Dave Ulrich: Harnessing Uncertainty for HR and Business Leaders

Known as ‘the father of modern HR’, Dave Ulrich joins us in this episode to share his wisdom and thoughts around how organizations are coping in this world of incredible change.

Dave Ulrich is the Rensis Likert Professor at the Ross School of Business, University of Michigan and a partner at The RBL Group, a consulting firm focused on helping organizations and leaders deliver value.

To help you make sense of the rapid changes we cover what good business leaders have been able to do through harnessing uncertainty and using the crises as an opportunity. Dave shares his biggest piece of advice regarding the most important thing HR leaders can give their employees, which could shift your mindset!

Here’s how the conversation went… This interview has been edited and condensed.

John Hollon: I was looking at your 2019 book, Reinventing the Organization: How Companies Can Deliver Radically Greater Value in Fast-Changing Markets and given what we’ve gone through in 2020, I couldn’t help but think how relevant the point you made that today the traditional hierarchy based organization is dead. Leaders need to know what really works so they can build an organization that’s responsive to fast changing markets. What’s your take on how leaders and organizations are coping with the need to change as we reflect on all that’s happened to us in 2020?

Dave Ulrich: The logic is really simple but content is king. What we do is critical. Context is the kingdom in which the king or queen operates. The context determines what matters, content is what we do, context is what we should be doing. There’s a tool in the movie Men In Black, they have a neutralizer they click a button and the world stops.

I think most of us are going to want to do that to 2020. We’ve had the global pandemic COVID crisis that has affected 7 billion people. It’s affected every country in the world, in every corner of the world. We’ve had racial injustice in the United States, we’ve had social problems. we’ve had a political bickering in America, we’ve had natural disasters… all of these things add up to a world of incredible change. The one word I’ve discovered around that is uncertainty. You just don’t know.

When somebody comes to you and says, “here’s the new normal”, what you have to do is turn around and run as fast as you can. They don’t know the new normal, nobody does. We live in this world of incredible change. So what does that mean? We’ve got to adjust, we’ve got to adapt, change or die. It’s not a new idea, but the pace of change in the last seven months is more than we’ve almost ever seen. So we’ve got to get organizations and leaders who can change.

John Hollon: What kind of observations do you have on what business leaders are doing well in the midst of this, and what should they be doing in your view?

Dave Ulrich: Number one, I think good business leaders are being able to harness uncertainty. They’re able to say we don’t know exactly what’s going to happen, so we’re not going to give you false hope. A bad business leader would say, this is going to be over by April. We don’t know when it’s going to be over so how do you harness that uncertainty? How do you take the uncertainty and find opportunity in it? Good leaders are starting to do that and they’re saying, let’s focus on the future. What CAN we do?

Somebody once said, a crisis is a terrible thing to waste. How do we use this crisis as an opportunity to create new stuff, to innovate, to try new things, to experiment quickly, to define new relationships? I see companies doing that. I see companies becoming more digitally focused. I see companies becoming more sensitive to people and the needs of people. Hopefully leaders are not locked by their past but they’re excited about their future.

John Hollon: What should HR professionals be doing right now, given the chaotic state of work? What’s the most critical and essential advice you would give them?

Dave Ulrich: Use this as a way to reframe your assumption. Let me give an example. When I meet with HR groups, I almost always start with this question. What’s the most important thing we in HR, or a business leader can give our employees? Multiple choice test. One: belief, purpose, meaning. Two: belonging, a sense of relationship, a sense of community. C: becoming, learning, growth. D: all the above. Or E: none of the above. And everybody picks 4. Believe. Become. Belong. That’s what we want to give our employees. They’re wrong, it’s number five, none of the above.

The most important thing that HR can give an employee or a business leader is a company or an organization that succeeds in the marketplace. Unless and until a company succeeds in the marketplace, there is no workplace. If there’s no marketplace, if there’s no company, if there’s no organization, there is no employee. You’ve got to get HR focused on the marketplace. What do we do with talent in order to be successful in the marketplace? People say our people are our most important asset, I love to say our people are our customers most important asset. Are we hiring, training, paying, developing our people, so that customers will have a better experience with us?

Culture are the leaves and branches of your tree that cause your customers to do business with you. Don’t go digging around the roots, create branches that have fruits and that customers savor. Leadership is not about your competencies, it’s the competencies that customers want you to demonstrate. Get HR people to focus less on what they know, what they do, and much more on the value they create in the marketplace.

John Hollon: We’ve seen a lot of workplace trends accelerate during the pandemic and the lockdown, like the growth of gig work and remote work. Are these trends sustainable when things start to normalize again, and I know that we don’t know when that is going to happen, but if they are sustainable longer term, what’s the long term impact on workplace culture?

Dave Ulrich: The answer is, I don’t know how sustainable it will be. After emotional events like 9/11, for the next few months the biggest selling items in Walmart were Americana (proud of America) and relationship items like rings and gifts, because people wanted to rebuild relationships. Everybody said ‘Oh, this is going to last’. But it hasn’t lasted. I don’t know how long virtual will last, what I think we’re going to see are a couple of principles emerge.

One of the lessons I think out of this is going to become a principle that will be adapted is almost everyone I know is affected uniquely by the pandemic. We’re all affected, but we’re affected in different ways. I think we’re going to see that coming back into the workplace. When people come back we’re going to say, what was your experience like? How do we personalize the work experience when we come back to work. I think that’s one of the things that may stick. We’re going to be very different and I think we’re all going to have different places where we work. For some it may be home, others it may be Starbucks, airplanes, hotels, remote work.

What I think we’re going to also see is the boundaries of work are not the physical place but they’re going to be the shared values of the company. I don’t care where you work in the future but are you creating value for the customers we serve? If you’re not creating value for the customers we serve, wherever you are, you’re not doing work today. I think that’s a principle that may have some sticking power.

John Hollon: Do you think that remote work is going to stick? A lot of people are working remotely now. I heard figures that prior to the pandemic and the lockdown, around 10% of the workforce worked remotely and now it’s somewhere between 40-50%. That’s a lot of people to be working outside the workplace. Do you think that will stick?

Dave Ulrich: I think it’ll stick for some. What’s interesting is I would have thought the digital natives, the young generation would love it. They don’t. At least the studies I’ve seen. The next generation is saying I can do technology, I’m technologically literate, I’m a digital native, but I need connection. I want to connect, I want to build relationships and what I’ve seen is different people are going to have different predispositions to working remotely. I actually like it. I’ve never worked in a traditional office because what does a professor do? You write books, you do research, you don’t do that in community. You go teach your class but then you do the rest in isolation. I think we’ll see less remote work than we have now but more than we did.

John Hollon: I’ve worked remotely for around 10 years now and I’ve worked in an office environment. The one thing I miss the most about remote work is the casual conversations you have in an office environment, in the lunch room, or over the coffee pot, or somebody pokes their head in your office or in your cube that lead to creative solutions, innovations, and problem solving that you can’t get from the remote way. Have you heard or seen of anybody who’s made any sort of inroads on how to make that work for people who work remotely?

Dave Ulrich: No, not yet. We tried Zoom and we tried breakout groups. Here’s what happens in breakout groups, you go to the group, it takes people five minutes to get there, they hedge around and then they go back together. You have examples like that of the Post-It Note. The Post-It Note came from a random interaction between somebody and there’s the story of somebody at a church choir and they glued the wooden stick. I think there’s so many things that are kind of realistic combustion that comes from those relationships.

Obviously, some work has to be done in an office. Our son lives near a meat processing plant, you’re not going to do meat processing virtually. I talked to a company that’s building food, and they said we have processing plants all over the world, we have to do a very good job with personal protective equipment but you got to be in person. There are other jobs when you do writing or research, you can do that more remotely. I think we’re going to see people going back to work to create that uniqueness and those opportunities. I just don’t know how fast it’s going to come.

John Hollon: Here at the Talent Experience Podcast, we wholeheartedly believe everybody should have a job that they love. One that they’re really passionate about. Dave, what do you love and what are you passionate about that you do?

Dave Ulrich: Easy, I love learning. I love ideas with impact. I love my idea friends, they put me to bed at night, they wake me up at night, they get me up in the morning, and to say what’s an idea that will then have an impact and help other people. One of my great joys is when the ideas that I’ve worked with and tried to make sense out of from problems and challenges I see other people absorb, and they start making them their ideas, I actually find that delightful.

The line that I love to use and my wife and I are passionate about is: good adults and good leaders in my world invest in the next generation. Your job as a parent is to build the next generation and to some extent that’s your children, your grandchildren, your progeny. But to be honest, the next generation is also the ideas we create. I think we should be thrilled that we create ideas and services and products that the next generation will use. I love to learn and I love to learn about new things that have an impact that shape next generation thinking – that’s my passion.

We hope you enjoy listening to this episode of the Talent Experience Podcast with Dave Ulrich! Look forward to sharing more learning with you.