Jeff Ma
Hello and welcome to Love as a Business Strategy, a podcast that brings humanity to the workplace. We're here to talk about business, but we want to tackle topics that most business leaders shy away from. We believe that humanity and love should be at the center of every successful business. I'm your host, Jeff Ma, and I'm a director at Softway, a business to employee solutions company that creates products and offers services that help build resilience and high performance company cultures. I am joined today with my president and CEO, Mohammad Anwar. Hey, Moh, how's it going?

Mohammad Anwar
Hey, Jeff, and Hey, everyone.

Jeff Ma
And Frank Danna, a director at Softway as well, and a good friend. Hey, Frank, how's it going?

Frank Danna
Oh, thank you so much, Jeff.

Jeff Ma
Yeah, good to see you, man.

Frank Danna
Hey, guys.

Jeff Ma
Nice hat. So each episode, we like to dive into one element of business or strategy and test our theory of love against it. And today, we have an amazing opportunity to speak with Dan Edds. For 25 years, Dan has been a practicing management consultant, working with state and local government healthcare, K through 12 education, higher education, nonprofits. He is the author of two books, the first of which is 'Transformation Management' and his most recent 'Leveraging the Genetics of Leadership: Cracking the Code of Sustainable Team Performance'. His latest book demonstrates how elite organizations are revolutionising the practice of leadership, recreating the world of work, and setting new standards for employee engagement and customer value. Dan, welcome to Love as a Business Strategy, how are you today?

Dan Edds
I'm terrific. And I'm absolutely delighted to be with you.

Jeff Ma
Awesome. If you're not familiar with the show, we do open before we dive right in with some icebreaker questions. And the fun part about this is I never know what they are until this very moment. So let me just crack this digital envelope right now, Frank, looks like your name is on the top of the list, so you're first.

Frank Danna
Me?

Jeff Ma
Yes, Frank, would you rather travel the world in a year on a shoestring budget or live in luxury in only one country for a year? It's very interesting.

Frank Danna
I would rather travel the world, but live on a shoestring budget.

Jeff Ma
For that year.

Frank Danna
For that year, yeah. Yeah, I'd rather I'd rather see way more places. And, and, you know, enjoy the actual space that I'm in and kind of find the beauty in those areas without having to just the creature comforts don't matter as much as the as the opportunities to learn and grow in those different places. So that's, that's what I would do.

Jeff Ma
Well, I've traveled with you. I feel like I feel like you'd miss, like you'd miss some things.

Frank Danna
Oh, no, I definitely would. If I can't stay at the Ritz Carlton, I don't know what I'm gonna do.

Jeff Ma
Moh, you're up next. Would you rather live without internet or without AC or heat?

Mohammad Anwar
I would probably be okay living without AC or heat. But I need internet.

Jeff Ma
I like the question, but when you really think about it's a no brainer, I think. I don't know how we would survive without internet. But fair enough. Dan, your question, are you ready?

Dan Edds
Yes.

Jeff Ma
Would you rather be, would you rather be able to teleport anywhere or be able to read minds?

Dan Edds
Oh, teleport anywhere or read minds? I think I would choose the teleport anywhere. Why? I'm not really sure. But I like the idea of being able to go someplace.

Jeff Ma
Yeah, you could bring Frank some amenities when he's roughing it.

Frank Danna
Bring the mini soaps.

Dan Edds
Yeah, I mean, in a normal year, I'm on an airplane at least two or three times a month, if not more. And in the last 12 months, I've been on one airplane. So I'm ready to go someplace. Just about any place. Just let me go.

Jeff Ma
Perfect.

Frank Danna
Agreed.

Jeff Ma
So let's jump right in. And Dan, obviously, I just like if you could open up with just tell me a little bit about or tell everybody a little bit about kind of your background. You know, your, what you've been doing for those 25 years I mentioned in your intro and how you kind of came to the book, give us the this the setup here.

Dan Edds
Okay. So, 25 years, I've been a practicing management consultant. You know, I've worked with I don't know, probably a couple 100 different organizations in various capacities. And there was no, you know, one single moment in time. But there were a couple of events sort of coalesced into an observation, which was basically there's something going on around the whole idea leadership and the experience of employees where there's a disconnect. Just one real brief story, I just finished a project for a large state agency, this agency, regulated 450,000 health care providers. And I was done with a project. And it was very successful, there was light at the end of the tunnel. They were by any measure a mess. And I was ready to I was having my last meeting with the Deputy Director, I was ready to walk out the door, I had my computer bag in hand. My hand was was, you know, on the door, for I walked out the door she, it was almost like, you know, we're in church, and she was in confession. It was that kind of tone. And she said, you know, I don't even tell my friends where I work anymore. And I turned around, I said, why is that? And she said, it's just too embarrassing. And that was one of those things where one of those conversations were that there's something going on. And so eventually, I began to ask the question, how do elite organizations, high impact organizations, organizations that consistently perform at a high level, not for a year, two or three, but for 4, 5, 8, 10, 15, 20, 25 years? How do they approach the practice of leadership? And that got me into a, you know, a research project and eventually a book that's darn near obsessive and it's taken over my life, and I don't sleep well, most nights, because I wake wake up at three o'clock in the morning thinking about it.

Jeff Ma
Sounds familiar. Yeah. Mohammad's is just like, okay, there's someone else.

Frank Danna
That's actually normal. Great. It's me validated.

Dan Edds
I appreciate your confirmation.

Jeff Ma
So, I mean, tell us about the book. Tell us tell us about this, the main kind of theories behind it and what you've learned in it.

Dan Edds
Yeah. Well, there there was a subset to my question of how to, you know, high impact organizations approach leadership. And the sub sub question was, I was, I wondered if there was anything that could be identified as systemic, that there was a system to the way they did leadership, they didn't just tell people go out and lead based on your own personal values or any way you wanted to. You know, I was I was looking for something that said, Okay, is there a system? And of course, then the first thing I had to figure out was, well, what is a system? And then what is the system of leadership? And if I saw one, how would I recognize it? And then that led into, okay, where do I find these organizations? And what am I looking for? I eventually avoided actual eventually, I intentionally avoided technology firms and public sector organizations, public organizations, excuse me, because there's, there's just too many other things going on there. That would impact the employee engagement and the employee experience. So I really, I really centered on health care, because the data on those organizations is public, and it's quite abundant. Ended up that led me to other organizations and manufacturing, health care, healthcare and other healthcare education. I had amazing conversations with two senior officers of the United States Army. And when I knew what I was looking for, I began to see evidence of a system, every place I looked. High impact organizations, approach leadership, very much like they were designing a system. And they start out with the purpose. And you guys know, in technology, if you're designing some kind of a technology system, you have to first figure out well, what's it going to do? What's it what's, what's the purpose behind it? What's the output? And another quick story, a hospital CEO had asked me to come in and help him. He said, I want to design a model for doing leadership. And so when I met with him, we talked about it and I said, I said, you know, Eric, that's great. I'd be happy to help you. But fundamentally, I believe that leadership is more about a system than a collection of individuals. And the first thing we're going to need to know is what do you want the system to produce? And he looked at me and he said, That's exactly what I want to do. And no exaggeration. I walked out the door, and I'm thinking to myself, now how in the heck am I going to do this? But it turned out to be hands down the most profound, the most impactful engagement in 25 years of consulting.

Mohammad Anwar
Can you Dan, for the... Sorry.

Frank Danna
You're good. No, Mohammad, take it, take it.

Mohammad Anwar
For the audience purposes and for my knowledge, what is your definition of a system just so that we're aligned to it?

Dan Edds
Yeah. Okay, that's a that's a perfect question. And there are several definitions. But one of the more common ones actually comes out of the book written by donella meadows, thinking and systems of primmer, where she defines a system as a system will take a handful of key elements, organize them in a specific way to produce a purpose. Other people have built on that definition to say, a designed or intentional purpose. There are other definitions out there, but many of them, you've, you know, have those same basic elements, a core set of resources or elements that interact in a very specific and defined ways that they produce a common purpose or output.

Mohammad Anwar
Okay, so and by deep, can you can you give examples of resources inside of that system that could be considered?

Dan Edds
Sure. Sure, sure. So that actually, that took me quite a while to figure out, but organizationally, every organization, your organization, my organization, it doesn't matter if it's the United States Army with, you know, 2 million active and reserve duty personnel, or, you know, a school, an elementary school with 75 leaders, every organization is comprised of people, money, using that term in the broadest sense to include plant and equipment, it's basically everything that money can buy, and specialized knowledge, you guys are in business because of your specialized knowledge. I'm in business because of my specialized knowledge. So what I discover is that high impact organizations, and this is probably one of the biggest takeaways from the research is that average organization understands those resources as assets that need to be managed, which is a nice way of saying controlled, right? High Impact organization sees those as resources that can be developed forever increasing value. So example. You know, how do we look at people in our organizations? Are they going to asset, right, we talked about people being our most important asset, well, that word asset sort of means and suggests something. However, if we say they are a resource, well, we can develop resources to increase more and more value for our customers. And so what I found was that organizations that have that perspective, they are more inclined to see people as a as a complete resource. In other words, they are not just about developing, you know, professional skills and technical skills, but they see value in developing the whole person. You know, one of one of the case studies is a is a large hospital of like, 10, almost 10,000 employees, and they see people as a resource. And they intentionally underscore that word intentionally go about developing, not just, you know, better doctors and nurses and med techs, etc. But they actually go about developing a more self confident workforce. Because they figured out that if they have a workforce that's self confident, and, you know, feel empowered personally, they're more inclined to speak up when they see an error or a potential error. They're more inclined to give their opinion, their observation and how to improve a system or a process. And oh, by the way, they happen to be for the last eight or nine years, ranked as one of the safest hospitals in America. Some have suggested one of the safest hospitals in the world. And that may not sound too much to you and I until we realize that accidental and avoidable deaths and hospital hospitals is one of the leading causes of death in America.

Mohammad Anwar
Yep. We believe that maybe COVID has changed those numbers, but even before pre COVID the deaths at a hospital, avoidable deatgs were almost like a Boeing 747 crashing every day. That's a number of deaths that could have been avoided at a hospital.

Dan Edds
Yes. Yeah, yeah. I last week, I was actually talking to a hospital CEO. And and just, you know, just for confirmation, I asked him about that. And he said, unfortunately, that is the reality.

Frank Danna
Yeah. So it sounds a lot like what what you're talking about, about kind of building these systems and talking about self confidence and empowerment and helping people. I mean, you're talking about actually saving lives, like when people feel more confident in themselves and their team members, and they feel like they can bring their full selves to work. And we approach that, like when we're translating it for our audiences as as developing and being focused on developing culture, right, create being very intentional about the culture you're producing inside of your organization. And I'm wondering, how do these organizations rally leaders around this purpose? Right, how do they How do they bring leaders from a variety of different perspectives from lived experiences that they've had elsewhere from other organizations they've worked for? How do they bring them in and and create a sustained purpose that people begin to emulate?

Dan Edds
Right? Yeah, great question. And, you know, what I saw is, you know how organizations do that. And then they sustain it for 5, 10, 15, 20, 25 years, right. And that's where the idea of a system comes in. So if you read the literature on on leadership, and in a lot of literature on culture, what you read is about how, you know, follow this leadership guru, or these principles are these laws, and you will be a leader others want to follow, or it's about, you know, personal fulfillment, be the best you can be. As soon as we start talking about a system though, now we have to start thinking about not being the best you can be and being the best I can be, but being the best we can be. So you know, one of my one of my question marks when I began to see this was just the act is this idea of a system and a systematic way of approaching leadership. Does it make a difference if it's a small organization or a large organization? So, Frank, to answer your question I'll get I'll tell you this, actually, I'll merge two little stories into one.

Frank Danna
I'm ready.

Dan Edds
So I'm having a conversation with a guy named by the name of general Barry McCaffrey, you still see him on on the news. Every once in a while he's a paid analyst for issues of national security. General McCaffrey, when he retired after 32 years, was one of the most highly decorated generals to have ever worn the uniform. During the first Gulf War, he was the commander of the 24th infantry, mechanized division for us non military types, that he had a workforce of 26,000 soldiers under his command. And when he retired, he went on to serve in the Clinton administration as a cabinet officer. And I asked him, I said, How does the army approach the subject to the practice of leadership? And he immediately said, we practice servant leadership. And that was not a surprise. But then he began talking to me about love. And about what about serving under, in this particular case, General Norman Schwarzkopf in the first Gulf War, he said, General McCaffrey said to me, quote, he actually loved me, end quote.

Frank Danna
Wow, there we go.

Dan Edds
And to be honest, I didn't hear him say that, in our conversation because I was I was so focused on him and not wanting to make a total fool of myself. But when I was reading the transcript, I saw that he actually said that and, you know, put in a in a context here you have a guy. He holds three purple hearts for wounds received in combat in Vietnam. Schwarzkopf held at least one purple heart for wounds received in combat. They, both men have led men into combat, they, you know, they've seen the requirements of leadership in the most extreme cases. And here's a general openly talking to me about love and about the role of love in the United States Army. I was frankly blown away. So, combine that with another story. I'm sitting in an office of an elementary school principal. She's a principal of 450 Elementary, elementary school children. This school in five years went from the lowest performing school, to the highest performing school in a district to 25,000 students and 18 different elementary schools. When I asked her about her approach to leadership, she initially said, leadership, I don't know anything about leadership. And then I said, well, if there was one or two words that you might use to describe leadership, what would they be? And she said, Well, this won't be very popular, but love and grace. And I'm thinking to myself, well, that's nice. You know, she's got 450 school kids that are coming in into the, yeah, in the, in the front doors, right behind her office, and they're streaming into the school, because it's early in the morning. And, you know, I'm thinking, well, how nice, you know, these kids have a principal that loves them. And she read my mind. She said, That's not how I'm thinking, that's not how I'm using these words. She said, I use these words, because I know, they challenge me that I can have a difficult conversation, but do it in a spirit of love and grace. She said, it means that I can push my people and hold them accountable, and hold myself accountable. But do it in a spirit of love, and grace. And then the next breath, she's talking to me about collaboration as the path to academic achievement with her students. And it was kind of I saw the connection between what she was saying and what General McCaffrey had said. And so when I walked out the door, I said, oh, by the way, don't be too embarrassed about these concepts of love and concepts, concepts of love and grace, I said, I had prior conversation, a full Colonel of the United States Marine or United States Army, member of the US Special Forces US Army Ranger, tell me almost exactly the same words, and a four star General, certified war hero holder of multiple Purple Hearts tell me almost exactly the same thing. So, Frank, long winded story, but this is how they do it. They don't rally anybody. They don't use inspiration. They don't use, you know, rhetoric that's just, you know, sort of inspires us. Yep. You know that that's good for a while, but after a while it gets weary. And, and what I found was that every one of these high impact organizations start with, what's the experience of the workforce that we want, that we want our employees to experience? What do we want our employees to experience on a daily, weekly, monthly basis? It has nothing to do with inspirational rhetoric and motivation. It's what do we want them to experience? Because it's that experience that will keep them and get them engaged, and keep them engaged, and keep them around. So that's the starting point. From there, every one of them had, they did it in different ways. But they all said in one way, shape or form. Okay, if we want our workforce to experience, what it means to be empowered, what kind of behaviors do our leaders or leaders need to model every day, so that our employees can experience empowerment, or team or love and grace, or collaboration, or respect or relationship. And in fact, what I found was that these high impact organizations put more value and emphasis on behaviors than they do core values.

Mohammad Anwar
Very cool.

Dan Edds
There's a whole lot more behind behind it, but that's

Frank Danna
You should take, you should take your headphone mic off and just drop it on the ground. Essentially, please don't do that. I don't want to be I don't want to break the heads the headset equipment.

Frank Danna
I'm just responding, I'm actually reacting. That was great.

Jeff Ma
Settle down, Frank, settle down.

Mohammad Anwar
So Dan, there's this saying that we we've come up with a Softway. You know, we're talking about culture. And you know, you must have heard of Peter Drucker's saying that culture eats strategy for breakfast, right? And we say that behaviors eat culture for lunch. Because it starts with behavior, you cannot build a culture that you want to aspire, whether that's culture of high reliability, like for hospital systems, or any of those things without the right behaviors, right, that are embodied by the leaders and every single individual, right? It's the leader who sets the tone for those behaviors that everyone follows or embodies, and witnesses and stretch practice on their own. Yeah.

Dan Edds
But so, so the question, so the question, Mohammad, and I love that observation. So the question I would put back to you, I'm happy to answer the question, if you want me to.

Frank Danna
Let Mohammad answer the question.

Dan Edds
So, so so so take that, and what do you do? How do you embed that idea that leaders must model behaviors to 2 million active and reserve duty personnel in the United States Army, or an elementary school with 75 educational leaders,

Mohammad Anwar
it starts with servant leadership, and servant leadership in the simplest terms is you put the needs of others before yourself. And when you are able to be selfless, and come from the angle of you're here to serve others not lead, but to serve, then that care, compassion, love endearment for your team for your coworkers, makes you behave in ways that give them that experience. Right. And that's how a leader must start. But if a leader is in a position of leadership for the wrong reasons, which is power, authority, selfish gain, and those kind of, you know, satisfying factors that some leaders may have, and they're in a position of leadership, but maybe not are truly leaders themselves. That's when you see the wrong type of behaviors of control, micromanagement, lack of empowerment, and so forth. And so what you're describing to me is in a high impact organization, you've taken it to the extreme, right, you've talked about military, you talked about hospital systems, if you think about it, these are all high reliability based organizations, for them. Reliability comes down to the lives of people, whether that's in the military, or the hospital system. And so your high impact organization is that it's that much of like, you know, emphasis is that it involves the life of people. And so what I'm gathering from your research, where you seem to have focused on those high reliability organizations, is that when leaders are embodying the behaviors of a servant leader, where they put the needs of others before themselves and create that environment of love and endearment, those organizations have seen an uptick in safety, and, you know, reduce the loss of life or accidents and empowerment, and so forth. So, is that correct?

Dan Edds
Yeah, there's more to it, though. So you asked me originally, what is my you know, what definition of a system am I looking at? Or am I am I using. So, you know, I said, the system takes a handful of key elements or resources and organizes them in a very specific way to produce an output or a purpose. So what I found was that there's three, the resources organize themselves through three things. We've mentioned one, which is behaviors. The other one is rules. And the other one is routines. So how does this work? So I actually asked the General McCaffrey I said, How does the United States Army reinforce the servant leadership among its its, its its officers? And he gave me three ways. I'll give you one. He said, when a helicopter when it when a team is going off on a mission, and they're boarding the helicopter, he said, by rule, not by suggestion, but by rule, the highest ranking officer gets on that helicopter last. It's it's largely symbolic, but it's it's reinforcing the whole idea. The highest ranking officer makes sure that his team is in the safety of that helicopter before him or her. And then there's the counterpart to that by rule. The highest ranking officer is to is the first to get off that helicopter, because they're putting themselves in harm's way, first. Now, army guys have told me Well, there's some logistical reasons for that. He said, Yes. But that's how the army trains its leaders. It's not a suggestion. Simon Sinek wrote a book, terrific book a few years ago called leaders eat last. And it's a great book. It's I thought it was one of the best books on leadership around until my own maybe. Yes, but you know, he makes the point is that in the United States Marine Corps, the rule is leaders eat last, they make sure that, you know, the highest ranking officer goes through the cafeteria chow line last. What I think he does not mention I ever I've read the book a couple of times, I think, I think I've got it correct. correctly. It's a he describes it as a suggestion that eater leaders eat last. In the Marine Corps, it is not a suggestion, it is a rule. And as soon as we start defining rules, and routines and behaviors, that will take these, you know, handful of resources produce a specific purpose. Now we're in the business of talking about a system, or systems that is defined, that's measurable, that's articulated, And oh, by the way, you can improve the system of is not performing the way you want it to.

Mohammad Anwar
So I have a question to ask. When you think about it, these systems are still defined by a person, by a human. So I wonder if the systems can truly be instituted, if the leaders who still have to make decisions around these systems are not embodying the right behaviors or mindsets. So I suspect that it's not that simple to just take a system and institute it. It has to go through, first, the leader, regardless of they have to embody those behaviors and mindsets in order for the system to be successful. Because if we put in the systems and the leaders at the top are not embodying the right human mindset, you may not even get that system. Yeah, we still have to start with the people aspect.

Dan Edds
Yeah, yeah. Yeah. Yeah. Perfect observation. And I'm not suggesting is suggesting at all that there is not a place for high quality leadership. In fact, what my observation and others others as well is that the right system can take a pretty average leader and turn them into a rock star. And that actually is the is the history of the United States military. And and, Mohammad, you're absolutely right, you could just you could design or install a terrific system of leadership or any other kind of system. But if leadership, the individuals, if they're not modeling their behaviors, DIC the system, throw it out the window because it's useless. Yeah. So just to show you how one organization that I looked at how they approach that. This healthcare organization, actually I just mentioned, it's what's one of the safest hospitals in America. When I was taking a tour, and one of their senior leaders spent a whole morning with me, she took me to a hallway where every Tuesday morning at exactly 7am, the executive leaders of this organization gather. And they it's a it's essentially a Value Stream Map, where they're, they're tracking strategic objectives where they want to go. And it's, it's all very well designed, you know, they do it for a specific amount of minutes every Tuesday morning, don't be late, they never sit down, they stand up. But at the end of this hallway, my tour guide pointed this, you know, poster out to me and there is eight or 10 what she referred to as foundational behaviors. This is a hospital system, like I said, of almost 10,000 people, and everything is driven off of a value of respect. Well, they've identified these core foundational behaviors, they had them posted on a wall. And then she pointed out to me that there were various initials that have been, you know, written on this poster as laminated. And, you know, I looked at it, you can see, you know, people's initial initial, she said, those are the initials of our senior leaders who have said, This behavior is a week weakness of mine, and I want to improve this, but this specific behavior, and here's my initial to tell the world, this is what I'm working on, personally, this year.

Mohammad Anwar
I hope that they'll work on more than one once a year, but well, so. But no, that's very good. Like, one of the things that we, we strive to practice is vulnerability. And one things that we have recognized is good leadership comes from leaders who are willing to be vulnerable. And by vulnerable, we're not talking about sharing your deepest, darkest secrets. But by taking ownership and apologizing, or understanding your shortcomings, and being willing to share that with others that, hey, I'm not perfect, I messed up. And I want to take ownership of that, that's on me. And that is probably one of the hardest things for accomplished leaders to do is being able to come in and say, this is my weakness. So the fact that you said that, that that safest hospital has this practice of doing is is really like hitting home. Where we strive to talk about the culture of love and the right behaviors practiced by the leaders.

Dan Edds
Frank, you were, you were starting to say something, but I think you may have been on mute,

Frank Danna
I was. My kids are dancing. The other rooms around the house, they're there, they're playing over there. So I'm trying to balance that. I was just I was just gonna kind of echo what Mohammad said that, you know, it's a it's a good starting point and be and creating visibility around areas that you want to improve on, I think is a valuable thing, because there's accountability there for the employees. Right. And also the the patrons of the hospital system, but I'm wondering about employees and how how this type of leadership helps employees feel that empowerment and and what you've seen in these types of organizations, where, how will leaders work with their employees to continue to prove out through these behaviors, rules and routines, the the values that they're espousing?

Dan Edds
Yeah, great, great question. So again, I'll use a couple of examples from from the book. So this healthcare organization I just referenced, they, they train their leaders very, very specifically to lead in very specific ways. So standard off the shelf, you know, definition of a great leader is someone who is a great problem solver. Almost every book you read on leadership, you know, here's a great leader, they're a terrific problem solver. This hospital actually says, No, we do not want our leaders to be problem solvers. Because it violates the value of respect. So if I'm working for Jeff, and he's the manager of a clinic, and I'm, you know, doctor, nurse, or med tech or whatever, I'm having a problem. If I come to Jeff, and say I'm having a problem, that's actually code for to two issues that Jeff was going to have to deal with. Number one, the routine is that, Jeff, that is that I don't go to Jeff, if I'm coming to Jeff, it's symbolic of the fact that Jeff is not leading the way he's been trained to lay because he's supposed to be coming to me. He's supposed to be coming through my workstation on a regular basis to see how I am doing to see if I have everything I need to see if there's anything on the on my plate today. That's gonna stop me hinder me or slow me down from doing my work. So that would be the number one problem is that Jeff supposed to be coming to me. Second of all, if I do bring a problem to Jeff, his job is to help me think through the problem. Think about the scope of the problem, to maybe talk with me, help me understand, work with me to understand other people who may be impacted by that problem and various solutions. But his job is not to solve the problem for me because that's disrespectful to my basic underlying intelligence, my ability as a human being, to think creatively and do problem solving. So he is he is trained not to solve my problem.

Frank Danna
It's interesting. I mean, the way we approach that and the thinking that we utilize in software is we view that as sympathetic leadership where Someone is coming in and solving a problem for someone which ultimately ends up stunting the growth and the development and the opportunities for that person, right. And so when you think about sympathy, typically you're thinking about that, and I have the best, the person's best interests at heart. But in reality, you're actually causing a disservice, the disrespect is a great way to think about it. Because you brought them in to solve problems. And now you're going ahead of them, trying to do it for them in the name of being sympathetic, instead of empowering them and being empathetic to the situation by providing the solutions alongside of them. So that that's a great answer. Yeah.

Dan Edds
Well, I, again, I'll go back to my conversation with General McCaffrey, because I asked him about that specific, you know, idea of who solves the problems. And he said, by rule, that's the word he used by rule, the highest ranking officer on a mission, the highest ranking officer who was closest to the battle, he makes the decision of of how to approach that battle. And he said, I have been in the White House Situation Room many times where we are watching a military mission in real time, as it's happening through the magic of satellite communications. He said, we have virtually the exact same information as that officer that's on the ground. But he said, If you really want to screw up the army, and his language got very colorful, he said, If you really want to screw up a mission, take that authority, or that power, away from that officer that's on the ground in the middle of that battle, and bring it back to the White House.

Frank Danna
Wow. Yeah.

Mohammad Anwar
So I have some observations and maybe some input, I'd love to seek from you from a healthcare standpoint. So in healthcare organizations, administrative leadership, traditionally, is not led by clinician background people. Is that correct? Like I believe from my research, I've understood that the administrative leadership even up to the C suite, they may not have come from the ranks of clinicians, the military in the military, I see they come from the you know, they grow from the ranks from the field. So is that the question I have is if you have leadership in place in administration, that don't have a clinician background, but yet are leading strategic decisions for the direction of a hospital system? And how they should be growing or adapting or moving forward? And the clinicians? Who are the frontline workers in the hospital system are not don't have a seat at the table? Or our voices are not even heard? How do we make sure that those organizations are high impact high performing? Because I see that as a problem?

Dan Edds
Yeah, yeah, well, you're not the only one. And I'm really not an expert in this. But I know that there's been a lot of research that's been done of, you know, who makes the better hospital CEO, the clinician or the peer administrator? And I don't know that there's a hard answer to that. But I do know that there's a lot of work going on right now in the industry, to merge the clinician with the peer administrator. And the, it's really a result of how the industry has evolved. where, you know, back in the day, you know, when I was, you know, young, you know, you went to the local neighborhood doctor to get your annual physical or to get your, your, your, your, your arm stitched up, or your head stitched up, when you you know, you fell off your bike. And, you know, everybody knew the doctor because he was sort of a neighbor. I mean, he was the little, you know, one, one person office and they had a, you know, a receptionist. Well, today, all those little offices have been bought out by larger organizations. And the tendency is to tell the doctor will you just focus on being a doctor and we'll take care of everything else. And the doctors are now or the clinicians now are beginning to kick back against that and say, Hey, Wayne, but we want we need a chair at the table. And there's actually processes in place and shared governance models that are in place, it's actually bringing them to the table.

Mohammad Anwar
Got it. So talking about that. So if clinicians if there is a trend for clinicians, merging with the administrative role, but they've been educated and their lifetime training is on being a clinician and not have a lot of leadership or business or management training in their career, even into continued education for that matter of fact, how are organizations going to fill that void? If they are trying to get clinicians to take on more administrative responsibilities?

Dan Edds
Yeah. Well, I think the simple answer to that, and maybe it's just because I wrote the book, is when you've designed a system, you can train people to the requirements of the system. So this particular hospital that I'm referencing, they have an extraordinarily well designed system that just happens to come from the Toyota, from the from the Toyota Motor Corporation. 2001 2002, they were the first healthcare system to adopt the Toyota Production System, ie lean, and they are now the world's leader, and the education and implementation of lean and healthcare. They train hospitals all over the world and how to apply lean, but what they don't talk about too much. And actually one of their key executives wrote an endorsement from for the book. And she said that she just she defines leadership as a system, separate from a charismatic personality that can be measured, monitored, improved. So when you take a person and place them into a system, you can teach them the requirements of the system. And then their natural leadership ability, whether it be terrific are average, really can grow and multiply. And, and, and have a tremendous impact. So this hospital that I've been referencing their CEO, he's now I think, in his 22nd, third, fourth year as the CEO. When they formally and he's an MD, he's still a practicing. Doctor. He actually did his residency at this hospital. So he's been with them a really long time. Wow. And he was named as the CEO based on a democratic vote of the whole system, all doctors. And one of the first things he did was in working with the board, he said, This democratic idea of being the CEO has got to change. And so they they appointed, Dr. Kaplan is the CEO. And he royally made most of us colleagues really angry. And, but they took seriously the, the imperative of improving safety, and knowing their hospital, but also lowering costs. And so they went radical at the time, it was a radical decision to adopt lean and the Toyota Production System. But with that system, came a management system, which they define as a leadership system that shows every leader whether they be a clinician or a peer administrator, how to lead, how to engage with their staff. And so it's the system that drives the drives the performance of the individual leader.

Mohammad Anwar
So I wanna, I want to challenge a little bit with the systems that we're referring to, I believe that COVID hat may have exposed some gaps in those systems. Because while the systems are filled with rules and routines, as soon as the pandemic hit, these hospital systems are dealing with things that they'd never encountered before. And so at times, the systems and routines that are filled with rules, can't immediately adapt or adjust to such radical change that may be we may be facing. And so in those cases, how do these systems that are set on these rigorous rules and routines? How can a leadership or management team quickly adapt to this because we saw a lot of hospital systems crumble when it came to COVID?

Dan Edds
Well, I think there's a it's a great question. And invariably, when I talk to when I first started talking to people I knew and my friends about you know, doing those researches leadership as a system, invariably, their first reaction Well, is that a good idea? and some would say, could because every leader has their own personal style? And is it a good idea to be telling people how to lead? And it was a it was a good question at the time I didn't have an answer for. But what I observed, actually that the simple answer is a plant right outside my backyard. So this plant normally has long and narrow leaves. But because I don't know anything about gardening, I put it in a place of shade. Well, today, if you look at that plant, it has long and wide leaves, because it's learned to adapt to my air and in being a dummy when it comes to gardening. Because it wider leaves it lets you know absorb the sunlight. So think about an organization, healthcare organization, 10,000 employees, by definition, they probably have somewhere between 900 and 1000. leaders, somebody with some kind of leadership management ability, if everybody is leading based on their own personal profile their own values. How easy is it to make a shift in something like COVID, when it comes along when everybody is leading based on their own kind of value system, or where there's a common way of leading, and then oh, we need to be doing this other thing as well. And our, our value system respects people, and we train people, we develop people to speak up, when they see an issue, that's actually one of their words, speak up. It's one of their core foundational behaviors, we want people to speak up when they see an issue. So you've got this culture where people are not only free, but they're empowered to speak up. So they see an issue. Oh, we need to make sure I actually had this conversation with one of their doctors, Tuesday, exact same conversation. They're empowered to speak up. So one of the doctor I was talking to, he was quite proud of the fact that in their determination of who is going to get the COVID virus, the vaccine, they're not going to make any distinction based on income, social status, equality race, ethnics, whatever. And fact, he said, we have 250,000 people on the waiting list right now, he said, the computer system that we're going to use, is going to randomly select those people, so we can make any distinction between who they are. Now, compare that to another hospital, that is virtually right next door. Last week, there was a huge issue, they for some reason, thought it would be smart to put out an email to 500 of their biggest donors that said, oh, by the way, because you're one of our donors, we're gonna put you in the front of the line, and we have a vaccine shot with your name on it. So that immediately hit the news. You know, lots of embarrassment, etc. And someone finally said, Oh, I guess that wasn't very smart. And we really didn't mean to send out that email. So, you know, when you've got a system that says, We value people, we value behaviors, we value ethics, we want people to speak up my observation, it's a lot easier to change that kind of redirect that kind of an organization, as opposed to an organization where everybody is leading based on their own idea of what's appropriate.

Mohammad Anwar
Yeah. So even in the organizations where there is like that unified structure, but see the pressures of the reality that our reimbursements to hospital systems are shrinking. And the administrative leadership is having to make decisions saying, you know, patient to nurse ratio has to be reduced. And we cannot have, you know, one nurse to six patients, we need to have one to eight patients so that we can manage our budgets, right manager funding. And at that moment in time, the nurses and the clinicians know that that's detrimental to the safety of the patient experience and the patient safety, but yet they're forced to comply, even if they're able to speak up or if they are in a situation where PP equipment is sold to them and COVID you can reuse it for A week and go to patients, when they've been trained all their life are saying that you have to change your PP equipment. And here in COVID times, we're saying you can reuse it. And they're being forced to do these things. And it is against their training, it is against their morality. How do just systems and rules because that's, that's really what they're doing. They're following the rules. And the rules are saying you should do this, whether you like it or not. So how do we make sure we manage the morality of these? These are clinicians to the business needs? Are the rules that are being governed and set at the top?

Dan Edds
Yeah, well, I think there's a couple of things there. One is who's who's making the rules, that actually is more important than the rules themselves as who's making them. So if the rule is coming out of a government agency, that's one thing. But if the rule is designed to support and enforce a culture of respect, now we're down to the level of, of, of, you know, what's our relationship with our staff and our employees? And how do we develop them? So I'm sort of on the the tangent of this one healthcare organization. So you want me to move on?

Mohammad Anwar
No, I'm actually enjoying the healthcare example.

Frank Danna
Yes, this is good.

Dan Edds
Okay. So in this particular organization. And, and, you know, let's be frank, every organization has has rules, and most of them are nonsense. The, you know, every organization has, you know, the written ones, and those we all out we all need, but then the really important ones are the non written rules. So this organization, when, because they put a value on their people, as a resource that can be developed both personally and professionally. They're not, they don't, I don't, I could be wrong, but they don't put a lot of emphasis on like ratios. What they do is they put emphasis on the process. And I actually I asked the question to my, my host, during this tour, I said, what happens when someone comes along and says, Well, we need more staff for this particular clinic? And she said, Well, the first thing we do is we we ask them, okay, what kind of process improvement or lean initiatives have you done recently? And if they say, Well, I haven't done any recently, they'll say, okay, by rule, you are a leader in this organization, and your job, by rule is to conduct 123 probably personally conduct 123 process improvement or lean initiatives every year? Have you done one? Well, no, I haven't done okay. Well, that's the first problem. The second problem is they don't spend a lot of time talking about budgets. What they spent a lot of time talking about is things like, what's the point? What percentage of time do are the nurses spending with patients. So in 2001 2002, when they started this journey with lean nurses was spending about 35% of their time, actually, with patients. Today, they're up around 90 or 95% of their time. And so by getting that kind of productivity, and focusing on value added service, value added processes and everything that will extract waste out of their system, they actually end up putting more value back in for their patients. So into the recession of 2008 2009. Most hospitals in the country, if not the world, were was you know, laying off people right and left. This hospital didn't lay off anybody. And fact, they continue to pay bonuses to the people who qualified for bonuses. And then as they do today, they still have some of the strongest financials in the industry. And they don't do it by fussing around with budgets. I've done a lot of work. Most of my consulting work. I spend a lot of time with finance directors, and they're all about budgets. And a good leader, a good manager or someone who, you know is really good at controlling the budget. And sometimes they just want to scream because they're putting the emphasis on the wrong thing. Yeah, they need to be focusing on what's what value are we providing our customers and working with developing their financial resources? Just like it was a resource that can be developed for value.

Frank Danna
You know, it sounds to me like the thing that I've that I've been thinking a lot about, as you've been talking, and I think this interesting kind of segue into this unique experience that you've seen in this healthcare, it's definitely not the norm. Right, there's definitely going to be organizations out there that are that are, unfortunately weaponizing the rules in order to get people where they need to go without being without being flexible. But but that the question you asked a little while ago, and somehow we've already been speaking for an hour, which is insane, but it's also wonderful. What is the question you asked is what do we want our employees to experience? And I think that's such a unique takeaway from this conversation like that. One question is such a unique, like, a thing to think about, regardless of industry is, as a leader, you should be thinking about that question of what do we want our employees to experience and then creating an a culture around the employee experience, because the output of that employee experience is better productivity, it's a better end product, whether that's patient care, or a better piece of technology, or widget or whatever it is. Right. And so that that, to me is is was a very special question that I'm going to continue to think about on a daily basis.

Dan Edds
Great, you know, I'll get off the healthcare kick for a moment. So there is a there's a Ford dealership in Albuquerque, New Mexico. I don't know where they're at right now with this number. But for the last several years, they have been either ranked as either the number one Ford dealership in the world to work for, or they've been right at it. Wow. You know, out of 5000 Ford dealerships, they're the number one Ford dealership to work for. And if they're not number one, they're they're like, right behind number one. Their pay their patient, their customer satisfaction scores, far out surpassed, you know, the traditional Toyota, Honda, you know, Nissan, you know, mercedes benz, etc. And they're a Ford dealership. But they make that that workforce experience strategic, and they measure it every year. And they have they have built that experience of the workforce right into their strategy. In fact, it's a central component of, of their business strategy is that engagement and experience of their workforce. And they, I think I have the last 25 years, I may get this not exactly right. But I like that last 25 or 26 years, they have been given the Forbes President's Award like 21 years, which is the highest award that Ford gives out to their dealership dealerships. And they, they lack nothing on profitability, they lack nothing in car sales. And oh, by the way, they're closed on Sundays. Because they want their employees to be with their family on Sundays, rather than in the car dealership selling cars.

Mohammad Anwar
Something I learned very recently from one of my mentors and advisors is that there's a difference between employee satisfaction and employee engagement. And employee satisfaction is benefited from the policies and the product, you know, the rules. And if those are set up really well, then the employee can have satisfaction, whether that's pay scales, processes, or rules and stuff. Engagement, on the other hand, is experienced from their immediate boss and your supervisor, right? If you don't have employee satisfaction, it doesn't matter how good your boss is, you will not have the engagement. Yeah. And so that I think, is making a case for what you just brought up this whole topic about systems as a system. Leadership is a system to get the highest impact out of your organization in your teams. And I can see now the importance of making sure that the employee satisfaction is set through their system, and then the engagement is to the people to people interaction, but without the proper system. You can't experience engagement, no matter how good your immediate bosses, right,

Dan Edds
Right. Yeah, yeah, thank you, you probably can't on a very small scale. I mean, if the four of us, you know, we're working together, you know, we could sort of you know, have a high degree of of engagement. But as soon as we go up to 400, or 4000, or 40,000, or 4 million, now, you need some kind of a system that's gonna coach teach train every leader and and and how to do it.

Jeff Ma
Yeah, yeah. Well, time has surely flied. And I want to thank by really showing some appreciation here for Dan. Dan, thank you for joining us and sharing about your book and your experiences and your wisdom. Thank you so much for that time.

Dan Edds
Honored.

Jeff Ma
Mohammad, Frank, thank you, as always, for joining this conversation. It was a great one. You know, we hear about you know, I love the dichotomy of kind of our conversation you hear when you hear the term system, you kind of have this like, thought of rigid, unmoving, kind of cold elements. And I love that contrast and opening it up and seeing as how there's room for the warmth of love, within systems and around systems and building systems in and out of love. So this was a great eye opening conversation for all of us, is a wonderful conversation. So thank you again, Dan. And for the audience here at Love as a Business Strategy, we are posting new episodes every Tuesday. And if you enjoyed what you heard, we'd love for you to give us that feedback, leave a review, subscribe, you can see us at softway.com/LAABS. And please tell us what you'd like to hear about next and share it with a friend. So with that, I will see you guys next week. And we'll talk soon.