Ashley Goodall: Embrace Stability, Not Disruption, to Drive Growth

This podcast is brought to you by Wells Fargo Advisors. Looking for a firm your clients can't outgrow? Wells Fargo Advisors offers financial advisors full balance sheet solutions with wealth planning, investment products, banking, and lending that meet the needs of affluent to ultra-high net worth clients. Build your practice your way and on your schedule with independent and employee model options designed to meet your needs today and tomorrow. Learn more at joinwfadvisors.com.

Today's best leaders are challenging the cult of constant change and have realized that the best work arises not from disruption, but from stability. Hi everyone, I'm business coach Steve Sandusky for Barron's Advisor, The Way Forward Podcast. My guest today is Ashley Goodall. Ashley is a leadership expert and the author of a thought-provoking new book called The Problem with Change, that questions the relentless pursuit of change for change's sake. In our conversation today, we explore Ashley's idea that the ultimate job of leadership is not disruption, and it is not to create change. Rather, it is to create a platform for human contribution, to create the conditions in which people can do the best work of their lives. And we discuss exactly how to do that. With that, please enjoy my conversation with Ashley Goodall. This idea of disruption and move fast and break things, and we've got to constantly be innovating, we've got to constantly be reorganizing— that has sort of been this mantra within corporate America, and that change is good. But you've got a new book out where you talk about the problem with change. So I'd love for you to set the stage here, give us some context on this idea of change is good, move fast, break things, innovate versus, and maybe there's some problems with that.

What gives you pause with that is when you start talking to people on the front lines of an organization and say, so what's it like when there's another change? And you say, well, does it make life easier or harder? And they go harder. You go, does it make it easier or harder to do your job? Oh, it makes it harder. Why? Well, because I never know what's going on. I never know which way is up. I'm not quite sure where my work fits in anymore because we keep changing what we're all about or what we're chasing as an organization. And so there are two stories of disruption and they don't fit one another. One is that it's necessarily a good thing or that it's generally a good thing or that it's what leaders should be trying to do. And the other is that it makes it harder for people to do their jobs. It can't be both.

So I don't want to put words in your mouth, but would you say change is good in the sense that we need change, we have to change in order to improve and enhance. It's just the way that we go about implementing the change or the speed of the change or not considering the human costs of the change that we could get better at as leaders.

If all change led to improvement, then our conversation would be at an end. But I'm arguing that not all change leads to improvement. In fact, some change, organizational change, leads to unimprovement. And so therefore, if we're saying, well, we're an organization and we exist in a marketplace and we have to get things done, so we have to change, I would just say, well, hang on a second. No, you have to get better. You have to get more effective, you have to get more efficient, you have to get more creative, you have to become a better place to work, you have to move up and to the right. Just don't mistake automatically triggering a change initiative as necessarily addressing all of those things. All I'm arguing essentially in all of this is that shake things up and lead to improvement are not necessarily connected. And very often, shake things up has the opposite effect.

What have you found have been effective ways to implement change, to speed things up, but do it in such a way that is not extremely detrimental to humans, that there's not a lot of collateral damage there, and actually gets positive things accomplished?

Yeah, so I think the first question, it's not actually how do you implement change. I think the first question is when. Do you implement change? If constant change is really hard on people, which it is, if constant change leads to uncertainty and confusion about what we're all doing and disruption of teams and disruption of routine and disruption of ritual, all of which it does, and all of which are psychologically very hard for people, then actually the first question is not how do you do change, but when, how often. I do think that organizations are too ready to launch a change initiative because nobody ever got in trouble for saying, hey, let's shake things up, shall we? Whereas it would be a brave leader who would say, maybe things should stay as they are for a little while because from stability will come improvement. Let's lean into stability. There's enough change in the world as it is. There's enough change in business as it is. Goodness me, we should not add to the pile. We should support our people to do their best work and improvement might come from there. So the first thing is not actually how do you do change, but should you do change? And I think we should be more cautious about it, more aware that a lot of change initiatives fail, a lot of mergers fail, a lot of reorgs fail. There's all sorts of academic work now about how seldom layoffs actually produce any sort of savings to an organization at the end of the day. So we've sort of enthroned a lot of large organizational change as economically good, even if hard on people. The truth is it's actually hard on people and not necessarily economically good either. So we could back off on all of those things. The second thing that's important, I think, is to understand that humans thrive in conditions of relative stability. That's not the same as stasis, but stability, a reasonable and reasonably predictable set of environmental characteristics so that we know our way around and we know how we fit in and we know how to put our shoulder to the wheel most usefully. Organizations should be deliberate about building those the whole time so that when change is needed, when actually it is time to respond to the big market move or the AI thing or the offshore thing or whatever comes along next, we actually have built a reservoir of stability to fortify our people against now what they have to face into. It's the stabilizers, the reservoir of stability stuff that I think we don't see. And by that, I mean, you know, do we have great teams and do we treat teams as the center of stability? Are we smart about organizational ritual? Are we great communicators so that people actually know what's going on and aren't in a state of perpetual confusion because we used some business gobbledygook and they don't actually understand what any of that means? So it's more the lean into stability because if you don't need it now, you'll need it tomorrow. And if you don't need it tomorrow, you'll need it the next day. Be deliberate about the things that help people feel rooted at work. And because those things help them contribute.

So you talk about this question of when do we need to change? So let's talk about Clayton Christensen for a minute. So, you know, very popular, now deceased professor, wrote a lot of work around the idea of innovation and disruption. And then we've got Reed Hastings and another guy. Very well known for disruption, tried to put his own business out of business when he, you know, years ago tried to move from the direct mail of the CDs to moving quickly to the streaming and had to backtrack after a short period of time. So he sort of took that idea of, you know, disrupt yourself before someone else puts you out of business. So as a leader, is there any framework to think about when change is needed in my business?

It's interesting to look at what Clayton Christensen actually said. So he said, okay, there are some circumstances where an upstart entrant into a market will actually take over the market. And the mechanism for this is that the new entrant, the upstart, doesn't have the same established customer base. So doesn't have a bunch of people expecting a certain set of capabilities, products, for a certain price. So they're sort of freer there. They might be sitting with a whole bunch of investor money, so they don't necessarily have to turn a profit. They don't have to hit a certain profit target. They don't have to go to the street and go, what do you estimate our earnings will be? And we've got to hit the consensus number. Meanwhile, over on the other side, the established company is beholden to its customers in many ways because they have certain expectations. It's certainly beholden to its corporate cost structure and it's certainly beholden to its investors and its board and so on and so forth. So it has fewer degrees of movement. And Clayton Christensen showed that in certain industries, the ones he studied were mini steel mills, mini mills and hard disk drives and a couple of others, that because the small entrant has freedom of action for a while, they can actually get really, really good at a new product and come in ultimately at a lower price point and take the market away. From the incumbent who can't do anything about it. And what Clayton Christensen said the incumbents should do was, as you've said, disrupt themselves. But he's told them to do it in a very particular way. He didn't say, therefore change 100% of everything in your business every year with a big new fanfare and a new plan and a new strategy and a new one of these and a new org chart and shuffle the executive team and tell all the investors it's a brand new thing. He'd said nothing of the sort. He said, take a small group of people and remove them from all the corporate constraints and make them like an upstart new entrance. Give them resources, give them a very clear sense of mission, give them a stable team, give them a bunch of stuff so that they can innovate for you. They can innovate in response to the pressures of the marketplace or the new technology or so on and so forth. That's the prescription that turns into disrupt everything. But that's the prescription for stability. That's not a prescription for change. That's a prescription for tell the rest of the organization, we're gonna keep on going 'cause we've got existing customers and existing lines of business, and it's very important for us to continue to honor those. And in parallel, Let's set a small group of people to one side and make their world stable too. Make them immune from the reorgs and immune from the changes of direction and immune from the changes of leader and immune from the need to justify their budget every 6 months. Leave them alone and let them innovate for us. So we've lost sight of that very, very important distinction that what actually comes out of The Innovator's Dilemma, which is Clayton Christensen's book, is in fact, he doesn't frame it like this, but if you look at the ingredients, it's exactly what it is, an argument for stability. So if we're worried about AI, the answer is think about the AI products and put some people in a room together and leave them alone and let them innovate in response to that. If we're worried about a new market over here, put some people in a room or do a spinout or do a address new technologies, address new ideas, but don't imagine that in a very focused way, addressing a new invention in the world or a new possibility in the world is anything the same as turning an organization on its head every 6 months because it was time to rotate the leaders. Those are just completely different things. And what's interesting about that is in both of these worlds, if you like, the large established world and the small innovative world, the thing that you are solving for is stability. It's stability of different sort. In the large established world, it's stability of customer and stability of economics and stability probably of technology and stability of how we go to market. That's one sort of stability. In the other world, the skunkworks, if you like, the group of people off, you know, having a fairly intense innovative experience for themselves. The stability is a stability of team, a stability of mission, a stability of funding, a stability of— it's not a stability of product because that changes the whole time. The most obvious example of this, by the way, is startups. And, you know, startups very often get purchased by larger companies. This happens a huge amount in tech. And what happens when the startup gets purchased? All of the employees of the startup sort of go, oh, okay, we get our payday, but now we are part of the Borg and now we're part of the big organization. It's going to be much less fun. I think if you interrogate the much less fun thing, it's taking away of control. We are no longer masters of our own destiny in the same way. But it's also now we've lost clarity of mission. Now we've lost clarity of who's in charge. There's a whole bunch of stuff that's very, very clear when you are small and focused that becomes much less clear when you are part of a larger entity. And so we tend to think of the large companies as stable and the startups are all about constant change. But if you think about psychological stability, Startups are actually very stable places and large organizations are very unstable places. And so again, if you see the world through the lens of what people need in order to make their best contribution and you start thinking through the lens of stability, I think you have to reexamine some assumptions about which sorts of environments are changey and dynamic and which are stable. And you find out that actually, A lot of the good stuff in life comes from an environment of stability.

One of my favorite bands— I don't think they really perform together anymore, but they were popular back in the late 1990s— a band called Semisonic. And one of their songs had a particular line in it. And the lyric is, every new beginning comes from some other beginning's end. And so when we talk about change, I heard you say the word ritual here a little bit earlier. And this idea of the psychology. So if we think about a change both being an ending of something and then a beginning of the new thing, somehow we gotta close the loop on the thing that is changing to open up space for the new thing. And when I think of the word ritual, you talk about this in your book, it's like, are there some rituals that maybe transcend the old change and the new change such that we get the stability that you talk about that enables us to thrive as humans? And maybe is that perhaps one way that we can help facilitate change by thinking about this idea of honoring what used to be, recognizing we need the new thing, and maybe having some rituals that can bridge the two?

It's fascinating to think of rituals at work to make nice endings of things. I'm not sure I can think of a single example. It would be kind of lovely. It would also be a moment of truth because you'd have to say, this is the end of strategy number 1. And everyone would go, of course, they might not say it out loud, but the thought bubbles will all go, well, did it achieve what you promised us it would achieve 3 years ago? And you'd have to go, well, the results are slightly mixed, but we don't have endings. We just have new beginnings, don't we? We just layer the new on the new on the new on the new on the new. And that's when it's possible to become a little bit cynical. So I think a ritual of endings would be lovely for an organizational sort of breathing in and breathing out and would give you a sense of where you stood on all of these things. And of course, if there were 3 ending rituals in one quarter, all on the same thing, you'd realize that we weren't doing beginnings very well either. We had to keep ending it in a different direction. So that's an instance, if you like. Of course, rituals are a much more varied and wide-ranging continent than simply beginnings and endings. In a way, a ritual is anything we do at work that provides a sort of anchor point or marks a particular moment, or actually is a particular way that we get our work done. I mean, there are plenty of teams in the world that will have a daily standup meeting. That's a ritual. You know it's a ritual by the way, by going to the people involved in it and saying, is this meaningful in some way? And if they go, yes, it's meaningful, it's actually, it's a ritual. These things tend to be repeated. They tend to be reliable. They tend to be sort of emotional anchor point for people. They are extraordinarily useful for humans. They give us all sorts of stability in our world. This is why if you look at the world outside work, of course, you find rituals left, right, and center. You find rituals around sport, you find rituals around religion, you find rituals around government, you find rituals around society. We love our rituals. They're super valuable for us. And when you change all the leaders and when you change the organization, very often what you also do is disrupt all of the rituals. And again, the All humans are left trying to figure out, okay, where does my sense of stability come from now?

Do you think that there is to some extent a misalignment in corporate America when it comes to the way that we measure human performance within an organization?

We are sort of defined by the things that we measure in a very profound way. And what we've learned to measure at work because of shareholder value is things with dollar signs on the front. And so almost everything in an organization is sooner or later translated into dollars, which are considered to be the currency of everything. If you're like me and you've spent a career in HR, there aren't actually many HR things which generate new dollars for an organization from the outside. Because HR is about looking after the people and the people then turn around and generate the dollars from the outside. But nevertheless, if you're an HR person, you have to get very good at saying, well, if we do this leadership class, it will increase something by 4% and the total amount of the thing now is $100 million. So this will be worth $4 million. So therefore we can invest $3 million developing the class. Is sort of how the thing goes. And everyone knows it's funny money and no one's ever going to be able to do the A/B test to figure out whether the thing actually had the effect it should have. But you have to translate everything into dollar terms. And then of course, the things in dollar terms outweigh massively the things that are untranslatable into dollar terms. So we don't have a way of measuring the human experience at work in a universal, in a uniform way across organizations. I think it would be very helpful if we did, but we don't. And so again, we're left defaulting to dollars. And then the other thing that's sort of related to how we measure is actually the data that we capture. And it's very interesting to think about the data that we use at work to capture a human being in our systems. It sounds like a very esoteric journey into the innards of enterprise software systems. But let's just imagine for a second that we're logging into the enterprise software system and setting up our profile. What are the things it knows about us? It knows first name, middle name, last name. It knows address. It knows your bank details so that you can get paid. It might know your educational qualifications. It'll know your date of hire. It might know a few things about the skills if you've done an assessment or the learning system has said it thinks you've got these skills or somebody checked some boxes when they were hiring you. So it might know a few things like that. It doesn't know very much about who you are. It doesn't know anything at all about what you're like to work with. It knows the sort of demographic and external things. It knows how much you get paid and when you last had a raise. It doesn't know what makes you laugh. It doesn't know whether you have a sense of delight in one sort of work and you'll procrastinate on another sort of work. It doesn't know what sort of a teammate you are. It doesn't know whether you like teams. It doesn't know whether you prefer to work in small groups or big groups. It doesn't know whether you're the person who likes to be in the front of the room or in the back of the room being thoughtful about things. We don't know most of the human stuff. We treat the humans at work partly because of the way we think about them in financial terms, partly because of the way we see them in the data we collect as interchangeable. And we treat them as interchangeable. We'll launch a change initiative. Some of the people will be upset. Well, we'll switch them out and get a different bunch of people. We overhired a few years ago. Well, we need to have fewer of the humans here. What sort of humans? Well, it doesn't really matter. Any of the sort of humans, they're all fundamentally the same. Aren't they? But if you study things in a human experience that lead to great work, they are all beautiful idiosyncratic things. If you look at teams that are really good at getting the best out of each person, they acknowledge all the differences between people. You get the reason the team takes a long time to build is because it takes a long time to learn who is the person who's more introverted? Who is the extrovert? Who's standing on stage? Who's doing the spreadsheets? Who's doing the communications? Who's the one who's always going to play devil's advocate and annoy everybody, but half the time be right as well? Who's that person? You have to learn all of these things about your fellow humans. They're not written down in systems. And so we don't appreciate them for what they are.

Now, as a leader, what can I do if I'm like, I really care about my team? You know, I really want these people to flourish here. And I want to create an environment where they can give their best work and they can find meaning and purpose to what we're doing while at the same time knowing I've got a business to run. We want to be successful. We want to contribute to our clients and our customers. How, as a leader, do I take all of those sometimes competing tensions and do well?

So you can honor the existing structures and rituals and habits of an organization. But maybe even before you do all of those, the most important thing surely in the face of onrushing change is to level with people. For some reason, organizational leaders very often seem to confuse themselves with cheerleaders and appoint themselves the guardians of saying positive things about stuff and being smiley. The whole time. And after a while, people look up and go, yeah, but you're just saying that because I've never met a human who's as constantly happy as you are about things that are actually a little more scary. And we all know that they're a little more scary because they're unknown and uncertain and we don't know where the world is heading. So firstly, with the cheerleading and the cheer-speaking, you could turn it down a little bit. But secondly, what people said to me over and over again when I was doing the research for this book is, Just level with me. Tell me the truth. I can handle the truth. And the truth is in itself a source of stability. If I feel that people are leveling with me, my world is more predictable because I understand that Steve will level with me, that when a bad thing comes along, Steve's going to tell me how he sees it. People will feel better told bad news honestly. Than they will feel when people put an unrealistically positive spin on something. The spin isn't cheering anyone up. The spin is destabilizing folks. The truth stabilizes people and helps them know that they're in the company of grownups. So in the scenario that you present, the first thing to do with the onrush of change is to say, Goodness me, here's the thing. I don't know yet what we're going to do about it. I am bothered by this thing. This does seem to be a threat to us, or this does seem to be an opportunity for us because we could go here and here and here and here and here. But you don't say it's an opportunity unless it feels like an opportunity, by the way, because that's another one of the cheer-speaking words. You just level with people. You say, what do you think? Where do you think we should go? What are your best ideas? How should we respond? Leaders don't have to know the answers to all of the questions. Leaders have to provide a sense of stability and a sense of predictability so that people can offer their best work and so that a collective group can figure out how to respond to stuff in the world around.

I was having a conversation not long ago with a financial advisor that I'm coaching, and it is a bit of a turnaround situation. And I said, don't sugarcoat it. I think you need to tell the team exactly what's happening. We need to show them the information here, the data that's showing that the company's going in the wrong direction. Because unless they know what the current reality is, unless they're clear on what the situation is, they're just going to think things are okay. And it's much better for them to know the truth and know that, okay, you know, we're sort of in a hole right now.. And the concern was by sharing that, well, maybe they're gonna wanna leave because they're gonna go to some other company that doesn't have these problems. I said, possibly, but if you've got the right team and you talk about this idea, spinning it, and I said, tell 'em the truth. Here's what we gotta do. And I said, they're gonna take it as a challenge and say, we could turn this thing around. You know, we like this company, we like the people. And just imagine how much satisfaction there's gonna be if you go from a negative to a big positive, sort of this big turnaround, the satisfaction that you're going to get from that is going to be huge. But you'll never get there if you don't tell the truth and level with them, even at the risk of maybe one or two people leaving because they don't want to deal with it. They may not have been the right people in the first place if they're not willing to stick with you.

I think you're exactly right. I also think that when you tell people that everything's rosy and it's obvious that it isn't, that's when they leave. They don't leave because you said we've got problems. They leave because you say everything's fantastic and they look to the left and look to the right and go, you're full of it. You're not a reliable human being. So why would I invest my energy and my future in hanging out with an unreliable human being? That's where the source of stress comes from in all of that. Relatedly, people really don't like to be told how to feel. And so the guidance, I think, is always tell people what's going on. Tell people as plainly as you can. Don't use business speak because business speak is actually usually a way of telling people not what's going on. It sort of muddies things a little bit. So use old-fashioned language, use short words as plainly as possible, say what's going on, but don't tell people how to feel. Leave people space to arrive at their own feelings, and they will thank you for that too.

I want you to put your history hat on here and think about the challenge that we face in business today. What we're talking about here, this idea of everyone's just, we're trying to change, change, change, and it's disruptive and not necessarily in a good way. Can you think of any historical figure, not someone who's alive today, that they would be able to break through that nonsense and be able to implement the types of things that you talk about in your latest work?

There's a couple that immediately come to mind for very, very different reasons. One would be Winston Churchill and the other would be Reverend Martin Luther King. Neither of them was in the business of telling people how to feel. You look at Churchill's speeches in the Second World War and he's not saying cheer up. He's not saying feel this way. He's saying we will do these things. So it's a very different heft. And he's saying it, by the way, in the most straightforward language you can imagine. He did not say, I don't know, let's rewrite Churchill for a second, shall we? He did not say we will resist their incursion on the sandy areas. He said we will fight them on the beaches. And you know what that means. "And it's not a cheer up." So there's an interesting example of actually the sort of stability of action and stability of resolve expressed in very clear and straightforward language. And then Martin Luther King, because he created change in the world by being massively predictable. So he's somebody who would never quit. And you sort of knew he would never quit if you were one of his followers. You knew he would keep going and keep going. And so when the protest got canceled, he would have another protest. And when the march got turned around, he would keep going and he would keep going and he would keep going. There is a sort of predictability in all of that. There is a sort of predictability that you knew he would give a soaring speech and you knew people would be moved by his words. You knew where you stood. That is another flavor of stability. In this case, stability that engenders change because the stability was such that people could flock to a cause and people could demonstrate their support for a cause. And so because stability, then suddenly you get enormous weight of numbers, if you like, an enormous number of people advocating for something, an enormous amount of attention drawn to the injustices that were going on at that time in the world. And if you change tactic every 15 minutes, you don't get that. If you change mission every 15 minutes, you don't get that. If you change your organizational leadership group every 15 minutes, you don't get that. If you actually want pervasive, sustained change in the world, it comes from stability.

Well, Ashley, as we get ready to wrap up here, I just got one other question I want to ask you. And I know that you also co-wrote a book with Marcus Buckingham, and Marcus is a previous guest here on the Barron's Advisor Podcast. And I'd, I'd love to hear anything that might have come out of the work that you've done with Marcus, any idea or theme that you think would be relevant to our listeners.

The work that I did with Marcus and the work that I'm doing now all emerge from a set of realizations about humans and about humans at work. And so I wrote a book with Marcus called Nine Lies About Work. That was 9 things that we do to the people that the people don't appreciate very much. And in that, we wrote about things like the fact that the best predictor of somebody's performance is whether they get to play to their strengths or not, which is a way of saying If you want to unlock the best in a person, you have to ask them to do things that they do well, and they will tell you what things they do well for the most part. And they will tell you either in words or just by going and doing them voluntarily. And if you're at all smart, you pay attention to that sort of thing. We wrote about the fact that because people are all different from one another, the idea of a team is super important at work because a team is where you harness together all of the different abilities of people and point them towards something that none of them could do by themselves. So in Nine Lies About Work, we were thinking about the world through the lens of what do people need at work and how might we provide it for them. And now I'm adding to the list of things that Marcus and I came up with, I'm adding the need for stability, the need for an environment that is predictable for me, the need for an environment where I understand how I can help. I understand what the problems are. I understand what I can lean into. I understand how my sort of person is useful around here. Which is to say that if you want to design a workplace that is a good, healthy, productive, and innovative, by the way, workplace, you have to start by understanding what the people in that workplace need to give you their best.

The new book is called The Problem with Change, and I highly recommend it. And obviously you can pick it up at any of your favorite book sellers. And if folks want to stay connected with you beyond the book and the books that you've written, what would be the best way for folks to stay up to date with what you're doing?

So you can always find me on LinkedIn, and then my website is very simply ashleygoodall.com.

All right, that's all for today. Make sure you like and share this podcast through your favorite social platforms. And for more great podcasts, visit us at barons.com/podcast. Take care and Be safe.

This podcast was brought to you by Wells Fargo Advisors. Looking for a firm your clients can't outgrow? Wells Fargo Advisors offers financial advisors full balance sheet solutions with wealth planning, investment products, banking, and lending that meet the needs of affluent to ultra-high net worth clients. Build your practice your way and on your schedule with independent and employee model options designed to meet your needs today and tomorrow. Learn more at joinwfadvisors.com.