Rolling with Change with Columbia Business School Expert Rita McGrath

Rita McGrath

Professor at Columbia Business School, Speaker, Strategic Advisor, Author of Seeing Around Corners: How to Spot Inflection Points in Business Before They Happen

What book changed your life?

In Search of Excellence. It was really the first book that brought business into a human form in terms of its storytelling, and the plausibility that business could be a force for changing the world. And I read it when I was pretty young, so it shaped a lot of how I thought about business.

What’s the best thing that happened in the 80s?

Definitely meeting my husband and getting married.

Advice you most frequently give?

To really think deeply about what your goals are. I find a lot of times when talking to students or executives, you say, "Well, what's your ambition? What's your goal?" And it usually takes four or five questions before you get to the real essence of why they want to do it. I really encourage people to think about the thing they want, not so much in terms of the trappings of power or money, but what they really want to experience in their lives. People are often remarkably unthoughtful about that, which I find interesting. Your life is your most precious creation; why would you not think more deliberately about what it could be?

Putting change in the comfort zone.

What does success mean to you in terms of the people you educate?

Here’s a canonical example: I teach a one-week executive education course, Leading Strategic Growth and Change. Every day of that week, we carve out an hour and a half for people in the course to bring in a challenge around a work project—something important and strategic that doesn’t quite have a final solution.

What's fascinating is that every day, as the course progresses, you can see the wheels turning as they're changing their mind about what the problem is. They're looking at it in a fresh way. I'm saying, "Wait a minute, wait a minute. Whoa, this thing that you're doing, have you thought about this other set of considerations?" So, success is really when people reframe what they're working on in a positive, new way. That's super powerful.

One of your many important pieces of work took aim at the long-held belief that a company's goal should be sustainable competitive advantage. Instead, you argue that advantages are transient, so winners must be able to move from exploiting an advantage to disengaging when it's exhausted. Do you think this also applies to higher education, and where are learning institutions with it? 

 I've been writing about this for years. The first big disruption for the higher education model was equivalent to what happened when music was available by the song, rather than on a CD. Because once you have credentialing at the level of the course, with the skill and not at the level of the degree, the whole edifice falls apart. It's why for decades, the music industry made chunks of money on the fact that you had to buy 18 songs to get the one that you wanted.

If you think about it from the perspective of a learner, if I can get a valid credential that employers and other people see as legitimate at the level of the skill, why would I take 20 courses from one university? Why wouldn't I take the best course on supply chain from the expert at Wharton and the best course on finance from whoever? In other words, why wouldn't I mix and match my own course playlist? 

The second big thing is that the university rankings process rates a whole bunch of stuff that has nothing to do with student achievement. That unintendedly created an opening for administrations to layer on lots of expensive administration. Take business schools. The offices where recruiters meet students are gorgeous; that is money spent that isn’t dedicated to the educational mission. You've got way too much money going into things like rock climbing walls—stuff that creates a cost structure that makes it very difficult to afford.

For a lot of students, it's an unaffordable enterprise. During the job recruitment process, industry takes a four-year degree as a proxy for a whole bunch of other things, like you showed up someplace on time and stuck with it long enough to get the degree. Your family was well off enough that you could either pay for it, or get access to loans. That has nothing to do with whether you can do the job or not. There's just all this institutional laziness around how we categorize people and how we open opportunities. By the way, if you require a four-year degree, you're automatically shutting out huge percentages of less represented groups from any opportunity at all. It's crazy. 

So one of the things we'll hopefully start to see employers get smarter about is, let's not use a four-year degree as a poor proxy for all these things we actually care about.

You're often teaching people who are older and more established in their career. What do you see as the strengths of older learners and what are things they should seek to cultivate?

The big strength is there's just a lot of experience there, many sorts of raw materials for finding inspiration, for connecting the dots. They've been exposed to so much. They're great, big sponges in the best case. The challenge is not to let that become a cause for complacency. You want to remain really curious, and be open to changing your mind. The big mistake is when you say, I've seen that before. Rather than saying, I've seen something like that before, is this that? Or could this be something else?

Whether it's innovation or strategy, many of the subjects you tackle require organizational change. What are the biggest roadblocks to true transformation?

 It's personal alignment with the objective. A great story that reflects this is my dad, who had been at Xerox Parc—literally seeing the future unfolding before his eyes. This was in the 70s and then he went to work at Kodak. In 1980, on my dad’s first day at work, an executive named Thomas Whiteley asked him what he saw happening in the future. He said, "Oh, well, eight millimeter film has had it. The world's going to go digital." Kodak had everything you needed to compete in digital in 1980.

But Whitely, he's hearing this message and to him, it's like your experience, your job at the emulsion research laboratory, everything you ever knew is now going to be invalidated by this new paradigm. That's deeply terrifying. So I think the biggest challenge to change is this: Do I see myself in that future? Or is everything I've ever done now going to be obsolete? 

Change takes time. It takes energy. So if you're a CEO and you have a three-year time horizon, and somebody comes along to you and says, "Well, you could transform this company," you think about that as a human being. It's 12 hour days, seven days a week and half of everybody you ever interact with is going to be unhappy with whatever you decide to do. You're not going to see your family. You're not going to live a healthy lifestyle. You have to ask, do I really want to do that? It's not easy and if it's not properly led, it's exhausting. When it's done right, it's exhilarating, it's energizing. We're creating the future together. But getting there is rare.

What impact do you think COVID has had on businesses and leaders?

 The first thing that struck me was how ingenious everybody was when it first happened. You think about it—this was all of humanity facing the same challenge all at the same time, very rare in human history. A lot of leaders were really impressed with how their organizations responded. They worked together, they got on with it. And everything was accelerated, so barriers got swept away. Competitors collaborated, things that we had previously thought impossible were all of a sudden on the table. Then, the reality set in that this thing was not going to be done by Easter, by Christmas. And here we are three years later and still grappling with what this is going to be. 

I think the phase we're in now is unsettled; we can't just snap back to the way we were before. There is the realization that the toolkit I was using before the pandemic is no longer fit for purpose. I see this great quandary that a lot of leaders are in: Do I bring people back to the office or not. People have changed their lives; they've relocated, they've done stuff in a different way. So the whole question of what is the glue that binds an organization—that’s front and center for a lot of companies. Bosses want everybody back in the office and many workers are saying on my terms, thank you very much. I don't think it's so much flexibility that people want, but autonomy. They want control over the terms of their engagement with their employers. For a lot of leaders, that’s uncomfortable. 

I think we will start to see coming together planfully, very deliberately. An interesting company to look at is Automattic (parent company of WordPress), whose model is completely distributed. They don't even talk about remote work because that implies a headquarters. What they have is levels of work without being together all the time. Even they say, one month of your year has to be reserved for face-to-face, in-person work. 

What would you tell people who are unsure about returning to structured learning because they are older?

I think try it. Start small—choose one thing you're really interested in, something that genuinely intrigues you. It might not even be work related. It could be a language, a skill. It could be learning to cook. Start with something that could be a path back to developing your skills. 

The second thing is, be kind to yourself. Learning is a muscle. You get better at it the harder you work at it, but it's like learning to ride a bike. The first few times it's not going to be easy, but be patient with yourself as you go up that learning curve, because it will get easier.

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For more about Automattic’s work practices, you can read The Year Without Pants: Wordpress.com and The Future of Work.