Mastering Change in Life and Work ft. Brad Stulberg (EP.134)

0:28We all need to make smart decisions with our money. into the dynamics of change and how we can navigate it with resilience and wisdom. Joining me is Brad Stulberg, a prominent author, coach, and speaker, widely recognized for his deep insights into how individuals can achieve and maintain peak performance. His bestselling books, such as Peak Performance and The Passion Paradox, have made significant contributions to our understandings of success, motivation, and the science behind achieving personal bests. But in this episode, we're focusing on Brad's newest work, Masters of Change. This is a great book to start off your new year with because Brad offers a really unique perspective on using change as a catalyst for growth and success.

1:16So whether you're seeking to enhance your personal journey, professional trajectory, or both, this episode is a treasure trove of knowledge and practical wisdom. As always, you can find show notes and links to resources mentioned during the episode at thelongterminvestor.com. And without further ado, here is my conversation with Brad Stahlberg. Brad Stahlberg, welcome to The Long-Term Investor. Peter, it's a pleasure. Thanks for having me. So many of your books are so thought provoking and so easy to digest so many great examples, your newest masters of change, I feel like ties into so many important issues that I deal with in my everyday life.

2:03But that I also feel like I'm sometimes coaching clients through from an investment standpoint, or even more this holistic, well being standpoint. So I was hoping that we could start with the science of change, where you know that there has been somewhat of a shift in the academic community in how we should think about it in the last few decades. That's right. Homeostasis is a term that many people are familiar with all the way back from high school biology. My guess is most people listening in right now have heard this. And homeostasis dates back to the late 1500s, early 1600s. It's quite old.

2:42really traces itself back to the very beginning of empirical science. Homeostasis describes change as a cycle of order, disorder, order. It says that living systems crave stability, and therefore any kind of instability or disorder or change is a threat. So we should try to avoid change, and when we cannot avoid it, we ought to try to get back to where we started, back to order as swiftly as possible. And homeostasis has been the prevailing model of change for the last 500 years. Only more recently has the scientific community stepped back and said, actually, when we look at individuals that are really gritty, that attain excellence over the long haul, and when we look at organizations that do the same, homeostasis isn't the most accurate or, in research speak, the best fit model.

3:38And they've coined this term called allostasis, which describes change as a cycle of order, disorder, then reorder. And it's a subtle difference, but it's a very important one. It states that following change, there's no getting back to stability where we were. There's only coming together again and achieving stability somewhere new. And I think the etymology of these two words really tells the whole story. Homeostasis comes from the Latin root homo, which means same, and then stasis, which means standing. So it argues that we achieve stability by staying the same. Allostasis comes from the Latin root aloe, which means change or variable, and then stasis, which again means standing.

4:22So it argues that we achieve stability through change. And we crave this stability. Is that what makes change so discombobulating in the first place? I think so. So allostasis, though, it has this really elegant double meaning, stability through change. So yes, we can be stable through change. And the way to be stable through change is by changing, at least to some extent. So it's this paradox that in order to keep our stability, we have to be willing and able to change. You write a little bit about how everybody responds to change differently. You are a coach, as well as obviously an author. What are some of the different ways that you've observed that people typically respond and deal with change?

5:09Well, I think that depends on the person, of course, and depends on the change. But so much of the common response is rooted in this homeostasis model where change is inherently seen as a negative. So we see people that resist change. They deny that it's happening altogether. together. Sometimes people finally accept it, but then sacrifice their agency. So throw up their hands and say, oh my gosh, this is so overwhelming. There's nothing I could possibly do. Or most common is trying to get back to how things were before. So a new parent that's comparing their relationship and sleep schedule and habits to what it was like before they had a child.

5:54Somebody that is approaching retirement or perhaps already has retired, trying to compare their life and their energy level and their motivation and their sense of purpose to what it was when they were still working. Somebody who moves geography and compares their new town to their old town is constantly trying to find their old best friend in the new place. So really just clinging to the old, instead of realizing that that stability only comes when you accept that it's going to be somewhere new. Something that came to mind is in the months and years after the pandemic, even during the pandemic, is I think about management of the company and things with family and friends.

6:36We kept talking about when things would get back to normal and we read so much in the papers. I feel like it really rattles people, the type of things that's getting put out there in the media. Sometimes change is happening gradual. Change is always happening gradually. That's sort of what you're saying here. And it only takes these big moments to notice that the changes all of a sudden come into your personal domain, or it's being so heavily covered by the national media that it makes us feel uncomfortable. Chat GBT being a great example where AI has been around us for years at this point. But it took a cool change for everybody to say, oh my gosh, AI is going to take over the world or come for my job or ruin the way we do things.

7:20And as you write about both from the science side and some of the personal stories that the more you resist change, the more suffering you endure. And you share a number of examples of individuals who overcame these just absolutely enormous life changes and the common thread among them all that allows them to embrace as opposed to resist this change is something you call rugged flexibility. Can you talk a little bit about that, start to unpack what that is? To be rugged is to be tough, determined, durable. To be flexible is to be soft, to be supple, to bend easily without breaking, to be really adaptable.

7:58So on its face, these terms are almost polar opposites. However, in scouring the literature, reading hundreds of studies and multiple hundreds of reporting interviews, what I found is that individuals and organizations that sustain excellence for a long period of time, they're not rugged or flexible. They're rugged and flexible. They take these two competing ideas and they combine them. They're sources of ruggedness. They have hills that they'll die on, core features, core values, attributes that really make them what they are. And then they are extremely good at being flexible in how they apply those core attributes to different circumstances and on everything else.

8:48And if you zoom way out and you look at the most immaculate empirical change that we know of, evolution, how me and you got here today as humans to have this conversation. Well, when evolutionary biologists look at species that have lots of longevity, what they find is that these species, they have these two core components. The first are what are called central features. So these are the attributes of a species that really make the species what it is. If these things change, the species would no longer be recognizable. And outside of those central features, they're highly adaptable on everything else.

9:27So they play these two polar extremes at the same time. Big sense of ruggedness or an evolutionary speak central features, hills that you're going to die on, the things that make you what you are, and the ability to be highly flexible and change on everything else. And by marrying these two approaches or by marrying these two qualities, you become rugged and flexible. And that's really what helps you navigate change without losing a sense of yourself, but also without being selected out when the environment shifts. So let me ask you this. I mean, are there ways that people can work to define or even strengthen these core values?

10:06There are. And I think that it is really important and well worth considering to have your core values, to know them, to know how you can practice them. So someone that is new to this language, let me step back for that person. core values are the attributes and characteristics and features that you aspire toward and that when you're living in alignment with them, you feel good and you perform well. Example core values, things like presence, creativity, health, intellect, wisdom, teamwork, authenticity, family, love, spirituality, strength, so on and so forth. What the research shows is when you are aware of your core values and how to practice them, change becomes a little bit less scary and threatening.

10:56And I think this is because you always have your core values. The world around you can be crazy. Complexity can be rearing its head. The path forward can be uncertain. But if you know your core values, they almost become like heuristics to guide you into the unknown. Because you can always ask, well, what would the creative thing be to do in this situation? Or if a core value is health, how might I protect my health in this situation? Or if a core value is intellect, what might someone who prizes intellect do in this situation to move forward? So core values, they really represent your sources of ruggedness and stability.

11:30And if you don't know what your core values are, then yeah, when there's change, it can feel very discombobulating, like you're just losing a complete sense of who you are. But if you have these core values, again, then they really become the ground on which you stand. But it is still normal for your core values to change over time, right? Yes, that is right. And yet it's your current core values that lead you to your new ones. So a metaphor that's commonly used with change is that of a river. The Greek philosopher Heraclitus famously said, I cannot step into the same river twice. And what he meant by that is every time he steps into the river, he's a different person.

12:09in the river is a different river. Fast forward 2 ,000 years, Bruce Lee, be like water. So there's this imagery about having a fluid sense of identity and changing over time that is really relatable. Yet, if you think about what makes a river a river, a big part of it is its bank, its boundaries. That's what guides where the water goes. If a river didn't have a bank, it would just be random water. So a river bank gives it direction. And when it comes to thinking about our identity over time and through change, our core values, that's our river bank. That's what gives our identity direction over time.

12:50So yes, our core values can and often do change, but even then it's acting in alignment and living in alignment with our old core values that ultimately lead us to our new ones. So Brad, I'd had a conversation with professor of psychology from UCLA, Hal Hirschfeld, a few months ago, where we were talking about really how your future self and your current self, in many ways, we think of each other as complete strangers, but it's these core values that do make you the same person. And a lot of what I picked up from the book was that using pursuits that align with your core values can help shrink this big, overwhelming world we live in.

13:30Can you give some examples of that and why it's so important to focus on that point? Yeah, because otherwise it's just infinity is my short answer. There are so many opportunities and so many things that can cause us to feel disoriented and fearful, particularly in this day and age where so much of the economy is just driven based on what we pay attention to. This is how you get the news cycle. Social media, if it bleeds, it leads, is essentially the name of the game for the entire internet. So it's very easy to get caught up in the whims of life if you don't have a strong sense of what your values are and how to practice them.

14:11But if you know your values and how to practice them, well, you can operate with some boundaries, I guess, around how you spend your time, energy, and attention. Another way to think about core values is they're akin to an internal dashboard. So we have all of these external dashboards in our life. Peter, in your line of work, it might be your performance against the market. For a client, it might be their net worth. For someone in a corporate setting, it might be their productivity on whatever product they're in charge of. So we're constantly measuring against these external dashboards. But I argue that what ultimately leads to fulfillment in truly sustainable excellence, not just doing well any given week, month, or year, but over the long haul, over career, over a lifetime, is if you're living in alignment with your core values.

15:03So I think that they also become this wonderful internal dashboard and they're portable. You can take them with you wherever you go. I think that oftentimes what happens is we mistake external measures, numbers on a scoreboard for what we're really after, which is the internal thing. I mean, how many times have you dealt with clients that think that they just have to hit a certain number in their saving account or net worth when perhaps what they really want is autonomy or they want to feel loved or like they belong and they're chasing the wrong thing or they're chasing the superficial version of it.

15:40And I think that what often happens is we chase those superficial versions without thinking of the core value or the more deep underlying thing that we want to maximize. When in fact, if we start with the deeper, more underlying thing, then it helps us choose what external targets to go for. That makes a lot of sense. And I think we're focusing here so much on the core values, which help develop this sense of identity. And I think you have a number of examples where if people really latch too much of their identity onto one person or one pursuit or one concept that when there is this inevitable change around us, that it can be disruptive.

16:21How should we think about that piece of identity when everything around us is changing all the time? I want to talk a little bit about the speed skater Niels Vanderpool. Vanderpool won gold medals in the 5K and 10K speed skating events at the Winter Olympics. He also shattered the world record. So he is the best speed skater to ever set foot on the planet, and he likely will be for quite some time. However, about a year and a half, two years prior to the game, Vanderpool was underperforming. And like any good elite athlete would do, he started uncovering stones. So he looked at his training, he looked at his nutrition, he looked at his recovery, and couldn't find anything.

17:07Everything looked really dialed in. He had blood work taken, on and on. But everything came back okay. And eventually he said, you know, I think the problem is I'm scared. I'm feeling a lot of fear. Every time I step in the oval to compete or even before important training sessions, I just feel fear. Then he said, well, why do I feel this fear? And the answer that he came up with is there was no Niels Vanderpool outside of Niels Vanderpool, the speed skater. his entire identity was fused with speed skating. And Vanderpool realized that all it takes is one misstep, one little injury, one split second mistake every four years, and that's it.

17:52Not to mention Vanderpool realized that speed skaters, they tend to peak in their late 20s and early 30s. Well, change is coming. And it's the inevitable change that every athlete faces, which is aging. And it was coming for Vanderpool. And it terrified him because he didn't know who he was outside of speed skating. He had no sense of self beyond the sport. He had no other sources of meaning in his life. So what Vanderpool did in the lead up to the 2022 games is fairly unheard of for an Olympic class athlete. And that is he took a normal weekend. So starting Friday night to Monday morning, Vanderpoel did nothing related to speed skating.

18:34He went out for pizza and beers with his friends. He went bowling. He went on hikes. He started reading books. He got more involved in his community. He essentially diversified his sense of self. He found other sources of meaning and identity in his life. And what he says is this allowed him to shed that fear because he knew that regardless of what happened in the speed skating ring, there was more to who he was as a person. So there's two metaphors. I'll go with the one that's foreign to you first, and then I'll go with the one that you're probably already thinking. So the first metaphor is to think of identity like a house.

19:09And if you have a house and it only has one room in it, and that one room floods or catches fire, it's very, very scary and disorienting. But if you have a house with multiple rooms in it? Well, if one room catches fire or floods, you can go seek stability and spend time in the other rooms. So in Vanderpool's case, he only had one room. It was the speed skating room. And what he did was he added on to his house. He added a community room. He added more of an intellect room. And that allowed him to not be so scared that something bad was going to happen in this one room. The second metaphor, I don't know much about investing, but I know the number one rule is you always want to make sure that you have a diversified portfolio.

19:52And why? Because if all your holdings are in one asset class and something unforeseen happens to that asset class, it is going to be a wild ride that perhaps you don't want. Whereas if you diversify your portfolio, you protect against change in any one asset class. And I think the same is true for our identities. If we only have all of our identity, all of our self-worth holding in one thing, it makes us very fragile. Because eventually that one thing's going to change. Whereas if we have multiple sources of identity and multiple sources of meaning, it sets us up for long-term success. And I want to be really clear.

20:30I'm not arguing that we should strive for quote-unquote balance. I've been doing this work for a very long time, and I've been so privileged to work with and report on people that are truly the best in the world at what they do. And when I talk to people that are older, that have retired, that are looking back on their careers, and in some cases, looking back on their entire lives, I find a really interesting observation. And that is, if you zoom in at any one point of time, these people tend not to look very balanced. But if you zoom out and you look across their life, they actually seem very balanced.

21:06So they go all in on the things they care about, but they don't go all in all the time. So using the house metaphor again, it's essentially saying that it's okay to have a season of your life where you spend a lot of time in one room of your house so long as you don't let the others get moldy, so long as you keep them available so that in other seasons of your life, they'll be there for you when you want to go into those rooms. So yeah, Yeah, you want to diversify your sense of self to make you more gritty, more rugged and flexible amidst change and have multiple rooms in your identity house, essentially.

21:48I really like that, Brad. And I think you'd make an excellent investor because so much of investing, honestly, at this point to me is about mindset. Having looked at the research, the academic research, in many ways, it feels like the tactics of investing have been solved for. It's not really the mystery that it was a decade ago or certainly not three decades ago. But the one thing that I always find that I'm coaching through and helping others with is this very insight that you mentioned of impermanence. And that's scary because our brains are just prediction machines. And if something doesn't fit our worldview and we aren't really sure how to predict that thing, well, it feels very uncomfortable.

22:31And one part of our conversation, arguably, I could have led with this that we sort of take for granted, perhaps, or at least I have, is that you and I are very open to this idea that the world is constantly changing. We are very open to the idea that it will change and what we know to be true today may not be what we know to be true tomorrow. What is it that you find effective in helping teaching other people that idea and being open to this impermanence, to this constant change? Well, I think two things. The first is the research is pretty clear. The work of Bruce Feiler shows that the average adult goes through 35 major life changes.

23:16So we think that change is this one-off event that happens to us when, in fact, we're always in conversation with change, right? We're always somewhere in the cycle of order, disorder, reorder in at least one, if not more, components of our life. And then the second is stability through change. It's not stability or change. It's stability through change. So we don't have to give up our stability amidst change. There is a way to maintain stability through change. It's just through changing, at least to some extent. So in my framework, the stability is the ruggedness. Like we can have sources of ruggedness in our life.

23:53One big source that we talked about is core values. Another is ritual and routine. So things that are within our control that are predictable that we get to create that we can hold on to. Enduring relationships. They're not completely rugged because eventually everyone that we love, including ourselves, mortality, we die. And that's just the tragedy of being a human. But enduring relationships up until that point are another really profound source of ruggedness. And if we have these sources of ruggedness, then in a paradoxical way, it makes change so much easier because it allows us to be flexible on everything else.

24:31It's almost like if you can say, hey, I have these four core values or these three routines and rituals that I just need in my life. And if I can do those things, then I can meet the world on its terms and maintain hope and take wise action. That is ultimately what rugged flexibility is all about. And we know that bad things will happen. There's good change. There's change that we're maybe a little bit indifferent to, but then there's that bad change. And so much of the coaching I do with younger employees on how I'm speaking with clients, even at the point at which they're prospective clients, is just this idea that I know you wrote about, and I use the exact same words, that happiness is the difference between expectations and reality.

25:15And so if you know that bad things will happen, and it will be okay, that we don't have to have the answer for them, we don't need to predict them, but we can just plan on them happening, and that we're doing good things. And your point in more life, holistic life, we're talking about routines, and the investment portfolio, we're going through those systematic routines. But it's an idea that you talk about called tragic optimism that really seems to link that idea together for me. Do you mind sharing of how tragic optimism fits into this idea of rugged flexibility? So tragic optimism was coined by Viktor Frankl, who's the 20th century philosopher and psychoanalyst, wrote a wonderful book called Man's Search for Meaning.

26:01He's a Holocaust survivor, a real pioneer in the field of clinical therapy. Much lesser known is Frankel's short essay, which he called The Case for Tragic Optimism. And in it, Frankel argues that even the most average human existence will have pain, suffering, and tragedy. He said there are three reasons for this. The first is that we're made of flesh and bone. Our bodies will hurt at some point. The second, we have these enormous prefrontal cortices in our brains so we can make plans. And sometimes our plans don't work out and that hurts. And the third is that everything that we love and that we want to hold on to forever will eventually change.

26:47As far as scientists know, we're the only species that is acutely aware of our own mortality. And Frankel says that those are real tragedies. There's no toxic positivity or being a Pollyanna associated with Viktor Frankl. What Frankl argues is that the work of a mature adult is accepting and acknowledging those tragedies and maintaining hope and optimism nonetheless. And it's not tragedy or optimism, it's tragic optimism. In Buddhism, they talk about the 10 ,000 joys and the 10 ,000 sorrows, and you don't get one without the other. And I think in today's world, there's so much pressure to be happy all the time, or in some circles to kind of be despairing and nihilistic all the time.

27:37And there's such a wide chasm in the middle, which is where the research shows that we all ought to exist, which is to acknowledge the very real pain and suffering and tragedy of being a human and to work to maintain our hope and optimism nonetheless. us. Because if we're going to have any chance at improving a broken world, we cannot become broken people. And I think that there's just too many extremes when it comes to change, right? There's either nihilism or Pollyanna. There's either pick yourself up by the bootstraps in full agency or complete structural everything you have no control. And the truth is almost always somewhere in the middle.

28:17And that's what tragic optimism is all about. Well, there's so much in this world that we can't control. An idea that's tangential to this is just the idea that all you can do is control yourself, control your own response or your own reaction, of which you point out are very different. So I'm kind of curious, maybe explain the difference between responding versus reacting and how someone can put them in a better position to respond to things in a positive manner or in a productive manner. I guess it doesn't have to be positive. So many philosophers have said that our freedom lies in the space between stimulus and what we do about it.