A Stanford Professor’s Approach to Building a World-Class Organization

“I don’t have control over each individual person’s knowledge, skills, and attitudes, but I can create the environment that allows them to build those.”

Michael Gervais is a high performance psychologist working closely with sports MVP’s, internationally acclaimed artists, and Fortune 25 CEO’s. Tina Seelig is a faculty director of the Stanford Technology Ventures Program and an expert on creativity, innovation, and entrepreneurship. Michael recently hosted her on the Finding Mastery podcast to discuss taking charge of your environment, identifying your risk profile, and crafting team culture.

This conversation has been edited and condensed. To listen to the full conversation, click here.

Michael: What is one word or phrase that cuts to the center of what you do best?

Tina: I’ve become very passionate about understanding how to unlock creative problem-solving. I say that intentionally, creative problem-solving, because people think creativity is coloring and art and music, which is all great, but you can apply [creativity] to addressing big problems in our lives.

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I created this framework which I call the “innovation engine,” and it looks at what has to happen on the inside for you personally and what has to happen in the environment to unlock creativity. The inside has three pieces: your knowledge, your creative problem-solving skills, and your attitude. They affect each other. Your knowledge is a toolbox for your imagination, and your imagination can get deployed to solve problems, but your mindset is critical. It’s the fire that gets it started. This is all well and good, your attitude, creativity, and knowledge, but if you’re not in an environment that supports it, you are at a huge disadvantage. This is what happens to a lot of creative people when they go into organizations that don’t work.

The outside is the resources, habitats, and culture. Collective attitude is culture. Knowledge expands out [and] becomes resources. Skills expand out to habitat. Now, habitat is a whole bunch of things. It’s the team you’re on, the rules, the rewards, the physical space. These levers all affect each other.

Michael: If you were going to start a new basketball team, you’ve got a bunch of young talent, and there’s no one clear alpha. There’s not that one Michael Jordan or whatever. They’re all young, talented, open to learning, and they’re looking at you. What would you do? How do you get going to create a world-class organization?

Tina: You as the person who leads the organization is in charge of this external environment. You can set the culture. You can determine what resource is available, and you are creating the habitat.

Michael: So you start outside, then go inside?

Tina: If I’m the leader, those are the levers I have. I don’t have control over each individual person’s knowledge, skills, and attitudes, but I can create the environment that allows them to build those.

“I don’t have control over each individual person’s knowledge, skills, and attitudes, but I can create the environment that allows them to build those.”

Michael: Then how do you set culture?

Tina: I love this question. You start with: what [is] the culture you want to create, and then work backward to figure out how you’re going to get there. Things as simple as the physical space… When people walk into a room, the room tells the story about what your behavior should be there.

If it looks like an auditorium where there’s a stage, it looks like one person’s going to be on the stage and everyone else is listening. If you have the chairs around in a circle, that’s a totally different setup. We know that everybody’s equal. The physical space matters. The rules, the rewards, the incentives, the people you’ve chosen to be on the team, all of these things play a huge role.

Michael: Okay, so what you’re saying is to think about habitat, because it influences culture. I’ve always thought culture begins with an idea. If culture is an idea of how I want to shape the interactions and the relationships with people that I’m engaging with, would you recommend that the head coach start with the idea by [himself/herself] and then hear from other people, or should it be a group environment?

Tina: The culture is the collection of all the attitudes of everyone who’s in the room, right?

Michael: The leaders can shape that, though.

Tina: Yes. They also shape who’s in the room. That’s one of the most important levers you have: picking who is on your team.

[Another] thing that’s important is your behavior as a leader. People are paying incredible attention to what the leader is doing—not even what you say, but what you do. They’re modeling what you’re wearing, how you’re talking, how you’re standing. This is true with parenting as well. The kids are watching their parents’ behavior. If I say to do one thing, but I’m doing something else, there’s an inconsistency and the kid says, “I don’t trust that rule.”

If someone is rude and you let them get away with it, they’re going to quickly learn that, “I guess they said we shouldn’t do it, but it looks like someone else did it, so I’m going to do it too.” It’s important to make it very clear what the expectations and consequences are, positive and negative. It’s not just punishment. It’s what gets rewarded.

Michael: I did a little investigation on how empires fall, and a thread that I came across [was that] they rot from within. [It’s] an erosion of culture and an erosion of the ideas that got them to the high ground.

Anyways, let’s go back to your model, that for culture you want to influence habitat and resources.

“You can get people who look great on paper, who are really skilled, but they’re going to be toxic to an organization. It’s not worth it, because it’s a poison that affects everybody.”

Tina: Everything affects everybody else, everything else. When we go into a situation, we have our own attitude, skills, and knowledge, and we’re embedded in this organization. The organization affects us, and we contribute to and affect the organization. You’ve probably been on a team where somebody leaves, someone new comes in, and everything shifts. There’s a shift based on having a new person in the room. It’s sort of like an orchestra conductor; they’re figuring out how to build the team, but also where to put the emphasis at different times.

Michael: What are some of the traps that people who are in a position of leadership run into?

Tina: Let’s say I bring in somebody who is really talented, but is culturally not a good fit. That happens all the time, so we’ve got the no-asshole rule. We’ve had to be very explicit about it. You can get people who look great on paper, who are really skilled, but they’re going to be toxic to an organization. It’s not worth it, because it’s a poison that affects everybody.

Michael: Yeah, okay. What if we went into environments that are dangerous, risk-involved, and very alpha, meaning that not many people want to be in that environment. To do that, you’ve got to [have] an edge to you, and now you have a group of people that have that same edge. Now, it’s a very different ecosystem than a kindergarten schoolroom. There’s likely to be some people that have gone too far with edge, and they have a big chip on their shoulder, and it’s like an “F-you” to the world.

Do you have any thoughts on how you’d corral them based on your model? Corral is a purposeful word because you want to let the stallion run, but at the same time, you want them to come into the fences to be part of something.

Tina: In these situations, the key thing is to be explicit about, “This is the environment we’re in. Here are the skills, approaches, the mindset we expect people to have, and this is the culture that we are building here.” The thing that gets crazy and difficult is when it’s unclear what the expectations are.

If you’re in the military, for example, the rules are very clear. They make it very clear what the hierarchy is, what the reporting structure is, how you deal with people in different levels. There’s no surprise, and people know exactly what to expect. If it’s not clear, people get confused, and if it’s not consistent, that’s what gets really problematic.

I think about risk-taking a lot, especially in the world of innovation entrepreneurship. You need people to take risks. If I ask you, “Michael, are you a risk-taker?” would you say yes or no?

Michael: 100%. I like to think of myself as a risk-taker.

“It’s a huge waste of effort to continually be going over your disappointment a hundred thousand times.”

Tina: You treat it as if it’s something binary. I think of risk as much more nuanced. There are physical risks, emotional risks, social risks, intellectual risks, financial risks, ethical risks. We all have our own risk profile.

You might jump out of an airplane, and I never would. You might be willing to put a lot of money in the stock market. I might not. But I’m willing to give a talk in front of a thousand people, and someone else goes, “You couldn’t pay me enough to give a talk in front of a thousand people.” It’s important to understand your risk profile and get into environments that play to your strengths, what you feel comfortable doing. It’s also [important] to fill in the gaps. I’m the person who’s going to take the intellectual risk and push forward with technology, [but] I need somebody else on my team who’s going to be the social risk-taker, who’s going to get up in front of everybody and give a talk.

Michael: I think you’re right on the money. I want to know if you’re a risk-taker as well and what type.

Tina: I am very happy to take social risks. I do it every single day. I put myself out there. I am comfortable taking emotional risk, telling people how I feel about things. I am not a physical risk-taker. I am not a financial risk-taker. I am definitely an intellectual risk-taker. I’m not an ethical risk-taker.

I think it’s important for people to tease this out for themselves, because if you think of it as just a binary thing, you’re missing the opportunity to realize, “Hey, I actually am a risk-taker. I take these type of risks, but I’m really not comfortable in this domain.”

One thing that’s super important is what happens if you take a risk and you fail. This is critical, because if you define it as failure, you’re screwed. You need to define it as data.

“I asked for a raise from my boss and I got turned down,” or, “I took a course that was super hard, and I didn’t get a good grade.” You should say, “Okay, what did I learn from this?” I have my students write failure resumes, their biggest screw-ups, personal, professional, academic. If you’re going to take risks, you’re going to get data back on when it worked and when it didn’t work. If you don’t mine that data for insights, you’ve missed the opportunity. You can let go of those “failures” much more quickly if you’ve analyzed them, mined them, and let them go.

Once you can let go of it, it is so freeing. Not only do you feel better, but it frees up your mind to do something more useful. It’s a huge waste of effort to continually be going over your disappointment a hundred thousand times.

Michael: It is an incredible resource strain. However, it’s entertaining to play that story over and over again, just like a daytime drama.

Tina: You know what’s funny? A couple of weeks ago, I was sick and I had some strange symptoms. I’m perfectly fine now, but I was going to go to the doctor, and I kept replaying all the symptoms in my head. Finally, I wrote them all down. I wrote myself an email, “Here are the symptoms and here’s what happens.” And I could let go of it, because now I didn’t have to keep replaying it over and over. I think that act of writing down something painful allows you to free yourself from having to keep reminding yourself of it.