those practices that I feel are so game-changing that it can turn your culture into the kind of culture that Amazon has. I appreciate you sharing all those remarks. I'll even take it one step further with you. I think that some people get this and some people don't get this. And so what I mean by that is I have some of my competitors that I call bottleneckers.

16:54What do I mean by that? They got to make every decision, Keith. Okay. We can't move until ABC, our chief says yes or no. Okay, that's a great idea. Can't run with it. He's on vacation on a yacht somewhere. We got to wait for him to say yes or no. Think about how that kills a culture and think about how that kills a business. Cycle time. That's why we have such long cycle times of getting shit done. Exactly. And we just did this event in Wyoming. It was a blockchain event. Somebody said to me, oh, Anthony, congratulations. I said, look, you're giving me the credit. These other people are doing all the work.

17:31My staff told me to show up here's your script here's what you got to say this is what you got to do and it was as good as anything i've experienced and the best thing about it was i had nothing to do with it keith you know and this is the thing i try to tell people you know who has your back if they made a mistake well you know why i have your back and you can't lead alone you got to be collaborative if they work with people if they're working for you they're going to be intimidated you know but before we shift to uh another thing that i want to talk about which is authority i want to go to ai for a second if you don't mind okay you've met at peter diamantes this conference yeah exactly and we talked about ai enhancing this collaboration the spirit of collaboration so give me some of your thoughts there on that gosh well right now so i coach executive teams mostly in the Fortune 500, but I've also joined the team at Lightspeed Venture Capital and I coach their portfolio companies.

18:34So the Anthropics, the Gleans, the AI first companies. And it is amazing to watch these young companies and not only what they're creating with AI, but how they work with AI. And one of the things that I'm awakening to is that these kids out of Stanford, they have no burden of the old bullshit way that most hierarchical organizations work where the org chart defines who your team is. These young entrepreneurs are working in teams actually around KPIs, meaning key performance indices or goals create a team. It's almost like a SWAT team coming together to get stuff done, dissipating, et cetera. It's absolutely inspiring to see what's going on there.

19:19I sit in the rooms with the Fortune 50 and I see some of the things that they're saying, which is let's figure out how AI will allow us to reduce our cost basis by 30 % overall and improve our customer experience and product quality. And this is the path that these companies are on. I just wrote a piece for Fast Company about Michael Dell and Dell Technologies. I think they're the first company, you can tell me if I'm wrong, they're the first company in the Fortune 500 that I know of that have split their revenue growth with their cost curve. So they've grown, they were able to report a massive, I think it was$5 billion lift in revenue, while at the same time, a 4 % reduction in costs, all focused on their AI efforts.

20:18And they didn't try to spread the peanut butter across every single person in 400 initiatives. They said in supply chain, we're going to reduce supply chain costs by 20%. We're going to put a time back in the hands of sales reps. Let's say a day a week. We're going to improve engineering productivity by 25%. Boom, boom, boom. And they focused, they took a CTO, John Rose, and focused all of his attention and all of the initiatives on those things. And they crushed it in 18 months. I do not see that. And they wouldn't be able to do it if the team didn't come around that. That executive team had to marshal all of their forces, stop spreading peanut butter and drive results.

20:57and they've done it. And it's extraordinary to see what AI is doing in the large enterprises. And I'm just, I'm so inspired by what's about to happen in the next 18 months for almost every company. Well, listen, he's a huge, you know, he's a huge role model for all of us, Michael. And you may not know this, Keith, but he was my first investor at Skybridge. I met Michael in 1993. And when I left Goldman Sachs in 96, he gave me a little bit of money to run. And when I started Skybridge, He was the first money into Skybridge. So I've had a three decade. You probably got to know Adam, his investment partner.

21:35I know Adam. I know Susan. And obviously, I know his team at MSD Capital. But what I would say about Michael is he has execution skills second to none. And he's probably listening to you, Keith, because he's a sharer. He understands that he can't get there by himself. You know, Reagan had this plaque in his, in the Oval Office, right on the desk. It said, you can get anywhere you want in life as long as you don't care who gets the credit. Amen to that. Michael, and Michael has done that his whole career. And so lots of kudos to Michael Dell. I want to, I want to ask you about authority because I think you write about authority in a way that I see authority, but in a way that others perhaps don't see authority.

22:24So let's talk about authority and your view on authority. Explain it to our viewers and listeners. Yeah, I wrote a book called Leading Without Authority. Right, exactly. And the point of it was this. If you want to be big, like if you want to punch way over your weight, then you've got to enable other people to achieve the things that you're hoping to achieve. You've got to co-create. You've got to expand that team. And when I work in large organizations, the kind of change, like I just mentioned that Michael Dell was able to achieve, the kind of change that is needed right now with the volatile marketplaces, with AI as a massive disruptor, that change doesn't happen in your silo as a leader.

23:11If you're trying to change, if you're trying to take 20 % out of supply chain, I learned this from my friends at AT Kearney, who are major supply chain re-engineers. If you're the procurement guy, you can't do it. you need sales forecasting and you need the sales folks you need supply chain you need manufacturing and operation scheduling you need that whole thing that's the team and so the sub-optimization of thinking that you can transform in your silos will make you a mediocre leader and so the point is when you realize that you no longer are so many of these these executives that I see, they're trying to gain control.

23:49Well, just give me sales. If I'm the head of marketing or I'm head of sales, just give me marketing and I'll make it work. No, you've got to realize how do you co-create with people across the silos, outside of your own organizations? I'm working with organizations today. I'm saying to them, do you think you're going to be as good as the hundred best AI programmers that truly understand these LLMs? No. And by the way, they're never going to come to work for you. So how do you partner? How do you partner with these young founders? Fundamentally differently. So large organizations are going to have to get rid of the hubris of ownership.

24:23Executives have to get rid of the hubris of control and authority to be big. And so, you know, you talk about yourself. That's what makes, look, look at your brand. Look at who you are. You've been able to do that by stitching together relationships, building partnerships, and working outside of the ecosystem of control. It's brilliantly said, and I just wanted to make sure that was shared with you. Okay, so we've got a couple minutes left. I picked five words from your books, not just the last book. And this is a little bit of a raw shot test at the end of our podcast. I'm going to say the word, and then you're going to give me a one or two words or a sentence, okay?

25:01So if I say the word teamship, you say what, Keith? Let your team lift each other up. Okay. What about leadership? get out of the way and stop being hub and spoke okay let's go back to let's go back to authority i say the word authority it will hold you back work more toward co-creation and inspiration yeah that's so much more empowering right and it gives people a lot more entrepreneurial flexibility in your organization what about relationships never eat lunch alone what about relationships keep it truly i mean i could get emotional about it it truly is defining of who you will be in the future it's the relationships that you have and now by the way i just got married since i saw you um congratulations and you know all of the relationships in our life i'm about to head out tomorrow to burning man with my sons um all of the relationships with your life will be the most defining elements of your life.

26:05It will define your success and it'll define your joy. I'm with you, man. I mean, it's the whole thing that matters to me. It could be, you know, it could be an Italian thing too, you know, in terms of our culture. Yeah, I think it is actually. All right. So last two words and then I'm going to give you the last word. Keith Ferrazzi. Oh, wow. Humbly hasn't started yet. Becoming, right? Becoming. Yeah. Yeah. Yeah. You see, I love that. My old man said, the most important thing on this planet is that you make the biggest footprint that you can and be of service in the meantime. And so I'm still trying to work my way to be of greatest service while I'm here.

26:47Well, I'll just share this with you. Warren Buffett is about to turn 95. And he said, if you ask him, how's he doing? He says, well, I'm just getting started. Okay. And you got to think like that about your life. You got to stay young. I really appreciate you joining us. The title of the book is Never Leave Alone. Keith Ferrazzi, thank you so much for joining us today on Open Book. Anthony, thanks so much. Cheers.