0:00:05 Charlie Munger once asked me how can someone give away 50% of profits and make billions
0:00:10 more than if he’d kept it all? Before I could answer he told me about Les Schwab,
0:00:14 a tire shop owner who understood incentives better than almost anyone.
0:00:17 What Schwab discovered will change how you think about business.
0:00:28 Welcome to The Knowledge Project. I’m your host, Shane Parrish.
0:00:33 In a world where knowledge is power, this podcast is your toolkit for mastering the best of what
0:00:38 other people have already figured out. This episode is for educational and information purposes only.
0:00:47 What Les Schwab discovered was deceptively simple. Most businesses treat employees like expenses to
0:00:54 minimize. He treated them like partners to enrich. The math was shocking. He gave away half his profits
0:00:59 and built a multi-billion dollar empire. Here’s how it worked. When people working in the tire
0:01:05 centers made a share of the profits, they don’t just change tires. They build relationships with
0:01:11 customers. When managers own real equity with skin in the game, they run stores like their family’s
0:01:17 “Future depends on it.” Because it does. Les documented his business lessons in his autobiography,
0:01:23 Pride in Performance. Keep it going. He wrote it himself on a 40-year-old typewriter because he wanted
0:01:29 every entrepreneur to understand exactly how he did it. No ghostwriter, no corporate polish,
0:01:36 just the raw blueprint for turning a leaky shed into an empire. Les proved that the most ruthless business
0:01:44 strategy is radical generosity. He turned employee loyalty into a competitive moat so deep that Walmart
0:01:53 couldn’t cross it. This is his story. Before Les Schwab was the name on over 400 tire stores across the
0:02:01 American Northwest, it was the name of a kid born into nothing. Bend, Oregon, 1917. His parents were desperate
0:02:07 homesteaders fighting the high desert for a living. His mother, Alice, taught him everything that mattered.
0:02:13 Then pneumonia killed her when Les was 15. That left him with his father, Bishop. A study in contradiction,
0:02:19 gentle and hardworking when sober, a maniac when drunk. Les spent his teenage years terrified that his
0:02:26 father would show up at school drunk and humiliate him. Poor but proud. That’s how Les described himself.
0:02:32 That pride was armor. A year after his mother died, they found his father’s body outside of a moonshine
0:02:39 joint. Les was 16. He was now an orphan. His relatives offered to take him in, but he said no.
0:02:44 Instead, he rented a room in a boarding house for $15 a month, decided he was an adult. The world had
0:02:50 given him a hard education and an allergy to alcohol. Most kids in his position would have taken the help,
0:02:57 moved in with family, and stayed safe. Les chose the harder path. While it wasn’t so much choosing the
0:03:02 harder path consciously, he just didn’t feel he could rely on anyone else. He wanted everything
0:03:07 on himself. I understand that. Choosing pride over comfort and independence over security
0:03:12 shows in nearly everything he went about doing. The lesson here is a bit counterintuitive. The worst
0:03:18 things that happen to you can become an advantage, but only if you refuse to let them define you as a victim.
0:03:22 Les could have blamed his circumstances. Instead, he used them as fuel.
0:03:27 Les got his first paper route before his parents died. However, this came with two problems.
0:03:33 One, he couldn’t ride a bike. Two, he couldn’t afford a bike. So he ran every day for two months,
0:03:40 running his entire paper route on foot to earn money for a used bicycle. He had to do the job to afford
0:03:46 the tool required to do the job. One morning, he couldn’t find a customer’s address. Ten miles he ran on
0:03:51 an empty stomach. He ended up collapsing in the street. Les needed to work. He had no choice.
0:03:57 He had bills to pay, and he needed a bike. Nobody was going to hand him anything. At the same time,
0:04:03 he was also washing dishes at a restaurant, earning $3 a week plus meals. Here’s his schedule as a 16 year
0:04:08 old orphan. Paper route in the morning, school all day, restaurant at night.
0:04:13 Then he started doing the math. Selling newspaper subscriptions paid 50 cents each. He could make more
0:04:18 in a few hours selling than a whole week washing dishes. So he quit the restaurant. When he finally
0:04:23 saved enough for a bike, he got a new route under Mr. Goldenberg. Goldenberg was important because he
0:04:28 taught him how to sell. Not just deliver newspapers, but actually sell them. Knock on doors, talk to
0:04:34 people, persuade them. Les doubled the route’s numbers in a few weeks. Goldenberg saw a potential.
0:04:40 So he had an idea. Start a Sunday route in farm country. It’s an underserved market, but a logistical
0:04:46 nightmare. Les would need a car. During the Depression, most 16 year olds saved for a baseball
0:04:54 glove. Les was saving for a 1926 Chevrolet with a box on the back. $75 cash. Sundays, he’d drive the
0:05:00 rural roads. On weekdays, he was back to the bicycle because gas cost too much. He liked the car, but he
0:05:06 liked money even more. He signed up 80% of farms in rural Bend. That’s when Les learned the principle that
0:05:11 would define his business philosophy. People don’t buy your product. They buy your service, your reliability.
0:05:18 They buy you. By his senior year, Les controlled all nine Oregon Journal routes in Bend. He was making
0:05:25 $200 a month during the Great Depression. More than his high school principal. Out of 500 students,
0:05:31 only Les drove a new car. A 1934 Chevrolet bought with cash. His classmates thought it was showing off,
0:05:37 but they missed the point. The car wasn’t about status. It was proof. Proof that hard work plus smart
0:05:43 thinking beats any disadvantage. What stands out to me here is the compound effect of small
0:05:50 advantages. Les turned one paper route into nine through relentless execution. A lot of people treat
0:05:55 smaller jobs as stepping stones to bigger ones. They’re never fully present in what they’re doing,
0:06:02 never giving it their all. Les gave 100% of his effort to the work right in front of him all the time,
0:06:08 and that always led to more work and more opportunity. As Charlie Munger said, the best way to get more work
0:06:14 is to do the work right in front of you. And do it well. Les met Dorothy Harlan when they were both
0:06:20 teenagers. They married at 18 and he bought them a small house. They barely had time to unpack. His
0:06:27 reputation as a newspaper salesman had spread beyond Bend. A paper in Eugene, Oregon offered him a district
0:06:32 manager job. The newlyweds packed up and hit the road, living out of motels, while Les traveled his
0:06:38 territory selling subscriptions. They called him a circulation man, someone with an almost supernatural
0:06:43 ability to boost subscription rates wherever he went. Les negotiated a new job with better pay,
0:06:49 but he had one question that revealed how he thought about the world. Who’s my boss? The owner said he’d be
0:06:55 Les’ boss. Simple enough. But within weeks, Les had three different managers giving him contradictory orders,
0:07:00 so he went straight back to the owner and laid out the problem. The owner immediately straightened out
0:07:05 the other two managers. The lesson here is if you don’t know who you’re accountable to, you’re
0:07:10 accountable to everyone, which is the same thing as being accountable to no one. Clear lines of authority
0:07:17 offer clarity and purpose. He was young and talented and perhaps even a bit cocky, but he had pulled
0:07:23 himself up from nothing, outworked almost everyone else, and learned through trial by fire. When Les took
0:07:29 over the paperboy program, he discovered it was hemorrhaging carriers. 20% of carriers quit every month,
0:07:36 so he got creative. First, he obtained lists of every 7th and 8th grader in local schools and recruited them
0:07:43 personally. Then he did something radical for the era. He hired girls. They turned out to be more reliable than
0:07:49 boys. But his real genius was the honor carrier program. Each month, one carrier won based on sales,
0:07:56 service, and bookkeeping. The prize? $25 in their picture in the paper. This was Les’ first real
0:08:02 experiment with incentive design, and he was learning how much they matter. One of my favorite mongerisms is
0:08:07 show me the incentive and I’ll show you the outcome. If you reward the behavior you want, you’ll get more
0:08:13 of it. The lesson here connects directly to building any organization. Les understood that unclear reporting
0:08:20 structures create chaos. Everyone thinks they’re in charge, so no one really is. He also grasps something
0:08:26 most managers miss. Recognition often matters more than money. That honor carrier program cost $25 a month,
0:08:32 but transformed retention. These weren’t just newspaper tactics. They were blueprints for building
0:08:38 a multi-billion dollar business. At 33, Les Schwab was consumed by a single ambition: to own his own
0:08:44 business, to be in control of his destiny. The newspaper world suddenly felt too small. He joined
0:08:50 every business club he could find, the Jaycees, Toastmasters, Chamber of Converse, anything that smells like
0:08:57 business. He was terrified of getting old, of falling into a rut that he’d never escape. And then he saw
0:09:04 it: a tire shop for sale in Prineville, Oregon. Les knew nothing about tires, but he did know sales, and
0:09:09 he figured that was what mattered. His brother-in-law offered to partner with him, then got cold feet,
0:09:14 and backed out. Racked with guilt, he came back and offered to fund Les, but no partnership. Les would
0:09:22 be on his own. The shop was an okay rubber welder’s franchise: new tires, retreads, flat repairs, hard,
0:09:29 dirty, manual work. In order to purchase it, he’d need to go all in on himself, and sell his house,
0:09:34 and borrow against his life insurance, and borrow from his brother-in-law. Les scraped together money
0:09:39 from every corner of his life. Everything he’d built, everything he’d saved, it went into this one bet.
0:09:46 On January 1st, 1952, at 34 years old, Les Schwab walked into his tire shop as the new owner.
0:09:53 It was a leaky 1,400 square foot shed with no running water and no indoor plumbing. It had one employee.
0:09:57 The annual sales for the year before were $32,000.
0:10:04 Are you struggling to manage your projects at work using lots of different tools for communication,
0:10:10 task management, and scheduling? It doesn’t have to be this hard. Basecamp is the refreshingly
0:10:16 straightforward, reliable project management platform. It’s designed for small and growing
0:10:20 businesses, so there’s none of the complexity you get with software designed for enterprises.
0:10:27 Complexity kills momentum. Basecamp clears the path so your team can actually move. Do away with scattered
0:10:33 emails, endless meetings, and missed deadlines. With Basecamp, everything lives in one place. To-do lists,
0:10:39 message boards, chat conversations, scheduling, and documents. When information is scattered,
0:10:45 attention is too. Basecamp brings both back together. Basecamp’s intuitive design ensures
0:10:50 that everyone knows what’s happening, who’s responsible, and what’s coming next. My head of
0:10:56 operations swears by this platform and is the first person to suggest it to anyone. If you need another
0:11:01 decorated referral, you should call her. Whether you’re a small team or a growing business,
0:11:07 Basecamp scales with you. Stop struggling, start making progress, and get somewhere with Basecamp.
0:11:14 Sign up for free at Basecamp.com. While Les knew nothing about tires, he knew a lot about selling and
0:11:20 being able to outwork other people. His first taste of real business, one he owned and controlled,
0:11:28 was about to begin. On his first day, a customer walked in wanting two six-ply tires mounted. Les got
0:11:34 right to work. There was just one problem. He had no idea what he was doing. He’d always taken flats to
0:11:41 a service station, and now he was the service station. Using hand tools on a cold concrete floor,
0:11:47 he made a complete mess of it until his lone employee arrived and saved him. That first month,
0:11:54 Les did $2,800 in sales, about what the previous owner had done. But by June, something had shifted.
0:12:03 Sales hit $10,000 a month. By year’s end, he’d done $150,000 in revenue, five times what the previous
0:12:09 owner managed. Growth created the best kind of problem. He needed help. Les appointed himself
0:12:15 outside salesman and told his one employee to hire someone. The new hire was, to put it charitably,
0:12:21 no good, so he fired him. Then something interesting happened. A man named Frank Kennedy walked in off
0:12:27 the street asking for work. He and his wife had just moved to Prineville. He was looking around town
0:12:33 and decided he wanted to work for Les. Les checked his references. Frank took to the work like he was born
0:12:38 for it. This became a pattern. The right people kept showing up, drawn to something they couldn’t
0:12:43 quite name but could feel. Les was creating gravitational pull for good, hardworking people.
0:12:48 Good people can sense when something real is being built. It’s the same energy a lot of people feel at
0:12:55 startups today. But Les was learning just how rigged the tire business was. The major rubber companies had
0:13:01 what Les called phony pricing. A truck tire might cost him $100 wholesale but he’d visit competitors
0:13:08 and find them selling that same tire for $90. He’d call his supplier furious. They’d say for that deal
0:13:14 we’ll sell it to you for $90 and give you a 5% commission. It was such a shell game. Months of paperwork
0:13:22 and bookkeeping, floating expenses all to arrive at the same 5% margin every dealer got. The entire system was
0:13:27 designed to prevent real competition. Les wrote down his philosophy in a fury of anger.
0:13:33 Never take advantage of a customer. Never take advantage of an employee. But take all the advantage
0:13:37 you possibly can of the rubber company because they are not being fair and honest.
0:13:44 The constraints forced him to innovate. Big dealers had fleets of $6,000 service trucks
0:13:50 visiting commercial accounts. Les had one store and no capital for trucks. So he flipped the model.
0:13:55 He put an ad in the paper with a simple message. You know the wholesale prices the big guys get.
0:14:01 Come to my shop and I’ll give them to you directly. No middlemen. His competitors visited customers once
0:14:06 a week. Les was at his store six days a week. A permanent fixture. Best service, best prices,
0:14:12 but you had to come to him. It was asymmetric warfare. He had low overhead. It was a simple
0:14:19 value proposition and it worked. People came in droves. What fascinates me here is how constraints can
0:14:25 become advantages. Les couldn’t afford to play by industry rules so he invented new ones. He couldn’t
0:14:31 compete on the suppliers terms so he competed on transparency. He couldn’t go to customers directly
0:14:37 so he gave them a reason to come to him. The lesson isn’t that you need resources to win. It’s that you
0:14:43 need to see the game differently than everyone else is playing it. Les was ready to expand. The nearby town
0:14:50 of Redmond needed a tire store. He bought land, put up a building, invested $10,000 total. Now he had two
0:14:56 stores. Both okay rubber franchises. But there was a problem. He’d bitten off more than he could chew.
0:15:03 Running between the two stores was killing him. So Les made his star employee Frank Kennedy a win-win deal
0:15:09 that would become the foundation of his empire. Here’s how it worked. Frank would manage the Redmond
0:15:16 store. He’d pay Les $200 monthly rent and take $400 salary. After that, they’d split all profits 50-50.
0:15:23 But here’s the genius part. Frank had to leave his share of the profits in the business until his stake
0:15:29 equaled Les’ initial investment. That was real skin in the game. Sit with that for a second.
0:15:34 Frank had zero upfront risk. Les put up all the capital. But every day Frank ran the store well,
0:15:41 he owned more of it. The better he performed, the faster he’d build equity. It was his store in every
0:15:48 way that mattered, except Les kept half the upside. Les even added another twist. If Frank wanted a raise,
0:15:53 he could give himself one. But the store’s rent would increase by the same amount, giving Les a raise too.
0:16:00 A self-balancing system. People thought Les was crazy. Why give away half your profits?
0:16:07 Les saw it differently. If I share half the profits, I still have half. And if Frank makes more money,
0:16:11 he’ll work harder to make the store more successful. And if the store is more successful,
0:16:17 my half is worth more than the whole used to be. It was pure math. But it was also more than math.
0:16:21 It was an understanding of human nature. Les remembered running his paper route on foot
0:16:26 because he couldn’t afford a bike. He remembered how the honor carrier program had motivated those
0:16:32 kids. He knew what it felt like to want something to be yours. The Redmond store turned profitable
0:16:38 immediately. Frank ran it like he owned it because increasingly, he did. The arrangement with Frank
0:16:45 became the template. Every Les Schwab store would follow this model. Every manager would be a partner,
0:16:50 not an employee. This is one of the most elegant business solutions I’ve seen.
0:16:54 Les solved multiple problems at once. He couldn’t manage multiple locations himself,
0:17:00 so he needed to retain talent. And he needed managers to think long-term. The solution aligned
0:17:07 everyone’s interests perfectly. Frank couldn’t get rich without making Les rich. Les couldn’t expand
0:17:14 without making Frank rich. Les stumbled onto his next innovation by accident. His Prineville store
0:17:19 was bursting. Retreading equipment and tires cluttered every square inch of the sales floor.
0:17:25 They were working in what amounted to a filthy garage. By now he had two stores. Les saw the problem
0:17:31 differently. Why should customers shop in a dirty garage? Why not separate the dirty work from the selling?
0:17:36 He bought a small carpenter shop nearby and moved all the retreading equipment there. Suddenly,
0:17:42 his stores looked like actual stores. Places where people might want to shop, not just get their tires
0:17:47 fixed. With retreading centralized, he could exploit the economies of scale. One set of equipment,
0:17:51 serving multiple stores. The savings would compound as he grew.
0:17:59 Time for store number three. Les set his sights on Bend, his old hometown. But there was a problem.
0:18:06 Bend already had an OK Rubber Welders franchise. This should have stopped him. Franchise territories are
0:18:12 kind of sacred. But Les had learned there’s always a deal if you’re creative enough. He pitched the OK
0:18:19 district manager something unprecedented. What if Bend had two OK stores and he’d pay royalties to the existing
0:18:26 operator and run a second location? The manager, probably thinking Les was crazy, agree. And it was
0:18:31 messy from the start. The two stores managers couldn’t get along. Les’s managers quit, leaving him with an
0:18:38 empty building and a lease. At this point, most people would have admitted it was a mistake and moved on.
0:18:44 Les, however, was not most people. He’d been planning to start his own brand anyway. He’d already been
0:18:51 advertising as Les Schwab OK Rubber Welders to get his name out there. Now seemed like a perfect time to
0:18:57 cut loose. When he told OK Rubber Welders he was going independent, they said he couldn’t do that.
0:19:04 Let’s not argue, Les replied. I just wanted to be open about it. He needed a name. Tire Center was too
0:19:09 generic. Tire Service Center wasn’t much better. He was thinking bigger than one store. He settled on
0:19:16 Les Schwab Tire Center, with his name initially in smaller print. Then something interesting happened.
0:19:22 Customers started asking for Les Schwab Tires, not Goodyear, not Firestone, Les Schwab. What strikes me
0:19:29 here is how Les bounced every time he hit a wall. No space? Centralized operations. Franchise territory
0:19:34 taken? Create a new model. Manager quits? Perfect time to go independent. But the real insight was
0:19:40 discovering that customers trusted him more than they trusted the tire brands. In a commodity business,
0:19:47 the seller’s reputation matters a lot. Store number four came from an unusual source. Gordon Pryday
0:19:52 worked at the Prineville store and every morning he’d walk in with the same greeting. When are we going to
0:19:57 open in Madras? Not good morning, not house business. When are we going to open in Madras?
0:20:03 Madras was another small Oregon town. Gordon saw opportunity there and wouldn’t let it go. Problem
0:20:10 was, Madras already had an OK Rubber franchise. Les figured if he was already fighting OK Rubber in
0:20:15 Bend, he might as well make it a proper war. He drove to Madras and found a bankrupt fruit stand for sale.
0:20:22 $10,000 got him the building and the land next door. The fruit stand had a small apartment in the back.
0:20:27 Gordon moved his family in immediately. Let that sink in. This man believed so strongly in the
0:20:32 opportunity that he moved his wife and kids to the back of a converted fruit stand. The family kitchen
0:20:37 table sat steps away from the tire racks. When customers left for the day, Gordon was still there.
0:20:43 When they arrived in the morning, he was already there. This wasn’t a job, it was a mission, and it existed
0:20:49 because of the profit sharing deal. Gordon knew that every tire he sold was building his own wealth.
0:20:56 Les and Gordon ran the numbers. They’d break even at $2,000 a month, make a small profit at $25, and do
0:21:03 pretty well at $3,000. In year one, they broke even exactly. In year two, $800 profit, split 50/50.
0:21:08 And here’s the punchline. Another tire dealer opened in Madras around the same time.
0:21:15 Shiny new building, proper equipment, all the advantages that Gordon lacked. That competitor
0:21:20 went out of business in two years. This story captures something profound about ownership
0:21:25 versus employment. The competitor had every advantage except the one that mattered, skin in the game.
0:21:32 Gordon Pryday wasn’t just managing a store, he was building his family’s future. That’s what real
0:21:36 incentive alignment creates. People who live in the back of a fruit stand because they’re not working
0:21:41 for you, they’re working with you. They’re not building your dream, they’re building their dream
0:21:48 with you. But Les had a problem. He was running OK rubber welder stores in Prineville and Redmond,
0:21:54 but Les Schwab tire centers in Bend and Madras. Two different brands, one owner. It was confusing for
0:22:01 customers and open rebellion against his franchise agreement. The corporate brass at OK had seen
0:22:06 enough. Five executives flew from headquarters to confront Les in a Redmond motel room.
0:22:10 “We’ve come for your answer,” they said. “Get out of Bend and Madras or else.”
0:22:16 Les had been losing sleep over this moment for weeks. He paced the floor at night,
0:22:22 terrified they’d seize his equipment and destroy him. The timing couldn’t be worse. His largest customer
0:22:29 was behind on payments that equaled his entire net worth. If that customer went bankrupt and OK seized
0:22:35 his equipment, he’d lose everything. But sitting in that motel room facing five corporate executives,
0:22:41 something snapped. “I don’t want any more harassment from you people,” said Les. “If you have anything more to
0:22:49 say, say it in court.” And then he walked out. It was pure bluff. Les had no money for lawyers. No case
0:22:56 to make. For months afterwards, he lived in terror that the lawsuit would end everything. The lawsuit
0:23:04 never came. Years later, Les figured out why. OK had 1100 franchises nationwide. If they sued him and lost,
0:23:10 it could set a precedent that would unravel their entire system. They couldn’t risk it. By standing up to
0:23:15 them, he’d accidentally found their weakness. They needed the franchise system more than they needed
0:23:22 to crush one rebellious dealer in Oregon. Now, Les moved fast. He repainted all four stores with Les
0:23:30 Schwab Tire Center, prominently displayed. One brand, one identity, one vision. The franchise rebellion
0:23:37 was over. Les was free. This moment reveals something crucial about negotiations and power. Les had no leverage
0:23:44 except for one thing: the cost of being wrong. They could crush him, but if they failed, they create a
0:23:50 precedent that threatened their entire business model. Sometimes your only power is making the consequences
0:23:56 of attacking you too expensive for your opponent to risk. Les won not through strength, but by understanding
0:24:03 what the other side feared losing. He saw the whole board, not just his own pieces. During the chaos of
0:24:08 growth and franchise battles, Les would escape with Dorothy on long drives. These weren’t romantic
0:24:13 getaways. They were strategy sessions. “I’m going to build a small warehouse,” he told
0:24:18 her one evening on the Columbia River Highway. “Move my bookkeeper out there, buy the tires myself,
0:24:24 do the advertising, price the tires, handle the books, maybe build six, seven, or eight stores someday.”
0:24:30 He could see it all mapped out. A central operation supporting a network of profit-sharing stores.
0:24:37 Each manager thinking like an owner because they were an owner. He’d need scale to buy tires at volume
0:24:43 discounts. He knew advertising. He knew promotion. Most importantly, he knew how to align incentives.
0:24:52 Six, seven, maybe eight stores. That seemed wildly ambitious in 1956. He would go on to build 410 before he died.
0:24:59 By the time Les had seven stores, a new problem emerged. The stores were growing. What started as
0:25:06 one manager and a helper had become teams of four, five, six people. Les wanted to extend profit-sharing
0:25:12 deeper into each store. His solution was elegant. Managers would appoint their best person as assistant
0:25:20 manager. That person would get 10% of profits. 5% from Les, 5% from the manager. The split would go from
0:25:27 50-50 to 45-45-10. The assistant manager would build equity in the store. When a new location opened,
0:25:33 they’d become the manager there, taking their accumulated profits with them. It was a self-replicating system.
0:25:39 Every store would create its own successor. The managers hated it. They didn’t want to lose the 5%.
0:25:45 This threatened Les’ entire growth model. Without succession planning, expansion would stall.
0:25:51 So Les wrote one of the most remarkable memos in business history. He said this,
0:25:56 “If a bright, young, ambitious man joins our company and wants to make our company his career,
0:26:02 does he do it because he likes Norm or Gordy or Bob? Do you men think that some little fairy sent
0:26:09 you this man just to help you build your bonus? This man is going to work for low pay year after year,
0:26:16 just so you can build your profit share into a nice, fat nest egg? No, I don’t think so.
0:26:21 This man didn’t join the company because of the store manager’s future. This man joined the company
0:26:28 because of his future with Les Schwab Tire Centers, not in you personally. If you men block this man,
0:26:34 you are being selfish. Two of the seven managers appointed assistants, and then Les dropped the
0:26:42 hammer. Effective immediately, all manager shares dropped from 50 to 45%. If they appointed an assistant,
0:26:50 that person got 10%. If they didn’t, the company kept the extra 5%. Suddenly, every store had an assistant
0:26:57 manager. And the growth engine roared back to life. This is leadership at its finest. Les understood
0:27:02 something that his managers didn’t. Their wealth came from the system he created, not just their
0:27:07 individual contributions. When they hoarded opportunity, they violated the very principle that
0:27:13 made them successful. His memo didn’t just shame them, it reminded them of their moral obligation to
0:27:18 pay forward what they’d received. But when moral arguments failed, he used economics.
0:27:25 The beauty is that once forced to share, the managers discovered what Les already knew. Developing
0:27:32 your successor makes you more valuable, not less. Coming up, the moment Les discovered he wasn’t really
0:27:39 in the tire business at all. That single insight let him charge premium prices in a commodity market
0:27:46 and made his employees run, literally run, to serve customers. If you think you know what business
0:27:52 you’re in, the next part will make you question everything.
0:27:58 Les had solved his incentive problem. Now he turned to something bigger, reimagining what a tire store
0:28:04 could be. It was 1956. On a weekend drive, Les found himself studying grocery stores.
0:28:10 Customers wandered the aisles, they compared prices, they made informed decisions. Then he’d pass a tire
0:28:14 shop, same cramped waiting room, same dealer disappearing into the back to fetch whatever
0:28:21 tire he felt like selling. What if Les wondered aloud, we displayed tires like Safeway displayed groceries?
0:28:28 Think about how radical this was. Tires were ugly industrial products. Heavy, dirty, technical. Every
0:28:32 dealer hid them in the back of the warehouse. Why would customers want to see them?
0:28:38 But Les thought differently. People buy what they can see and what they can understand.
0:28:44 He started converting his stores into supermarket tire centers. Massive showrooms, hundreds of tires on
0:28:51 display, organized by type and size. Clear pricing, educational materials. Let the customer browse,
0:28:57 let them compare, let them touch, let them choose. When he opened the next store, Les centered a company
0:29:03 memo that read like a declaration of war. This I vow, we’re going to have a supermarket tire store in
0:29:09 every town that we have a Les Schwab tire center. I hate to use threats. It’s against my policy entirely,
0:29:15 but you can visualize what is going to happen in your town if you don’t run a supermarket tire store,
0:29:21 because I’m going to have it regardless of cost. I sincerely hope I have made myself very clear. I
0:29:27 love you, but I love a supermarket tire store even more. But displaying tires wasn’t enough. They were
0:29:33 ugly. They had to be spotless. They had to be beautiful. Les would visit stores constantly looking for
0:29:40 the ideal place a person would want to buy tires. The winners were always the cleanest. Tires waxed and
0:29:46 gleaming everything in its place. He became obsessed with the details of tire presentation. He found the
0:29:52 perfect spray paint and lacquer to make tires look their best. He sent another memo to everyone telling
0:29:58 every manager exactly what brand to buy and where to get it. This is 40 years before Steve Jobs would
0:30:03 obsess over every detail of the Apple store. Les Schwab was applying the same thinking
0:30:09 to truck tires. The results were immediate. Customers spent more time browsing, they asked better
0:30:15 questions, and they bought more tires. More importantly, they trusted what they could see.
0:30:22 In the 1960s, Les made a decision that would have seemed insane to other dealers. He took down every tire
0:30:28 manufacturer sign from his stores. His sign maker asked what design you wanted for the new signs. Les looked
0:30:34 around and pointed to a standard oil station. Put Les Schwab where they have standard and put tires where
0:30:42 they have the Chevron logo. Done. With that simple instruction, Les became the first major tire dealer
0:30:49 in America to build his business around his own name instead of a manufacturer’s brand. No more Goodyear
0:30:56 signs. No more Firestone banners. Just Les Schwab. He was betting everything on one idea. People would buy tires,
0:31:02 not because of who made them, but because of who sold them. We don’t have the blimp flying around
0:31:06 like Goodyear, he’d later joke, but we’ve got something better. The Les Schwab sign. And in the
0:31:12 Northwest, that’s more powerful than the blimp. The timing was perfect. Foreign tire manufacturers were
0:31:18 flooding into America. The market was oversupplied. For the first time since World War II, the big American
0:31:25 tire companies had lost their stranglehold on pricing. Les embraced the chaos. I was so disgusted with the tire
0:31:30 suppliers that I was willing to do most anything to help my company survive, he wrote. I decided to
0:31:36 take down all rubber company signs, to go straight independent, to buy tires like Safeway buys groceries,
0:31:43 to buy the best possible tire, good quality, and at the lowest possible price. Most dealers at the time
0:31:48 stayed loyal to one manufacturer. They’d get a good deal on one brand, but that’s all they could offer.
0:31:55 Les bought from everyone. Japanese manufacturers, European imports, anyone who made quality tires at the right
0:32:01 price. His scale gave him leverage. Like Costco, decades later, he bought in massive quantities and
0:32:06 passed the savings on to customers. Here’s how it worked. Les always had one line of tires priced to
0:32:12 match his lowest competitor. But then he’d have three, four, or five other options at different price
0:32:18 points, all displayed beautifully in his spotless showroom. Customers had no reason to shop anywhere else.
0:32:24 He had the best prices, he had the best selection, and he had the best service. The tire manufacturers had
0:32:30 lost control of their own market. This move reveals a profound insight about branding and power. Schwab
0:32:36 understood that in a commodity business, the relationship with the customer matters more than the product.
0:32:43 By removing manufacturer signs, he wasn’t just changing decor. He was asserting ownership of the customer
0:32:50 relationship. The tire companies became his suppliers, not his partners. It’s the same playbook that Amazon
0:32:56 would later use with book publishers or that Walmart used with consumer goods companies. Control the
0:33:04 relationship and you control the business. By 1965, Les had 15 stores scattered across Oregon and Idaho.
0:33:10 He faced the classic scaling problem. How do you maintain quality when you can’t visit every store
0:33:16 every week? His solution was elegant. He promoted his best store managers to become zone managers. But
0:33:22 here’s the twist. They kept running their own stores while overseeing others nearby. No extra salary,
0:33:27 no corner office, just results-based pay. Think about those incentives for a second. If your zone thrived,
0:33:31 everyone made money. If it struggled, your own store suffered because you were spending time away from
0:33:37 it fixing other people’s problems. It was kind of self-regulating brilliance. Bad zone managers would
0:33:43 naturally step back to focus on their own struggling stores. Good ones would lift every store around them
0:33:47 and share in the profits. Zone meetings became the company’s heartbeat. This is where they picked
0:33:54 managers for new stores, debated expansion, shared what worked. Les ran them like board meetings. Every
0:33:59 zone manager had skin in the game. They’d all started changing tires and worked their way up through the
0:34:04 profit-sharing system. When a management position opened, it was like Shark Tank before Shark Tank
0:34:11 existed. Assistant managers would pitch for their shot at running a store. Les and the zone managers would
0:34:17 interrogate them. How much money do you have in your profit-sharing account? What’s your plan? Why should we bet on you?
0:34:22 The person with the most skin in the game usually won, but not always. But it was never the smoothest
0:34:29 talker. This structure solved multiple problems at once. It created management depth without bureaucracy.
0:34:34 It aligned regional interests with store-level execution. Most importantly, it ensured that
0:34:38 decision-makers had lived the business from the ground up. When you’re picking someone to run a new
0:34:45 store, who better to judge than people who’ve already succeeded at it? Les didn’t need consultants or
0:34:51 personality tests. He had a system that selected for proven operators with their own money on the line.
0:34:57 By 1970, Les had codified his profit-sharing into what he called the 100 story. For every $100 of store
0:35:04 profit, $25 went to the manager, $10 to the assistant manager, $27 to the employee bonus and retirement fund.
0:35:10 The company kept 38%. But here’s the clever part. The company didn’t take its share until the manager
0:35:16 had enough equity to start drawing theirs. That 38% stayed in the store as working capital,
0:35:22 building the manager’s stake. This created wealthy managers through ownership, not salary. By the mid-1970s,
0:35:27 some of the store managers were making over $100,000 annually, more than most corporate executives in
0:35:38 the 1970s. The growth was relentless. Seven stores in 1956, 35 by 1970, over 60 by 75. But the real
0:35:44 brilliance wasn’t the growth rate. It was that each new store made the whole system stronger. The central
0:35:51 warehouse bought in ever larger quantities, crushing competitors on price. Every store created assistant
0:35:57 managers, hungry to run their own locations. And most remarkably, the expansion was self-funded. Managers left
0:36:02 their profits in as working capital. When they moved up to run a new store, they brought their accumulated
0:36:09 wealth as startup capital. Les had built a machine that financed its own growth. This is one of the most elegant
0:36:15 business models I’ve seen. He solved the eternal problem of expansion capital by making his managers into bankers.
0:36:20 They funded growth not because they had to, but because they wanted to. Their equity was
0:36:24 building while it sat there. Meanwhile, the company got interest-free loans from the very people most
0:36:32 motivated to make those stores succeed. Around 1970, Les made another counterintuitive move. Instead of just
0:36:37 building new stores, he started recruiting his competitors. The pitch was simple. Keep your independence,
0:36:44 but join Les Schwab network. Get access to our buying power, our advertising, our system. Buy tires at the
0:36:50 same prices we pay. Think about the elegance of this. Every dealer who joined made Les’s buying power
0:36:56 stronger, which made his prices better, which made more dealers want to join. It was a virtuous circle.
0:37:02 JJ Stamper had been a Goodyear dealer for 40 years, barely scraping by. After joining Les’s network,
0:37:08 he built four stores and hit six million in annual sales. Within five years, 60 independent dealers had
0:37:14 joined. They added 50 million in annual sales without Les investing a dollar in real estate or inventory.
0:37:20 He turned competitors into allies. His gravity alone was enough. This is network effects before
0:37:26 anyone called them that. Les understood that in a commodity business, scale is everything. Every
0:37:31 dealer who joined made it more attractive for the next dealer to join. Sometimes the best way to beat
0:37:37 competitors is to actually make them partners. As Les’ empire scattered across multiple states,
0:37:42 he faced a new problem. How do you maintain personal relationships when managers are hundreds of miles
0:37:49 apart? His solution raised eyebrows. He bought airplanes, first a Cessna, then a Piper,
0:37:54 then eventually a Citation. Les initially resisted, but he realized planes were tools that collapse
0:38:00 geography. He could visit five stores a day, attend zone meetings, look managers in the eye instead of
0:38:06 managing through reports. The planes make all of our stores just one hour away, he said. For a
0:38:13 company built on relationships, that proximity was everything. By 1975, Les Schwab had over 60
0:38:20 company stores plus 60 member dealers. Revenue exceeded 130 million. The investment banker started
0:38:27 circling. Private equity firms made offers. The numbers were astronomical, enough to make Les one of the
0:38:32 wealthiest men in America. But he turned them all down. What would I do with the money? He’d ask. What
0:38:37 good is money beyond a certain point? But it went deeper than that. Les knew exactly what would happen
0:38:42 if he sold. Some MBA would look at his profit sharing system and ask the obvious question: Why do store
0:38:49 managers make more than executives? Les had an answer they’d never understand. That’s exactly why we’re so
0:38:54 successful. We think the most important people in the company are the people on the firing line, he wrote.
0:39:00 The ones who sell, do the service work, and take care of the customer. Most American corporations have
0:39:07 fat salaries for the top people and treat the people at the end of the line as peons. I guess that is why,
0:39:13 if you’re on the ball, you can beat them. Any buyer would try to fix his inverted hierarchy. They’d cut
0:39:18 profit sharing to boost margins. They’d pay executives more than store managers. And they’d destroy
0:39:24 everything that made Les Schwab work. The results validated his approach. In an industry notorious for
0:39:31 low margins and high turnover, Les Schwab stores outperformed competitors by 30 to 50 percent. Manager
0:39:38 turnover was virtually zero. Customer loyalty was legendary. Most telling was by 1975, Les Schwab
0:39:44 dominated the Pacific Northwest without acquiring a single competitor. Every store was built from
0:39:51 scratch or recruited as a member dealer. They’d won through performance alone, not financial engineering.
0:39:57 Les understood something that money can’t buy. The real money is in the people and the system he created.
0:40:01 Selling would have made him rich, but it would have destroyed thousands of careers built on his
0:40:08 profit sharing model. He chose legacy over liquidity. In an era of quick flips and financial engineering,
0:40:14 Les proved that sometimes the most valuable asset you can build is the one you’ll never sell. The irony is,
0:40:19 by refusing to cash out, he built something worth far more than any buyer was offering.
0:40:25 By 1975, Les was approaching 60. His model was proven. But in business,
0:40:31 there’s no such thing as the status quo. The giants were coming. Big box retailers looked at tires and
0:40:38 saw opportunity. It seemed perfect for their model. It’s a simple commodity product with a huge market.
0:40:44 It’s ripe for customer disruption through bigger scale. They had deep pockets. They had massive stores and
0:40:50 supply chains that had already crushed local hardware stores and grocers. The big retailers bought tires by
0:40:57 the train load and sold them cheap. But they treated tires like toilet paper, stacked them high, priced them low,
0:41:03 and watched them fly off the shelves. They had no service departments worth mentioning. Most failed miserably.
0:41:09 Fred Meyer was typical. They had opened 16 tire departments across their stores and within two years,
0:41:14 they were hemorrhaging money. So they approached Les with a proposition. Would he take over six of their
0:41:19 freestanding tire centers? Les took over five of them. And within a year, he had tripled the business Fred
0:41:26 Meyer had been doing. Here’s what’s remarkable. He was selling the exact same tires at higher prices.
0:41:32 It’s worth asking, how is this possible? Les understood something the big retailers missed.
0:41:37 He said this, “People don’t buy tires on price. They buy from someone they trust and from someone who will
0:41:43 smile and from someone who will give service and stand behind what they sell.” Fred Meyer thought they
0:41:49 were in the tire business. But Les knew he was in the trust business. When your car starts shaking at 70
0:41:55 miles an hour, you don’t want the lowest bidder. You want someone who will make it right. Big retailers had
0:42:01 every structural advantage. Scale, capital, real estate, supply chain, sophistication. But they were
0:42:07 optimizing for the wrong thing. They thought customers wanted cheap tires when what they really wanted was
0:42:13 to never worry about their tires. Les could charge premium prices because he wasn’t selling rubber.
0:42:20 He was selling peace of mind. The early 1980s tested whether the Les Schwab tire empire could survive
0:42:25 without Les Schwab. First, company president Don Miller suffered a heart attack. Les, who’d been
0:42:31 stepping back from daily operations, returned to run the company while Miller recovered. Then on August 1st,
0:42:39 1983, Les himself suffered a massive heart attack, open heart surgery, a week in intensive care, and a long
0:42:45 uncertain recovery. While Les was still hospitalized, Don Miller dropped a bombshell at the annual managers
0:42:52 meeting. He was retiring. The timing stunned everyone. The company faced a double crisis. Its founder
0:42:59 incapacitated while its president was departing. From this chaos emerged Phil Wick, who’d started at the
0:43:04 bottom and worked his way up like everyone else at Les Schwab. He’d become president proving the
0:43:10 succession system worked even under the worst circumstances. By 1985, Les had recovered and the
0:43:16 company was positioned perfectly for the industry upheaval ahead. The tire manufacturing giants were
0:43:22 consolidating or failing. Foreign competitors like Toyo were flooding in. While other dealers picked sides,
0:43:28 Les bought from everyone. He’d built a massive warehouse in Prineville, the town where it all started.
0:43:35 325,000 square feet of pure buying power. This let him offer customers the best tire for their specific
0:43:42 needs, regardless of who manufactured it. People kept asking Les why he didn’t create his own Les Schwab
0:43:47 tire. He had the scale. He had the reputation. He had the capital. He had the know-how. It seemed like
0:43:53 the obvious move. And Les had thought about it deeply and decided against it. His reasoning was brilliant.
0:43:58 If we have a problem with the tire, we drop the tire, pick up another one, and continue to swim.
0:44:03 If he made Les Schwab tires and they had a defect, he couldn’t just drop the line. He’d have to defend
0:44:09 it, recall it, manage the crisis. His people would have conflicts selling “Do I sell the Les Schwab tire,
0:44:14 or do I sell the Goodyear tire?” instead of “What is best for the customer?” By staying independent,
0:44:20 he could always pivot to whatever served customers best. It’s tempting to put your name on everything
0:44:26 once you’re successful. But Les understood, by not making tires, he could always offer customers the
0:44:33 best option without defending a bad product. In the long run, what is best for the customer is best for the
0:44:39 company? The 1990s brought new threats. Costco started selling tires. Online retailers emerged.
0:44:45 Industry experts predicted Les Schwab’s high-touch model was doomed. It was too expensive, too slow,
0:44:52 too old-fashioned for the digital age. The opposite happened, though. As competitors automated everything
0:44:58 and removed human interaction, the Les Schwab experience became more valuable, not less. Customers who could
0:45:03 buy tires online still drove to the Les Schwab store. They wanted someone to run out and greet them. They
0:45:08 wanted experts who knew their name. They wanted the peace of mind that comes from dealing with a person
0:45:14 they knew and trusted. The company’s decades of investing in people had created a moat that no
0:45:21 amount of technology could cross. The numbers by the late 1990s were staggering. Revenue approached $700
0:45:30 million. The employee trust fund hit $332 million, averaging over $65,000 per employee. Store managers
0:45:37 were earning over $200,000 annually, proving Les’ belief that the people closest to the customer should
0:45:42 make the most money. At 80 years old, Les began stepping back. He’d built something unprecedented: a
0:45:48 billion-dollar company where thousands of employees had become wealthy alongside him. From a leaky shed in
0:45:54 Prineville to over 400 stores across seven states, all maintaining the culture he’d established
0:46:01 in the 1950s. By 2000, annual sales crossed $1 billion. But the real measure of success
0:46:07 wasn’t in the revenue. It was in the thousands of families across the West who’d built middle-class
0:46:14 lives and genuine wealth through the Les Schwab model. I can imagine Les saying something along the
0:46:19 lines of if people knew how profitable it was to pay your people well, everyone would do it.
0:46:25 What fascinates me here is how weakness became strength. Everyone thought personal service would
0:46:31 become obsolete in the digital age. Instead, it became more valuable precisely because it was rare.
0:46:38 While competitors raced to eliminate employees, Les doubled down on his people-first bottle. Les Schwab
0:46:44 gave away 50 percent of his profits and became richer than if he’d kept 100 percent. By the time
0:46:50 he died, Les Schwab Tire Centers was distributing over half of all profits directly to employees.
0:46:58 The employees’ trust held $332 million. Store managers routinely made $200,000 a year and many
0:47:06 retired as millionaires. Meanwhile, Les paid himself $32,000 a year. Charlie Munger studied Les Schwab’s success
0:47:10 and reached a simple conclusion. He must have harnessed the superpower of incentives.
0:47:15 He must have a very clever incentive structure, driving his people, and he must be pretty good at
0:47:21 advertising, which he is. He’s an artist. But here’s what I think Munger was getting at:
0:47:26 Les didn’t just design a clever incentive system. He designed a system that acknowledged how humans
0:47:34 actually work. Give people real ownership, not promises. Share profits monthly, not maybe someday. Promote from
0:47:41 within, not from above. When Les died in 2007 at age 89, Oregon’s governor ordered flags flown at
0:47:47 half-staff. Think about that: a tire shop owner received the same honor as a fallen soldier or
0:47:54 president. 13 years later, when the family finally sold, the market value of Les Schwab’s creation was
0:48:00 over $3 billion. Not proprietary technology, not for executive products, for a culture that turned tire
0:48:07 changers into millionaires. The tools haven’t changed since 1952. Trust, incentives, and the radical belief
0:48:12 that ordinary people can build extraordinary things when you align their interests with yours.
0:48:17 Les Schwab asked himself a simple question: What would happen if I treated my employees like partners
0:48:22 instead of expenses? $3 billion later, we have our answer.
0:48:29 Wow, what a force. Les was incredible. He’s somebody we can learn a lot from. I haven’t picked up this
0:48:35 book in probably a decade or so, and just flipping through it, I was reminded of all my old highlights,
0:48:39 which are available for members and our learning community. You can read through what I highlighted,
0:48:45 but reading all my old highlights, it was interesting to me how some of the things that I didn’t highlight,
0:48:49 I highlighted this time and some of the things that I highlighted last time didn’t make as much sense,
0:48:55 but there’s so much business wisdom in this book and there’s no nonsense approach. I really loved reading
0:49:00 this again. I want to mention a few of the quotes that I highlighted that didn’t make it into the episode
0:49:06 that I loved. So one on open books, he said, “We have no secrets in our company. We have no secrets as
0:49:12 to where you stand on your profit share arrangements as we put out a P&L every month showing you exactly
0:49:18 where you stand.” On frontline workers, he said this, “Too many corporations think the brains are in the
0:49:23 main office and all the bonus money is paid to four or five high people. All the others are peons and
0:49:28 just numbers if you have a union that really makes them a number. The truth is that success is at the
0:49:34 other end. The office merely keeps their records and tells them how they are doing. The real job for office
0:49:39 people is to provide motivation, to create programs that make it possible for them to be successful,
0:49:45 to be fair, to be open, to have a really open communication, to have no secrets, and to support
0:49:51 them.” This, he went on to say, is an unusual way to run a business, but more businesses would be
0:49:56 successful if they gave more attention to the people on the front lines. Part of that quote made it into
0:50:01 the episode, but I wanted you to get the full context of that one. So on going public, he said this,
0:50:06 “When we had 12 or 13 stores, I thought a lot about going public, partly to raise money,
0:50:11 and partly to expand faster. I had the chance to buy a small public company that was nearly
0:50:16 bankrupt. It would have been an easy way to go public. I’m so glad I resisted the urge to have
0:50:21 our stock on the market. I don’t want a few investors around the country club asking about
0:50:26 our business and questioning some of our decisions.” I thought that was really interesting. That reminded
0:50:31 me a lot of John Bragg and what he said in the episode and the Jimmy Pattison outliers episode.
0:50:35 And Jimmy Pattison sort of had the reverse experience where he was public. His shares
0:50:40 got up to $42 and then down to as low as 85 cents. And he ended up buying them out.
0:50:45 on what less tells managers when they’re coming in. The big thing that I think is going to hit
0:50:50 you right between the eyes is that we expect you to run the store. You are on your own and you will sink
0:50:58 or swim according to your abilities. It takes quite a man to be a store manager. I’ve always said because
0:51:03 you must have great manager abilities, sales manager abilities, service manager abilities, and above all,
0:51:09 just plain old management ability. And finally, on not being complacent. He said this, “We have great
0:51:16 people and they do a great job, but we must constantly remind ourselves as to just why we are so successful
0:51:22 and what we must do to continue to be successful. Because if we become complacent, it’s all over with.”
0:51:28 All right, let’s talk about some of the lessons you can take away from Les Schwab. I have
0:51:32 countless lessons from the book, but I’m going to talk about eight here that I want to highlight for you.
0:51:39 And the first is win-win. The math of generosity. Les discovered that splitting profits 50-50 with store managers
0:51:45 didn’t cut his wealth in half. It multiplied it. His reasoning was pure math. If I share half the profits,
0:51:52 I still have half. And if Frank makes more money, he’ll work harder to make the store more successful.
0:51:58 And if the store is more successful, my half is worth more than my whole used to be. He gave away billions
0:52:01 to make billions more. You get rich by making others rich.
0:52:07 Number two, skin in the game. Make them owners, not employees. Les didn’t just share profits. He made
0:52:14 managers earn their ownership with real money. The deal. Manage the store, take your salary,
0:52:20 and get 50% of profits. But there’s a catch. You can’t withdraw your profit share until it equals the
0:52:26 initial investment. The result? Zero manager turnover. Don’t pay people to care. Make them actual owners
0:52:30 with skin in the game and real money on the line. And they can’t help but care.
0:52:38 3. Think in decades. Act today. Investment bankers offered less astronomical sums to buy his company,
0:52:43 enough to make him one of America’s wealthiest men overnight. He refused every offer. What would I do
0:52:48 with the money, he said? The real answer? Selling would destroy the profit sharing culture that
0:52:54 made thousands of employees wealthy. New owners would fix his inverted pay structure. Les thought in
0:53:01 decades while acting with daily urgency. By 2020, that patience had paid off. The company was sold for
0:53:08 $3 billion. Preserving the culture even after his death. Build something worth keeping, not just worth
0:53:15 selling. 4. All in or all out? At 34, Les sold his house, borrowed against his life insurance, and scraped
0:53:23 together $11,000 to buy a failing tire shop with no running water and no plumbing. He never had changed
0:53:29 a tire. His competitors had decades of experience. But Les had something they didn’t. No backup plan.
0:53:35 That total commitment forced him to figure it out. One year later, he quintupled revenue. Half measures
0:53:42 guarantee half results. 5. High agency. Everything is your job. Les bought his first tire shop,
0:53:47 having never fixed a flat tire in his life. Day one, customer needs tires mounted. Les fumbles with his
0:53:53 hands on the cold floor, making a complete mess of the situation until his employee arrives. He
0:53:59 insisted on being taught, so the situation never repeated. Within a year, sales jumped from $32,150
0:54:06 He treated every problem as his problem, whether he knew the solution or not. Sometimes the only
0:54:13 qualification you need is the willingness to figure it out. 6. Reputation works while you sleep. In the
0:54:19 1960s, Les made a decision that seemed insane. He removed all tire manufacturer signs from his store.
0:54:25 Back then, tire shops were essentially Goodyear or Firestone franchises. The signs meant manufacturer
0:54:32 support and co-op advertising money. Les gave all that up to put his own name on every store. He bet the
0:54:39 customers would buy based on who sold the tires, not who made them. Within a decade, Les Schwab became
0:54:44 more powerful than any manufacturer brand in the Northwest. Your name is either making you money or
0:54:51 costing you money. There’s no neutral. 7. Go positive, go first. Les instituted free flat
0:54:56 tire repairs for anyone, whether you’re a customer or not. Competitors called them crazy. Why would you
0:55:02 fix flats for people who bought tires elsewhere? But Les understood reciprocity. Humans are biologically
0:55:09 wired to return favors, even unearned ones. Those free repairs created a loop. Strangers who owed him
0:55:15 nothing suddenly owed him something. Most businesses wait for the transaction before the service. Consistently
0:55:22 going positive and going first is one of the most powerful forces in the universe. 8. Dark hours.
0:55:27 Every morning before dawn, teenage Les ran his paper route. Not biked, but ran. For two months,
0:55:33 he sprinted through dark streets on foot saving for a bicycle. His classmates were asleep. He was earning.
0:55:40 By senior year, Les owned all nine routes in town. He’d wake up at 4, deliver hundreds of newspapers,
0:55:47 then show up to school. Your competition is asleep from 4 to 7am. That’s three free hours to build your lead.
0:55:54 Thanks for listening and learning with us. And be sure to sign up for my free weekly newsletter at
0:56:00 fs.blog/newsletter. I hope you enjoyed my reflections at the end of this episode. That’s normally reserved
0:56:06 for members. But with this outlier series, I wanted to make them available to everyone. The Farnham Street
0:56:12 website is where you can get more info on our membership program, which includes access to episode
0:56:19 transcripts, reflections for all episodes, my updated repository featuring highlights from the books used in
0:56:26 this series and more. Plus, be sure to follow myself and Farnham Street on x Instagram and LinkedIn. If you like
0:56:30 what we’re doing here, leaving a rating and review would mean the world. And if you really like us,
0:56:41 sharing with a friend is the best way to grow this special series. Until next time.

0:00:04 Growing up in an environment where India had just come out of 350 years of British rule,
0:00:07 you sit there going, I have to pull myself up.
0:00:11 You had a conversation once with Steve Jobs where he told you not to be too nice.
0:00:16 How did that candid conversation influence how you ran PepsiCo?
0:00:19 I think the biggest lesson I took away was he said,
0:00:21 what I was focused on was micro-understanding.
0:00:26 Because if you don’t understand the business down to where the rubber meets the road,
0:00:31 you can make decisions at the top which are not implementable.
0:00:34 The business was a multi-multi-billion dollar business.
0:00:38 And remember, if you don’t earn your place, the people below you are willing to push you out.
0:00:43 So people don’t realize that as you get more senior in an organization, it’s up or out.
0:00:53 Welcome to the Knowledge Project podcast. I’m your host, Shane Parrish.
0:00:58 In a world where knowledge is power, this podcast is your toolkit for mastering the best of what
0:01:04 others have already figured out. My guest this week is Indra Nooyi, the former chairman and CEO of
0:01:09 PepsiCo, who led a global transformation at the company as one of the most remarkable leaders of
0:01:14 a generation. What makes Indra fascinating isn’t just her accomplishments, it’s how she navigated
0:01:20 her colliding worlds. An immigrant who became more American than most Americans. A dutiful daughter
0:01:25 who became a corporate revolutionary. A mother who reached the pinnacle of power but kept her
0:01:30 daughter’s please-come-home note tucked in her drawer as a reminder of what she was missing.
0:01:34 This is a conversation rich with clarity, resilience, and ambition.
0:01:40 Indra shares the surprising story of how she almost quit PepsiCo, the unforgettable advice she received
0:01:45 from Steve Jobs, and the moment her mother told her to leave the crown in the garage after being
0:01:51 named president of the company. We talk about how to give feedback that gets heard, why great leaders
0:01:56 zoom in before they zoom out, and how real strategy always has to be implementable. If you’re trying to
0:02:04 lead better at work or at home, this episode is packed with timeless lessons. It’s time to listen and learn.
0:02:13 I want to start with this wonderful story about you and your husband. When you first met, you went to a
0:02:19 movie, and you watched Silver Streak at the Sandberg Theater, and then you went out to dinner after, and you
0:02:27 decided to get married. But you’re still not sure who asked who, who proposed to who. I want the real
0:02:33 story here. That is the story. Sometimes I tell him, why did you rush this proposal? I wanted to be dated
0:02:38 and wooed and dined and wine. And he said, I didn’t propose to you, you proposed to me. So I said, why did
0:02:44 you accept if I proposed to you? He says, I don’t know. It was just destined to be that way. And I think
0:02:51 over summer, even though we didn’t spend much time together one on one, there must have been some spark.
0:02:58 And he’s just a very good guy, to be honest. And I guess he thought I was a pretty good person, too. And so it was
0:03:05 just a meeting of the minds, value system, families, every which way. And I said yes, without being wined and
0:03:11 dined. And he said yes, without, you know, dating me and getting to know me. And the rest is history. And 45 years
0:03:15 later, we can look back and say, huh, who proposed to whom again?
0:03:22 That’s such an incredible story. I love these stories of couples that just, it clicks right away.
0:03:27 You might not know each other, as well as some other people who get married. And it just works out. My aunt
0:03:33 and uncle have never actually dated another person. They started dating at 13, and they are still happily
0:03:35 married today. It’s incredible.
0:03:40 Maybe that’s the reason we’re happily married, because we started to date each other after we got
0:03:45 married. And we started to discover each other after we got married. So we had that long process
0:03:50 of discovery. And in spite of that, we kind of liked each other, loved each other.
0:03:57 That’s incredible. I want to go back to your childhood in India. Are there memories or lessons
0:04:00 that stand out from your mom that you still carry with you today?
0:04:05 It’s mom, dad, grandfather, the whole extended family. It’s not just the mother.
0:04:15 And I think that it was a focus on excellence and doing well. It was sort of beaten to us.
0:04:20 If you’re going to do something, do it well. If you can’t get good grades, then, you know,
0:04:25 what’s your value to society? What are you going to do for society? So it was always this thing about
0:04:32 push yourself. Don’t sit idle. Satan has work for idle hands. If you can read in every spare minute,
0:04:37 do it. So that’s the environment we grew up in. And we couldn’t go complain to somebody else because
0:04:42 our entire community was that way. And so you sit there going, who am I going to complain to?
0:04:46 If I complain to an aunt or an uncle, they’ll say, oh, I’m doing the same with my kids.
0:04:52 So we grew up in an environment where everybody was being pushed. And we were being pushed because
0:04:58 we were growing up in an environment where India had just come out of 350 years of British rule.
0:05:03 And it was trying to find its place in society. And we were looking at other countries and saying,
0:05:08 wow, you know, there could be growth. There can be innovation. The economy could get a whole lot
0:05:15 better. And so everybody needs to pull themselves up to contribute to the country in order to make the
0:05:22 country better. So that was the goal to push young people. And so you sit there going, I have to pull
0:05:28 myself up. The family pushed you, but you have to pull yourself up. Everything in my childhood was
0:05:35 about that. It was about working hard, being a team member at home, doing chores, not having much
0:05:45 money at all, but lots of discipline, freedom within the frame. That’s what I remember. But work hard,
0:05:52 study hard, and be viewed as a reliable person. If you promise something, deliver it. Unless you’re dead,
0:05:53 you will deliver it.
0:05:57 When you came over, like growing up in that environment, when you came over and you went to
0:06:03 Yale, were you like, this is, these people don’t work as hard as I do. Like they don’t,
0:06:07 they don’t come from this environment where, you know, you’re struggling to break out and you’re,
0:06:12 you’re sort of driven by your parents and everything around you is sort of pushing you forward. And
0:06:16 there’s no option for failure. You have to succeed and you have to keep going.
0:06:22 I actually came here, I was in awe of everybody I met. And I’ll tell you why, because there we worked
0:06:29 hard because the simple things in life we didn’t have. You know, if you wanted to iron your uniform,
0:06:36 half the time there was no power. So you had ions with hot coal inside them. You know, you have spray
0:06:41 starch here. You know, we had to, when I was in a Catholic school, the uniform had to be starched and
0:06:46 you had to show up looking very crisp. Here you just buy spray starch and you spray it and you iron it on.
0:06:51 There you had to make your own starch at home. And sometimes it’d be clumps that would, you know,
0:06:57 land on the uniform because you didn’t really, you know, cook out the clumps and the starch that you
0:07:03 made. And so we spent a lot of time doing things that people here didn’t have to think about. You
0:07:07 just went to the store and bought it or you had electricity, you had water. So you took all that
0:07:15 for granted. We had to spend a lot of time on those so-called unnecessary survival tasks growing up.
0:07:20 So you come here and you watch everybody here going, wow, they’re so brilliant. They think
0:07:27 differently. They break boundaries. They’re irreverent, but they’re reverent also in their
0:07:33 own ways. How does one become like that? You know, I was more in awe of them rather than they don’t work
0:07:41 so hard. It’s just that the working hard part was on stuff that was made easy in the United States.
0:07:43 The price of development.
0:07:48 I never thought of it that way. Thank you for sharing that. There was a moment before you came
0:07:55 over, you had just got a big promotion and I think it was Norman. And you went to talk to him and you said,
0:08:00 should I take this? Because you were about to take over 60% of the factory or go to Yale.
0:08:06 And walk me through that moment and what went into that decision to, because that’s a huge promotion.
0:08:08 That’s incredible success.
0:08:12 No question about it. I would have been incredibly young to run such a big part of the company.
0:08:18 Would have been successful. Would have been in an environment that I was quite familiar with.
0:08:23 My expenses would have been nil because I would have had to live at home. No issues with anything.
0:08:30 But I had always dreamed about the United States because all my friends had come here and loved
0:08:36 American music, culture, innovation, entrepreneurship. Everything I read about just fascinated me.
0:08:39 And at that time, I’m really talking about the 70s.
0:08:47 America was a seat of culture and just brilliance. And as a young person growing up, your dream is to
0:08:53 be part of this environment. So I went to Norman and said, hey, Norman, look, this job you’ve offered me
0:09:01 is fantastic. One side of me says, take it and grow in this culture and environment. The other side of me
0:09:08 says, be a rebel. Go and be part of this incredibly amazing country and culture and environment called the
0:09:16 United States. And I knew one was risky and one was safe. And something in me wanted to take that risky
0:09:22 bet also. But Norman was clear. He said, look, if I were you, I would take the risky bet. Even though
0:09:27 it would be a loss for me and the company, if I were you, I’d take the risky bet because you may not get
0:09:33 this chance again. And even though I knew I was going to take on loan liabilities, I could fail. I was an
0:09:39 alien country that I didn’t have too much family in because I’d grown up with family. I decided to take
0:09:39 the plunge.
0:09:46 Has that changed how you, when you were like the CEO of Pepsi, did that change how you developed people
0:09:50 where the best thing for Pepsi might’ve been for them to stay, but the best thing for them might’ve
0:09:51 been for them to leave?
0:09:56 Well, at some point when people come to you and say, I’ve got this great opportunity,
0:10:01 you sit there going, would they be better off leaving? And in case I want them back,
0:10:07 I can always go back and get them. Or are they better off staying at PepsiCo? Sometimes selfishly,
0:10:11 I look at this and say, I’m actually better off if this person goes and gets this completely
0:10:17 different experience because I can bring them back. So you always look at this in a nice selfish way.
0:10:23 I don’t mean in a negative selfish way, in a nice selfish way. Somebody went to a tech company,
0:10:28 go there. I’m sure the allure of PepsiCo would make you want to come back if I wanted you back.
0:10:33 And now I have somebody who’s got the PepsiCo pedigree, has got a tech background and now can
0:10:39 come back and contribute to the company in profound ways or partner with me. So I’d look at it that way.
0:10:45 But if I felt that a person did not have much runway in PepsiCo, I would also tell them very honestly that
0:10:51 they might be viewed as a critical professional in PepsiCo. You know, they could have a career,
0:10:57 not a fantastic career. And if they got a better opportunity somewhere, I would provide the
0:11:02 reference and I would help them find something. I think if you really care about people developing,
0:11:04 you’ve got to think that way.
0:11:10 I love that. After Yale, you went into the consulting business. What did you love about that?
0:11:15 It was a sink or swim place. I went to the Boston Consulting Group in Chicago. We had just opened up
0:11:21 and I’d never been in consulting before. And so this was a new experience. First of all,
0:11:27 the caliber of people is just fantastic. Each one is pushing the other. You’re operating at the
0:11:33 highest level of a corporation. And in BCG, you worked on two different assignments at the same time.
0:11:38 So you had to understand two industries, the value drivers, two non-competitive industries.
0:11:44 What are the value drivers? How do you think about adding value to the client in the assignment you’re
0:11:51 working on? And so it challenged me in profound ways. First to learn industries, learn the economics
0:11:57 of the industry, the value drivers. Think beyond the industry to see what insights you can bring
0:12:04 to the industry and learn about dealing with leaders at very high positions, which I’d never done before
0:12:09 in the United States. I mean, I’d looked at these leaders as, my God, so-and-so is the CEO. And now
0:12:16 I’m sitting in the same room with the CEO. How do I behave? How do I, you know, articulate my point
0:12:22 of view without sounding like I’m a know-it-all? There’s so much I had to learn. In my six and a half
0:12:29 years at BCG, I think I grew 10 or 15 years. It was tough. It was a tough learning curve, but man,
0:12:33 I would never trade that experience for anything in the world. And a very competitive environment.
0:12:35 Incredibly competitive.
0:12:40 I think a lot about systems, how to build them, optimize them, and make them more efficient.
0:12:46 But efficiency isn’t just about productivity. It’s also about security. You wouldn’t leave your
0:12:51 front door unlocked, but most people leave their online activity wide open for anyone to see,
0:12:56 whether it’s advertisers tracking you, your internet provider throttling your speed,
0:13:02 or hackers looking for weak points. That’s why I use NordVPN. NordVPN protects everything I do online.
0:13:07 It encrypts my internet traffic so no one, not even my ISP, can see what I’m browsing,
0:13:12 shopping for, or working on. And because it’s the fastest VPN in the world,
0:13:18 I don’t have to trade security for speed. Whether I’m researching, sending files, or streaming,
0:13:23 there’s zero lag or buffering. But one of my favorite features, the ability to switch my virtual
0:13:30 location. It means I can get better deals on flights, hotels, and subscriptions just by connecting to a
0:13:36 different country. And when I’m traveling, I can access all my usual streaming services as if I were at
0:13:42 home. Plus, Threat Protection Pro blocks ads, malicious links before they become a problem,
0:13:48 and Nord’s dark web monitor alerts me if my credentials ever get leaked online. It’s a premium
0:13:53 cybersecurity for the price of a cup of coffee per month. Plus, it’s easy to use. With one click,
0:13:58 you’re connected and protected. To get the best discount off your NordVPN plan, go to
0:14:05 NordVPN.com slash knowledge project. Our link will also give you four extra months on the two-year plan.
0:14:11 There’s no risk with Nord’s 30-day money-back guarantee. The link is in the podcast episode
0:14:12 description box.
0:14:18 You know what doesn’t belong in your epic summer plans? Getting burned by your wireless bill. Most of us
0:14:23 don’t realize just how much we’re overpaying for wireless. But here’s the truth. You could be getting
0:14:29 premium phone services for a fraction of what you’re paying now. Mint Mobile gives you high-speed data and
0:14:35 unlimited talk and text on the nation’s largest 5G network for just 15 bucks a month. And right now,
0:14:41 they’re offering three months of unlimited premium wireless for the same price. You don’t need a new
0:14:46 phone. You don’t need a new number. You don’t even need to change your contacts. Just smarter service,
0:14:52 fewer surprises, and more money in your pocket. Some are short. There are better things to think about
0:14:57 than your wireless bill. Make the smart switch. If I had needed this product, it’s what I’d use.
0:15:04 The savings are undeniable. This year, skip breaking a sweat and breaking the bank. Get this new customer
0:15:10 offer and your three-month unlimited wireless plan for just 15 bucks a month at mintmobile.com
0:15:17 slash knowledgeproject. That’s mintmobile.com slash knowledgeproject. A front payment of $45
0:15:22 required, equivalent to $15 a month. Limited time, new customer offer only for the first three months.
0:15:29 Speeds may slow above 35 gigabytes on unlimited plan. Taxes and fees extra. See mintmobile.com for details.
0:15:33 How did you go about learning about industries you knew nothing about?
0:15:38 It’s surprising, you know, for example, let’s say that I was working in the tissue business,
0:15:44 all right, paper tissue. I would actually go to factories. I’d go to manufacturing lines. I’d go to
0:15:52 R&D laboratories, talk to everybody that was willing to give me time. Because consultants can’t just sit
0:15:59 there and articulate a point of view or provide direction without really understanding the details.
0:16:06 So my philosophy was zoom in before you zoom out. So in everything I’ve done, I always went deep into
0:16:13 whatever the business was, the company was, try to understand things from the ground level. Then I’d zoom
0:16:21 out and say, what’s missing here? Why is the strategic direction in need of a tweak or a reset? And then I’d go
0:16:27 back and say, if we did reset it, how would it sit in the front line? What changes would we have to make?
0:16:33 Then go back out. So this constant telephoto lens that I had in my head is what stood me in good stead
0:16:38 through my entire life. Zoom in, zoom out, zoom in, zoom out.
0:16:43 How did that help you at PepsiCo when you were CEO in terms of understanding, you know, the right side of
0:16:49 the decimal place at the low level and then also, you know, 30,000 foot view setting strategy for a huge
0:16:50 company?
0:16:56 You know, some people say CEOs should be careful not to micromanage. I agree with you. What I was
0:17:02 focused on is micro understanding. Because if you don’t understand the business down to where the rubber
0:17:10 meets the road, you can make decisions at the top, which are not implementable. Or in the implementation,
0:17:16 the intent of the strategy gets lost. To me, strategy and implementation have to go hand in
0:17:24 hand. And very often the reason operating executives rise to become CEOs is because the belief is they
0:17:30 know how a strategy has to land in the front line. In my case, I didn’t grow up in the operating businesses.
0:17:38 I grew up in strategy, finance, you know, corporate operations, not, you know, P&L. So my replacement for
0:17:44 having not run a P&L was go and learn each business from the ground up. So, you know, whether it was
0:17:50 Steve Reinemann who gave me an opportunity to learn the right side of the decimal, whether it was the
0:17:56 work I did with the Frito-Lay distribution system, it was always zoom in, learn the business, bottom up.
0:18:01 And have the humility to tell people to teach you the business. People like it when you tell them,
0:18:06 hey, can you teach me this business? You know, I’d go to the R&D laboratories. I tell them,
0:18:13 teach me how the concentrate is made. Teach me how the Frito-Lay, you know, chip is produced,
0:18:18 a Lays chip or a Doritos chip. I’d walk the manufacturing lines, walk the research labs,
0:18:21 talk to people. I spent an inordinate amount of time doing that.
0:18:26 What was the right side of the decimal lesson? I forget what that was.
0:18:30 So, you know, when you’re sitting in corporate as a CFO, the head of strategy,
0:18:34 you’re thinking in millions, tens of millions, hundreds of millions of dollars.
0:18:40 That’s the left side of the decimal. But money is not made always in the hundreds of millions of
0:18:47 dollars. It’s can you take a penny out of delivery for Frito-Lay? And when you have so many routes
0:18:53 times a penny, it adds up. So on a daily basis, you’ve got to think about a tenth of a penny,
0:19:01 half a penny on a package or on a route. So it’s that little micro pennies that add up to the whole
0:19:08 business. So if you don’t understand the business at the most granular level, you come at it in a
0:19:12 very different perspective. And people don’t understand you because you’re talking in tens
0:19:18 of millions and hundreds of billions. And they’re like, I’m selling a 25 cent bag of Doritos,
0:19:24 a 45 cent bag of Tostitos. What are you talking about? Don’t talk to us about millions. We got to
0:19:29 cut a penny out of this route or cut a penny out of the packaging cost to get the profitability up.
0:19:34 So you’ve got to be able to talk that language. So the left of the decimal is that language where
0:19:41 you sit down with the team and say, can we take out two cents from this entire product package?
0:19:45 That reminds me of J.D. Rockefeller when he was first starting out with Standard Oil and
0:19:49 they were welding the oil cans that they were shipping it in. They were putting, I think it was
0:19:55 13 welds on these and we do it with 11. And those two welds would make a huge difference over the
0:20:00 volume that they were doing. I mean, the example is when we decided that it’s an imperative that
0:20:06 we reduce the water usage in our beverage plants, right? We were using two and a half liters of water
0:20:14 to make a liter of Pepsi. Now, I want to get it down to 1.2 or 1.3. And it’s not enough to provide a
0:20:19 dictate and say, get it down to 1.3. It’s a question of what does it take to get it down?
0:20:25 Let’s talk through it. Where do we use the water? How can we recycle some of the water? How do we need
0:20:30 to clean it to fishborne standards? You’ve got to ask all those questions so that the R&D people realize
0:20:35 that you’re not just providing a mandate. You’re basically saying, I’m going to help you get to the
0:20:41 right answer. So then you set goals saying, by year two, let’s get to two liters. Then let’s get
0:20:49 to 1.8, 1.7. Here’s a meaningful step down over a reasonable period of time so that we can get to
0:20:57 the 1.4 or 1.2 within five years. So it’s having respect for the frontline. So you talk to them in a
0:21:02 language that they’re familiar with as opposed to waving your hands and saying, I want to save 100
0:21:06 liters of water within two years. And people go, does she know what she’s talking about?
0:21:11 I want to come back just for a second to the consulting. And one of my favorite anecdotes
0:21:18 from this yearbook was when you were sitting in a bar in Green Bay, Wisconsin, and you were listening
0:21:24 to the line workers talk about the problems in the business. And you were getting insights from that.
0:21:29 I thought that was like so unique. And I’ve never seen anybody document that before. And I’m sure
0:21:34 people do it. Are there any other ways that you went about learning that were sort of off the beaten
0:21:41 path that provided valuable insight like that? Well, one of the most interesting ones was I was
0:21:48 working for a particular industry and a competitor was building a big plant. And we wanted to know how
0:21:54 big the plant was, how many bays they’re going to have, and what kind of bays, what kind of
0:21:59 transportation. And we couldn’t get enough information from the local filings or whatever.
0:22:06 And the plant was being built in a very wooded area. So it was a highly wooded area, but the middle
0:22:12 was cleared for the plant. And a big lesson I learned is that in the United States, don’t ever say the data
0:22:18 is not available. Say you didn’t look hard enough, because the data is available somewhere. So I kept
0:22:23 digging and digging and digging and digging to see where I could get this data. And the US government
0:22:29 has got fantastic data available. Somebody from one of the departments said, oh, I know where you can get
0:22:35 the data. If you did an FOI, a Freedom of Information request to the intelligence department, and ask them to
0:22:42 give you satellite photographs of the plant from different altitudes, they can give you a pretty good
0:22:50 picture. And I did that. And in a few days, I got the pictures at like 5,000 feet and 3,000 feet. And I now
0:22:57 know from the top what the plant looked like, the size of the plant, you know, what kind of bays, you know, what
0:23:03 kinds of products they might be considering manufacturing there. And so the valuable lesson is don’t tell me you
0:23:10 can’t get the data. Find a way to get the data. Because in the US, directly, indirectly, tangentially,
0:23:17 you can get enough information and data to, you know, really develop hypotheses about the issues you’re
0:23:22 working on. And so I’ve always kept that in mind. When people come to me and say, I don’t know how to
0:23:25 get this data. I say, come on, go look hard. It’s there.
0:23:30 What an incredible story. Is there another example like top of mind that comes to you when you think of
0:23:37 that? Well, when we were doing COVID, the question is, we didn’t use it as much, but one realized this
0:23:43 was available to us. You know, when you had to do tracking to see who’s got COVID, but had not
0:23:49 declared it and how big could the transmission be? You know, the syndromic surveillance, which is a
0:23:58 well-known tool where you look at their driving patterns. If they keep going towards a pharmacy and
0:24:04 buying tests, you know that they might have COVID. Okay. So you’ve got to immediately track that person
0:24:10 to say, should that person be socially distancing or quarantining? So there are so looking at the
0:24:15 wastewater that comes out of their home, you can tell whether there’s COVID. So I think it’s how do you
0:24:20 triangulate on data using multiple sources. Now with social media, you’ve got lots more opportunities
0:24:26 to track people, know what’s going on without invading their privacy. You can get all this
0:24:32 information. Those days, it was all paper and pen and, you know, pouring through wards of data.
0:24:38 As a leader, you’ve called yourself blunt and direct when delivering a message to people. I’m
0:24:43 curious what you’ve learned about delivering a message that gets heard. You know, it’s an evolving
0:24:50 process, if you want to call it that. Sometimes people deliver messages that are not heard because
0:24:57 you haven’t really delivered the message clearly. People actually come out of performance appraisers and
0:25:02 say, I think I’m doing a good job. And you’re going, oh my God, I hope that’s not what you heard.
0:25:06 You’re saying to yourself, because this person was supposed to have told you the three or four
0:25:12 things, areas that you’re supposed to improve upon and the three or four things that you did wrong,
0:25:18 you’re supposed to have gotten very direct feedback. People don’t like conflict. People don’t like to
0:25:23 deal with issues directly. They like to beat around the bush and then leave saying, I think I gave the
0:25:29 person the message. I had the opposite perspective, which is give the message, do it in a supportive way
0:25:36 and make sure that whatever you tell them they have to work on, you help them get to that. So I chose to
0:25:43 write performance appraisals, which said, this is what you’ve done well. This is where I think
0:25:48 you didn’t do well. This is what you need to work on. And if you were to work on these issues and show
0:25:54 progress, this is where you could go. So you see what this letter did was celebrate them for what they did
0:26:01 well. Told them what they didn’t do well. Told them the three or four things they had to demonstrate
0:26:08 progress on in the next year and how I was going to help them. And then also told them, if you showed
0:26:13 progress, this is your trajectory. Because if we don’t do it, I think we’re not getting the best out of people.
0:26:20 There’s a kindness and clarity. Toughness, kindness and clarity, all three. But don’t forget the
0:26:26 toughness. Because you’re confronting them and saying, you know, I asked you to really get to know
0:26:31 the international markets. You made two trips internationally last year. And each trip in three
0:26:35 days, you came right back. How could you have learned international markets without getting out of the
0:26:41 office in the US? Okay. And then you write saying, I’d like you to visit the following countries next year.
0:26:46 And when you visit those countries, make sure you go down to this level of detail. You know, some people
0:26:53 would say, a CEO shouldn’t be getting to that level of detail. Yeah, they’re right. But if I truly care
0:26:59 about this executive, and I think they have great potential, I will get to that level of detail. And I will
0:27:04 monitor it middle of the year and say, hey, did you make any international trips? Did you follow
0:27:09 anything I said? And then they say, nah, I really don’t want to go. Then you go there. You know, you don’t have
0:27:14 the potential to be a CEO. From the outside, we hear these stories about how CEOs pay attention to
0:27:21 the top 50 of the top 100. How many people inside were you really monitoring and trying to develop and
0:27:25 having a personal, a real one-to-one personal relationship where you’re doing this and you’re
0:27:28 in the weeds and you’re in the performance report and you’re trying to build them?
0:27:34 I think there’s about 300 or 400 that were corporate assets. And one watched them
0:27:39 all the time because these are people who in 15 years could be CEO. There’s something about them
0:27:45 that, you know, you sort of caught your fancy when you were in a meeting or in some project that they
0:27:51 were on, they had brilliant ideas. Not brilliant ideas that reinforced your thinking. Brilliant ideas
0:27:55 that challenged your thinking and took us to a better place. Because you don’t want yes people around you.
0:28:00 You want people who say, why don’t we push the boundaries of our thinking? Why don’t we
0:28:06 approach this creatively? And people who put the company before themselves. I look for that all
0:28:14 the time. And so there were three or 400 people that we actually call them corporate assets and we
0:28:20 track them to make sure that we game plan them, give them the right assignments. And even if they
0:28:25 couldn’t move, could we give them interesting assignments so that they could get the experiences
0:28:30 moving? So that’s the number of people that we track.
0:28:33 What were the signs that somebody was putting the company ahead of themselves?
0:28:40 They would put their hand up for difficult assignments. And if something went wrong,
0:28:44 they didn’t look for somebody else to blame. They would take the blame and say, hey, you know,
0:28:48 I could have done a different job or I could have led differently or I could have staffed my team
0:28:55 differently. These are people who would come to me and say, you know, whatever’s going on in this other
0:29:02 part of the company, I think may be putting something in jeopardy. And I’m not throwing them
0:29:07 under the bus. Would it be okay with you if I went and worked with them to perhaps write things?
0:29:13 And I’d say, be careful how you do it, but go for it. And I will tell them that I didn’t send you
0:29:18 there, that you were doing it out of your own good nature. Otherwise people say, oh, the CEO’s got some
0:29:23 pets that she’s sending our way. So you’ve got to be very careful how you deal with organizational
0:29:29 dynamics. But these are people who look around themselves and are constantly looking for ways to
0:29:34 improve the company as opposed to how do I get the next promotion, the next raise.
0:29:41 Are there things you’ve learned about reducing bureaucracy, increasing meritocracy and decreasing
0:29:47 sort of company politics? Obviously in a company the size of PepsiCo with hundreds of thousands of
0:29:53 employees, there’s a little bit of politicking going on, but how do you minimize that? And how do you
0:29:54 find and promote the best people?
0:30:00 That’s a very important question, Shane, because I think you have to understand the politics of an
0:30:03 organization. Where there are people, there’s politics, okay? You’ve got to understand
0:30:08 the politics, but don’t play in the politics. Don’t meddle in the politics. Just understand
0:30:15 who doesn’t like whom and, you know, how meetings work. Just understand it. And then figure out how
0:30:20 best to contribute within that. Once you start to meddle in the politics and gossip about it,
0:30:26 you become a negative force. That’s been my mantra through the entire time that I was in corporate
0:30:32 America. Because meddling in the politics, playing the politics, becoming political yourself and gossiping
0:30:39 is only a formula for disaster. Focus on the job. Focus on moving everything forward. I think things
0:30:45 would be great. Now, I was helped because of the fact that I had a family and kids. So work in the
0:30:52 office, I had to go home to the family and kids. I had no time for bar talk or going out to dinner and
0:30:54 talking about the politics. And I really didn’t care about it.
0:31:00 What about bureaucracy? Was there ways to, I mean, there’s a natural entropy to these large
0:31:06 organizations to hire somebody to do this job. And then they make that job important. And Parkinson’s
0:31:10 law, it takes up all this time. And, you know, you’re distancing yourself from it. And if you let
0:31:17 it go, it just becomes, you know, at the extreme, it becomes government and you go bankrupt. And how do you,
0:31:18 how do you fight that?
0:31:23 Companies like PepsiCo, at least in my time, I can only talk about the time when I was there.
0:31:27 You know, we had very good scorecards to measure productivity,
0:31:35 spans and layers. And we monitored that constantly. You know, is our output per employee going up?
0:31:40 How many spans? How many layers do we have? Are we adding layers for no reason?
0:31:45 You know, we monitored all of that carefully. And that’s why the company was successful, because
0:31:50 you know, it’s like an accordion. Sometimes you end up adding a couple of layers. And then you say,
0:31:55 hey, wait a sec, how did this happen? Why did we drift there? Let’s get the number of layers down.
0:32:00 You know, we see certain levels of people have to have at least eight reports or 10 reports.
0:32:07 So we have different ways we triangulate on organization, hierarchy, levels, bureaucracy,
0:32:15 overhead. We look at all of that. And because our target setting process for the businesses and for
0:32:23 the company as a whole is always reasonably stretched. It’s never easy targets. It’s always a reasonable
0:32:32 stretch. And then we always promise the street a number that’s lower than what we set ourselves to do.
0:32:38 Okay. So we never do the opposite way. We tell the street a higher number and promise ourselves lower
0:32:44 and pay ourselves big bonuses. We always had internally stretched goals. And we promised the
0:32:49 street something more reasonable. That way, we never got paid if we didn’t make the stretch goals. The
0:32:54 bonus, we never paid our bonuses without the stretch goals. So that was the performance culture in
0:32:57 PepsiCo for every leader that was there in the company.
0:33:03 I mentioned kids and one of my favorite stories from your book, and I’m going to read this because
0:33:08 I want to make sure I get it right, is when you got promoted to the president of PepsiCo and you drove
0:33:15 home after work and you were so happy and you were feeling so confident about yourself. And when you
0:33:20 got home, your mother was there and you told her you had the most incredible news. And she told you,
0:33:26 the news can wait, I need you to go out and get milk. And you went back in the car and you drove to the
0:33:32 store for milk and you came hopping mad, telling your mother, I’ve just become president of PepsiCo and
0:33:38 you couldn’t just stop and listen to my news. You wanted me to go get the milk. And your mom said to
0:33:44 you, listen to me, you may be the president of whatever, of PepsiCo or whatever, but you come home,
0:33:51 you’re a wife, a mother and a daughter. Nobody can take your place. So leave that crown in the garage.
0:33:56 What does that teach you about power and humility?
0:34:01 Well, you know, we grew up with all these dualities, especially as you ascend to the top,
0:34:07 the dualities just grow. Okay. Power and humility was a set of dualities that I had to struggle with
0:34:17 always because I chose to be a mother. I chose to get married. I chose to work hard and ascend in my career.
0:34:23 I was helped along by other people, but I decided I’d like to keep working and I’d like to do well and move
0:34:32 forward. So when I make those choices, I can’t delegate all of that to somebody else. I chose to marry an Indian
0:34:37 man, which means that there were some duties and responsibilities that went with being a person of
0:34:45 Indian origin. I didn’t shirk them. And so having made those choices, she was right. Somebody else can
0:34:50 take my place in the company, but at home, who else is going to be the wife and the mother and the daughter?
0:34:58 Nobody else but me. And so I knew that I had to play those roles and play them well. So the real
0:35:05 question was, since I made all those choices, how do I get the support structure and have the
0:35:10 resilience to play all those roles? It’s not easy to play all those roles. Okay. You can’t just come
0:35:15 home and start bossing your kids around because they say, I don’t work for you, mom. My kids have told me
0:35:22 that. Stop treating us and like we work for you. Don’t give us instructions. And so it’s not that I talk to
0:35:27 my, the people who work for me that way, but somehow they interpreted it as I just sit there in a chair
0:35:32 and I boss people around. Little did they know, but they would say, we don’t work for you. I said,
0:35:40 no, I understand. And so I think that all that she was telling me was just constantly remind yourself
0:35:46 as to all the roles you play. And don’t just think that you can walk away from any of those roles
0:35:51 because you made those choices yourself. Do you see that as balance or do you see it as harmony
0:35:56 between these things? There’s nothing called balance. What balance? You know, anytime you use
0:36:02 the word balance, I think of this beam sitting on a fulcrum as perfectly still. It doesn’t exist.
0:36:12 It’s juggling all those roles. It’s not even harmony. Sometimes it’s not very harmonious. You just juggle
0:36:18 those roles and hope the most important balls every day don’t fall and crash and burn. So that’s all you
0:36:25 do. They’re all full-time roles, each one of them. I think this often with, you know, being ambitious
0:36:30 and driven and working hard, and then also holding myself to an incredibly high standard as a parent.
0:36:37 And it motivates me. And it simultaneously, like having those standards can also be
0:36:43 counterproductive because you’re so hard on yourself. Is there any advice?
0:36:49 You’ve got to start off by saying, look, the job is a selfish thing. Okay. We love the job. We love,
0:36:55 you know, working on challenges. But when you have kids, you’ve got to understand it’s a tether. It’s a
0:37:02 beautiful tether, but it’s a tether. It’s a loving tether, but it’s a lifelong tether. And so
0:37:10 I think you should have kids only if you love having kids. I mean, I adore my kids. They may
0:37:17 not think that always, but I just adore my kids. I love them more than anything in this world.
0:37:24 And so does it cause angst at times? Yeah, it does. Do sometimes I sit down and say,
0:37:28 God, I wish I could just work on this problem uninterrupted? Yes.
0:37:35 But that tether comes with some responsibilities. And so I have to have the resilience to balance all
0:37:41 of those things. So each of us as parents, working parents have to find a way to manage all of these
0:37:47 priorities and not lose ourselves. So what you end up doing is giving up some of the things that you
0:37:54 want to do for yourself. Just forget them because you’ve got to see it through the eyes of your kids,
0:37:58 through the eyes of your spouse, through the eyes of the job. You have to morph into a new
0:38:00 being. That’s a reality.
0:38:05 And when you were CEO of Pepsi, your kids were pretty young. How did you manage the information
0:38:12 flow? Just the volume of information that goes to the CEO. How did you do your full day at work?
0:38:17 I imagine you had like a homework bag almost where you’re coming home with, you know, two or three or
0:38:22 four hours of homework as well. But you’ve got to put dinner on the table. You’ve got to be there
0:38:25 for the kids. How did, how do you, what did that information flow look like?
0:38:33 I had two or three skills, talents, I don’t know what you want to call it, or curses. I didn’t sleep
0:38:34 much. Okay.
0:38:38 So, you know, you can either say that was, wow, you’re lucky or man, I wish I could sleep.
0:38:46 I had a pretty good memory. I could read anything and it’ll stick in my brain. And I was a speed
0:38:52 reader. All three helped. I had a support structure between family. And then later on, I could afford
0:38:58 to hire help. I had a support structure. So to put food on the table, the food was prepared.
0:39:05 And then the most important thing is I had a supportive spouse. The role that my husband
0:39:11 played in this hall was just fantastic. And if I wasn’t there, he made sure the kids were taken
0:39:17 care of because he was working full time too. And I did the same when he was traveling. And so I think
0:39:25 the two of us worked as a team. We had support from family a little bit, but mostly the help around us
0:39:31 were like family. And the weekends we had no help. It was just us. But then we said,
0:39:36 look, the weekends we were just devoted completely to family. I never went into the office on the
0:39:41 weekends most of the time, but I worked from home because there’s just lots to read. When the kids
0:39:48 did homework, I did homework. And so was I always there for the kids? I’d say no. But you don’t get
0:39:54 to be CEO by being the perfect mom, the perfect wife, the perfect everything. You don’t. You do the
0:39:56 best you can. And that’s all I did.
0:39:59 Do you think a lot of people are unwilling to make those sacrifices?
0:40:06 It’s hard to make those sacrifices. I mean, I’d like to say it’s easy. It’s not. You look back and go,
0:40:11 God, I missed all of these things I could have done for myself. I missed all of these fun events. I missed
0:40:18 20 date nights. Yes, you missed all of that. But, you know, on balance, if you put it all together,
0:40:21 the whole package worked okay.
0:40:28 I see this often. We hold up CEOs and entrepreneurs and people starting a business as sort of, we want
0:40:31 that, but we don’t want all the things that come with it.
0:40:37 It’s that climb. It’s a tough climb. Anybody who thinks it’s easy to get there and then keep the job
0:40:45 of stuff. I mean, every organization is a pyramid. Okay. It’s not a cylinder. It’s a pyramid. So as you go from
0:40:51 the bottom layer of managerial positions to the top, think of it in PepsiCo and the bottom layer, probably
0:40:59 14,000, 15,000 people. By the time you get to CEO minus two, you’re at about 60 or 70. CEO minus one, you’re down
0:41:07 to 15. So you’ve gone from 15,000 to 60 to 15 to one. Just think of the climb. And then this
0:41:12 is all happening at a time when the world around you is changing so much. So you’ve got to keep up
0:41:16 with all the changes in the world. And you’ve got to make sure that you earn your place in the next
0:41:22 realm. And remember, if you don’t earn your place, the people below you are waiting to push you out.
0:41:29 So people don’t realize that as you get more senior in an organization, it’s up or out. So just keep
0:41:31 those jobs. It’s very difficult.
0:41:37 We’ve tried a lot of supplements over the years, but Momentus is the first one the entire team is getting
0:41:42 behind. We’ve been using their products daily and not only do they work, they actually taste great.
0:41:48 That’s rare. Momentus stands out because of what they call the Momentus standard. Rigorous testing
0:41:54 backed by science and the highest quality ingredients. Plus, there’s no artificial flavors or sweeteners.
0:42:03 every product is NSF certified for sport or informed sport, meaning it’s clean, accurate and free from banned substances.
0:42:09 If it’s trusted by all 32 NFL teams and over 200 collegiate programs, it’s good enough for us.
0:42:16 They’ve worked with experts like Dr. Andrew Huberman and Dr. Andy Galpin to create products that support long-term performance,
0:42:25 not just short-term boosts. From recovery to focus to energy, this is the supplement line that actually delivers.
0:42:42 Is that why there’s a lot of turnover after a CEO change? Like when you were promoted to CEO,
0:42:46 the people you were competing with for CEO probably left.
0:42:52 I kept many of them because I told them, look, I may become CEO, but I can’t, I don’t see why we
0:42:57 can’t work together. Most of them stayed. After two or three years, they got CEO jobs and they left,
0:43:02 but many of them stayed. But you’re right. You know, when you’re, when, if there are five people
0:43:08 competing to be CEO and only one is made CEO, typically what happens is other companies grab
0:43:11 them. Especially for a company like PepsiCo, which has a great leadership development,
0:43:17 people came and grab them. And so they go off to be CEOs, which is good because you’ve got PepsiCo alumni
0:43:25 now running so many companies. But you know, you’ve got to think about this math, which is pretty tough.
0:43:30 When you became CEO, I’m going to rewind after this and go to pre-CEO. But when you became CEO,
0:43:35 you walked into your general counsel’s office, Larry, and you fired him and you hadn’t thought about this
0:43:40 beforehand. And then he looked stunned. And about 10 seconds later, you hired him back. What was the
0:43:47 importance of that? I had to make sure that all the people working for me knew that they were working
0:43:53 for me, the new CEO, not just carryovers from the old CEO. Typically what happens when you have carryovers
0:43:59 is that people wonder if you can trust them. And not that there’s any bad feelings between you and the old
0:44:05 CEO, but you want your own team. The general counsel is one of the most important jobs. And even though I worked
0:44:10 very closely with Larry and I adored him, I didn’t ever want him to think that he was always going to be
0:44:16 viewed as a carryover from Steve, even though Steve and I were best friends, great colleagues. I
0:44:22 respected Steve enormously. So I had to make sure Larry realized that I’m going to respect him even
0:44:28 more if he was now my hire. So I walked in and said, Larry, you’re fired. But I did it with a smile.
0:44:32 And he just looked at me and said, what do you mean, boss? I said, okay, you’re now hired as my general
0:44:39 counsel. He burst out laughing. And I mean, my first years at PepsiCo, my early years as CEO,
0:44:42 was successful because of Larry. What a general counsel.
0:44:47 Well, even he said that that was an important moment because it reset him as well to not being
0:44:54 a holdover and to being there. Is it, when you mentioned you sort of like the old CEO around,
0:44:57 if a CEO goes to the board, how does that impact the new CEO?
0:45:03 The outgoing CEO is never in the deliberations. You provide your perspective and then you leave the
0:45:08 room. The board picks the next CEO because remember the outgoing CEO doesn’t have to deal with the new
0:45:14 CEO, right? And so that’s what happened when Steve was stepping down. And that’s what happened when I
0:45:20 was stepping down. I told the board what I thought the company needed going forward. I gave them the
0:45:26 dossiers of four or five people and said, these are all the pros and cons of each candidate based on what
0:45:31 the company needs. And this is how these people have evolved over time, the trajectory of their
0:45:35 development over the last five or seven years. But it’s your decision. You need to
0:45:40 deliberate. You need to interview each of these people. You need to do your assessments. Because at
0:45:46 the end of the day, I’m gone. You have to make sure the company stays successful based on the choices you
0:45:53 make. And so the board deliberated, diligently met each candidate one-on-one and got to know them and
0:46:02 spent almost two years deciding who should be CEO. So that’s the way to do succession. And so I think
0:46:07 outgoing CEOs can develop people, but they don’t select the person.
0:46:13 When a CEO steps down, is there a risk if they join the board of the company, they’re stepping down from
0:46:18 a CEO in a way that limits the incoming CEO in a way?
0:46:24 That’s my belief. I think an outgoing CEO should just leave, should not sit on the board because then
0:46:29 you’re sort of curbing what the new CEO can do because they’re not always looking over their shoulder to
0:46:36 see if they can take a direction that’s different than the CEO sitting on the board. It’s a terrible
0:46:42 situation. When I stepped down as CEO, I told the board I wouldn’t be chairman for more than two months
0:46:49 max, max. And then I’m out because I wanted the new CEO to have total flexibility to do whatever he
0:46:56 wanted. While we’re on boards, you’re on many boards, including Amazon’s. What’s the difference
0:47:02 between being the CEO and being a board member? When you’re a CEO, you’re it. When you’re on a board,
0:47:09 you’re one among peers. So it’s a group of you collectively that are serving the company.
0:47:15 Nobody is more important. We’re all doing it together. So it’s got to be, you’ve got to
0:47:22 understand you’re dealing with peers. And together we are the board first. Point number two, there’s a
0:47:28 deep urge as a CEO to want to manage the company. You cannot manage the company. You can only provide
0:47:33 direction, ideas, suggestions to the company. And worry about the governance of the company.
0:47:40 So you’ve got to make sure you don’t dig into the reeds and create confusion as to whose direction
0:47:46 should we be taking. So it’s very important that CEOs forget their CEOship and put on a board hat.
0:47:52 And always ask yourself the question, when I was CEO, if a board member behaved the way I’m behaving
0:47:54 now, would I have liked it?
0:47:55 Oh, that’s a good question.
0:48:03 And if you say, Oh God, I would have hated it, then change your behavior. Okay. So understand the
0:48:08 roles of the CEO and understand the role of the board member. And the third thing is, you know,
0:48:13 when you’re a board member of the company, remember that the shareholders are expecting you to play
0:48:20 the role of, you know, setting the right strategy, picking the right leaders, all of that are the roles
0:48:25 that this company is expecting you to, the shareholders are expecting you to perform. Focus
0:48:31 on those things. Focus on the strategy. Focus on leadership development. Understand the business so
0:48:36 you can marry it with the strategy. Focus on those things. Don’t try to get into the weeds and try to
0:48:41 micromanage quarterly results, annual results. It’s just not your role.
0:48:45 You’ve spent your life in strategy. What is strategy?
0:48:51 You know, it’s a nebulous concept, but it’s a very clear concept in the other hand. The strategy in
0:49:02 my books is crafting a path forward for an entity that allows it to execute on that path forward
0:49:09 with superior results. Can you never craft a strategy so that your results are diminished? You always craft
0:49:15 a strategy to improve your results. But if you craft a strategy which is not implementable, it’s not a
0:49:22 strategy. So strategy requires implementation with it and a place that’s better than where
0:49:27 you are today. Both are difficult to, because you have to almost anticipate what the outcome of the
0:49:33 strategy could be. It can be implemented and you’re going to get to a better place. And that’s the challenge
0:49:38 with strategy. You’ve almost got to have a 360 degree view of the environment, of competition, of the markets,
0:49:44 of customer revolution, everything else. And then you’re crafting a path to say, this is how we should proceed.
0:49:50 This is why it’s going to be better for us than it is today. And incidentally, if the world around us
0:49:54 changes, we’re going to zag a little bit. But we’re still going to focus on getting to a better
0:50:02 place. That’s why I think strategy requires unique skills. Zooming in, zooming out, being able to have
0:50:08 peripheral vision constantly, learning from other industries. That’s where consulting was a huge
0:50:15 benefit, because that’s what consulting taught you. Strategy consulting. And I think that’s what I sort of
0:50:19 took to heart and everywhere I went, that’s what stood me in good stead.
0:50:24 There’s two times that you’ve mentioned in this that it has to be implementable. What’s the importance
0:50:30 of that? Is that something that comes up often? Or is that the difference between academic strategy and sort
0:50:38 of real world strategy? Yes, definitely the latter. Because very often, strategy is as it is taught.
0:50:43 It’s taught by people who’ve never run a company, never implemented strategy. So I’ll give you an
0:50:53 example. In business schools, they teach the fact that organizations are siloed. And siloed
0:50:58 organizations are terrible. You should have information exchange within divisions in the
0:51:05 company, et cetera, et cetera. But then universities are the most siloed places. There’s hardly any
0:51:10 sharing of information across departments. It’s the most siloed organization. You see, what it is,
0:51:16 is they’re teaching something which is not implementable in that entity. So from our perspective,
0:51:23 if I go into the company and say, I want power of one, I want PepsiCo to practice power of one,
0:51:29 as opposed to Frito-Lay beverages, I’m not going to say, what is power of one? What do I mean when
0:51:34 I say power of one? What all do I have to change to make power of one happen? Where can the friction
0:51:40 be in the company to implement power of one? How do I provide the right incentives to remove that
0:51:44 friction? Because at the end of the day, everything has to happen through people. So you’ve got to
0:51:49 understand people. And you’ve got to understand all the changes you’ve got to make to people,
0:51:56 processes, incentive structures, everything to enable a change to happen. And that’s what I mean
0:52:01 by implementable. Don’t just sit there saying we should have power of one. Talk about what is it going
0:52:08 to take to implement it. And understand where it could be derailed, anticipated, keep addressing it. Watch
0:52:13 for science when it’s not working well. See what changes you’ve got to make. So you’ve got to be very
0:52:18 alert when you’re making a change. You’re one of the few people I’ve interviewed that started with
0:52:23 removing friction, which I think is beautiful. Most people start with force. How do I make this happen?
0:52:29 How do I will this? How do I push through the friction? Most of it is friction in organizations,
0:52:34 friction points, which you’ve got to look for and remove it. Coming back to the board just for a second
0:52:38 here. What’s the difference between a good board member and a great board member?
0:52:45 A good board member probably does governance well and knows all the board rules and can show up at a
0:52:50 meeting reading the material. A great board member reads a lot more than the material that’s provided
0:52:55 to you. You know, go read everything that’s available outside of the company, its businesses, its competition,
0:53:02 technologies, whatever. So when you come to the meeting, you don’t just do what the basic stuff required
0:53:08 to get through the two days of board meetings. But you’re adding value over and above the basic
0:53:15 requirements of the board. And so when you provide insights that really cause the company to pause
0:53:21 and say, God, she’s got a great point there. Let’s call her back and say, Hey, Indra, can you tell us
0:53:26 more about what you meant by that? Now you’re really a value-added board member, as opposed to, yeah,
0:53:32 so-and-so is a good board member. Read the board material, made sure that the governance was
0:53:39 ticked off. I think that’s the table stakes to be on the board. But a great board member does a lot of
0:53:43 work themselves to read way beyond what the company gave you to read.
0:53:50 I love that. Amazon is known for doing things completely differently internally, including
0:53:54 their memos to start meetings and stuff like that. What are the lessons that you’ve learned from being
0:53:58 on the board there that may have been counterintuitive or new to you?
0:54:03 You know, the entire company is focused on the customer. The obsession of the customer is
0:54:07 something else. And it’s always like, how do we make customers’ life better? How do we
0:54:14 lower costs for customers? How do we improve delivery times? How do we latency? All these things are
0:54:20 what they focus on all the time. So I’ve never been part of such a customer-obsessed company.
0:54:28 PepsiCo is consumer-focused, but these are customer-obsessed companies, first. Second, Amazon has paranoia about
0:54:37 sort of devolving into hierarchy and what they call losing the day-one culture. Day-one culture being when
0:54:43 they were young, entrepreneurial, how hungry they were and how they hustled. They want to have that
0:54:49 hustle culture all the time. The fact that they’re paranoid about it, even today, given their size,
0:54:54 is what blows me away. They’re always scared that they will lose that day-one culture. And so you’ve
0:55:00 got everybody hustling to make sure that hierarchy is not built. Too much bureaucracy doesn’t kill
0:55:05 ideas. And so anybody can come up with an idea as long as they can write a six-page document and present
0:55:11 it to people and, you know, seek funding if your document is good. So I would look at Amazon as this
0:55:20 gigantic day-one company that’s customer-obsessed. It’s an unusual culture, a culture that’s prevailed,
0:55:30 a culture that’s constantly re-examined so that it never, ever changes from this day-one hustle.
0:55:34 And I feel privileged to be part of this company.
0:55:41 You’ve led directly as CEO through many crises, including, I think you had a food safety scare
0:55:47 while you were CEO of PepsiCo. What are the differences between, I mean, academic and real
0:55:50 world leading to a crisis, I guess, would be a good way to frame this?
0:55:56 You know, academics teach crises, which is good, because how else will students learn about what
0:56:03 leaders did in crises? So I respect academics who teach all that. And they do a good job of doing
0:56:09 the teaching. The thing is, when you’re in a crisis, it’s happening in real time. Public is writing about
0:56:18 it. You’re being taken down the eyes of everybody in the media and investors, analysts. You’re home.
0:56:25 Everybody’s scared because your face is on TV saying, what the hell’s going on? And it was even tougher for
0:56:34 a female CEO because, you know, women CEOs got a lot more attention than men. And so when you’re going
0:56:40 through a crisis, first of all, you’ve got to understand the crisis down to the details as opposed
0:56:46 to, we have a recall. Sit down and get your R&D and manufacturing guys and say, tell me about this
0:56:53 in a lot more detail. Ask all the questions you need to ask to understand exactly the root cause of the
0:56:53 crisis.
0:56:59 Then let them give you a plan as to how they’re going to address it. Then step back and decide what the
0:57:04 messaging is going to be. Very often, people don’t take the time to really understand the root cause of
0:57:09 what caused this crisis. And don’t listen to the plan. And then they try to pass the blame on to somebody
0:57:12 else. As a CEO, the buck stops with you.
0:57:17 How does that go with positioning? I love this because how do you take what’s happening? You’ve
0:57:21 agreed that this is the plan. This is the path forward. You have credibility with this. I think
0:57:27 we can do a lot with this. And then how do I position that in a way where the company is moving
0:57:32 forward in the best way possible, but you’re positioning it for an audience too, to be receptive
0:57:38 to it and not pass the buck. Honesty is critically important. When you have a crisis, be honest with
0:57:44 your employees, with the outside world saying, this is the crisis we’re facing. This is how we’re going
0:57:50 to address it. And we’re going to give you an update on this timeframe. Honesty means, I mean,
0:57:57 changes the whole game. Because when you try to use big words to hide the crisis, so you’re just trying
0:58:03 to deflect responsibility. People just don’t have time for this, including your own employees. Okay.
0:58:09 And so I’ll give you a little crisis. When we had our second activist investor in the stock,
0:58:13 it was a crisis for the company because nobody likes to have an activist in the stock.
0:58:18 I did a town hall and I told everybody, I said, look, I’ll give you regular updates
0:58:24 on the activist. You’ll see it on TV. Ignore it. There’s a general counsel, the CFO and I,
0:58:29 who’ll handle the activist. Your job is to just keep focusing on delivering performance. That’s
0:58:35 your only job. Don’t worry about the other distractions. And you can be sure that three
0:58:41 of us have the company’s best interest at heart. And they all knew that I always put the company
0:58:45 before me. I said, we have the best interest of the company at heart, but we will keep you informed.
0:58:54 But your job is to keep driving the performance. Now, deep down inside, you know, I was in turmoil
0:58:58 because I had to deal with all of this stuff instead of just focusing on the company. However,
0:59:04 to the employees, I had to show that I was calm, I was in control, and that I was going to take
0:59:12 them to a better place. So I think boards pick leaders for resilience, ability to manage through
0:59:14 crises. And can you stay calm through it?
0:59:18 The second activist investor you had, was that Nelson?
0:59:20 Nelson Peltz. Yeah.
0:59:24 Walk me through that. What was that like? What was the engagement with them like? I mean,
0:59:28 it’s so far in the past now that it’s all sort of come out, but from your point of view?
0:59:32 It was a typical activist book. He wrote a white paper and he gave it to me. I mean,
0:59:39 I knew Nelson Peltz for years. I liked him actually. So there was no strangers walked off the street
0:59:45 with the white paper. It wasn’t that way. He’d done his work. Most activists pick data selectively
0:59:49 to make their case. And so when he gave me the white paper, I didn’t sit here going,
0:59:54 I’m not going to listen to you. I said, look, let me study his white paper because he may be the
0:59:59 external activist. I’m an internal activist. I want this company to do well. So why don’t we look at
1:00:06 his white paper as a free consulting report? And let’s pour through it. If he has any ideas that
1:00:13 we haven’t implemented in the company, let’s take those ideas. But we’re not going to make big changes
1:00:19 to the company just because Nelson said, I had to make it. We’ll make it if it makes sense for this
1:00:25 company. And if we can keep performing at the level we’re performing. So I was clear on the company
1:00:30 strategy. The board was clear on the company strategy. We listened to everything Nelson said,
1:00:35 because we have great respect for him. Okay. So this is not about blowing off activists as terrible.
1:00:40 Some companies do that. I didn’t do that. I said, I’m going to treat him with respect. Every time we
1:00:46 wanted to meet, I met. Anytime he wanted to meet a board member, they met with him. But every time he
1:00:51 proposed something, we said, look, we’re doing this because of the strategy of this direction,
1:00:56 because of these trends. If he wants to change his strategy, it’s because you think the trend has
1:01:02 changed. Has the trend changed? No, it hasn’t. Then if the trend is that way, that’s our strategy and
1:01:09 we’re not changing it. Okay. So he came around. I mean, he’s a smart guy. He came around and we’ve
1:01:13 remained friends since. There’s no question about bad feelings or anything of that sort.
1:01:19 Often, activists want a board seat or demand a board seat. What are the pros and cons from your point of view
1:01:25 as a CEO of letting an activist investor onto the board? And at what stake do you think it makes more
1:01:28 sense, even if you disagree with it? What ownership levels?
1:01:33 Well, it depends on the board member they propose. You know, Bill Johnson, who we used to run Heinz,
1:01:40 came on our board. And Nelson actually suggested Bill Johnson. But what Nelson didn’t realize is that
1:01:45 Bill Johnson and I knew each other and we were friends already. So when Nelson recommended Bill
1:01:50 Johnson, it was a welcome thing for us because he came from the consumer world, knew us well.
1:01:56 Now, had he recommended somebody who was disruptive, we may have paused and said, don’t want that board
1:02:01 member because you don’t want to spend our time answering activist questions when we should be
1:02:08 running the company. Bill Johnson was hugely accretive to the board. And, you know, he had known Nelson
1:02:15 forever, but he knew the consumer world, he knew PepsiCo. And so, you know, he actually added a lot to the board.
1:02:16 It was a win-win.
1:02:17 It was a total win-win.
1:02:23 Is there a percentage in your head where if a shareholder has a certain percentage, then it’s sort of probably right
1:02:25 for them to have a board seat, even if they might be disruptive?
1:02:34 Oh, 15% or so, 10, 15%, maybe, maybe. But one to 2% and you try to agitate for a board seat, I think that’s really wrong.
1:02:42 You mentioned women CEOs. Correct me if I get this wrong. When you became CEO of PepsiCo, you were the first woman CEO in the S&P 500?
1:02:56 No, no, no, no. A couple others, Carly Fiorina, Warsaw. So, when I became CEO in 2006, I think there were 11 companies that had women CEOs, okay?
1:03:04 When I became president of PepsiCo, I think I was one of two or three. But I was the first woman of color to run a Fortune 50 company.
1:03:10 Now, I think there’s about 54 women CEOs of the Fortune, of the S&P 500.
1:03:13 Does it feel like we’ve made progress to you?
1:03:19 You know, when you’re at 10%, it’s not really progress because 50% of the MBA graduates are women.
1:03:27 Okay, so somewhere that pipeline is leaky. But, you know, it’s a journey because you’ve got to make so many trade-offs.
1:03:37 Why did it get to the top? But it was novel at the time I became CEO, the first immigrant person of color from an emerging market
1:03:44 to lead a Fortune 50, iconic American company. It might have made a lot of news, but deep down inside, I’m like, God, I better prove myself.
1:03:52 Okay, I lived off of that fear of making sure that I did my job right and didn’t let any of these constituencies down.
1:03:54 To the outside world, it was big news.
1:04:06 How do we go about creating more of an equal opportunity while maintaining a meritocracy in companies that allow for more women?
1:04:08 Like, where do we get in the way of this happening?
1:04:14 I think if you decide that you want to have a meritocracy in the company, you should draw from the entire talent pool.
1:04:21 When you have more than 50% of the graduates are women, women are getting all the top grades, they’re hungry, they want to move ahead.
1:04:27 And then you don’t hire from that pool because you start off saying, oh, she’s a woman, must not be very good.
1:04:30 You have these biases, that’s a problem.
1:04:39 So you’ve constantly got to check your biases at the door and say, if I had to put on a blindfold and hire people, how do I make sure that I draw from the best and the brightest?
1:04:41 That’s what consulting does, okay?
1:04:43 So you draw from the best and the brightest.
1:04:52 And then while they’re in the company moving ahead, make sure that barriers that exist to their success are removed.
1:05:00 Because once you attack somebody’s confidence, it attacks their competence.
1:05:12 So if a woman is presenting and you roll your eyes at her, or when she’s presenting, you cut her off, or she says something and you cut her off, or, you know, I’ve seen this often.
1:05:16 Somebody will say, oh, yeah, this is so theoretical when a woman presents.
1:05:19 When a man says the same thing, they’ll say, oh, God, that’s so brilliant.
1:05:24 So these things happen as a matter of practice in companies.
1:05:29 Women, people of color, when they present, they do go through some bad behavior.
1:05:30 I’m talking of then.
1:05:31 Things have changed a lot now.
1:05:33 But in those days, it did happen.
1:05:41 And so when those things happen, you’ve got to figure out a way to call those people out right there and say, hey, can you let her finish?
1:05:46 Can you let this person articulate their point of view before you cut them off?
1:05:49 Will you stop rolling your eyes when she’s presenting?
1:05:51 Because you can feel the person rolling their eyes.
1:06:03 So if you really value every talent for what it is, meritocracy, bring them all in, allow them all to thrive, then everybody has the confidence to continue to contribute.
1:06:11 But if you have all these unconscious biases that impact people who are different, then they lose their confidence.
1:06:15 And once you lose your confidence, you no longer feel comfortable.
1:06:19 So your competence is impacted because you’re questioning yourself.
1:06:20 Am I good enough?
1:06:21 Can I do this?
1:06:34 So I think the whole idea of meritocracy is thinking about all talent is equal, as opposed to one talent is more important than the others.
1:06:37 And then creating equality of opportunity, I would imagine.
1:06:45 Opportunity, environment, constantly monitoring it, making sure we don’t slip back to old bad habits, and making sure we have the numbers.
1:06:52 Usually when you have one or two diverse people in the organization, you can’t really practice how to be inclusive.
1:07:03 And then you have to constantly check yourself and say, if 60% of the summa cum laude from that college were women, where are my summa cum laude?
1:07:05 Why aren’t they in this company?
1:07:06 Okay?
1:07:13 So you’ve got to ask yourself those simple questions based on the statistics coming out of all the graduating classes.
1:07:23 Because if 55% of the graduating class are women, 55% of the summa cum laude and magna cum laude are women.
1:07:31 And even in STEM disciplines, if it’s more than 50%, and if you only have 20% of the hires are women, why aren’t they coming to you?
1:07:38 So you’ve got to look at all these numbers and say, let me ask the question about, what is it about my company?
1:07:42 Especially if you’re a conceivable company, you go, boy, they should really want to come here.
1:07:44 What are we doing wrong?
1:07:47 So you’ve got to get introspective yourself.
1:07:59 One of the anecdotes that you pointed out in your book, and correct me if I’m getting this wrong, because I’m just going from memory here, is when you started listening in on the performance reviews with the men, it was they did all these things and this.
1:08:03 But with the women, it seemed like they did all these things but this.
1:08:06 Was that like a bias within the organization?
1:08:08 Or what was going on there?
1:08:12 So performance appraisals for men is like, you know, he didn’t deliver on all his goals.
1:08:14 Yeah, I agree.
1:08:17 But the guy’s got really, he’s got great potential.
1:08:21 With the women, it was, she delivered on all her goals.
1:08:27 But I think, you know, her future trajectory is not that great.
1:08:28 You go, why not?
1:08:32 Well, I don’t know, something about her tells me that she won’t be successful.
1:08:34 Sometimes it was just ineffable.
1:08:39 Not with all people, but some of the people, that’s how the dialogue would go.
1:08:43 You have to stop it at that time and say, let’s not just leave this discussion.
1:08:47 Let’s really have a conversation about this because maybe it’s true, maybe it’s not.
1:08:57 And sometimes it used to be issues related to her style or the way she dressed or how she showed emotion or how she gesticulated too much.
1:09:13 And now these women show up in these C-suites and it’s a different gender, behavior, everything.
1:09:14 People have to get used to it.
1:09:17 So you need more examples of people in C-suites.
1:09:22 And then you say, okay, look, each person behaves differently, but they all bring a richness to the dialogue.
1:09:25 Was that what happened when you quit PepsiCo?
1:09:32 Because you quit, you went to Roger and you said, I’m leaving, I’m going to do this board meeting and then I’m gone.
1:09:34 I didn’t quit, remember, I just threatened to quit.
1:09:38 I said, I’m, oh yeah, I just said, after this meeting, I’m leaving tomorrow.
1:09:39 If nothing changes.
1:09:41 I didn’t even say that.
1:09:45 I said, you know, look, you’ve been watching this bad behavior and you’ve said nothing.
1:09:50 So I’m going to make this presentation tomorrow to the board.
1:09:51 After that, I quit.
1:09:53 And he didn’t say anything.
1:10:02 And then that day, the meeting with all the presidents that was supposed to happen, where I would always get beaten up, didn’t happen.
1:10:07 He called off that meeting and said he brought in the people who were tough on me.
1:10:08 And I think he had a chat with them.
1:10:16 And then the next day morning, he walked into my office and said, say, you know, next week we’re going on this trip to look at these operations and these operations.
1:10:17 Just make sure.
1:10:20 He didn’t even tell me, I hope you’ve changed your mind.
1:10:21 He just assumed.
1:10:22 He just acted like.
1:10:23 Yeah, nothing.
1:10:27 And then, believe me, I don’t know what conversation he had with those people.
1:10:30 Everything was night and day after that.
1:10:32 We never talked about it.
1:10:34 Did you ever have to have a conversation like that with people?
1:10:38 I would call out bad behavior immediately when I saw it.
1:10:42 But in a gentle way, I’d say, hey, can you let her finish?
1:10:45 Stop interrupting her or him.
1:10:46 It could be a him too.
1:10:51 What I would say, don’t roll your eyes when they’re talking unless something’s wrong with your eyes.
1:10:52 Okay.
1:10:58 So, but I do it in a way that didn’t make them feel bad, but it was direct and pointed.
1:11:00 You only have to do that a couple of times.
1:11:01 Yeah, that’s right.
1:11:03 The message goes quickly down the company.
1:11:07 You had a conversation once with Steve Jobs where he told you not to be too nice.
1:11:11 How did that candid conversation influence how you ran PepsiCo?
1:11:16 I think he taught me a valuable, first of all, it gave me time, which was just so generous.
1:11:25 I think the biggest lesson I took away was he said, if you care about something, and you should care about a few things, show your passion.
1:11:41 For example, the guy who ran TVWHI at day, the ad agency, which was doing work for Apple, would always say, when you go to see Steve Jobs, the campaign, if he didn’t like it, he’d throw the stuff all over the room and say, I want to see a new campaign by the morning.
1:11:48 And you scream, but he wasn’t doing it to destroy the place.
1:11:57 He was doing it because he cared so much about Apple that he wanted the absolute, brilliant, right campaign for Apple.
1:12:05 And his way of showing his frustration at himself and at the group was to act the way he did, okay?
1:12:16 Now, as a woman, I’m not the kind that utters full-letter words and throws things around, but all that Steve Jobs was telling me was, people have got to know what you’re really passionate about.
1:12:22 When you’re really passionate about something, don’t sit here going, God, I don’t want to send them back three times.
1:12:24 It’s okay to send them back three times.
1:12:27 Get it to a point where you’re really comfortable, this is going to be good for the company.
1:12:29 Show your passion, push people back.
1:12:34 So I got to a point when design as a discipline was set up in PepsiCo.
1:12:38 When they’d bring me something I didn’t like, I’d say, hate it.
1:12:39 Absolutely hate it.
1:12:45 And then I would tell a joke about it and say, this is what the customer is going to say when they see it.
1:12:48 Or I’d say something like, this new product is delayed.
1:12:49 I don’t care.
1:12:50 In six months, we have to launch it.
1:12:53 Even though it normally takes three years to do it.
1:12:54 And guess what?
1:12:55 I’m the program manager.
1:12:58 So we’re going to meet every Friday morning to talk about this program.
1:12:59 People go, you’re the program manager?
1:13:01 I said, yeah, I’m the program manager.
1:13:09 And people go, this is a disaster because to have a CEO review every week means we have to have two other reviews before we come to see you.
1:13:11 I said, no, I’m the program manager.
1:13:12 I’m not the CEO.
1:13:13 I’m the program manager.
1:13:14 And I was.
1:13:17 And I told them, no need for pre-discussions before you come to me.
1:13:19 I’m the program manager.
1:13:25 And so people sort of realized that I was passionate about launching this product.
1:13:28 And so they went along with the program and they were grateful.
1:13:34 I removed every barrier, told them that, okay, this is what’s holding you back.
1:13:38 Let me make a few phone calls and see if I can’t get this out of this company faster.
1:13:40 So I jumped through hoops for them.
1:13:46 There’s a lot of value in being passionate about something and just that energy sort of like transferring over to everybody else.
1:13:49 There’s also a huge benefit to just having clarity.
1:13:51 It’s not like it’s okay.
1:13:53 You know, maybe try changing colors.
1:13:55 It’s like, no, I don’t like it.
1:13:56 It’s garbage.
1:13:58 Like come back with something new.
1:13:59 But there’s one big lesson.
1:14:04 When you’re in such positions of leadership and you have passion about something, don’t try to take the credit.
1:14:12 If the team does a great job at the end of it, even though you were the program manager and you drove it, give the credit to the team.
1:14:13 Because you couldn’t have done it yourself.
1:14:14 The team did it.
1:14:19 It’s just that you exercise the power of your office to help them get there.
1:14:20 So the credit should go to them.
1:14:22 Make sure you give them the credit.
1:14:25 When if something goes wrong, take the blame.
1:14:29 But, you know, blame flows upwards.
1:14:30 Credit should flow downward.
1:14:34 Steve Jobs inspired the design thinking at Pepsi.
1:14:37 How did that change how PepsiCo went about their business?
1:14:40 Like, I remember you gave binders to sort of people and stuff.
1:14:43 But like, how did it tangibly work its way into products?
1:14:45 And what was the impact of that?
1:14:48 Well, all of a sudden people are saying, God, we can do so much for design.
1:14:49 We can change our innovation process.
1:14:52 We can change our package, our product design.
1:14:58 We started to move from what’s the color of the package on the shelf to how is this product going to be consumed?
1:14:59 How is it going to be used?
1:15:00 How is it going to be carried?
1:15:02 How is it going to be stored on the shelf?
1:15:04 How is it going to be stored in the pantry at home?
1:15:13 We were thinking about the chain, the use chain, all the way to how does a consumer shop for it, put it in the pantry at home,
1:15:16 and then take it out and eat it and carry it in the purse.
1:15:22 We were thinking about every touch point of the product until it got into the mouth and was consumed.
1:15:28 So it expanded the entire chain, which goes into the thinking.
1:15:32 And previously you were sort of focused on like, what’s going to make it stand out on the shelf?
1:15:33 How are people going to buy it?
1:15:34 Right.
1:15:36 And then we’re not worried about it once they put it in the cart.
1:15:41 I think, you know, if there were 10 steps, we worried about three steps in the past, about 30%.
1:15:44 Now we started to worry about 80, 90%.
1:15:46 So it was a different experience.
1:15:47 It was fulfilling.
1:15:48 People loved it.
1:15:52 Are there any other lessons that you’ve taken from other CEOs?
1:15:54 I mean, you had a conversation with Jobs.
1:16:00 You worked with Jeff Bezos on the board of Amazon where you’re like, oh, that’s a really good idea or really clever.
1:16:05 I wish I would have known that before or ones that you did implement while you were CEO of PepsiCo.
1:16:09 You know, one of the things you should do as a CEO, talk to other CEOs.
1:16:14 If you see something interesting they’re doing, you’re in such a rare club, the CEO club.
1:16:16 Call them up and say, hey, you’ve done this.
1:16:17 It’s so interesting.
1:16:20 Can you share some findings with me?
1:16:22 Can you share some results with me?
1:16:25 Or I’ll give you one example.
1:16:29 We used to do business with club stores like Costco and people like that.
1:16:33 Very different businesses than a regular retail store.
1:16:34 Item merchandisers.
1:16:36 Costco only merchandisers.
1:16:38 So many SKUs, limited number of SKUs.
1:16:43 They’re all in a different packaging than most other retailers.
1:16:47 You know, I sat there going, I don’t understand Costco enough.
1:16:51 My salesman told me about Costco, but I didn’t understand Costco enough.
1:16:56 So I called Jim Sinigal, who was at that time the founder and still running Costco.
1:16:59 I said, Jim, I want to do better at Costco.
1:17:01 I’m CEO.
1:17:05 And he said to me, if you want to do better at Costco, walk the store with me.
1:17:09 Come to a store opening, spend the whole day, because he goes to every store opening.
1:17:11 Walk the store with me.
1:17:14 Amazing human being, Jim Sinigal.
1:17:17 Just, I mean, heart of gold that he gave me a day.
1:17:19 Walk the store with me.
1:17:22 Taught me how club stores operate.
1:17:25 Taught me the basics of the business.
1:17:26 This is CEO to CEO.
1:17:28 He taught me the basics of the business.
1:17:34 And in that store, everybody watches him, Jim Sinigal and me, being great friends.
1:17:36 But I’m the student.
1:17:37 He’s the teacher.
1:17:39 And he taught me the business.
1:17:40 Oh my gosh.
1:17:41 Walk me through this.
1:17:42 Like, what did he point out?
1:17:43 What did he notice?
1:17:45 What did he draw your attention to?
1:17:46 Package sizes.
1:17:48 How they think about packaging sizes.
1:17:49 How they think about treasure hunt.
1:17:52 Because in Costco, there’s always something new.
1:17:54 How they think about the treasure hunt alley.
1:17:56 How they think about pricing architecture.
1:18:02 You know, it’s like Costco would have a unique packaging configuration, which was not really
1:18:04 comparable to anything out there in the marketplace.
1:18:06 And why that was important for Costco.
1:18:12 You know, what is their thinking about how to manage the budget of a family, especially a
1:18:13 family with two or three kids?
1:18:14 How do you think about that budget?
1:18:19 So, for example, we stood at a refrigerated shelf.
1:18:24 I remember in Port Chester, the store, he and I were walking in and he said, okay, Indra,
1:18:27 you get to pick a product that I should put into the store.
1:18:29 Do you have an idea?
1:18:31 I said, yeah, I gave him an idea.
1:18:32 I’m not going to tell you what it was.
1:18:33 I gave him an idea.
1:18:36 And I thought, you know, in six months, it’ll show up on the shelf.
1:18:38 Two weeks later, I go to the Costco store.
1:18:39 It’s there.
1:18:42 How he got it done in two weeks, I don’t know.
1:18:44 But it was a huge seller.
1:18:45 So, I felt relieved.
1:18:53 But based on the draw of that consumer in that neighborhood, I thought this product would
1:18:53 do very well.
1:18:55 But he listened.
1:18:56 You see that?
1:19:00 You see how you feel about the fact that the CEO wasn’t just teaching, he’s also learning
1:19:01 from you.
1:19:03 And so, I had experiences like that.
1:19:09 I remember there was a Walmart senior executive, Greg Foran, who was running North America Walmart.
1:19:12 And he was in Kiwi.
1:19:15 And he was turning around Walmart, North America.
1:19:18 People thought he was very difficult.
1:19:20 And I went to meet him.
1:19:25 And Doug McMillan, the CEO, told Greg Foran, hey, Indra is a good friend of mine.
1:19:33 And Greg Foran said, well, if you really want to learn Walmart, follow me on a store tour.
1:19:37 And, you know, these guys go to a store every day, some region.
1:19:44 So, Greg would say, I’m going to be in Pittsburgh from 8 a.m. to 6 p.m. on the 23rd of March.
1:19:45 So, I’d fly to Pittsburgh.
1:19:46 I’d meet him there.
1:19:53 And my job was just to trail Greg Foran to see how he looked at every aisle, how he looked
1:19:59 at how clothing should be merchandised, what product was married with what, where did he
1:20:02 stop and say, redo this entire display for the consumer.
1:20:06 So, I was learning from Greg Foran, but he allowed me to tail him.
1:20:08 Okay.
1:20:10 And so, I felt it was a gift he gave me.
1:20:13 And at lunchtime, he would only take a half an hour break.
1:20:15 He said, Dan, he said, tell me what you learned.
1:20:19 Let me tell you what I think you should have taken away.
1:20:20 Okay.
1:20:21 Greg now runs in New Zealand.
1:20:23 I was in New Zealand a year ago with him.
1:20:26 We were reflecting on our market experiences.
1:20:30 He taught me more than I would have learned from anybody.
1:20:36 But this is the advantage of being open to ideas, open to learning.
1:20:40 And you can learn a lot from CEOs and become a better person yourself.
1:20:42 Because at the end of the day, a company does not exist in a vacuum.
1:20:48 That’s one of the reasons we interview so many CEOs and share your lessons with our audience.
1:20:52 Is there anything that stands out about what you learned that day walking through Walmart or
1:20:56 the lunch after where you were sort of, oh, I never thought of it that way?
1:20:59 You know, how they merchandise T-shirts is dark to light.
1:21:05 You know, when you hang, let’s say you’re hanging a certain T-shirt, but you’ve got to
1:21:07 make sure the colors go from dark to light.
1:21:12 If you mix up all the colors, consumers have a difficulty shopping for a T-shirt.
1:21:16 He’ll go and stand there and then he’ll look at his team and say, what have you done wrong?
1:21:20 And, you know, sometimes the guy will have the right answers.
1:21:21 Sometimes they won’t.
1:21:24 You got to merchandise it dark to light.
1:21:31 Or he’ll stand in front of a Frito-Lay aisle and he’ll say to the guys, what do you think
1:21:32 about this aisle?
1:21:33 All right.
1:21:35 And they’ll say, it’s perfect.
1:21:36 He’ll say, yeah.
1:21:38 Why isn’t every aisle like the Frito-Lay aisle?
1:21:41 Because PepsiCo’s merchandised us perfectly.
1:21:46 Or the best example, I remember we stood in front of a Quaker Roads aisle.
1:21:52 He’ll pull out four packages of multi-packs, you know, all the different flavors of, he’ll
1:21:54 put all four packs and he’ll look at me and say, Indra, come here.
1:21:56 I say, yes, Greg.
1:21:57 I said, awesome lineup.
1:21:58 Because in my products, right?
1:21:59 I own Quaker Roads.
1:22:07 He’ll say, each of these boxes, they’re three different sizes, but each of these boxes has
1:22:10 got nine packs, 12 packs, six packs, whatever.
1:22:13 But the pricing doesn’t reflect the changes.
1:22:16 You know, why is that?
1:22:18 And why do I need four different packs?
1:22:19 Why don’t I just have two?
1:22:22 And I’m going, but I don’t have the reason.
1:22:31 But, you know, he’s thinking about how can I get the maximum inventory on these shelves
1:22:37 that make sense for the consumer, but have price transparency so the consumer is served well.
1:22:41 And basically what he was pointing out to me is my pricing architecture was messed up.
1:22:44 And it was causing confusion, I would imagine.
1:22:49 And even if the consumer didn’t express their confusion, they were probably confused because
1:22:53 we were confused at that time looking at the four packages, but he would look at it at
1:22:54 that granular level.
1:22:55 That’s incredible.
1:22:58 And, you know, you learn so much and say, guys, hang on.
1:23:02 When you go back and you look at pricing architecture, you ask people these questions.
1:23:04 How many SKUs did you put on of Quaker Roads?
1:23:06 Why do we need 10 SKUs?
1:23:06 Why not four?
1:23:09 It’ll simplify the manufacturing operations.
1:23:12 I think Frito does their own stocking of shelves.
1:23:13 Do they know?
1:23:15 Is there a reason behind that?
1:23:19 Because the velocity is so high and it’s all, you know, air in the bags.
1:23:23 So if you put it through the warehouse, it’ll take up too much space in the warehouse.
1:23:29 So we bring it in through the art trucks and our salesmen know how to put the right SKUs
1:23:30 in the right place on the shelf.
1:23:34 If Frito-Lay products and beverage products came through the warehouse, they would have to
1:23:36 build separate buildings just to house those products.
1:23:38 Because I’ll give you an example.
1:23:41 A Frito-Lay chip will turn 40, 50 times a year.
1:23:45 Beverages might turn 60 to 70 times a year.
1:23:47 Toothpaste turns 12 times a year.
1:23:50 Cookies turn 10 times a year.
1:23:53 So, you know, those people, those can come to the warehouse.
1:23:58 But chips, milk, beverages, very hard to bring it through the warehouse.
1:24:03 When you look at an aisle of Frito-Lay or PepsiCo products, what draws your attention?
1:24:04 What do you notice?
1:24:06 Well, I look for new products.
1:24:07 Have they been slotted?
1:24:12 Are the existing workhorses like Alley’s or Doritos got enough facings so the consumer
1:24:14 knows that they should grab it?
1:24:17 Is each package neatly crisped and put on the shelf?
1:24:20 Because that’s the media you own, right?
1:24:24 When your consumer sees the product on a shelf, that’s the media talking to you.
1:24:28 So to me, the media you own is very important to the consumer.
1:24:31 Because the media you rent is your TV and your advertising.
1:24:33 Many people don’t see it.
1:24:35 But they see that billboard effect on the aisle.
1:24:38 So how does your package show up on the shelves?
1:24:40 Is the right assortment there?
1:24:41 Can they shop it easily?
1:24:46 For example, is there a corporate block called Frito-Lay or do you have potato chips, corn chips?
1:24:48 How would you prefer having it?
1:24:50 Are the dips next to the chips?
1:24:52 If something is on deal, is it on an end aisle?
1:24:55 There’s so many things we look at.
1:24:57 The Frito-Lay guys do a great job.
1:24:58 That’s awesome.
1:25:03 One of the big strategic pivots, I guess, that happened under you is when you were president,
1:25:05 you sort of outsourced the bottlers.
1:25:07 And then when you were CEO, you brought them back in.
1:25:08 Do I have that right?
1:25:11 Well, you know, when Roger was CEO, we spun out the bottlers.
1:25:15 In North America, I executed on his direction.
1:25:18 And at that point, it was the right thing to do.
1:25:22 But when I became CEO, I realized that the market was growing.
1:25:23 The bottlers were thriving.
1:25:29 When the market growth rate slowed down, okay, the pie wasn’t growing, but there were two
1:25:33 companies, the concentrate company and the bottling company fighting for a larger share
1:25:34 of that pie.
1:25:35 It was not constructive.
1:25:38 We were not serving the customer, but we’re now fighting amongst ourselves.
1:25:43 I made the hard decision to buy back the bottlers.
1:25:45 Now it gets back to strategy.
1:25:47 Sometimes people say, oh, you flip-flops.
1:25:49 No, the environment changed.
1:25:53 Remember, I talked to you about you change strategy, the environment changes.
1:25:56 You cannot be dogmatic about your strategic direction.
1:26:00 When the environment changes around you, you’ve got to zag a little bit, which is what I did,
1:26:01 bought back the bottlers.
1:26:06 Had we not bought the bottlers back at that time in North America, we’d still be fighting
1:26:08 with the bottlers and the pie would be shrinking.
1:26:11 Because we’re not serving the consumer, we’re fighting each other.
1:26:13 So it was tough, but we bought them back.
1:26:18 But one of the ways that people deal with reality is to be humble.
1:26:20 You know, that was the best path at the time.
1:26:22 But that sounds so easy.
1:26:25 But this is a multi-billion dollar decision.
1:26:27 The business was a multi-multi-billion dollar business.
1:26:32 So again, you know people are going to criticize you for flip-flopping.
1:26:35 People are going to say you took on a more asset-intensive business.
1:26:37 But was it right for the company?
1:26:39 Got to put the company before you.
1:26:43 They might criticize you, but is it right for the company?
1:26:44 The answer is yes.
1:26:48 What have you learned about decision-making that you wish more people knew?
1:26:50 I think many people do it well.
1:26:53 Decisions are rarely made in a vacuum.
1:26:58 Decisions are made because you’ve looked at reams of data.
1:27:04 You’re married with experience, with a little bit of intuition, a lot of counseling with other
1:27:07 people, a lot of discussions, a lot of input from other people too.
1:27:13 Don’t underestimate, you know, how much knowledge is resident in your teams and how you can tap
1:27:14 into it.
1:27:19 And so I think if you’re willing to incorporate all those points of view into decision-making,
1:27:21 you’re going to end up with a great decision.
1:27:24 But you’ve always got to keep one thing in mind.
1:27:28 If something goes wrong with the decision you made, the blame is yours.
1:27:32 If it goes well, give it to the team that worked on it.
1:27:33 Okay?
1:27:33 Cover for them.
1:27:35 Provide the air cover.
1:27:39 But don’t try to take the credit to yourself because the more you take the credit to yourself,
1:27:41 people will go, she just wants to look good.
1:27:42 Okay?
1:27:44 Just say, guys, I’ve got your back.
1:27:47 We’ve done all the thinking, discussion.
1:27:49 We’ve looked at this from every perspective.
1:27:51 Go make it happen.
1:27:52 If something goes wrong, I got your back.
1:27:54 Your people feel empowered.
1:28:01 You were involved in a lot of acquisitions of companies through strategy and through being
1:28:03 the CEO of PepsiCo.
1:28:07 Why do so many acquisitions not work out the way that they’re intended?
1:28:11 First of all, the acquisition logic should be correct.
1:28:12 Okay?
1:28:17 Don’t do deals just because it’s sexy to do a deal or you’re trying to buy some short-term
1:28:19 growth or profitability.
1:28:22 If you do it for the wrong reason, they will not work out.
1:28:28 Second, any acquisition, the deal process is just 10% of the whole process.
1:28:31 The whole work is in the post-merger integration.
1:28:35 How do you integrate the acquired company into your company?
1:28:36 How do you extract the synergies?
1:28:38 How do you build a new culture?
1:28:40 How do you absorb them?
1:28:42 People don’t pay enough attention to that.
1:28:47 And when post-merger integration efforts are not done right, acquisitions do fail.
1:28:48 And you’ve got to keep that in mind.
1:28:55 And sometimes acquisitions don’t work because the people that you put in charge of running
1:28:57 the new company are not competent.
1:29:02 I think one of the lessons I learned is respect the culture of the company of acquired.
1:29:03 I’ll give you two examples.
1:29:09 When we bought Tropicana, the days when there were oranges available in Florida, Roger said
1:29:10 something very interesting to me.
1:29:13 He said, it’s a different company.
1:29:14 It’s a good for you product.
1:29:22 Don’t allow people from the rest of PepsiCo to go there and put their ideas on a good for
1:29:24 you business because you’ll mess up that business.
1:29:29 So he made me go sit down with Ellen Marram, who was running that business, to say, what
1:29:32 are the rules under which Tropicana should operate?
1:29:34 Almost their value system.
1:29:39 And he said, preserve that until this company is mature enough to be called part of PepsiCo.
1:29:41 Very important lesson.
1:29:43 The second was when we were buying Quaker Roads.
1:29:48 It was Bob Morrison was very important to Quaker Roads.
1:29:50 Which included Gatorade, right?
1:29:51 Quaker Roads, yeah.
1:29:55 He said, when we’re buying Quaker Roads, whatever happens, we’re going to do everything possible
1:29:59 to keep Bob Morrison, at least for the first two years.
1:30:05 So the onboarding into PepsiCo is done with the way that, you know, we respect their culture
1:30:06 and they respect us.
1:30:08 Made a whole lot of difference.
1:30:13 So I think acquisitions fail when you don’t recognize these pitfalls and don’t address them
1:30:14 proactively.
1:30:19 Are there any big mistakes that you made in an acquisition where you’re like, ah, lesson
1:30:21 learned for next time, but…
1:30:23 I’m not going to tell you those mistakes, but yeah, of course.
1:30:28 I mean, we correct them, but yeah, we made mistakes.
1:30:34 And if the mistakes were made, it’s because I wish we had played out how that market could
1:30:37 have evolved even more.
1:30:42 Or I didn’t bring the bottlers in soon enough to talk about how they’re going to carry it on
1:30:43 the bottling system.
1:30:49 Or I put it into Frito-Lay, even though it was a good for you product, and somehow it
1:30:51 became a fun for you product when I wasn’t looking.
1:30:53 So yeah, we made mistakes.
1:30:59 The key thing is, where it makes a huge difference and big bucks are involved, be careful.
1:31:05 Be ultra careful about post-merger integration in people because the cost of failure is very
1:31:05 high.
1:31:07 I’m going to ask a question.
1:31:12 I want to hear your sort of rapid fire response of either behaviors or traits.
1:31:16 If somebody had an unfair advantage in PepsiCo and they were just constantly knocking it
1:31:21 out of the park all the time, what would be the behaviors and traits that that person would
1:31:22 have or the skills?
1:31:26 They’ve got this uncanny ability to zoom in and zoom out.
1:31:33 They ask people for opinions and ideas and incorporate them.
1:31:39 They put their hands up for difficult assignments and learn from difficult assignments.
1:31:42 They’ve gone through failure in the past.
1:31:46 People who hit it out of the park have been through a lot of failure and learn from that
1:31:46 failure.
1:31:48 They haven’t allowed it to get them down.
1:31:50 They’ve learned from those failures.
1:31:55 They pick themselves up, talk about what they learned, fix it the next time and move forward.
1:31:58 These are people who are typically humble.
1:32:03 You know, people who hit it out of the park rarely beat their chest and say, I hit it out
1:32:03 of the park.
1:32:04 I hit it out of the park.
1:32:05 Look at me.
1:32:06 I got to move forward.
1:32:08 These are people who say, hey, this is what the company needed.
1:32:09 I did it.
1:32:12 And PepsiCo had a lot of them.
1:32:18 Was that almost a reverse signal when people were too braggy about what they’ve done or look
1:32:19 at me, look what I’ve done.
1:32:24 And then you just dismissed that because, you know, historically that doesn’t correlate
1:32:25 really to people who do the work.
1:32:29 You know, PepsiCo didn’t have too many of these bragging people.
1:32:36 So I was blessed to run a company where the culture was such that some people might have
1:32:41 tried to be a bit more out there to take credit, but there were very few people who were
1:32:42 braggers, really.
1:32:44 Even Amazon has no braggers.
1:32:49 Philips, the other company I said on the board of, the MedTech company from the Netherlands,
1:32:50 not at all.
1:32:51 Nobody brags.
1:32:55 Everybody’s talking about what can we do together to move the company forward.
1:32:58 So I think I’m just lucky to be in these sorts of companies.
1:33:02 Do you think that there’s an important component to being part of a company?
1:33:07 And I mentioned this in the sense of maybe COVID or work from home, where it’s really easy
1:33:09 not to feel part of something larger than yourself.
1:33:14 But there’s this very human side of us that needs to feel part of something larger than
1:33:18 ourselves, whether it’s a family or work, that we’re making a difference, that we’re
1:33:20 contributing to society.
1:33:22 Does that get lost in work from home, do you think?
1:33:26 I don’t even know what it is to work from home only.
1:33:31 To me, if you don’t come to work, interact with other people, understand the culture of
1:33:32 the company.
1:33:38 You know, see people in the corridor, toss around ideas, pop your head into a meeting and
1:33:40 say, hey, I see you guys are working on this.
1:33:41 Can I help?
1:33:47 If you don’t have that sort of human interaction, I don’t even know what it is to work in a
1:33:51 corporation as opposed to doing a job from home, doing an assignment from home, if you
1:33:52 want to call it that.
1:33:58 So I grew up at a time when everybody came to work and I loved it.
1:34:04 So as we went through COVID and post-COVID, I’m struggling to see how I would have run the
1:34:06 company without people coming to work.
1:34:11 I’m struggling to see how I would have developed people without seeing them.
1:34:13 Now, let me come to the other side.
1:34:18 I also see the benefit of people who choose to work from home because they can now juggle
1:34:21 more responsibilities working from home.
1:34:22 So I understand that too.
1:34:28 However, I’m also of the belief, Shane, that if you choose to work from home, male or female,
1:34:29 I don’t care.
1:34:35 If you choose to work from home, you might also want to accept that your promotional challenges
1:34:39 may be, your promotional opportunities may be limited.
1:34:42 That was the most controversial tweet I’ve ever put out.
1:34:45 I put this out, I think, in 2021 or 2022.
1:34:48 And I said, if you work from home, you’re going to end up reporting to somebody who works
1:34:48 at the office.
1:34:51 Unless you’re in a company where only individual contributors.
1:34:53 just move forward because they’re all super techie.
1:34:58 But in companies where you really have to work in teams to move things forward, I don’t
1:35:00 see how you can do it all on Zoom.
1:35:02 I want to thank you so much for your time today.
1:35:04 This has been a fascinating interview.
1:35:08 We always end with the same question, which is, what is success for you?
1:35:10 Performance with purpose.
1:35:13 You know, when I ran PepsiCo, I ran it on that motto.
1:35:20 To me, delivering performance in whatever field is one thing, but you’ve got to leave the place
1:35:21 better than you found it.
1:35:27 And you’ve got to do it with a deep sense of, I want to make the world a better place.
1:35:29 I want to make the company a better company.
1:35:35 I want to make the employees feel better about themselves than when they, you know, came into
1:35:37 PepsiCo or had a different leader.
1:35:42 So at every point in time, how do you have a deep sense of purpose to leave the place better
1:35:43 than you found it?
1:35:46 Those are the three words I used as a CEO of PepsiCo.
1:35:49 Those are the three words that continue to guide what I’m doing today.
1:35:55 This deep sense of purpose without taking your eye off the core performance you have to deliver.
1:35:57 Thank you very much.
1:35:58 That’s a beautiful way to wrap this up.
1:35:59 Thank you, Shane.
1:36:01 Thank you for having me on your show.
1:36:03 It’s a privilege talking with you.
1:36:06 Thanks for listening and learning with us.
1:36:10 Be sure to sign up for my free weekly newsletter at fs.blog slash newsletter.
1:36:15 The Farnham Street website is also where you can get more info on our membership program,
1:36:21 which includes access to episode transcripts, my repository, ad-free episodes, and more.
1:36:26 Follow myself and Farnham Street on X, Instagram, and LinkedIn to stay in the loop.
1:36:29 Plus, you can watch full episodes on our YouTube channel.
1:36:32 If you like what we’re doing here, leaving a rating and review would mean the world.
1:36:36 And if you really like us, sharing with a friend is the best way to grow this community.
1:36:38 Until next time.

0:00:05 Anna Wintour once looked at photos from a $300,000 fashion shoot
0:00:09 and killed the entire story without explanation.
0:00:14 The photographer was Stephen Meisel, now one of fashion’s legends.
0:00:18 He was so furious, he refused to work with her for years.
0:00:21 Today, he credits her with making him better.
0:00:24 This is the Anna Wintour paradox.
0:00:27 She’s fired assistants for poor clothing choices.
0:00:31 She’s made editors stand during meetings because sitting wastes time.
0:00:34 When asked what job she wanted once, she replied, yours.
0:00:37 And the meeting ended abruptly.
0:00:39 She got the job anyway.
0:00:43 For 40 years, people have been predicting her downfall.
0:00:47 She’s too harsh, too demanding, too unwilling to compromise.
0:00:49 Meanwhile, she keeps getting promoted.
0:00:53 At 75, she now runs every magazine at Condé Nast.
0:00:56 Because Anna figured out something most leaders never learn.
0:01:02 In a world awash in mediocrity, maintaining standards looks unreasonable.
0:01:05 But standards are also the only moat that matters.
0:01:08 And if you want to understand how a British girl who couldn’t type
0:01:11 built the most bulletproof career in media,
0:01:13 and what that means for your own ambitions,
0:01:15 you need to hear this story.
0:01:30 Welcome to the Knowledge Project.
0:01:32 I’m your host, Shane Parrish.
0:01:34 In a world where knowledge is power,
0:01:38 this podcast is your toolkit for mastering the best of what other people have already figured out.
0:01:45 Anna Wintour got fired for refusing to compromise her vision.
0:01:47 The magazine that fired her?
0:01:47 It’s dead.
0:01:48 Anna?
0:01:52 She runs every magazine at Condé Nast, including Vogue at age 75.
0:02:00 This is the story of how a British girl who couldn’t type or so built the most powerful position in global media,
0:02:05 then made it impossible for anyone else to take it away by continuously reinventing herself.
0:02:08 Here’s what a lot of people get wrong about power.
0:02:10 They think it’s about climbing ladders.
0:02:13 Anna understood it’s about building the ladder itself.
0:02:16 While her competitors fought for promotions, she built infrastructure.
0:02:19 While they protected magazines, she created platforms.
0:02:23 While they pleased bosses, she made bosses need her.
0:02:24 The result?
0:02:29 Four decades at the top of an industry that reinvents itself every five years.
0:02:33 She survived the death of print, the digital revolution, the great financial crisis,
0:02:38 the social media transformation, and a pandemic that killed most of her competitors.
0:02:38 How?
0:02:43 By mastering the principles that sound simple, but almost nobody executes.
0:02:50 First, she figured out that being fired for your uncompromising standards is very different than being fired for your performance.
0:02:51 One is failure.
0:02:52 The other is intelligence.
0:03:02 Second, she learned that in creative industries, speed beats perfection because perfection without deadlines is just procrastination with better excuses.
0:03:08 Third, she discovered that real power comes from making yourself essential to multiple systems simultaneously.
0:03:10 Even if one fails, you survive.
0:03:19 This episode draws from Amy O’Dell’s definitive biography to reveal how Anna transformed from fashion assistant to cultural kingmaker.
0:03:28 But more importantly, it extracts the repeatable lessons and strategies that she used, strategies that you can apply whether you’re building a career, a company, or an empire.
0:03:31 Her greatest insight wasn’t about fashion.
0:03:35 It was understanding how to get the best out of herself and others.
0:03:38 It’s time to listen and learn.
0:03:53 When Anna was two, her 10-year-old brother, Gerald, died in a cycling accident.
0:03:56 Her mother installed window bars and never spoke of him again.
0:03:58 The family moved forward.
0:03:59 No pictures, no mentions.
0:04:00 Just forward.
0:04:02 This is how the Wintors operated.
0:04:07 Her father, Charles, edited the evening standard with surgical precision.
0:04:09 Staff writers froze when he passed.
0:04:14 They called him Chili Charlie, though they would work themselves to exhaustion for his approval.
0:04:16 Anna never understood the nickname.
0:04:19 It had nothing to do with the person he was, she’d insist.
0:04:22 The same words would follow Anna her entire career.
0:04:27 In a household that prized academic achievement, Anna chose a different education.
0:04:31 Her siblings devoured political theory at Oxford and Cambridge.
0:04:37 Anna devoured fashion magazines, eight newspapers every weekend, every fashion publication she could find.
0:04:45 While her siblings prepared for careers in law and social causes, she studied hemlines and cultural shifts with scholarly intensity.
0:04:51 I was so desperate to get out in the world and get on with things, she explained about leaving school at 16.
0:04:55 Her family found her fascination with fashion incomprehensible.
0:05:01 I’ve always been a joke in my family, Anna later admitted, they’d always thought I’m deeply unserious.
0:05:07 The irony is that Anna’s unserious pursuit required more discipline than any degree.
0:05:09 She wasn’t avoiding rigor, but applying it differently.
0:05:14 Fashion was cultural anthropology, business strategy, and visual communication.
0:05:15 Full stop.
0:05:17 Every magazine was a textbook.
0:05:19 Every trend was data.
0:05:25 In the face of my brother’s and sister’s academic success, I felt I was rather a failure, she recalled.
0:05:31 Anna, like so many of our outliers, and perhaps like you yourself, felt overlooked and underestimated.
0:05:33 She would turn it into rocket fuel.
0:05:38 While her siblings shaped policy and law, she would shape how power itself presented to the world.
0:05:45 What her family couldn’t see, because it didn’t look like what they expected, was that Anna was a learning machine.
0:05:50 This commitment to vacuuming up everything about fashion, it was building mastery.
0:05:53 Anna’s father, Charles, believed in his daughter.
0:05:57 When 16-year-old Anna needed to list her career objectives, he didn’t hesitate.
0:06:01 Well, you write, you want to be the editor of Vogue, of course.
0:06:05 Not work in fashion, not try magazine.
0:06:06 Editor of Vogue.
0:06:07 The apex.
0:06:11 Named with the same certainty that you’d write your own address.
0:06:13 Most people aim for realistic.
0:06:17 The exceptional, name their destination, and work backwards.
0:06:21 Anna had two advantages most pretend don’t matter.
0:06:22 Connections and cash.
0:06:30 Her grandparents’ trust fund paid out $120,000 in today’s money over six years, exactly what her siblings spent on university.
0:06:32 Anna invested that tuition differently.
0:06:35 While they bought credentials, she bought time.
0:06:38 Time to take an unpaid internship.
0:06:40 Time to say no to the wrong opportunities.
0:06:42 Time to wait for the right ones.
0:06:44 Her father made one phone call.
0:06:47 The Evening Standards fashion editor took Anna to lunch.
0:06:50 Barbara Griggs expected to mentor an eager teenager.
0:06:53 Instead, she met someone who already knew exactly where she was going.
0:06:56 All she wanted from me was some information.
0:07:01 What she didn’t want at all was any guidance or tips on how to manage her career.
0:07:02 That certainty at 16?
0:07:05 Most people don’t even have that at 40.
0:07:10 Willie Landells at Harper’s Bazaar hired Anna because of her father’s reputation.
0:07:15 Anyone connected to such a respected newspaper was worth a shot, he figured.
0:07:17 Here’s where privilege meets performance.
0:07:19 Yes, her name opened the door.
0:07:21 But what happened once she walked through?
0:07:22 That was all Anna.
0:07:25 The real advantage isn’t the door that opens.
0:07:28 It’s knowing exactly what to do once you’re inside.
0:07:30 Harper’s operated on a skeleton crew.
0:07:33 Three people running the fashion pages.
0:07:35 No budget for coffee fetchers.
0:07:36 Everyone did everything.
0:07:39 I was thrown into my career, frankly, with ignorance.
0:07:42 I knew nothing, Anna later admitted.
0:07:43 Perfect.
0:07:48 While her peers at bigger magazines were filling in expense reports and grabbing coffee,
0:07:50 Anna was learning the entire business.
0:07:53 I learned how to go into market and choose clothes.
0:07:54 I learned how to choose talent.
0:07:56 I learned how to collaborate.
0:07:57 I learned how to do a layout.
0:07:59 I learned how to write a caption.
0:08:02 She wasn’t afforded the luxury of specializing.
0:08:05 She had to learn every job in detail.
0:08:07 Anna had three qualities that mattered.
0:08:10 Taste, organization, and certainty.
0:08:11 She never forgot her dress.
0:08:13 Never lost jewelry.
0:08:14 Never second-guessed decisions.
0:08:16 People may not always like it,
0:08:20 but they knew exactly what she thought and what was expected from them.
0:08:23 Sounds a lot like Steve Jobs and Elon Musk.
0:08:25 Her editor noticed something else.
0:08:27 Anna could spot talent before it had a name.
0:08:31 She’d book unknown photographers who’d become famous.
0:08:33 She’d champion designers others ignored.
0:08:35 This wasn’t luck.
0:08:37 Remember those eight newspapers every weekend?
0:08:39 Those thousands of magazine pages?
0:08:40 She wasn’t just reading.
0:08:43 She was building a mental repository.
0:08:45 When Anna saw a new photographer’s work,
0:08:49 her brain compared it against millions of images she’d studied.
0:08:50 When she met a designer,
0:08:54 she measured them against every trend she’d ever tracked.
0:08:56 Pattern recognition can’t be taught.
0:09:00 It can only be earned through obsessive accumulation of high-quality inputs.
0:09:04 Most people want to trust their gut without feeding it the right things first.
0:09:07 Then came the moment that defined her aesthetic forever.
0:09:09 Christmas, 1971.
0:09:16 Anna styled a shot mixing a $2,000 white fox coat with a $29 wicker chair.
0:09:18 Diamonds with democracy.
0:09:20 Luxury with accessibility.
0:09:23 Everyone else segregated high and low.
0:09:25 Anna smashed them together.
0:09:30 The insight she had was that aspiration without accessibility is just snobbery.
0:09:33 Accessibility without aspiration is just a commodity.
0:09:36 The magic lives in the tension between the two.
0:09:41 That high-low mix would become her signature and eventually fashion’s default language.
0:09:45 But first she had to survive long enough to impose it on the world.
0:09:48 Anna’s assistant, Claire Hastings,
0:09:52 got a front row seat to what extreme standards actually look like in practice.
0:09:54 Anna wasn’t warm.
0:09:56 She didn’t explain much.
0:09:57 But Hastings noticed something.
0:10:01 Anna was obsessively invested in her success.
0:10:05 Not through pep talks, but through the intolerance for mediocrity.
0:10:08 Every borrowed item needed to be returned perfect.
0:10:10 Down to the original tissue paper.
0:10:11 A missing button.
0:10:12 Unacceptable.
0:10:13 A wrinkled collar.
0:10:15 Career ending.
0:10:17 This wasn’t about the clothes.
0:10:22 It was about proving you could be trusted with the details before being trusted with the decisions.
0:10:25 Outliers share unreasonable standards.
0:10:28 Standards aren’t what you accept from others.
0:10:30 They’re what you demand from yourself when no one’s watching.
0:10:33 Then there was the lunch table incident.
0:10:35 Eight people ordered wine and steaks.
0:10:37 Anna, just a yogurt, please.
0:10:39 The table froze.
0:10:41 Everyone was suddenly questioning their orders.
0:10:43 She wasn’t performing discipline.
0:10:49 She’d internalized it so completely that normal behavior looked like an excuse by comparison.
0:10:51 Her steak had to be perfectly rare.
0:10:54 She’d send it back three times and then eat two bites.
0:11:01 Not because she was being difficult, but accepting good enough in small things trains you to accept it in big things.
0:11:04 Steve Jobs sent back sushi at his own birthday party.
0:11:06 Elon sleeps on the floor of the factory.
0:11:09 Outliers don’t have work-life balance.
0:11:11 They have standards that follow them everywhere.
0:11:14 The talent scout in Anna was brutal.
0:11:16 Photographers lined up for go-sees.
0:11:16 Bad work?
0:11:18 She’d look away mid-sentence.
0:11:19 Thank you.
0:11:20 No feedback.
0:11:21 No false hope.
0:11:23 Just cutthroat rejection.
0:11:26 But when she spotted genius, total commitment.
0:11:31 One photographer showed up and staff described him as some madman with boxes of shoes.
0:11:36 Anna saw what others missed, gave him his first major endorsement.
0:11:41 James Wedge, a hat maker trying photography, Anna booked him repeatedly until he had a career.
0:11:48 By 1974, Anna was doing half the major shoots, maintaining standards that made everyone else look casual.
0:11:53 When they fired her superior for someone with writing background, Anna expected the promotion.
0:11:59 The lesson she was about to learn, having the higher standards doesn’t guarantee recognition.
0:12:01 It only guarantees you’ll deserve it.
0:12:04 Are you crushing your bills?
0:12:06 Defeating your monthly payments.
0:12:09 Sounds like you’re at the top of your financial game.
0:12:14 Rise to it with the BMO Eclipse Rise Visa Card.
0:12:17 The credit card that rewards your good financial habits.
0:12:22 Earn points for paying your credit card bill in full and on time every month.
0:12:25 Level up from bill payer to reward slayer.
0:12:26 Terms and conditions apply.
0:12:31 Hit pause on whatever you’re listening to and hit play on your next adventure.
0:12:35 Stay three nights this summer at Best Western and get $50 off a future stay.
0:12:36 Life’s the trip.
0:12:38 Make the most of it at Best Western.
0:12:41 Visit bestwestern.com for complete terms and conditions.
0:12:46 They gave Anna’s promotion to Min Hogg, a textiles expert who wrote features.
0:12:49 Anna had been doing the actual job.
0:12:51 Min had been writing about fabrics.
0:12:52 Anna got a new title.
0:12:54 Deputy fashion editor.
0:12:55 Corporate translation.
0:12:56 Please don’t quit.
0:12:59 Here’s where character reveals itself.
0:13:00 Anna didn’t complain.
0:13:01 She didn’t confront.
0:13:03 She didn’t leak to gossip columns.
0:13:06 Instead, she let her work create unbearable contrast.
0:13:11 Every shoot she produced made Min’s inadequacy more visible.
0:13:16 Min would have realized pretty soon that Anna didn’t think much of her work, Hastings observed.
0:13:20 When you maintain exceptional standards, you don’t need to attack mediocrity.
0:13:22 It exposes itself.
0:13:26 After months of this passive war, Anna pulled Hastings aside.
0:13:28 It’s outrageous I haven’t been made fashion editor.
0:13:29 I’m resigning.
0:13:31 Are you going to stay?
0:13:36 No, said Hastings, who quit in solidarity despite having no backup plan.
0:13:38 Study that moment for a sec.
0:13:40 Anna did not negotiate.
0:13:41 She didn’t threaten.
0:13:43 She didn’t give them time to counteroffer.
0:13:44 She just left.
0:13:49 While others might not have believed in her as much as she believed in herself, it didn’t matter.
0:13:53 She was going to bet on herself and she was going to go all in.
0:13:59 Five years of vacuuming up every detail of the fashion business from inside.
0:14:00 Building relationships.
0:14:01 Developing her aesthetic.
0:14:03 Proving results.
0:14:07 When the system failed to reward merit, she didn’t try to fix the system.
0:14:09 She rejected it.
0:14:14 With passport in hand, she aimed for New York, where talent mattered more than tenure, where
0:14:18 hunger beat hierarchy, and where results spoke louder than words.
0:14:23 The girl who couldn’t type was about to teach Manhattan how power really works.
0:14:26 New York, 1975.
0:14:28 25, no job.
0:14:30 Just confidence in herself.
0:14:36 I felt quite isolated growing up in England, with it being such a class-driven culture, Anna
0:14:36 explained.
0:14:41 Everyone in New York is from somewhere else, and that creates a very positive force.
0:14:44 America promised meritocracy.
0:14:46 Anna would test that promise.
0:14:49 Harper’s hired her as junior editor.
0:14:52 Day one, she broke every rule of the American fashion authority.
0:14:54 The industry equation was simple.
0:14:55 Drama equals competence.
0:14:58 Polly Mellon at Vogue cried of her photos she loved.
0:15:02 Gloria Monker at Bazaar threw shoes at assistance.
0:15:03 Emotion was currency.
0:15:05 Anna stayed quiet.
0:15:06 She watched.
0:15:06 She processed.
0:15:08 It was a smart move.
0:15:12 A special projects editor observed the new hire during a photo shoot in Jamaica and wondered,
0:15:14 have we hired the wrong person?
0:15:19 Anna’s job was to command the set with authority, but she just stayed in the background.
0:15:24 This confused magazine’s leadership, but not the crew, who preferred working with someone
0:15:27 who didn’t feel the need to interfere with every detail.
0:15:29 For them, she was a breath of fresh air.
0:15:34 Years later, she would say, I’m a big believer in hiring talented people and giving them the
0:15:34 freedom to work.
0:15:37 People work better when they have responsibility.
0:15:41 There are two kinds of power, the kind that announces itself and the kind that doesn’t
0:15:41 need to.
0:15:44 And as we’ll see, Anna actually has a bit of both.
0:15:48 Her real revolution wasn’t style, it was substance.
0:15:50 Her assistant discovered something unprecedented.
0:15:56 She’d really had no qualms about being completely focused to the point of being very abrupt, seemingly
0:15:58 rude because she just didn’t have the time.
0:16:03 She was on her path to what she needed to do, period, the end.
0:16:06 No small talk, no office politics, just work.
0:16:12 In an industry built on relationships and feelings, Anna introduced something radical, pure efficiency.
0:16:15 She wasn’t cold, she was clear.
0:16:18 Every interaction had a purpose or it didn’t happen.
0:16:23 In addressing her tough reputation much later, she would say, if one comes across sometimes
0:16:28 as being cold or brusque, it’s simply because I’m striving for the best.
0:16:32 Most people organize their entire lives around being liked by nearly everyone.
0:16:34 They don’t want to offend anyone.
0:16:37 Outliers have the courage to be disliked.
0:16:41 The British girl who couldn’t break through England’s class ceiling was about to crack
0:16:45 America’s code, not by playing the game better, but by refusing to play at all.
0:16:47 Anna was devoted to work.
0:16:51 In an office, people kind of clown around and they take breaks and they gossip.
0:16:53 And she never did any of that.
0:16:55 She wasn’t in it for fun and games.
0:16:56 She was in it to work.
0:17:01 While colleagues treated jobs as social clubs with deadlines, Anna treated the office like
0:17:07 a laboratory every day, impeccably dressed, not vanity, but strategy in fashion.
0:17:09 Your appearance is your argument.
0:17:15 Her boss, Tony Missoula wanted traditional shoots, advertiser friendly, text heavy, safe.
0:17:17 Anna wanted revolution.
0:17:20 When they clashed, she didn’t argue, at least not directly.
0:17:25 Instead, she would meet photographers in the lobby, select only the best shots, hide the rest.
0:17:28 When Tony asked for alternatives, Anna would shrug.
0:17:30 Sorry, there aren’t any more.
0:17:33 Tony’s choice, accept her vision or pay for expensive reshoots.
0:17:35 Budgets were tight.
0:17:36 Anna knew this.
0:17:37 Anna won.
0:17:40 When Tony berated her, Anna stayed silent.
0:17:41 A colleague noticed.
0:17:43 She knew she could go on to other things.
0:17:45 She knew damn well she wanted to run Vogue.
0:17:50 Harper’s wasn’t the end of the line, but more importantly, she also didn’t treat it as a
0:17:51 stepping stone either.
0:17:52 She was present.
0:17:53 She was all in.
0:17:54 She gave it her all.
0:17:58 While everyone else fought daily battles, Anna was mapping the entire war.
0:18:00 They were playing for Friday.
0:18:02 She was playing for Vogue.
0:18:03 And then Paris happened.
0:18:07 Anna returned with photos that broke every rule.
0:18:13 When Tony later fired Anna for being too European, he was essentially firing her for having a point
0:18:13 of view.
0:18:18 Years later, after Anna conquered fashion, Tony would deny that he ever happened.
0:18:21 History, as they say, is written by the winners.
0:18:24 At the time, I didn’t know what he meant, Anna reflected.
0:18:28 But in retrospect, I think he meant I was obstinate, that I wouldn’t take direction.
0:18:32 Years later, Anna conquered fashion and Tony denied firing her.
0:18:36 Anna would reflect on this years later and say everyone should get sacked at least once in their
0:18:39 career because perfection doesn’t exist.
0:18:43 The lesson, getting fired for your standards is different than getting fired for your performance.
0:18:44 One is failure.
0:18:46 The other is reconnaissance.
0:18:51 Despite the setback, she was confident in her vision and confident in herself.
0:18:53 Anna took a job at Viva magazine.
0:18:54 The owner?
0:18:55 The Penthouse publisher.
0:18:58 A porn king trying to make feminist fashion content.
0:19:03 Stores hid Viva behind the counters next to the adult magazines.
0:19:05 Anna didn’t care.
0:19:09 I needed a job and Viva offered me an enormous amount of freedom.
0:19:12 The editor, Alma Moore, saw Anna clearly.
0:19:14 This woman knows what she wants, but she’s going to be difficult.
0:19:16 She hired her anyway.
0:19:21 Smart leaders know that difficult people often produce the best work in the right environment.
0:19:26 At Viva, Anna spent hours studying French L, Italian Vogue.
0:19:27 No one questioned her vision.
0:19:30 No committees, no interference, just pure freedom.
0:19:33 The receptionist observed she was always her own person,
0:19:38 didn’t really listen to any structure because, whether she was or not, she was the boss.
0:19:39 Here’s what everyone missed.
0:19:43 Working at a disreputable place meant no one was watching.
0:19:45 With no one watching, Anna could do anything.
0:19:47 She could experiment.
0:19:48 She could push the limits.
0:19:49 She could play.
0:19:53 She’d promise boutiques front page placement for lending clothes,
0:19:56 promise advertisers their pieces would be shot.
0:19:57 The clothes kept coming.
0:19:58 The ads kept selling.
0:20:02 While her peers fought for assistant positions at respectable magazines,
0:20:06 Anna was running her own fashion laboratory at a publication funded by porn.
0:20:09 Sometimes the worst address can have the best classroom.
0:20:12 At Viva, Anna developed her signature aesthetic.
0:20:16 Photographs that made you want to become the person wearing the clothes.
0:20:21 Models in country settings with chunky sweaters and inexplicably bows and arrows.
0:20:23 It shouldn’t have worked, but it did.
0:20:25 She pushed farther than anyone dared.
0:20:28 One spread featured S&M-inspired photography.
0:20:30 It was way out there, her colleagues said.
0:20:32 Nobody did anything like that.
0:20:37 When you’re already at a controversial magazine, you can push farther than anyone thought possible.
0:20:38 She was playing.
0:20:40 Her process was military precise, though.
0:20:42 Everything was planned in advance.
0:20:43 Rapid fire fittings.
0:20:45 The model put on an outfit.
0:20:47 Anna says, okay, next.
0:20:48 No deliberation.
0:20:48 No committee.
0:20:50 Just decisions.
0:20:51 Then came the test.
0:20:56 Her publisher wanted to save money by using penthouse centerfolds as fashion models.
0:20:57 Anna’s response?
0:20:58 No.
0:20:59 She walked away.
0:21:02 Cheryl Rickson, one of those models, understood.
0:21:04 Working with centerfolds didn’t serve her ambition.
0:21:07 We all know she wanted to be fashion editor of Vogue.
0:21:10 Standards aren’t standards if they’re negotiable.
0:21:12 They’re absolute or they’re not standards.
0:21:13 The miracle?
0:21:15 People started paying attention.
0:21:21 Alexander Lieberman, who ran Condé Nast and controlled Vogue, mentioned to Vogue’s editor,
0:21:23 I love Vogue.
0:21:25 I noticed you have an Englishwoman on the masthead.
0:21:31 For three years, Anna transformed Vogue’s fashion pages into the required reading at Vogue and Harper’s.
0:21:37 The porn magazine nobody respected was teaching the fashion establishment how to shoot.
0:21:39 Excellence is excellence.
0:21:41 The platform is just context.
0:21:46 November 17th, 1978, Viva announces it’s closing tomorrow.
0:21:50 Anna starts sobbing, shocking colleagues who thought she didn’t care.
0:21:51 She wasn’t crying for the magazine.
0:21:56 She was mourning the loss of her laboratory, the first place she had had total control.
0:22:00 For 18 months, Anna disappeared into what fashion people called the wilderness,
0:22:05 jet-setting with her boyfriend from Paris to Jamaica to the south of France,
0:22:07 her only real break from work since age 16.
0:22:10 But Ambition doesn’t like vacations.
0:22:15 When she returned to New York in 1980, Savvy magazine called the magazine for executive women.
0:22:17 Anna needed work.
0:22:18 She took it.
0:22:19 The problem was immediate.
0:22:24 Savvy appealed to women who’d fought through the 70s to make partner at law firms,
0:22:27 women who hid their femininity like a liability.
0:22:32 But Anna had built her entire career making femininity a superpower.
0:22:38 Editor Judith Daniels wanted real people instead of models, practical office clothes, reasonable prices.
0:22:42 Anna nodded in meetings and then shot exactly what she wanted.
0:22:47 Anna was very strong-minded and she just did whatever she wanted, the executive editor recalled.
0:22:50 Daniels tried to fire her, but Anna had learned something.
0:22:51 How to talk her way out of trouble.
0:22:54 She bought some time to job hunt while getting paid.
0:22:56 Then came humiliation.
0:22:58 March 18th, 1981.
0:23:04 Anna pitches interview magazine, Andy Warhol’s glamorous publication, an idea she spent three months developing.
0:23:08 The editor looked at it for one second and said,
0:23:12 Anna cries right there in his office.
0:23:14 And then she leaves for her next appointment.
0:23:19 When you believe in yourself completely, rejection is data, not a verdict.
0:23:25 That persistence paid off when Laurie Jones at New York Magazine called in early 1981.
0:23:31 Jones was desperate to fill a fashion editor position that required someone to basically run a one-person fashion department
0:23:38 attending shows, selecting clothes, booking photographers, managing shoots, do everything, deliver weekly.
0:23:45 Anna shows up to the interview with storyboards, complete with Polaroids, layouts, fully realized ideas, not hopes, but plans.
0:23:47 Anna, this is fabulous.
0:23:50 I like every one of these story ideas, Jones said.
0:23:52 She rushed editor-in-chief Edward Cosner.
0:23:54 Ed, this woman is amazing.
0:23:56 We’re all going to be working for her someday.
0:23:59 Cosner laughed and hired her.
0:24:02 Most people prepare for interviews by thinking about answers.
0:24:04 Outliers show up with solutions.
0:24:06 It’s the same with cold emails today.
0:24:09 Don’t tell someone how you would solve their problems.
0:24:12 If you want to get noticed, just solve their problem.
0:24:16 At New York Magazine, Anna finally had a budget to match ambition.
0:24:18 Want to shoot a $20,000 sable coat?
0:24:19 Approved.
0:24:22 Need the best photographers to compete with the times?
0:24:22 Done.
0:24:26 They recognized talent and they gave her room and an environment to execute.
0:24:30 Her first story, Summer Dresses, on a tilted Manhattan rooftop,
0:24:34 making the Empire State Building appear to dance behind the models.
0:24:37 Every fashion editor in the city was shooting straight.
0:24:39 Anna was tilting reality.
0:24:41 But her standards remained brutal.
0:24:45 When one of her assistants styled her for shoot with photographer Stephen Meisel,
0:24:47 Anna killed it without explanation.
0:24:50 Didn’t matter was her assistant’s big break.
0:24:51 Didn’t matter Meisel was talented.
0:24:53 Standards were standards.
0:24:56 And Anna’s standards to nearly everyone appeared unreasonable.
0:25:01 And also, just like Steve Jobs, that made everyone work harder and be better
0:25:04 and pulled out the best version of themselves.
0:25:08 Meisel was so enraged, he would refuse to work with Anna for years.
0:25:10 He’d become one of fashion’s greatest photographers.
0:25:11 Anna didn’t care.
0:25:13 She wasn’t there to collect friends.
0:25:14 She was there to win.
0:25:18 This reminds me so much of Michael Jordan, who said in the last dance,
0:25:21 I pulled people along when they didn’t want to be pulled.
0:25:24 I challenged people when they didn’t want to be challenged.
0:25:30 And I earned that right because my teammates who came after me didn’t endure all the things
0:25:30 that I endured.
0:25:34 Once you joined the team, you lived at a certain standard that I played the game,
0:25:36 and I wasn’t going to take anything less.
0:25:40 Now, if that meant I had to go in there and get on you a bit, then I did that.
0:25:44 You ask all my teammates, the one thing about Michael Jordan was he never asked me to do
0:25:46 something that he didn’t do.
0:25:50 When people see this, they’re going to say, well, he wasn’t really a nice guy.
0:25:51 He may have been a tyrant.
0:25:54 Well, that’s you, because you never won anything.
0:25:58 I wanted to win, but I wanted them to win and be a part of that as well.
0:26:00 Look, I don’t have to do this.
0:26:02 I’m only doing it because it’s who I am.
0:26:03 That’s how I played the game.
0:26:05 That was my mentality.
0:26:08 If you don’t want to play that way, don’t play that way.
0:26:11 Jordan could have easily been talking about Anna.
0:26:14 At New York Magazine, Anna wasn’t just editing fashion.
0:26:15 She was playing at the highest standard.
0:26:19 And if you wanted to be a part of it, you needed to bring your A-game every day.
0:26:21 No exceptions.
0:26:25 Polly Mellon at Vogue had been watching Anna since London.
0:26:31 She thought Vogue was getting boring and arranged a meeting with editor-in-chief Grace Mirabella.
0:26:34 Mirabella called Anna and asked what position she wanted at Vogue.
0:26:35 Anna’s answer?
0:26:36 Yours.
0:26:39 The meeting ended immediately.
0:26:45 Most people hide their ambitions and Anna just announced hers and let the world adjust.
0:26:47 But the real power wasn’t Mirabella.
0:26:51 It was Alexander Lieberman, Conde Nast’s editorial director.
0:26:56 Art director by day, wielding massive steel sculptures on weekends, he collected talent like
0:26:57 others collected art.
0:27:03 In August of 1983, Anna publishes a story where 12 artists create paintings inspired by fashion.
0:27:09 Lieberman sees it and recognizes a kindred spirit, someone who understood fashion as high art,
0:27:10 not just commerce.
0:27:13 He invites Anna to his Connecticut estate.
0:27:17 She shows up in what he called a wonderful, simple, gray tunic.
0:27:20 Not trying to impress, just being precisely herself.
0:27:23 I was absolutely enchanted with her, Lieberman would say.
0:27:24 His problem?
0:27:27 Mirabella was successfully running Vogue.
0:27:31 So his solution was to create a fake job, creative director.
0:27:37 A made-up title that made Anna second on the masthead with deliberately vague responsibilities.
0:27:38 And I took it.
0:27:42 She wasn’t a number two person, but she also understood chess.
0:27:45 She would change tactics, but not her dream.
0:27:48 For three years, she was officially Mirabella’s deputy.
0:27:49 Actually, she was Lieberman’s protege.
0:27:54 Learning the operation, building the relationships, waiting, preparing.
0:27:59 Mirabella later wrote that Anna would sit in meetings, shaking her head, obviously disagreeing
0:28:00 with everything I said.
0:28:01 Anna wasn’t being insubordinate.
0:28:03 She was being inevitable.
0:28:09 In 1985, British Vogue editor Beatrix Miller stepped down after 21 years.
0:28:11 Anna was offered the job.
0:28:12 She’s pregnant.
0:28:14 She hesitates a little bit, and then she takes it.
0:28:17 She needs to prove that she can run something.
0:28:22 Anna walks into British Vogue and detonates, fires most of the staff, demands shorter skirts,
0:28:25 injects an energy that had been missing for decades.
0:28:29 The British press nicknamed her Nuclear Winter.
0:28:30 She doesn’t care.
0:28:35 Circulation climbs, profits soar, British designers get discovered.
0:28:39 The first rule of transformation, you can’t renovate a house with people still living in
0:28:39 it.
0:28:41 Two years later, she’s proven her point.
0:28:46 When House and Garden’s editorship opens in New York, Anna takes it, not because she wants
0:28:50 to edit home decor, because it’s her ticket back to America and closer to Vogue.
0:28:53 At House and Garden, she renames it HG.
0:28:58 Anna adds fashion shoots to a decorating magazine, replaces anonymous rich people’s homes with
0:29:00 celebrity features.
0:29:05 Readers revolt, advertisers flee, subscription cancellations require a dedicated phone line.
0:29:09 She would do things that people have never done before and that alienated some people, a
0:29:11 feature’s editor observed.
0:29:14 But Anna wasn’t trying to save House and Garden.
0:29:18 She was auditioning for Cy Newhouse and Alexander Lieberman.
0:29:20 The magazine was her performance space.
0:29:26 Years later, every decor magazine would copy what Anna tried at HG, voyeuristic glimpses into
0:29:30 celebrity homes instead of furniture catalogs.
0:29:32 She was right, just a little bit early.
0:29:35 But by then, she’d have bigger things to transform.
0:29:42 Just as the criticism at HG was starting to die down, Grace Mirabella’s 37 years at Vogue
0:29:42 were ending.
0:29:44 She just didn’t know it.
0:29:47 Newhouse and Lieberman had decided by summer of 1988.
0:29:52 They kept Anna in endless planning meetings while she pretended everything was normal at HG.
0:29:55 June 28th, 1988.
0:29:57 Mirabella’s husband calls her.
0:30:00 He just saw gossip colonist Liz Smith on television.
0:30:04 Anna Wintour will replace his wife as editor-in-chief of Vogue.
0:30:06 Mirabella goes to Lieberman’s office.
0:30:07 He’s waiting.
0:30:11 Grace, he says, I’m afraid it’s true.
0:30:14 37 years, dismissed via gossip column.
0:30:17 Power transitions are never elegant.
0:30:18 They’re either swift or sloppy.
0:30:19 Never both.
0:30:20 Anna was prepared.
0:30:25 She spent three years studying Vogue’s operations from the inside, learning its weaknesses, building
0:30:26 her network.
0:30:33 While Mirabella finished her final two weeks, Anna summoned all 120 Vogue staff to her HG office.
0:30:35 One by one, brief interviews.
0:30:37 Three days later, 90 people remained.
0:30:39 When you finally get power, use it immediately.
0:30:41 Hesitation invites resistance.
0:30:47 17 years after her father wrote editor of Vogue on that career form, after getting fired for
0:30:54 being too European, after crying in Andy Warhol’s office, after transforming two other magazines,
0:30:57 Anna had the job she’d wanted since she was 16.
0:31:00 Now the real work could begin.
0:31:07 Make memories, not medical bills, with travel insurance from BC’s health experts, Pacific
0:31:08 Blue Cross.
0:31:14 Their affordable travel plans offer protection from unexpected travel costs like medical emergencies,
0:31:17 trip cancellation fees, baggage issues, and more.
0:31:22 Plus, kids of all families are covered for free, and there’s no deductible in the event
0:31:22 of a claim.
0:31:25 Buy worry-free travel insurance in minutes.
0:31:28 Visit pac.bluecross.ca.
0:31:32 Spring is here, and you can now get almost anything you need delivered with Uber Eats.
0:31:33 What do we mean by almost?
0:31:37 You can’t get a well-groomed lawn delivered, but you can get chicken parmesan delivered.
0:31:38 Sunshine?
0:31:38 No.
0:31:39 Some wine?
0:31:39 Yes.
0:31:42 Get almost, almost anything delivered with Uber Eats.
0:31:42 Order now.
0:31:43 Alcohol and Select Markets.
0:31:44 See app for details.
0:31:47 Anna didn’t come to Vogue to run it.
0:31:48 She came to rebuild it.
0:31:54 Her management style honed over the years, and now unleashed at Vogue was calculated to create
0:31:58 a specific type of workspace that produced exceptional work.
0:32:03 If you’ve seen the movie The Devil Wears Prada, you might be familiar with what comes next.
0:32:07 She installed glass offices so she could see everything happening, fired people with startling
0:32:13 frequency, and developed what became known as the look, a daily assessment of what every
0:32:15 staff member’s outfit from shoes to hair.
0:32:17 One assistant described it perfectly.
0:32:21 She would stare at your shoes and work her way up.
0:32:26 She was creating an environment where every detail mattered, because she understood that
0:32:30 in fashion media, there is no separation between how you look and how you work.
0:32:33 If you look sloppy, your work will eventually look sloppy.
0:32:39 If your office operates with casual standards, your editorial standards will eventually become
0:32:39 casual.
0:32:40 She fired constantly.
0:32:46 In the creative business, one person operating at 60% can bring an entire team down to their
0:32:46 level.
0:32:49 Excellence requires difficult choices.
0:32:50 Some saw tyranny.
0:32:52 Anna saw physics.
0:32:56 She was creating environmental pressure that made mediocrity impossible to hide.
0:33:01 When every detail of your appearance matters, every detail of your work starts mattering too.
0:33:03 Most leaders try to change behavior.
0:33:05 Anna changed the environment.
0:33:06 The behavior followed.
0:33:08 But the real revolution went deeper.
0:33:10 Fashion magazines operated like art museums.
0:33:13 Slow, contemplative, precocious.
0:33:19 Anna brought newspaper urgency to an industry that thought deadlines were just suggestions.
0:33:21 She wasn’t just changing Vogue.
0:33:23 She was changing what a fashion magazine could be.
0:33:25 The devil wasn’t in the details.
0:33:28 The devil was ignoring the details.
0:33:30 Anna came from newspaper blood.
0:33:33 Remember, her father, Charles, ran the Evening Standard.
0:33:36 She understood what fashion editors didn’t.
0:33:38 Speed creates quality under pressure.
0:33:43 Marabella had run Vogue like a museum, everything written down, committees for committees.
0:33:47 Anna walked in and saw a bureaucracy where there should be velocity.
0:33:49 First, she killed comfort.
0:33:51 Out went beige walls and butter-colored chairs.
0:33:55 In came white walls, glass offices, and metal seats.
0:33:59 Comfort breeds complacency, and discomfort breeds decision.
0:34:01 Her meeting revolution was pure newspaper.
0:34:04 You walk in, you stand, you ask, you leave.
0:34:06 The saying internally was, you get two minutes.
0:34:08 The second is a courtesy.
0:34:11 The chairs in her office were for decoration, not sitting.
0:34:13 No sitting meant no settling.
0:34:15 No chit-chat meant no waste.
0:34:17 Every interaction became a transaction.
0:34:19 The glass walls weren’t about surveillance.
0:34:21 They were about accessibility.
0:34:25 Anna could catch an editor’s eye and assign a task without leaving her desk.
0:34:31 One editor realized Anna called on her constantly simply because her office was in the sightline.
0:34:32 The lesson here is clear.
0:34:34 Architecture is destiny.
0:34:38 Design your environment to eliminate friction between thought and action.
0:34:41 Then came Anna’s masterstroke, AWOC.
0:34:44 Her initials plus OK became a verb.
0:34:45 Is that AWOC’d yet?
0:34:46 Nothing.
0:34:50 Not a caption, not a photo, not a comma moved without her approval.
0:34:52 This wasn’t micromanagement.
0:34:54 It was standards transformation.
0:34:58 Every AWOC taught editors what excellence looked like.
0:35:01 The infamous clothing run-throughs that took hours under Mirabella.
0:35:02 Anna did them in minutes.
0:35:03 Yes.
0:35:03 No.
0:35:04 Yes.
0:35:04 No.
0:35:05 No.
0:35:05 Yes.
0:35:06 Goodbye.
0:35:07 No explanations.
0:35:08 No committees.
0:35:09 Just decisions.
0:35:13 When you explain every decision, people just learn to argue.
0:35:15 When you just decide, they learn to anticipate.
0:35:17 The fear of rejection made editors sharper.
0:35:21 They learned to pre-filter, to think like Anna before presenting.
0:35:22 She wasn’t reviewing work.
0:35:24 She was programming their brains.
0:35:26 Anna was anything but hands-off.
0:35:31 She ran on founder mode, staying until midnight the first three months, personally reviewing
0:35:32 every single layout.
0:35:37 But unlike Mirabella, who hid in her office, Anna spent half her time with designers, telling
0:35:38 them what to add to collections.
0:35:41 Every hiring revealed her system.
0:35:43 Anna personally screened everyone.
0:35:45 One candidate was rejected for wearing matching pearls.
0:35:46 Two matchy-matchy.
0:35:49 Another almost didn’t get past HR for being overweight.
0:35:54 They negotiated Anna, giving her at least two and a half minutes for this one, and that
0:35:54 one got hired.
0:35:57 She was building a machine where mediocrity had no place to hide.
0:35:59 Glass walls meant no privacy.
0:36:01 Speed meant no procrastination.
0:36:03 Personal approval meant no excuses.
0:36:05 A lot of people manage outputs.
0:36:09 Anna managed inputs, control the environment, and excellence becomes inevitable.
0:36:12 The British girl who couldn’t type had figured out something profound.
0:36:17 In creative industries, velocity often beats perfection, because perfection without deadlines
0:36:20 is just procrastination with a better wardrobe.
0:36:24 What Anna did was change Vogue’s cover strategy.
0:36:31 Anna puts a $10,000 Christian LaCroix jacket with $50 guest jeans on her first Vogue cover.
0:36:34 The printer literally called the check.
0:36:36 Surely someone had made an error.
0:36:38 No error, just strategy.
0:36:43 To understand why this matter, you need to understand fashion’s unwritten law.
0:36:45 Luxury doesn’t mix with mass market.
0:36:48 It’s like putting a Ferrari engine in a Toyota.
0:36:53 It violates the hierarchy that lets luxury charge luxury prices.
0:36:55 Anna broke that law on purpose.
0:36:57 She understood something the industry didn’t.
0:37:00 People don’t dress in just Prada or just Gap.
0:37:01 They mix.
0:37:05 She was documenting reality while everyone else was protecting mythology.
0:37:07 This is how disruption often works.
0:37:09 You don’t invent new behavior.
0:37:12 You legitimize behavior that already exists.
0:37:15 But the Madonna cover reveals her deeper insight.
0:37:20 A businessman on a plane tells Anna he loves Vogue because it’s so elegant, so classic.
0:37:22 Katherine Hepburn, Grace Kelly.
0:37:23 It would never be Madonna.
0:37:27 Most editors would take this as market research.
0:37:29 Our readers want elegance, not controversy.
0:37:31 Anna heard it differently.
0:37:35 If everyone agrees Vogue would never do something, that’s exactly what would get attention.
0:37:41 Anna would go on to say the fact that that very nice man that I sat next to on the plane thought
0:37:45 that it would be completely wrong to put Madonna on the cover and completely out of keeping with
0:37:50 the tradition of Vogue being this very classically correct publication pushed me to break the rules
0:37:56 and had people talking about us in a way that was culturally relevant, important, and controversial,
0:37:59 all of which you need to do from time to time.
0:38:00 Context matters here.
0:38:07 Madonna in 1989 had just released Like a Prayer, Burning Crosses, romantic scenes with a black saint.
0:38:09 Pepsi pulled her sponsorship.
0:38:11 Religious groups wanted boycotts.
0:38:15 She represented everything Vogue readers theoretically rejected.
0:38:16 Anna put her on the May cover.
0:38:21 You need to be culturally relevant, important, and controversial from time to time, she later
0:38:22 explained.
0:38:23 The numbers told the story.
0:38:27 200,000 more copies sold than previous May.
0:38:28 But that’s not the lesson.
0:38:30 The real lesson is about information asymmetry.
0:38:34 When everyone knows something would never work, they stop testing it.
0:38:35 That creates an opportunity.
0:38:39 Within five years, every fashion magazine featured celebrities.
0:38:40 Anna didn’t predict the future.
0:38:43 She created it by doing what nobody else would test.
0:38:48 Sometimes the best strategy isn’t finding what people want, it’s showing them what they didn’t
0:38:49 know they were allowed to want.
0:38:54 The early 1990s belonged to supermodels, Naomi Campbell, Kate Moss.
0:38:56 They commanded massive fees and magazine covers.
0:38:58 Anna killed them off.
0:38:59 It wasn’t personal, it was business.
0:39:01 Here’s the lesson she understood.
0:39:04 Models offer only one story, beauty.
0:39:07 Celebrities, however, offer infinite stories.
0:39:10 Marriage, divorce, scandals, politics.
0:39:13 Every life event becomes content.
0:39:18 The insight, people don’t buy aspirational images, they buy aspirational narratives.
0:39:19 Think about the math.
0:39:22 A supermodel gives you 12 beautiful covers a year.
0:39:25 A celebrity gives you 12 chapters of an ongoing drama.
0:39:27 Which do you think keeps readers coming back?
0:39:29 But Anna also saw something deeper.
0:39:32 Supermodels influenced how people wanted to look.
0:39:35 Celebrities influenced how people wanted to live.
0:39:39 Fashion wasn’t just about clothes anymore, it was about lifestyle.
0:39:41 The proof came at every red carpet.
0:39:44 Who are you wearing became the question, not what are you wearing?
0:39:45 Who?
0:39:49 Fashion became a character in every celebrity story.
0:39:53 One of the most remarkable things I discovered researching Anna was that she didn’t just change
0:39:55 magazine covers.
0:39:58 She changed how culture talks about clothing.
0:40:02 The supermodel era ended not because models became less beautiful.
0:40:05 It ended because beauty without story is just a wallpaper.
0:40:08 And nobody subscribes to wallpaper.
0:40:10 Anna was busy.
0:40:12 Busier than she’d ever been.
0:40:17 And she developed an assistant system that reveals something profound about how power operates in elite
0:40:18 institutions.
0:40:22 She would employ up to three assistants at any given time.
0:40:27 Each with specific roles that collectively insulated her from administrative tasks that were not
0:40:30 directly related to editorial decision making.
0:40:31 This system worked like this.
0:40:33 First assistant, schedule and communications.
0:40:37 Second assistant, homes, screenings, and her dogs.
0:40:42 Third, errands, tickets, and custom orders to designers for Anna’s personal clothing.
0:40:46 While this may appear as an extravagance, it was math.
0:40:49 Most executives spend 40% of their time on logistics.
0:40:51 Anna spent zero.
0:40:57 100% of her mental energy was spent on work, while an army of other assistants handled everything
0:40:58 else.
0:41:00 Think about how powerful that is.
0:41:01 The system was brutal.
0:41:03 Emails without subject lines.
0:41:04 Just commands.
0:41:05 Coffee, please.
0:41:06 Get me Tom Ford.
0:41:07 No niceties.
0:41:08 No unnecessary words.
0:41:13 Assistants arrived at 730 to prepare for her entrance when orders would rain down without
0:41:14 pause.
0:41:17 There’s an elevator story that captures it perfectly.
0:41:22 Rumors said Anna banned others from riding with her, but the truth is people avoided the
0:41:26 elevator because she’d immediately start issuing orders they’d need to write down.
0:41:28 Impossible while moving.
0:41:33 One assistant would meet her at her car to collect the AW bag, her papers from home.
0:41:38 Not because Anna was lazy, because she understood every second carrying bags was a second not spent
0:41:42 She wouldn’t learn assistants’ names until they proved they could last.
0:41:44 Most burned out in weeks.
0:41:45 Here’s the paradox.
0:41:48 The survivors became fanatically loyal.
0:41:48 Why?
0:41:50 They weren’t just filing expenses.
0:41:53 They were watching Anna negotiate with billionaires.
0:41:57 They saw how she made split-second decisions that moved markets.
0:42:00 They built relationships with every power player who walked through Vogue.
0:42:03 One former assistant summed it up really nicely.
0:42:04 The demands weren’t personal.
0:42:09 When you’re affecting billion-dollar industries, there’s no room for casual execution.
0:42:11 The lesson isn’t about having three assistants.
0:42:14 It’s about understanding the value of your time.
0:42:18 It’s about holding the people around you to the same unreasonable standards you hold yourself
0:42:18 to.
0:42:23 Anna calculated that her hour was worth more than three people’s days.
0:42:24 She was right.
0:42:27 While competitors managed calendars, she managed culture.
0:42:29 Focus isn’t about doing one thing.
0:42:32 It’s about doing only the things that you can do.
0:42:38 By 1997, Anna had been editor-in-chief for nearly a decade, and Vogue was performing spectacularly.
0:42:44 The magazine had its biggest March issue since 1990, with ad pages up 5.9%.
0:42:52 The September issue that year weighed 4.3 pounds and was packed with 734 pages, mostly advertisements.
0:42:57 It was the biggest issue in nine years and represented complete market dominance over its competitors.
0:42:58 One problem?
0:43:01 Anna’s publisher, Ron Gagliotti, wants more.
0:43:07 Gagliotti was hired to maximize revenue, and Anna’s refusal to feature advertisers’ clothes
0:43:09 in editorial spreads was making him very angry.
0:43:11 His logic was simple.
0:43:14 If you need a white shirt for a shoot, why not use Ann Klein’s?
0:43:16 They’re paying us hundreds of thousands of dollars.
0:43:18 Anna’s response was simple.
0:43:20 If it’s ugly, it’s not in Vogue.
0:43:23 This is the eternal war in creative businesses.
0:43:25 The money people want compliance.
0:43:27 The creative people want control.
0:43:29 Gagliotti escalated to sigh Newhouse.
0:43:33 They prepared a list of editors who could replace Anna.
0:43:34 Then they invited her to lunch.
0:43:36 The ultimatum was blunt.
0:43:39 Start featuring advertisers’ products or find another job.
0:43:42 Newhouse’s exact words, I suggest you follow the money.
0:43:45 Most editors would choose one of two paths.
0:43:50 Cave completely, turn Vogue into a catalog, or fight and lose, maintain your principles, and
0:43:50 get fired.
0:43:52 Anna chose door number three.
0:43:57 She’d photograph advertisers’ clothes, but only pieces that met her standards.
0:43:59 Yes to commerce, but she kept the veto.
0:44:03 The genius here was she made herself indispensable to both sides.
0:44:08 Advertisers got more coverage than ever, but only Anna could guarantee it would elevate their
0:44:09 brand and not embarrass it.
0:44:15 She started taking advertiser meetings, building relationships that transcended the transactions.
0:44:16 The result?
0:44:18 Vogue kept its credibility.
0:44:19 Advertisers got prestige.
0:44:20 Anna got more powerful.
0:44:22 The lesson?
0:44:24 When forced to choose between X and Y, don’t.
0:44:26 Find the narrow path where both can win.
0:44:28 Follow the money wasn’t a default.
0:44:29 It was data.
0:44:32 Anna learned to speak money fluently while thinking in art.
0:44:36 That’s how you survive four decades at the top.
0:44:41 In 1994, just one year after the introduction of the very first web browser to seamlessly
0:44:46 integrate text and images, many in the publishing world were still pretending the internet didn’t
0:44:47 exist.
0:44:51 Anna wasn’t, but she also wasn’t particularly tech-oriented at this point.
0:44:56 When a new feature editor sent an email to the entire Vogue staff in 1994 to introduce
0:44:59 himself, he received a fax from Anna in Europe that said,
0:45:08 But even as Anna dismissed email as impersonal, she was obsessively asking Condé Nast’s digital
0:45:09 team, when can Vogue go online?
0:45:14 It’s starting to get embarrassing that Vogue.com is not online.
0:45:16 Why aren’t we online?
0:45:17 Here’s what drove Anna’s urgency.
0:45:23 The entire purpose of fashion is to be a reflection of the times, as one digital executive explained.
0:45:28 Anna understood that a fashion magazine that felt antiquated or out of date would lose its
0:45:32 cultural authority, authority that Anna had been building for six years now at Vogue,
0:45:34 with no intention of stopping.
0:45:39 While other editors saw the internet as a threat to their business model, Anna saw it as an
0:45:41 opportunity to increase Vogue’s influence.
0:45:44 The contradiction reveals her genius.
0:45:45 Email was internal.
0:45:46 The website was relevance.
0:45:48 Email was internal.
0:45:50 The website was external relevance.
0:45:55 When Vogue.com eventually launched in 1998, Anna made a radical decision.
0:45:57 Post every runway show.
0:45:58 Make it searchable.
0:45:58 Make it free.
0:46:00 The fashion world revolted.
0:46:03 Fashion’s entire business model depended on scarcity.
0:46:05 Invitation-only shows.
0:46:06 90-day embargoes.
0:46:09 Magazines charging premiums for exclusive access.
0:46:11 Anna was about to give it all away.
0:46:13 Half the designers said no.
0:46:16 Many of the fashion houses didn’t even have internet yet.
0:46:17 Anna published anyway.
0:46:20 The tagline at the time captured her strategy.
0:46:23 Before it’s in Vogue, it’s on Vogue.com.
0:46:26 Her own team worried about this diminished role for print.
0:46:27 Anna saw it differently.
0:46:29 It makes our brand more modern.
0:46:35 The first rule of disruption is if you’re going to get cannibalized, it’s better to eat yourself.
0:46:38 But Anna didn’t just go online.
0:46:39 She pushed it farther.
0:46:45 She orchestrated what may have been High Fashion’s first live stream for Chanel’s resort show in 2000.
0:46:54 Clothes hit the runway, immediately photographed, instantly purchasable, the see-now, buy-now concept that Burberry would invent 13 years later.
0:47:00 A partnership with Neiman Marcus represented another breakthrough that wouldn’t become standard until years later.
0:47:09 Anna negotiated a deal where Condé Nast got a cut of all clothing purchases driven by the Vogue website, essentially inventing fashion e-commerce affiliate marketing.
0:47:13 After that first season, designers discovered the hidden benefit.
0:47:16 Digital slideshows replaced expensive lookbooks.
0:47:18 Buyers could see collections instantly.
0:47:20 Anna hadn’t just moved fashion online.
0:47:24 She’d made Vogue indispensable to the entire supply chain.
0:47:26 This was remarkable.
0:47:29 And although it’s obvious in hindsight, it wasn’t at the time.
0:47:36 She took a wild risk to use her name and reputation to push a very unwilling fashion industry into the digital age.
0:47:40 The parallel to Andy Grove here really stands out.
0:47:45 In episode 229, when memory chips got commoditized, Intel pivoted to microprocessors.
0:47:49 When print got commoditized, Anna pivoted to platform.
0:47:54 Her competitors spent the next decade protecting traditional revenue.
0:47:58 By then, Anna owned the entire infrastructure that everyone needed to use.
0:48:04 Women who wouldn’t use email built fashion’s digital future because she understood something her competitors didn’t.
0:48:07 The question isn’t whether your industry will be disrupted.
0:48:10 It’s whether you’ll be the one doing the disruption.
0:48:14 Let’s fast forward to 1999.
0:48:16 Anna has been running Vogue for 11 years.
0:48:19 Revenues are up to $149 million.
0:48:21 Anna’s professional life, perfect.
0:48:22 Her personal life, imploding.
0:48:26 The divorce from David Schaefer should have been a disaster.
0:48:27 Instead, it became rocket fuel.
0:48:31 New York Magazine was preparing a hit piece about Anna’s breakups.
0:48:34 Her husband and her deputy editor both leaving.
0:48:38 When they asked for a cover photo, her former colleague, Jordan Shapes, gave her the playbook.
0:48:43 We all know it’s going to be a piece of shit article, but a fabulous cover.
0:48:45 That’s all people take away anyway.
0:48:49 In a visual culture, perception beats reality.
0:48:52 Control the image, and you control the narrative.
0:48:54 No one understood this better than her.
0:48:56 A colleague noticed something remarkable.
0:49:01 She was remarkably good at compartmentalizing, which bothered some staff.
0:49:02 Bothered them?
0:49:03 It made her unstoppable.
0:49:09 While others would have crumbled, Anna separated her personal pain from a professional persona,
0:49:12 like removing one outfit and putting on another.
0:49:14 The divorce wasn’t a distraction.
0:49:15 It was rocket fuel.
0:49:17 Work became her outlet.
0:49:20 Avoid a crisis as you can, but perform through it if you can’t.
0:49:23 The woman who emerged from this divorce would be different.
0:49:26 No personal crisis could derail her professional momentum.
0:49:28 She was done building a magazine.
0:49:30 It was time to build an empire.
0:49:35 With her personal life stabilized, Anna turned her attention to something more ambitious than
0:49:37 just editing a magazine.
0:49:42 She wanted to build what she called Big Vogue, a media empire that would extend her influence
0:49:45 across multiple platforms and demographics.
0:49:47 The strategy was simple.
0:49:50 Anna understood that power in media comes from controlling an ecosystem.
0:49:57 Teen Vogue launched in 2003, followed by Men’s Vogue in 2005, and Vogue Living shortly thereafter.
0:50:03 Each publication served a different audience, but all carried the Vogue brand, and more
0:50:05 importantly, all reported to Anna.
0:50:09 Her philosophy for managing this empire was characteristically direct.
0:50:13 She described editing multiple magazines like planning a dinner party.
0:50:16 You need to have the pretty girl, the controversy, and something reassuring.
0:50:21 By controlling the different elements of the cultural conversation, Anna ensured that the
0:50:24 Vogue brand touched every significant demographic.
0:50:27 Teen Vogue was chess, though, not checkers.
0:50:29 Hook the readers at 15 and keep them for life.
0:50:35 Plus, it became Anna’s digital laboratory, testing strategies too risky for the mothership.
0:50:37 Men’s Vogue expanded her range.
0:50:40 Main Vogue only featured people Anna wanted to celebrate.
0:50:42 Men’s Vogue could criticize.
0:50:44 Same brand, different roles.
0:50:47 But the real genius was the talent pipeline.
0:50:49 These magazines became Anna’s farm system.
0:50:51 Train editors at Teen Vogue.
0:50:52 Promote them to the best Vogue.
0:50:56 Her influence multiplied through protégés across the industry.
0:50:59 The portfolio approach had another benefit, resilience.
0:51:02 When Men’s Vogue folded in 2008, Anna shrugged.
0:51:04 She had other pieces on the board.
0:51:09 While competitors protected single titles, Anna built a portfolio that could absorb risk.
0:51:14 Nothing revealed Anna’s approach to power more clearly than how she handled major crises.
0:51:21 Her response to September 11th became legendary within Condé Nast and established a template she would follow for decades.
0:51:27 On September 12th, 2001, while much of New York was still reeling from the 9-11 attacks, Anna went to work.
0:51:32 Not because she always went to work, but because she had calculated that normalcy was a form of resilience.
0:51:37 As the message trickled down to her staff, the best thing to do was keep going.
0:51:38 If Vogue stopped, fashion stopped.
0:51:41 If the world stopped, the terrorists would have won.
0:51:43 Anna’s bias toward action revealed itself.
0:51:49 She assigned a spring fashion preview celebrating the season 9-11 had canceled.
0:51:52 While others froze, Vogue published.
0:51:55 But 2008 revealed her true genius.
0:52:01 While other executives partied through 2007, Anna and publisher Tom Florio were studying currency rates.
0:52:04 The euro-dollar shift was crushing European luxury brands.
0:52:06 They saw the canary in the coal mine.
0:52:11 They built three scenarios, belt tightening, major cuts, or catastrophe mode.
0:52:15 When Bear Stearns collapsed, Florio warned other Condé Nast publishers.
0:52:16 They laughed.
0:52:18 Anna and Tom executed their plan.
0:52:19 The result?
0:52:25 Condé Nast ad pages dropped 30% in 2009, wiping out nearly $1 billion in revenue.
0:52:29 Vogue was one of only two magazines that stayed profitable.
0:52:33 Famously, after the 2008 crisis, Anna said internally,
0:52:35 we will not participate in the recession.
0:52:38 The pattern never changed.
0:52:40 Position yourself for multiple possible futures.
0:52:42 Prepare to the extent possible.
0:52:42 Execute.
0:52:43 No emotion.
0:52:47 Whether 9-11, 2008, or any crisis between,
0:52:48 Anna’s approach was identical.
0:52:49 See it coming.
0:52:50 Build options.
0:52:51 Stay focused.
0:52:54 The 2008 lesson went deeper.
0:52:56 When budgets shrink, profitable divisions survive.
0:52:58 Unprofitable ones don’t.
0:53:00 No matter how prestigious they are.
0:53:02 Anna understood in good times, excellence matters.
0:53:04 In bad times, only profit matters.
0:53:06 Crises don’t build character.
0:53:09 It reveals who was positioned and who was pretending.
0:53:10 As Warren Buffett says,
0:53:14 Only when the tide goes out do you discover who’s swimming naked.
0:53:17 By keeping Vogue profitable when others bled,
0:53:18 Anna made herself indispensable.
0:53:21 While others around her were losing their job,
0:53:23 no one could come at the queen.
0:53:28 The digital revolution should have killed Anna’s tenure at Vogue.
0:53:29 Instead, she weaponized it.
0:53:34 Vogue.com traffic grew from 1 million to 10 million monthly visitors.
0:53:40 Same principles, new medium, impeccable visuals, exclusive access, celebrity partnerships.
0:53:43 But Teen Vogue revealed her real genius.
0:53:45 In December 2016, Teen Vogue publishes,
0:53:47 Donald Trump is gaslighting America.
0:53:49 The media world gasps.
0:53:53 A fashion magazine doing some serious political commentary.
0:53:55 Anna’s response, more please.
0:53:56 She understood,
0:53:58 Controversy drives engagement.
0:53:59 Engagement drives revenue.
0:54:03 Teen Vogue’s traffic exploded from 2 million to 12 million.
0:54:05 Print subscribers tripled.
0:54:06 The lesson,
0:54:09 Your sub-brands can take risks your main brand can’t.
0:54:10 Use them as laboratories.
0:54:13 Anna became obsessed with Metrix.
0:54:18 The woman who once cared only about aesthetics now lived for traffic reports.
0:54:24 The 2015 Met Gala coverage set records she’d chase after every year.
0:54:25 She found the holy grail,
0:54:28 modernizing her greatest creation while expanding its reach.
0:54:32 Even her Go Ask Anna YouTube series in 2018 was strategic,
0:54:34 answering random questions.
0:54:37 No, humanizing her brand while maintaining mystique.
0:54:41 Digital transformation isn’t about abandoning what made you successful.
0:54:43 It’s about translating it into a new medium.
0:54:46 Anna didn’t become a different person online.
0:54:49 She became a more measurable version of herself.
0:54:52 And in digital, what can’t be measured can’t be monetized.
0:54:57 By 2008, Anna discovered fashion was just her vehicle.
0:54:58 Power was the destination.
0:55:01 She backed Obama, but not with just checks.
0:55:05 She created events mixing fashion, entertainment, and political elites.
0:55:08 Anna positioned herself as the essential connector.
0:55:12 First principle of real power is don’t join other people’s networks.
0:55:15 Create your own and be the one everything flows through.
0:55:17 When ambassador rumors swirled, Anna stayed silent.
0:55:20 The speculation alone increased her value.
0:55:23 Why can firm or deny when mystery multiplies the leverage?
0:55:25 She didn’t get the ambassadorship.
0:55:26 She got something better.
0:55:28 Artistic director of all of Condé Nast.
0:55:29 Not just Vogue.
0:55:29 Everything.
0:55:33 But the Met Gala has been her masterpiece of power.
0:55:37 In 1999, Anna inherits a stuffy charity dinner.
0:55:40 Wealthy New Yorkers writing checks, patting themselves on the back.
0:55:47 By 2018, she’s running a $12 million cultural phenomenon that determines who matters in America.
0:55:49 The transformation reveals everything.
0:55:51 Anna didn’t just change an event.
0:55:54 She created a new currency.
0:55:57 Met Gala invitations became more valuable than money.
0:56:01 They signaled cultural relevance that no amount of wealth could buy.
0:56:03 The Met Gala looks like a party.
0:56:04 Look closer.
0:56:06 It’s a machine for manufacturing power.
0:56:09 Anna controls the three levers that matter.
0:56:10 First, the guest list.
0:56:14 Reality stars with millions of followers can’t buy their way in.
0:56:18 By saying no to money, Anna created a currency more valuable than money.
0:56:20 Second, the seating chart.
0:56:23 Anna places emerging designers next to billionaire investors.
0:56:25 Models next to beauty executives.
0:56:28 She deliberately separates couples, forcing new connections.
0:56:32 Anna wanted people to meet other people, a former planner revealed.
0:56:34 That’s where a lot of business came from.
0:56:36 Third, the content engine.
0:56:39 One night generates 12 months of coverage.
0:56:42 The anticipation, the arrivals, the analysis.
0:56:47 When Lady Gaga spent 16 minutes changing outfits on the steps, that wasn’t spontaneous.
0:56:49 That was strategy.
0:56:53 Vogue.com breaks traffic records every Met Gala Monday.
0:56:58 Ad sales follow eyeballs, the event pays for itself through the content it creates.
0:57:00 Watch how the flywheel spins.
0:57:03 Anna’s Vogue coverage can make a designer’s career.
0:57:05 So when she calls, everyone says yes.
0:57:07 Their presence makes the event matter.
0:57:09 The coverage reinforces Vogue’s authority.
0:57:12 That authority attracts next year’s guests.
0:57:14 Each turn makes the wheel spin faster.
0:57:19 The $12 million for the Met is impressive, but it’s a distraction from the real genius.
0:57:23 Anna made herself essential to three industries at once.
0:57:24 Fashion needs her platform.
0:57:26 Museums need her funding.
0:57:28 Entertainment needs her validation.
0:57:33 If magazines vanish tomorrow, Anna would still control the room where culture gets decided.
0:57:35 She didn’t just build a better magazine.
0:57:37 She built better infrastructure.
0:57:41 In 2020, the fashion industry was devastated by the pandemic.
0:57:43 Conde Nast was bleeding money.
0:57:45 Critics were circling Anna like vultures.
0:57:47 Everyone predicted her fall.
0:57:48 Instead, she got promoted.
0:57:52 December 2020, Anna becomes chief content officer of everything.
0:57:54 Every Conde Nast magazine.
0:57:55 Every country.
0:58:00 The New Yorker to Vanity Fair to GQ all report to the girl who couldn’t type.
0:58:03 Looking back from today, that promotion wasn’t a reward.
0:58:05 It was recognition of reality.
0:58:08 Anna had built something that transcended job titles.
0:58:10 Her power rested on three pillars.
0:58:11 Anticipation.
0:58:15 She saw the celebrity shift before supermodels peaked.
0:58:18 Pushed digital while competitors protected print.
0:58:21 And built platforms while others guarded pages.
0:58:22 Adaptation.
0:58:24 Her methods never changed.
0:58:25 Control the environment.
0:58:26 Maintain standards.
0:58:27 Move fast.
0:58:29 But her tactics evolved constantly.
0:58:31 Indispensability.
0:58:32 The magic formula.
0:58:34 Even when controversial, she stayed profitable.
0:58:36 Even when criticized, she delivered results.
0:58:39 Revenue plus relevance equals irreplaceable.
0:58:42 At 75, Anna controls more than she did at 40.
0:58:46 Not because she’s holding on, but because she’s built the infrastructure everyone needs.
0:58:47 Here’s what most people miss.
0:58:49 Anna didn’t achieve power.
0:58:50 She architected it.
0:58:56 The 16-year-old who wrote Editor of Vogue on that form, she got that job in 1988.
0:58:57 But that was just the beginning.
0:59:01 She spent the next 40 years building something that couldn’t be taken away.
0:59:03 Jobs can be lost.
0:59:04 Titles can be stripped.
0:59:09 But when you become the platform your entire industry runs on, when you control the room
0:59:14 where culture gets decided, when three different multi-billion dollar industries need you to
0:59:16 function, that’s not a career.
0:59:17 That’s architecture.
0:59:21 The fashion world that Anna entered in 1975 is dead.
0:59:25 The magazines, the business model, the culture, all transformed beyond recognition.
0:59:29 Yet Anna didn’t just survive each transformation.
0:59:30 She caused them.
0:59:33 True power isn’t controlling what exists today.
0:59:35 It’s building what controls tomorrow.
0:59:41 And tomorrow, like every tomorrow for 40 years, still belongs to Anna Wintour.
0:59:49 Wow.
0:59:56 I want to talk about some of my reflections from reading and learning about Anna and what a
0:59:57 force this woman is.
1:00:01 There’s a couple of things that didn’t make the episode that I really want to emphasize
1:00:07 here, but I also want to point out one of her secrets is that she’s direct and clear.
1:00:10 She is kind, but not nice.
1:00:13 Kind people will tell you something a nice person won’t.
1:00:14 She will give you the feedback.
1:00:16 You know exactly what she’s thinking.
1:00:18 There are no mixed messages.
1:00:25 And I think a large part of her success is due to the fact that she’s decisive and clear.
1:00:31 And I think it gets rid of the wrong people very quickly and the right people love it.
1:00:32 Okay.
1:00:36 I want to talk about one of the things that gets talked about a lot online with Anna, which
1:00:37 is her daily routine.
1:00:42 It’s practically become internet folklore among productivity geeks.
1:00:43 She wakes up around five.
1:00:45 She plays an hour of tennis at dawn.
1:00:50 And then consumes a whole bunch of news, British US newspapers by breakfast by 8am.
1:00:55 She’s in the office perfectly coiffured with her Starbucks cappuccino, which is her version
1:00:57 of breakfast in hand.
1:00:59 I got that from the 80 questions video.
1:01:04 But her routine’s most viral element is perhaps her wardrobe strategy.
1:01:06 I have a wardrobe full of print dresses.
1:01:10 So every morning I just go to one of my print dresses of choice and put it on.
1:01:11 It makes decision making a lot easier.
1:01:18 That simple hack from the queen of fashion revealed in her Go Ask Anna video series is cited as a
1:01:21 brilliant way to just figure out what to wear in the morning.
1:01:22 I mean, think of Steve Jobs.
1:01:23 He always wore the same thing.
1:01:26 And Anna Wintour is effectively doing the same thing.
1:01:27 I think it’s brilliant.
1:01:28 You don’t have to think too much.
1:01:29 You can buy a whole bunch of them.
1:01:30 You know what size fits.
1:01:31 It’s great.
1:01:34 I also want to say something a bit underrated with Anna.
1:01:39 She cultivated immense loyalty by genuinely helping other peoples.
1:01:45 It’s a reminder that behind what appears from the outside to be cold, there’s incredible acts
1:01:47 of generosity in her.
1:01:49 There’s softer antidotes.
1:01:54 You know, they might not trend on TikTok, but they circulate in professional communities.
1:01:58 For instance, you know, one story that sticks in mind that didn’t make this was she helped
1:02:02 designer John Galliano get his career back on track.
1:02:08 She gave countless people who didn’t have a name at the time, photographers and assistants,
1:02:09 a shot.
1:02:12 And, you know, I want to think about this for a second.
1:02:16 She might come across as cold as some, but despite what you think from the Devil Wears Prada,
1:02:20 my sources tell me she was never insulting.
1:02:23 She valued clarity, speed, and directness.
1:02:26 She gave direct and honest feedback.
1:02:28 She’s kind, but not always nice.
1:02:35 She says people work so much better when feedback is fast, direct, and honest, and they know where
1:02:36 they are.
1:02:40 Nobody works well when the atmosphere feels slow and lazy.
1:02:45 Okay, I want to get into some of the lessons and, you know, some of the recurring themes that
1:02:46 we see over and over again.
1:02:50 The first is a taste for salt water.
1:02:55 Anna spent five years at Harper’s on a skeleton crew of three people doing everything from market
1:02:57 visits to layouts to captions.
1:03:00 There was no coffee fetching or filling.
1:03:03 She was just thrown in completely over her head.
1:03:06 She said, I was thrown into my career, frankly, with ignorance.
1:03:07 I knew nothing.
1:03:12 She treated this grinding apprenticeship as education, not exploitation.
1:03:15 Most people would have complained or stopped trying.
1:03:19 That’s why most people don’t get the education that Anna got.
1:03:21 Two, unreasonable standards.
1:03:25 Anna returned every borrowed item with original tissue paper intact.
1:03:30 She’d send steaks back three times for being insufficiently rare, then only eat two bites.
1:03:35 At Vogue, she instituted the look, a daily assessment of every employee’s appearance from
1:03:36 shoes to hair.
1:03:41 Her AWOC system meant nothing, not even a comma, moved without her approval.
1:03:43 Excellence is a tyrant you invite in.
1:03:47 Once it moves in, mediocrity has no place to hide.
1:03:48 Three, high agency.
1:03:55 When passed over for fashion editor at Harper’s, despite doing the job’s work, Anna didn’t complain
1:03:56 or negotiate.
1:03:58 She resigned immediately, taking her assistant with her.
1:04:02 She moved to New York without a job lined up, betting everything on her vision.
1:04:04 The system won’t fix itself for you.
1:04:08 When merit meets politics, choose exodus over argument.
1:04:10 Four, burn the boats.
1:04:16 At Viva, the porn-funded fashion magazine, Anna had a total creative freedom but zero prestige.
1:04:22 Rather than job hunting for something respectable, she used the disreputable platform to develop
1:04:23 her aesthetic without interference.
1:04:28 She studied European fashion magazines while working at a magazine sold behind the counter.
1:04:31 Sometimes the worst address is the best classroom.
1:04:34 Embrace opportunities others are too proud to take.
1:04:37 Five, bias towards action.
1:04:39 Anna’s meeting revolution at Vogue.
1:04:41 Walk in, stand, ask, leave.
1:04:42 You get two minutes.
1:04:44 The second is a courtesy.
1:04:49 The clothing run-throughs that took hours under Mirabella, Anna did them in minutes.
1:04:51 Yes, no, yes, no, yes, no.
1:04:52 Goodbye.
1:04:55 No explanations, no committees, just decisions.
1:04:59 When people avoided her in the elevator, it wasn’t because she banned them, it was because
1:05:02 she’d immediately start issuing orders they’d need to write down.
1:05:04 Decisiveness is a muscle.
1:05:06 The more you use it, the faster you move.
1:05:08 Velocity matters.
1:05:10 Six, outthink, don’t just outwork.
1:05:17 When her boss at Harper’s wanted advertiser-friendly spreads, Anna would meet photographers in the lobby,
1:05:20 select only the best shots, and claim no others existed.
1:05:25 She forced him to choose between her vision and expensive reshoots, and she won every time.
1:05:26 Don’t fight the system.
1:05:30 Architect situations where the system has to choose you.
1:05:32 Seven, don’t care what they think.
1:05:37 Putting Madonna on Vogue’s cover in 1989 horrified fashion purists.
1:05:39 The woman had just released a video burning crosses.
1:05:42 Pepsi had polled her sponsorship.
1:05:43 Religious groups wanted boycotts.
1:05:48 Anna did it anyway because a businessman on a plane said Vogue would never feature Madonna.
1:05:52 The issue sold 200,000 extra copies.
1:05:57 When everyone agrees something will never work, that’s precisely when they stopped testing it.
1:05:59 Consensus kills innovation.
1:06:01 Eight, positioning is leverage.
1:06:07 Anna accepted a made-up creative director role at Vogue, officially Mirabella’s deputy,
1:06:09 but in reality Lieberman’s protege.
1:06:13 It wasn’t the job she wanted, but it got her foot in the door.
1:06:17 For three years, she learned the operation while appearing to be number two.
1:06:21 She’d sit in a meeting, shaking her head, obviously disagreeing with Mirabella,
1:06:24 playing a longer game than office politics.
1:06:26 When Mirabella was fired, Anna was ready.
1:06:30 When you know what you want, the strongest form of positioning is preparation.
1:06:33 Nine, be a talent collector.
1:06:39 Anna championed unknown photographers who became legends and built a three-assistant system that
1:06:42 created Fashion Magazine’s most powerful alumni network.
1:06:44 Her protégés run fashion globally.
1:06:48 They learned by watching her negotiate with billionaires and shape culture daily.
1:06:53 Your legacy isn’t just what you build, it’s who you build with.
1:06:55 And you can’t buy good company.
1:06:57 Ten, overmatch.
1:07:00 Anna didn’t just go into detail.
1:07:07 She forced the entire industry online in 1988, making Vogue.com the platform every designer needed.
1:07:09 She didn’t compete with other magazines.
1:07:11 She built the infrastructure they’d have to use.
1:07:13 The Met Gala wasn’t improved.
1:07:20 It was weaponized into a $12 million annual event of cultural dominance where she controls
1:07:23 the guest list, seating charts, and cultural relevance itself.
1:07:25 Don’t play fair games.
1:07:27 Build the game itself and then charge admission.
1:07:29 11, win by not losing.
1:07:35 During the 2008 financial crisis, while other Condé Nast magazines bled out, Vogue remained
1:07:35 profitable.
1:07:41 Anna and her publisher had watched Eurodollar exchange rates, built three scenarios, and executed
1:07:44 their plan while others partied.
1:07:47 When Bear Stearns collapsed, they were ready.
1:07:48 They were well-positioned.
1:07:51 In a crisis, profitable divisions survive.
1:07:53 Unprofitable ones get cut.
1:07:55 Excellence matters in good times.
1:07:57 Profits matter in both.
1:08:00 When you combine the two, you succeed no matter what.
1:08:01 What a force.
1:08:04 Anna, oh my God, I can’t even say enough about her.
1:08:10 This woman is so amazing and incredible, and I hope you learned as much as I did listening
1:08:15 to this episode, and I would love to have her as a guest on the podcast, so if you’re listening
1:08:19 to this and you know how to get in touch with her, I would love to interview her and sit
1:08:26 down and talk about her and Vogue, and man, what an amazing woman and an amazing story.
1:08:38 Thanks for listening and learning with us, and be sure to sign up for my free weekly newsletter
1:08:41 at fs.blog slash newsletter.
1:08:45 I hope you enjoyed my reflections at the end of this episode, and that’s normally reserved
1:08:50 for members, but with this outlier series, I wanted to make them available to everyone.
1:08:55 The Farnham Street website is where you can get more info on our membership program, which
1:09:02 includes access to episode transcripts, reflections for all episodes, my updated repository featuring
1:09:07 highlights from the books used in this series, and more. Plus, be sure to follow myself and
1:09:13 Farnham Street on X, Instagram, and LinkedIn. If you like what we’re doing here, leaving a rating
1:09:17 and review would mean the world. And if you really like us, sharing with a friend is the best way to
1:09:20 grow this special series. Until next time.