Bret Boyd and Joseph Kopser: Episode 99

Transcript

[0:00:47] Charlie Hoehn: You’re listening to Author Hour, enlightening conversations about books with the authors who wrote them. I’m Charlie Hoehn. Today’s episode is with Joseph Kopser and Bret Boyd, coauthors of Catalyst. Change is happening faster and bigger than ever before but how can your organizations adapt to these forces when the environment is evolving so rapidly? Well, Joseph and Bret have a framework to guide leaders into the future. They are the cofounders of the Gray Line Group, a firm dedicated to disruptive change management. Joseph is the former CEO and cofounder of Ride Scout which was acquired by Car To Go and Bret is a strategy and corporate development executive with a ton of experience in defense, energy, technology and the finance sectors. Both of them graduated from West Point and Joseph served in the US army and Bret served in the US special operations command. In this episode, they explain how change works, why disruption is happening so quickly, how to adapt and what is required of our leaders to succeed in the future. Now, here is our conversation with Joseph and Bret.

[0:02:25] JK: It really began when I was actually a captain in the United states army as the company commander and I thought, everything that we were doing and working on in the army had to do with tanks and guns and blowing stuff up. Well, I got a visit one day in the motor pool from three different black tinted window, 15 passenger vans, and then out pops these group of people, this young woman probably in her 30’s, about my age was in the lead of this V shaped formation and on the wings of this V were all of these generals and colonels. All these trap hangers, following her and that’s when I realized that she was from the Senate Armed Service Committee, she was the staff that was coming to visit Fort Hood and see what was going on and it really made me understand that the world is so big in terms of the intersection between the big decisions and the big budgets in congress and the big decisions made in the military, that despite all of them, it comes down to people and how she was being treated on her trip and if she walked away with a favorable impression of Fort Hood, that would probably be good for Fort Hood’s future but if for some reason she had a bad trip, it would be bad. No matter how well intended everybody is in terms of the making sure that they have in place the right strategy, that it’s the human side of the execution, that’s something that’s hard to replace.

[0:03:48] Charlie Hoehn: When did it start for you Bret?

[0:03:49] BB: One of the things that I find is very interesting here is you know, I don’t care who you are, a student, business professional, soldier, sailor, airman, et cetera. It’s impossible to watch the news right now and not really seize the idea that things are happening. I mean, there is just so much change that’s going on in the world right now, it’s really a remarkable time to be alive. I guess the epiphany for me here was to take that realization or I guess that constant awareness that we see in the media on and say “Wow, there’s a lot happening. If you extrapolate this forward here, there is a lot of the fundamental conditions that we’ve built businesses and social structures and government institutions on top of, seem like they’re changing. I guess that realization of the idea that it seems like so much is changing, led to a little bit deeper discovery to say, “Well, you can’t just generally look at these things and get enough comfort with what to do about it, you really kind of have to dive in and identify what’s important.” I think that’s the genesis of this book really is to say, you know, “Okay, we all understand the world is changing but how do we look at change in a structured way to really be able to parse out the interesting versus the transformational, when we look at this whole ecosystem of announcements and media and those types of things.”

[0:05:08] Charlie Hoehn: Let’s kind of make this concept a little bit more concrete, can you give an example of how we need to be approaching this change with a change that’s going on right now. I mean, one that comes to mind, obviously is like the block chain is a pending change or we’re starting to transition eventually to that. What do we need to be doing according to what you lay out in catalyst versus what maybe we tend to do?

[0:05:37] JK: Well, let’s even talk about, because the whole point of the book is not to really focus on things that are 10 to 15 years out and while block chain is definitely emerging, we speak about it in the book, there’s another catalyst that’s out there in the world of technology where intersects with cities and it specifically, the implementation of drones for commercial use, for logistical use, for transportation use. It’s going to provide all kinds of new opportunities and also all kinds of friction. I’ll let Bret jump in and give some examples of what we mean, how it applies to the book.

[0:06:09] BB: Yeah, to take the drone as an example here, what we really did is we built the framework in a methodology to try to look at all of the different things that are happening and again parse out the interesting and the locally important versus the transformational and the globally important. We talk a little bit about this in the book but we have a process that we go through to try to evaluate the magnitude, the scope. We look at how broad these changes could be from an industry perspective and a public institution perspective. That’s really how we work through and look at these types of things. Again, as you look at drones, sure, that’s important for drone companies and it’s important for companies that provides software to support drones but the reason why we consider drones part of a broader catalyst in the technology field, is the idea as Joseph mentioned here, is that we’ve got the potential to reimagine the movement of goods, especially in dense urban environment which we think has an extremely broad impact that will ultimately actually affect the physical footprint of what cities actually look like. Again, we’ve got several different topics that we look at in this framework but that’s the general idea, you know, the book is titled Catalyst because again we’ve built that framework around how to identify these transformational developments. We also think about people as catalysts which we can dive in to in a little bit more detail around change agents within our organizations but that’s a high level example.

[0:07:38] Charlie Hoehn: That brings up a great point. How do we identify catalysts? I listed block chains and that’ snot really relevant right now so you lay out in the book how we identify them, what’s that process?

[0:07:52] BB: Well, I mean, again, we’ve got five different areas that we look at for these catalysts here in terms of – there is a timing issues, there is a magnitude issue, there is a regionality, if these are contained to specific countries or specific regions or categorically across the developed or developing world, we also look at the – I don’t know if investability is a good word. But really, we’re looking at areas where there is enough capital and entrepreneurial talent to present the solutions that ultimately allow large institutions to adapt in order to accommodate or build new business units around some of these different areas of change. It gets reasonably technical when we get in to how we parsed different developments through this framework but I guess at a high level, that’s how we think about sorting here and again, this is not the diminish, the iPhone eight, we’re going to call it the iPhone 10, is a significant and important development in the mobile industry. It is not nearly as significant however as the first iPhone or the first iPhone that you wear on your face or in a contact lens will be. I mean, those are kind of obvious examples but we’re really trying to identify those inflection points here. Block chain, we’re still in our exploratory phase on that, my personal view on block chain is that I have no idea how cryptocurrency is an asset class will play out but I do think that there are some underlying structures there around trust and transaction mechanisms on the internet that are going to endure. They’re going to have some very interesting implications logistics companies and a lot of industries that have typically made their businesses in being between two parties to verify transactions, we’re a little early there. Again, the book focuses on cities and manufacturing, power generation, technology as we mentioned and then a couple of different forces that roll up into the overall shifting nature of work that we see going .

[0:09:56] JK: Let me just give a quick example to expand on what he said about the phone for our listeners to understand where the book comes in and what we mean by catalyst. When you had landline phone for the last hundred years, the invention of the cellphone, the mobile phone, that was great, but it wasn’t so huge that it revolutionized how we operated. It just meant that we could talk in more places, we didn’t need a landline. Then, incrementally, they stayed in the same advancements all the way up through, including flip phones, nothing big and nothing too different but my goodness, in the mid 2000’s. When we made it so that a phone had the ability to carry internet capability, when it had GPS, when the smart phone came along and also brought in the camera, when it brought in all these other devices, what it did was create a step function. Now, nothing going forward in the future was like anything in the past. Going from the point that we invented the smart phone, it was great to have the iPhone five, six, seven, eight, nine, 10 but those are just incremental changes. But like Bret said, once we put the iPhone or the smart phone technology in your contact lens, when we embed it in your sunglasses and you have all that same connectivity, that will be a step function because then it will be able to get into bio and health technologies, it will be able to monitor your heart, your glucose levels, all these other things that will just as the smart phone brought together technologies of those days to improve your quality of life. When we marry up the next evolution with bio tech, it will be able to save lives, not only improve lives. That’s what we mean by catalyst and that’s what we mean by the step function nature of it.

[0:11:41] Charlie Hoehn: It reminds me of the quote, “Innovation is marked by everything that came before it is obsolete and everything after bears its mark.”

[0:11:51] BB: Yeah, I think that’s a wonderful quote and to build on Joseph’s point about the step function nature of change, I mean, look, all industries work in cycles, there are these big major shifts and they have been in different frequencies and different industries. I mean, you can look at the energy industry for example and look at the shift from the age of sale, to coal, to oil and gas, to whatever’s next. Each one of those tips literally changed the world, changed the entire geo political dynamic of the planet and similarly, if you look at the media business as we went from radio to television, to internet, to mobile internet, there were entire new industries created, industries diminished, new types of companies came in and these are the inflection points that we’re really trying to identify here. If you map that framework towards the performance, specifically of large companies, during these times of transformation, one of the somewhat distressing realities that we need to address is the idea that most large organizations are significantly diminished when the market changes in a significant fashion. It’s not impossible to navigate these types of transformations but it is very difficult and the track record for organizations really is not great, which we can explore in SMP 500 and Fortune 500 data and a lot of different sources. It really is important to say, “Okay, you know, these transformations are huge areas of opportunity and of risk and we really need to walk into these with our eyes open. Understanding that things are changing and understanding that if the fundamental conditions or assumptions upon which we build strategy shift, then our strategy also needs to shift or we’re going to have problems.”

[0:13:35] Charlie Hoehn: How can major organizations, how can the leaders, the managers, people on the frontline, how can they be adaptable to change, rather than having to react to it happening?

[0:13:50] BB: That’s a great question and we think about three different activities here, we’ve tried to talk to these three in the book as well, but the first function or the first requirement is, you need to see that something is happening and you need to see it early enough with time to do something about it. These transformations are always easy to see in the rearview mirror and in the business school case studies and so on but they’re actually kind of difficult to tell in the windshield when you’re looking at all of these different things that are happening, trying to identify the nuggets that really are going to be transformational. On the front end there is an intelligent function to understand what is happening, in the middle of this, there is a strategy function which is really deciding if and what to do about it. After that decision has been made, there is a change management function where then you have to implement change which is extremely difficult and often underappreciated in terms of the organizational and interpersonal dynamics that come with the change management element of transformation.

[0:14:48] JK: Yeah, a good example just to visualize is Pokémon Go. For a while, Pokémon Go captured everybody’s attention and if you’re the CEO of a retail company and your kid’s 14 years old obsessed with Pokémon Go, that is a noise coming in. But the question is, how do you separate the signal from the noise? And the case of Pokémon Go, what hopefully that frontline leader that manager, CEO understood was “Wait a minute.” “Augmented reality is creating completely new experiences, what is that going to mean for my furniture store? Will I still be able to draw people into the store or do I need to figure out how to use augmented reality to make my furniture look like it’s in someone’s living room and how will that change the very nature of my sales and then if we concluded, it will, what’s my strategy to change and then thirdly, can I get this industry full of people who have always done it the same way to then suddenly realize, we got to go mobile. We got to go augmented reality.” That’s what we mean by those three steps.

[0:15:54] Charlie Hoehn: Yeah, the final step I agree, that sounds like the hardest part but you can’t get to that without the first part which is the individual, being able to tap into the signal to be able to listen to what’s happening in the market. How do we become better listeners, how do we pick up on these signals?

[0:16:12] BB: Well, the first point that I’d offer is to think more broadly. We’re in an area here where change is happening more and more quickly and this is a result of the computing revolution and a number of other forces. But these industry cycles that we’ve talked about here previously, these are happening more and more often. We’ve gone from once every several centuries, to once a generation, to once every few decades, to in some industries, we’re looking at every five to 10 years, these industries are being totally transformed here. The one point is just to look broadly and understand that A, these transformations are happening quickly and B, understand the implications of the essentially the globalization movement of the last 25 years and to the extent that has connected markets with each other, right? We used to be in an environment or you could focus on your industry, your region, your customers, your suppliers, globalization has essentially inter-connected all industries, all regions so that one disruption or one transformation and one industry has far more of a ripple effect into other industries than it has ever before. This is actually a really big challenge for organizations because you really can’t be expert in everything. I mean, that’s not an efficient way to go to market and only the largest organizations have the opportunity to build those types of teams. This really becomes an issue of stepping back and looking broadly which again we appreciate as a big challenge in an organization at the same time needs to be heads down in highly competitive markets to ensure that they succeed on a day to day basis.

[0:17:48] JK: One of the examples we give in the book is, when you have been in an industry for so long that you don’t realize that those underlying assumptions are changing, it happened with my experience in transportation when we were building Ride Scout and we were aggregating together all the different modes of transportation in a city. We met with one of the largest taxi provider aggregators in the nation and after I explained to him what we were trying to do by bringing all of these moves together, he said, “Young man. Let me just explain to you how the world of transportation works. You got people who take the bus, people who drive their car and people who take taxis. There’s not going to be a time when people will change modes and there will certainly not be a time when people get into the car with perfect strangers that they don’t know, in their own personal automobile.” Sadly, you roll the clock forward, six, seven eight years later, we see where parts of the taxi cab industry are because they just refuse to believe, despite the data coming in that something was changing because they did not allow themselves to step out and look as Bret said, more broadly to all the other trends and our book has lots of different examples of that, that illustrate because again, change is hard and we try to step through the book with the methodology to allow people to understand how they can implement that change.

[0:19:16] Charlie Hoehn: Author Hour is sponsored by Book in a Box. For anyone who has a great idea for a book but doesn’t have the time or patience to sit down and type it out, Book in a Box has created a new way to help you painlessly publish your book. Instead of sitting at a computer and typing for a year, hoping everything works out, Book in a Box takes you through a structured interview process that gets your ideas out of your head and into a book in just a few months. To learn more, head over to Bookinabox.com and fill out the form at the bottom of the page. Don’t let another year go by where you put off writing your book. What you said Bret about globalization, these industries all being interconnected, it made me think of Amazon’s recent acquisition of Whole Foods and I remember thinking wow, I wonder how many other industries just like shuddered with fear of the idea of these industries overlapping now so much. I’m curious though. Apart from sort of the obvious tech giants, what organizations and companies do this exceptionally well, which ones are adaptable to change that you’ve seen or maybe talk about in the book?

[0:20:43] BB: Yeah, it’s a wonderful question and we would argue, we do argue in the book that the economic system here of the last century has tended to be an organization model that was focused on efficiency. You have these top down hierarchical organizations, you have individuals that fills specific roles in a highly efficient and often repetitive process here. You’ve got these massive engines built that are excellent, I mean, these are wonderful companies that have built their organizations like this. They’re optimized for efficiency. When you look at taking an organization like that and you look at a world that’s not reinventing itself, or industries that are being reinvented here on recurring five to 10 year timeframes, we suggested that that model is no longer perhaps the best fit, this is again both for businesses and public sector organizations to consider. We would offer the idea that agility and flexibility and creativity have become as important as efficiency in large organizations here. As you think about that, it’s easy to say that, it’s actually incredibly hard to do that, I mean, there are so many short term pressures on both public and private sector institutions. I mean, in the case of public companies, you’ve got – you have markets that really care about quarterly financial performance in the public sector, you have short term voting processes that keep everybody oriented on very short timeframes. The organizations that we get excited about and that we have a lot of respect for area these organizations that have managed to be agile, flexible, and forward looking, while at the same time, balancing those near term and long term pressures. Look, it’s easy to speak the accolades of the googles and the apples and the Netflix and the Facebook of the world and let’s be really clear that they have not faced their systemic shift moment yet.

[0:22:44] Charlie Hoehn: No, they haven’t.

[0:22:44] JK: They’re too young.

[0:22:47] BB: Yeah, I agree, but we do appreciate how those organizations have managed to organize around flexibility and agility in a different fashion than the traditional top down hierarchical, you know, American industrial sector company has.

[0:23:03] JK: And I’d like to always point out to readers and listeners, what we mean by the difference between agile and adaptable. So if you were a Swiss Army knife or if you’ve had a Swiss Army knife, a Swiss Army knife has so many different tools from knives to screwdrivers to even cork screws to fish hooks that is adaptable. It could do a lot of different things and you can use that tool for a lot of different purposes. But agile is to be holding that Swiss Army knife in your hand and then realize in the middle of a business meeting to show proper respect and honor the person you are meeting with that you hand that entire knife over to them as a gift, that is agile thinking. Which is to take something that has many different purposes but use it in a way that had nothing to do with what you thought was the purpose of that knife. I hope that makes sense in trying to distinguish between something that’s adaptable and something that is agile, or a person that’s adaptable and agile. And you think about like for instance the utility markets today, those that produce electricity around the country, right now they are in a production method. They are trying to be adaptable in producing electricity through different ways, coal or nuclear, or wind or solar. They are trying to adapt but an agile way of changing might be to say, “Wait a minute, rather than sell electricity based on consumption which is what we are doing now, why don’t we sell it as a service.” Meaning that you are going to pay the same amount of money every month and I, the service provider, having an incentive to lower the energy consumption in your house by subsidizing better efficient refrigerators, washing machines, installing solar, putting in new corking around your windows and making you more energy efficient and that’s agile thinking and that’s what we mean by trying to distinguish to help these companies and public institutions and academia continue to evolve.

[0:25:04] Charlie Hoehn: This is great that you brought up power. You have as you said the five main areas of catalyst that you talk about in the book, manufacturing, power, demographic, cities, technology. Can we talk a bit about how each of those could be looking through the framework that you just listed, Joseph? Maybe let’s start with manufacturing, how can they be approaching things.

[0:25:29] BB: Yeah, I’ll jump into this one first and then Joseph can pile on, on the back end here. But so again, if you step back here and the idea is to say, “We want to look for these broad transformations that are going to affect the world across, again, don’t care what type of an institution, don’t care what industry you’re in, running this through the Catalyst framework here, this is how we landed on manufacturing and it is important to understand. That manufacturing is important far beyond just companies that are associated with component manufacturing and logistics. It’s actually a more fundamental part of the global economy. I mean really when you look at globalization, in large part globalization is outsource manufacturing. In the traditional way here, if you buy a laptop you’ll have materials pulled out of the ground, ship it to another place, turn it into a part, shipped to another place and so on. And you could have a laptop, you probably have a laptop, that has components that were on eight different cargo ships and touched 40 different countries. So as we looked at the fundamental technologies around how manufacturing works, we think that additive this is 3D printing and the next iteration of autonomous manufacturing that will be enabled by machine learning and some other different technical components such as battery development. We think that there is a whole fundamental shift in the way things are built and we think this isn’t going to matter, right? So again right now, the model is built on, “Let’s have subcomponent parts constructed in the places where they can be built most cheaply.” That’s essentially what outsource manufacturing has – that’s what that means but if we get to an environment where you are going to fabricate, or you are going to print a part, and the printing machine is going to cost what it costs. And it is going to cost roughly the same to print it near the place where you’re going to sell it or to print it in a faraway country and then ship it to where you’re going to sell it, you’re actually going to localize more manufacturing which is a very, very interesting thing to think about in terms of again, the global system, the shipping business, the logistics business, the warehousing business. Which is again, predicated in the idea that I have to buy huge lots in order to have low per unit price. 3D printing changes that dynamic where the per unit price is, there is still some economies to scale, but it’s far less significant to produce 10 versus 10 million of an item. The thing that we think is broadly important it also has the potential to create a whole new creative class. This whole rise of the craft’s person here, if we think about the ability to just have you or I can learn how to build software and we can build companies around that in this type of an environment, we can apply that same logic to physical goods.

[0:28:14] JK: Yeah and to build on Bret’s point, I always like trying to capture people’s imagination through story of what added manufacturing couldn’t do. So, we are going to get to a point soon where 3D printers are going to be so affordable that you can put them on your kid’s desk, in their bedroom at home and if you can only imagine what happened to an entire generation of people across the planet when personal computers became cheap enough that they can take them home. And what that did to unleash the creative class of the last 40 years in technology, in connectivity and in the internet and consumer goods, just imagine what’s going to happen when we have inventors, creative people who use both parts of their brain to be able to build and design right there in their own home, unleashing a whole new creative class and inventors and engineers among young girls and boys all across the planet. That for me is the most exciting part about 3D printing. I can’t even wait to see what my kids and their kids come up with.

[0:29:17] Charlie Hoehn: Oh I know, it’s thrilling to think about it because right now it’s just such a novelty. It’s just for the enthusiast and it seems like “Okay, it’s a small little thing” but you’re right. As soon as it comes about, the innovation is going to sky rocket. It’s really exciting.

[0:29:34] JK: Yeah, a whole new class of inventors.

[0:29:37] Charlie Hoehn: Yeah, I’m curious for you two personally, what are you most excited about? What changes are each of you most excited about?

[0:29:45] BB: Oh man, that’s a difficult question.

[0:29:47] Charlie Hoehn: I know.

[0:29:48] JK: Well for me, what I am most excited about is on the energy side. So I spent two trips in Iraq and during that time, I realized that our National Security strategy was mired in the mud by our lack of an energy security strategy because we have so much legacy equipment that was fuel based, diesel based, gas based, such that we were delivering fuel to parts of Iraq and my buddies in Afghanistan and they themselves became the soft targets that the bad guys were shooting at. They didn’t shoot at us and all of our big heavy military equipment. They shot at our tankers and our soft targets and so if we can get to a part where we decentralize power generation, you know this magical box that’s not too far away from being built where it is able to be deployed along with the war fighter and in it, it has a capability of unleashing panels for solar, capturing wind, digging down for geothermal, purifying water on site and the best part is, I recognize that will be expensive to build. But the military’s got the incentive to do it but once we get that commercially available product cheap enough then imagine what you’re going to do in places like Puerto Rico after the hurricane went through and destroyed their electrical grid. You can drop these boxes everywhere you need to go in order to power. You can allow it for people who live in remote locations to not have to worry about sustainability. Parts of the world that are underdeveloped that can’t store medicine with refrigerated capability, to keep it cold. To be able to keep food fresh for days, that is for me the most exciting part about these catalysts when they all come together in terms of power and demographics and technology, when they all just come together. So that’s mine Bret, I don’t know what you would say.

[0:31:34] BB: Yeah, I mean again, it’s hard to pick one element. Again the future is integrated, right? So none of these happen in isolation, they actually are woven together in this intricate dance and it will be very, very interesting to see how all these plays out. I mean I guess I go back and forth between, being worried is not the right term, but concerned and excited about the way the nature of work is changing. I think that there are some fascinating new capabilities. They are coming online around the real adoption of machine learning algorithms which we’ll probably essential redo every software application that we currently interact with right now and add new capabilities to it and as with all of these transformations here, there are going to be companies and nations and educational systems that lean into that and say, “Look what an amazing new tool here.” We need to now rethink about what we want our people doing. So that these are compliments to our skills and they can unlock additional creativity, additional capacity, etcetera-etcetera and candidly, I suspect there are going to be others who say, “Look we’re good doing what we are doing and the world can change but we like our old systems.” I fear that that mindset, that reactive posture here is going to lead to some groups that are going to fair less well as these system change.

[0:32:59] JK: Yeah, I mean to put a fine point on that. We’ve all worked in organizations, Bret and I both in the military and civilian world, where we always encounter that one person who has been in the organization for a long time who says, “No, no, no, no that’s not the way we’ve done it. We’ve done it this way for the last 30 years, we’re going to be just fine” and those people do concern us.

[0:33:21] Charlie Hoehn: Yeah so I am curious based on both of your responses now, why did you decide to write this book? I mean on a personal level for each of you, what change and impact where you were hoping to make with the leaders, the people who can make these changes across organizations, what were you hoping to do yourselves?

[0:33:45] JK: Ooh, I like the way you frame it because I want to push back on it a little bit. When we got into this and I expressed to Bret this desire to write a book that would capture some of these ideas and we decided to do it together. I was never really ever working for an organization in the first 20 years of my professional career where I could affect the big change but what I was doing was constantly reading, constantly talking with mentors. Always engaging with people to figure out what’s a better way of fixing the problem and as I found in all of them, there are plenty of smart people that have come up with ideas but very few people with the grit and the drive to see it all the way through to execution. So, when I finally did get my first chance in the private sector with the company Ride Scalp that we went from just the PowerPoint all the way up through acquisition, what I noticed is that the very same challenges that I faced in the private sector, I was facing in the military. Just the same, we may be used different words, but the leadership and the people side of it was the same. Then when I worked in the corporate years for a couple of years with Mercedes after we have acquired my company, I saw the same kind of resistance to change, the desire by the way to change but at the same time, the resistance to change in the corporate world as I saw in the private sector as we saw in the military and as someone who is a student of history who loved to read and expand by opportunities of lifelong learning, I thought well “Why not write a book that I’d be interested in reading to hopefully change some folks and improve the way they see these problems and to give them a methodology.” It’s really about, “Okay so what? So what’s your methodology?” That was my personal drive.

[0:35:28] BB: The way I think about this is again, I don’t want to come off as a pessimist. I am generally optimistic about the way that the system is going to evolve here But I think if you really look at some of these transformations, there will be a bifurcation between organizations and public institutions that thrive in the phase of transformation here and that do less well. I think that the dividing line is actually going to become more sharp and it’s going to become more difficult to catch up if you failed to remain agile and adjust to these changes here. I think it’s important to note that given that framework here, look we work with wonderful businesses, we live in a wonderful country here and it’s really important. I mean we are incentivized here to at least put these on these forces on the radar on the people that lead these organizations because these really are important and there are several different paths that all of these different groups can take and if we can be one element of the forces of good, pushing organizations to be more proactive, more forward leaning I think that actually results in better outcomes for our communities and our country and the world, candidly. So, I guess I think about this very broadly here but I am excited about this book from that aspect.

[0:36:49] JK: Yeah and obviously we would love for there’d be one day in a board meeting where people are arguing back and forth about the right way to do it and someone pounds their fist in the table and says, “Haven’t you read Catalyst? Don’t you think of what’s coming if we don’t try to change and then implement the change?”

[0:37:03] Charlie Hoehn: Absolutely, now you guys have been at Gray Line. You’ve been doing this work with organizations, with companies to help them manage disruption and change. Can you talk about some of the work that you’ve done? Maybe stuff that you’re particularly proud of with these companies.

[0:37:25] BB: Yeah, I mean look Joseph and I have known each other for a long time. We built this business here a few years ago and you know as we mentioned the organizational activities here of understand what’s happening, decide how to react and implement change, again that’s generally how we’ve tried to map our business here. It really has been fun to help some of these cities and regional level transportation organizations and some of these different types of companies think through these big picture, structural changes. And again, it’s a lot right? It’s actually we are trying to figure out how to build, I am going to call it an early warning system but a little bit more of the situational awareness system because we understand that there are big decisions with significant financial implications that you make as a result of these changes and the timing is extremely important. I mean being too late is a huge risk, being too early is often also a huge risk and so we’ve spent a lot of time trying to work on really understanding. Look at where is the inflection point in this catalyst? It’s actually reasonably easy to get people on board with the idea that transformation is coming. This is one question which is an interesting one that we are spending most of our time working to solve right now.

[0:38:37] Charlie Hoehn: I think that’s amazing that you are spending time on timing. As far as I know that is the number one hidden reason why startups succeed or fail that almost never gets the full credit it deserves. Have you found any interesting insights regarding the timing? I mean I’d imagine because of the cycles things are speeding up and everything but.

[0:39:02] BB: Yeah, no we’ve actually done a lot of good work around this and one of the interesting observations here that I think is, I don’t know, it’s somewhat obvious in hindsight but I don’t think it’s something that is broadly understood and talked about here but this is not to detriment how organizations here work, or detriment anyone. But there is a lot more personal risk for an executive who decides to do something first than there is for waiting and doing something with the herd. Even if the herd is behind and ultimately have failed to do what they need to do. I don’t know if I said that clearly but the idea here is that when you are looking at these big transformations and you are trying to decide what to do, that timing element really, really is important and you can tell again, we don’t want to come at this and say, “Hey we know exactly the date, time, moment that you can predict when the flip will happen and the economic viability of renewables will hit broad adoption.” I don’t actually know that and I don’t want to try to pretend like that’s something that to date that you can pull out of the air but I do think that you can disaggregate that. I think you can look at the cost and efficiency curves around affordable tech. I think you can look at the efficiency around turbines. I think you can look at some of the cost and storage metrics around grid storage batteries and I think you could look at some of the regulatory shifts that are going to need to happen in order to incorporate a multi buyer multi seller energy market. I think you can actually build some industries to help people think about how these forces are converging and when they’re coming together.

[0:40:45] JK: And this timing piece though is critical, and we do admit as Bret said how hard it is but it is critical to understand. So, our book is laced with stories and you know, one of them is in my own life in the development of Ride Scouts. So, seven, eight years ago long before peer to peer ride sharing happened, I saw these trends coming in terms of buses that were empty with very few people riding them. We saw cars on the road with only one passenger and yet three or four empty seats. We saw traffic and congestion building and yet, I also saw at the same time that wait, GPS technologies in the palm of your hand on these new things called smart phones should be able to allow us to connect in real time much better to the available inventory of seats that were out there. So had the idea of Ride Scout come a year or two before or a year or two after, it would be totally different than what it was but again, it goes back to the methodology of the thesis of the company that we lay out in the book. Which is that you have to be able to see the changes that are coming, figure out what’s most important, decide how you are going to take a strategy forward and what the strategy will be and then thirdly, implement that. The idea of Ride Scout, the idea of Apple, the idea of IBM or whatever company or gadget you want to explain had been invented previously probably 10,000 times but other people thinking the same ideas. They saw the noise, they figured out what the signal was. They decided what to do and they didn’t implement and our book is full of story after story of trying to help the reader understand how difficult this is but provide the framework to do it.

[0:42:29] Charlie Hoehn: So that leaves us at a great point which is would you two give our listeners a challenge, something they can do from your book this week maybe within their organization or in their own personal lives to start thinking about the catalyst framework?

[0:42:48] BB: So, I guess the challenge that I would offer here and even in this conversation we’ve had a lot around CEO’s and governors and senior leaders and so on. I think it’s important that we understand here that the change agents within our organizations are often those line leaders that are close to the intersection of tech and markets and customer behavior. The challenge that I would offer here is to everyone and again, I don’t care what your job title is. Or what type of formal leadership responsibility you have here. I would challenge all of us to really step back and understand how what you do fits into the overall organizational strategy and if you don’t have an answer for that, that’s actually a problem and you need to look up and tell someone and if they can’t explain that to you, think about what you are doing here because the unifying characteristic of successful organizations is alignment. It is alignment and proactive behavior at all levels. Again, we are all past the time where you can sit on high and direct the behavior of 50,000 employees towards a coherent end. It’s far more of a complex dynamic here and so we just really want to encourage and empower those leaders at the front.

[0:44:00] JK: Yeah and I would build on that by being more simple in the sense that I would ask anyone whether they’re in academia, business, government or they are just fascinated by these subjects to write down on the back page of the book the three or four things that they’ve already thought about in society that are fascinating to them that’s changing or the things that they already know they want to fix, just write them on the back page of the book. And then go through the book and then as they are reading the book see how many ideas are spurred by what they’re reading about other industries, other sectors and how that adds to what they’ve already identified they want to work on.

[0:44:40] Charlie Hoehn: Excellent, guys how can our listeners connect with you, follow you, work with you?

[0:44:46] BB: So again, our business is called Gray Line. Our website is graylinegroup.com, we spell that as Gray Line. On our site you’ll find a ton of videos and analysis and data sets and description of our business and so we appreciate you all saying hello there. We got a newsletter as well where we push out the most interesting things that we are looking at to our audience every few weeks. So, from my perspective that will be the best place for us to connect.

[0:45:13] Charlie Hoehn: Wonderful, Joseph and Bret, thank you guys so much. The book is Catalyst.

[0:45:19] JK: Thanks for having us.

[0:45:20] BB: It’s been a pleasure.

[0:45:22] Charlie Hoehn: Many thanks to Joseph and Bret for being on the show. You can buy their book, Catalyst on amazon.com. Thanks again for listening to Author Hour, enlightening conversations about books with the authors who wrote them. We’ll see you next time.