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Hosts Spencer Horn and Christian Napier discuss a better way to build and strengthen teams in any organization.
00:13 - 00:22
Christian Napier: Hello everyone and Welcome to another episode of Teamwork a Better Way. I'm Christian Napier, joined by the always suave and dapper Spencer Horn.
00:22 - 00:30
Spencer Horn: Spencer, how you doing? I am fantastic, Christian, and I understand you have some very exciting news this past week.
00:30 - 00:46
Christian Napier: Yes, we've had very exciting news. We became grandparents. So super excited for that. Not going to get into all the details, but yeah, our first grandchild was born last week and we're super excited for our son and his wife welcoming their first child into their family.
00:46 - 00:54
Spencer Horn: But see that that kind of fits well with our theme today, right? Mastering, you know, change. Of course, that's not a business, but in your personal life, that's a big change.
00:54 - 01:12
Christian Napier: It is a big change, but it's a very welcome 1, and we're super excited. Speaking of our topic, Spencer, you've got an amazing guest lined up for us today. I can't wait for our viewers and listeners to get to know her. So why don't you go ahead and introduce her.
01:13 - 01:58
Spencer Horn: Absolutely, I'm gonna introduce Dr. Nadia Zhexembayeva. So glad to have you. And she's often called the reinvention guru, the queen of reinvention, and you will quickly learn why. And Dr. Zhexembayeva is a scientist, entrepreneur, and author specializing in reinvention and resilience, which is so important today. As a consultant and educator, she's worked with major organizations such as Coca-Cola, Cisco, L'Oreal, Dannen, Henkel, Erste Bank in Germany, and all over the world She's worked with organizations that research and understand the dynamics of reinvention, which I'm so excited for her to share with all of our listeners, but they
01:58 - 02:36
Spencer Horn: really work to with these organizations to change their leadership practices and business models, to meet new market demands and prepare for upcoming or incoming disruptions. And they happen like every minute, it seems like. And As a speaker, she's delivered keynotes and workshops to over 500, 000 executives around the world. She's given 4 TEDx talks, if you've ever tried to do that. That's amazing. As an author, she's wrote several award-winning books. I'm surprised you don't have those behind you there, Nadia. She's been a contributor to There you go. There you go. I've got my workbook my reinvention
02:37 - 02:49
Spencer Horn: workbook right here And she's included, you know contributing to Forbes Harvard Business Review among others We are so glad to have you and our listeners. Welcome. Dr. Nadia Zhexembayeva
02:50 - 02:52
Dr. Nadya Zhexembayeva: It's my honor to be here. Thank you for having me.
02:53 - 03:32
Spencer Horn: Well, I saw you first at the NSA, National Speakers Association Thrive event in March, 2023. And I took so many notes. I actually reviewed my notes and so much of the information you gave was astonishing. And yet it feels like what you were talking about and just the disruption, the change that we're experiencing. And you told a little bit about your story. What got you into this field of studying resilience and disruption? Would you please share just a little bit about where you came from, why this is So important to you and why this is your
03:32 - 03:33
Spencer Horn: mission.
03:33 - 04:12
Dr. Nadya Zhexembayeva: Of course I think our stories are also our biases and I'm not afraid to say that I'm not at all neutral when it comes to resilience and reinvention and of course my background and my history creates a bias in my thinking on what matters or not. I'm definitely subjective here. I was born in the Soviet Union before the collapse of the Soviet Union, and I saw firsthand what happens to a system that fails to reinvent on time. Because when the collapse happened, we already had a significant shortage of food and standing in line for basic necessities
04:12 - 05:00
Dr. Nadya Zhexembayeva: such as hot dogs or mayo would be a massive daily grind. So the whole family usually would be participating in food hunting throughout the week. But in addition to the collapse of the Soviet Union, the food shortages, the rise in crime, the complete obliteration of any social security network. So no government, no ministers, no working police, no working healthcare system. We had no currency of our own for more than 2 years because we were so unprepared. This laid on top of about 100 years of traumatic, traumatic experiences, including revolutions, 40% of Kazakh population murdered by the
05:00 - 05:49
Dr. Nadya Zhexembayeva: state in a state-organized famine. And after that Second World War, the largest number of concentration camps on the territory of Kazakhstan for the entire Soviet Union, and the use of Kazakhstan land and its people to test all of Soviet Union nuclear power. So as a result, we have massive growth, rise of cancer, but also genetic disorders of every kind. That was my history. So when the collapse happened and I saw what is happening to the country, the biggest surprise is that despite 100 years of every kind of torture, murder, food shortage, anything you can imagine, most
05:49 - 06:29
Dr. Nadya Zhexembayeva: people still resist the change. They still would rather stay in a horrific but predictable past than go into the uncertain future. So, when I started my doctorate in 2001, I decided I want to study ability of systems to not just survive disruption, but actually thrive in them. And what makes 1 system that could be a company, a country, a family, a career, what makes 1 system very resilient and able to reinvent and again and again, while others are collapsing with relatively small disruptions. So that was the beginning of my story.
06:30 - 07:07
Spencer Horn: You talk about this Titanic syndrome, right? This the not being aware of the dangers of the iceberg. And it's really interesting that you experience people when the Soviet Union collapse actually committed suicide rather than deal with the change. And I didn't experience something that dramatic, but I lived in Italy in 1984. So very close to the collapse of, you know, right after the Soviet Union and or the wall coming down in East Germany. And I remember this woman who lived in our apartment complex was from Moscow. Her husband was Ethiopian. And so she was there with
07:07 - 07:28
Spencer Horn: her daughter. And she would say to me, you know, when I lived in the Soviet Union, we knew where our food was coming from. She said, I'd rather live in the zoo where I knew where the food was coming from rather than the jungle. And that was the attitude that change was so traumatic, right? That you experienced. You said something, go ahead.
07:28 - 08:03
Dr. Nadya Zhexembayeva: Imagine my surprise When I grew up and learned the neuroscience of change, for me, the biggest discovery was that when we are born, that's not our natural state. Fear of change is not innate. If we had a fear of change, we would never learn how to walk, talk, crawl, or do anything we do. We are born natural at reinvention. We're just educated out of it. And seeing the impact of that on millions and millions of people, not only what they do to themselves, but what they do to everyone around them because of their fear of change,
08:03 - 08:17
Dr. Nadya Zhexembayeva: made me much more motivated to make sure we move to a place where reinvention is a birthright, but also reinvention is a massively available skill in this century. Spencer, I interrupted you. Go ahead.
08:17 - 08:23
Spencer Horn: No, go ahead. I actually, I saw Christian had something on his lips. I'll come back to that. No,
08:25 - 09:17
Christian Napier: I'm just finding this backstory completely fascinating. And But 1 of the questions I have is, you described this feeling in the sense of people and governments changing or collapsing and so on and so forth. But you do a lot of work with organizations that are not nation states, you know, but they're for-profit entities or other organizations. But I suspect that the lessons apply across the board, right? That it's not, oh, well, you're talking about the collapse of the Soviet Union. That doesn't have anything to do with what I'm dealing with in this company that I'm running.
09:18 - 09:34
Christian Napier: So how did you draw the line between what happened, what you experienced so personally and so deeply in a civic environment to something that happens in more of a corporate environment? What are the parallels?
09:36 - 10:17
Dr. Nadya Zhexembayeva: Well, I think if we are busting some myth, let's bust some more. So the first myth is that humans hate change and they're bad at it. I see 0 evidence in the way of our neuroplasticity. Neuroplasticity means that our brain is extremely adaptive in nature. Any ideas we had in the 20th century that the brain is very static structure, and you only lose neural cells, You never grow new ones and you never grow a new brain tissue. We already disproven. We know that brain is very plastic. It's not static, that it always develops new structures. And
10:17 - 11:00
Dr. Nadya Zhexembayeva: we do grow neural cells, and we can also stimulate that growth if we're thoughtful about it. So number 1, humans are greater change. We're just educated out of it. Number 2, this idea that reinvention is unique to either a system or a particular subject is another myth that we have to debunk. So system means that reinventing a country is very different from reinventing a family. But here, a natural systems thinking laws apply. Any system is reinvented using about the same set of rules. There are subtle differences. You need to know a little bit more different dimensions.
11:00 - 11:44
Dr. Nadya Zhexembayeva: But generally speaking, we are very fractal. Fractal means that what happens at a small level is completely repeated at a large level. And we have the same patterns looking at the large system called the country versus large system called a company versus medium-sized system called a department or a small system called a single person. All of those have subsystems. All of those have feedback loops. All of those follow the same approach that we take when we understand system thinking. Second is the idea that topic makes any difference, that reinventing your company to address the rise of
11:44 - 12:26
Dr. Nadya Zhexembayeva: artificial intelligence is different than reinventing your family in the moment in the middle of COVID is different reinventing your own team when your boss has quit and you have a new boss versus anything else. The reality is it's like being a very, very good piano player. When you are an excellent piano player, you can play Bach or Tchaikovsky or you can play M&M and local country song. It makes absolutely no difference. And you can make a truly genius performance using exact same instrument and the same set of keys and the same set of principles. So the
12:26 - 13:16
Dr. Nadya Zhexembayeva: surprise that I've seen in the work of Reinvention Academy, which unites thousands and thousands of people around the world. We actually touched almost a million people with our reinvention toolkits, mindset methodology, philosophy, comprehensive field of study now that connects across strategy, innovation and change. Now when you look at our community, we have people who apply the same tools in personal coaching, in finance reinvention, in operations reinvention, marketing reinvention, family reinvention, nonprofit reinvention, public sector reinvention, exact same toolkit. There's tiny variations here and there. You would substitute 1 tool for another, but the core of the methodology
13:16 - 13:23
Dr. Nadya Zhexembayeva: and the core of the field of reinvention, which is now a new field of management is definitely the same.
13:36 - 14:16
Spencer Horn: Dr. Nadi, I want you to talk about why. You said you're working with over a million people around the globe. I want you to share with our listeners why that's happening. And I just want to get you started on that train, because when I heard you speak, you asked us a question. How many recessions do you think there have been since 1989? And I'm like, okay, you know, maybe 10 or... And the answers surprise me. And I think if you will share that in that data, I mean, that will... That equates to why this work that
14:16 - 14:20
Spencer Horn: you're doing is exploding just because of the need, the rapid need for reinvention.
14:21 - 15:09
Dr. Nadya Zhexembayeva: Absolutely. I had that date a few years ago. It's already outdated and I haven't fresh. So you can increase that by quite significant number. When I asked the audience how many recessions you think we had, majority speaks about 5 or 10. And when I expand the definition, think about global recession versus regional recession, let's say just Latin America, or industry recession, let's say just mining industry, or a country level recession. Even with those definitions, we still saw people naming 2030. And at that time, the number of just country level recessions was 469. And if you add
15:09 - 15:48
Dr. Nadya Zhexembayeva: it to that industry region and global recession, at that point, we were at the stage of about 1 recession every 1 to 2 weeks. And majority of people say, well, I don't care if there is a recession in the Democratic Republic of Congo. Who cares? Well, the issue is that we're living in a very globalized, very interconnected supply chain. And specifically, Democratic Republic of Congo, who we have never tracked until very recently, is responsible for almost all production of cobalt. And cobalt is what makes our devices work because without them the battery cannot be compact enough
15:48 - 16:27
Dr. Nadya Zhexembayeva: to be functional. So when there is a recession in Congo, all of us feel that recession and it's called inflation, because volatility in the supply chain is compensated by increased prices to manage the risk, to deal with the difficulties with deliveries. Right now, for example, close to my neck of the woods, the war of Russia against Ukraine, we now typically have to fly 2 to 3 hours longer because the airspace around the 2 countries is now unsafe. That is the cost of fuel. That is a cost of work hours of the employees. That's amortization on the
16:27 - 17:07
Dr. Nadya Zhexembayeva: plane itself. Of course, the tickets will go up, but also the delivery of all of your goods and services. So when we're talking about recessions, we're talking about daily, weekly recessions that all touch you in the form of disrupted supply chain and ultimately increased prices. And that's just 1 of disruptors. I will ask you another guess and let me ask you both, Spencer and Kristen, please guess. What has been the rise of disruption in the last 5 years? And I'll give you a benchmark. So before recent history COVID and AI and all of that, we had
17:07 - 17:25
Dr. Nadya Zhexembayeva: other disruptions, economic recession. And right after economic recession between 2011 and 2016, 5 years, Our overall disruption index grew up by 4%. So we became 4% more disrupted in 5 years. Give me a guess.
17:25 - 17:26
Spencer Horn: How much? Okay, I know the answer to this 1.
17:26 - 17:27
Christian Napier: I'm not
17:27 - 17:30
Spencer Horn: going to guess, but I will tell you after Christian guess what I would have said.
17:30 - 17:35
Dr. Nadya Zhexembayeva: Okay, Christian, tell me,
17:36 - 17:50
Christian Napier: what's the price of the next 5 years? In percentage terms, compared to 4% over the previous time. I would probably say maybe marginally higher, maybe 6%. I don't know. I I'm just like spitballing here I was
17:50 - 17:53
Spencer Horn: I doubled it Nadia I doubled it to 8 percent and
17:55 - 18:35
Dr. Nadya Zhexembayeva: between 20 and 50 the actual number is 200 and we are tracking economic technological geopolitical social climate because now the climate is changing the crops. California in the last month's insurance went up 34%. Who is paying for that? That's inflation for you immediately. It's just the fact that everyone who produces anything in California is now paying more So they're passing on those extra costs to the consumers So we're looking at this chain reaction upon chain reaction upon chain reaction and most people say well I feel it in my gut there's nothing new in that data you
18:35 - 19:09
Dr. Nadya Zhexembayeva: just very fine and validating what I felt in my gut anyway the problem is that most people who say that did 0 to change the way they function Meaning that if there is 200% of growth of disruption, your weekly schedule needs to change because 200% more likely you are to get an email from your customer who says cancel, an email from your employee who says I'm not coming to work, an email from your insurance agent who say I'm upping the game by 30%, an email from supply chain manager who says I'm not delivering your goods and
19:09 - 19:11
Dr. Nadya Zhexembayeva: on and on and on.
19:11 - 19:45
Spencer Horn: So, Nadia, you said in the very beginning this is what I was going to say and if you weren't listening and paying attention, you would have missed it. You said the when you disrupt is so important now. You're talking about the timing of disruption. And you mention it again, We have these gut feelings. Like right now my industry is disrupted in the speaking industry. We're in an election year. Everything is different right now. People are not booking in advance because they have no idea what is happening in the future. So I had, last Thursday, I got
19:45 - 20:17
Spencer Horn: 2 new clients for September. Luckily I had an opening. They had to move their date to accommodate me, but that's for September. So we're not talking about 6 months or a year from now. No one's booking that far out in advance because they can't compute what's going to happen. And so how do I have to change my business? I know it's happening and I've known it for a long time. What am I doing differently? That's what you're asking me. And to be honest, not a lot.
20:17 - 20:51
Dr. Nadya Zhexembayeva: And that's the issue. Whether we're talking about individual level, entrepreneurs, large companies or countries, We have not changed a bit. So what needs to happen number 1? You need to make sure you have time in your calendar that is protected disruption time. Meaning, you know, forgive my language, shit will hit the fan. You just don't know which 1. You don't know what will break, what will require extra time. So you need to have a buffer time, Because if you don't, that means you are addressing all those crisis in the middle of the night, in the evenings,
20:51 - 21:27
Dr. Nadya Zhexembayeva: over weekends. You're getting more and more exhausted. You're getting more and more burnt out. And therefore your capacity to be effective and productive is also decreasing over time. And it's a kind of a spiral, a vicious spiral that is making you weaker over time because you're not managing your time. Second, money. Every organization I know today has to become much more resilient when it comes to access to cash. So it's yes, having some cash flow that is greater than before. If before we could rely on that much more, now volatility means it's much harder to predict
21:27 - 21:58
Dr. Nadya Zhexembayeva: your cash flow and it's much harder to take on a debt because you don't know if you're going to service it. Same in personal life. You cannot afford as much debt as you could before because the volatility means at any given moment, things can change with your salary, with your contract, with your small and big business and so on. So having a cash reserve, but also thinking about multiple sources of income. What do you need to have? How do you need to diversify yourself? For example, in my business, 1 of the key things we've done is
21:58 - 22:32
Dr. Nadya Zhexembayeva: adding to the consulting business a massive digital course academy where we are able to deliver things asynchronously, pre-recorded plus live and doing other things that combine when COVID happened that saved us. We made that decision before COVID, but when we couldn't fly to our clients anymore, we had an alternative and now we're building new sources of income and new sources of income and creating more resilience. But it starts with simple things. Do you have a backup internet? All of us are working in the digital business right now and All of us are working in the digital
22:32 - 22:51
Dr. Nadya Zhexembayeva: business right now, and all of us are working in volatile weather. If electricity shuts down, do you have a backup electricity? Things like that start you thinking on, how do I create more resilience and more disruption readiness? So when it happens, it's a seamless transition. It's not the end of the world. It's not a crisis. Nobody's freaking out. We move on.
22:51 - 22:51
Christian Napier: We keep
22:51 - 23:29
Dr. Nadya Zhexembayeva: going. That's what separates winners from losers. And that's why in the world of constant disruption, reinvention is the strategy. It's not a methodology for executing your strategy, it's the strategy itself. The actual gimmick, whether it's price or product or positioning, all of that has a very, very short shelf life right now. So betting on your product or betting on your price or betting on particular technology is unsustainable, it will deliver advantage for a few months or maximum 1 to 2 years. The reinvention process is becoming a much better source of competitive advantage.
23:45 - 24:35
Christian Napier: I want to come back to the musician analogy, right? I think it's true that very experienced professional, classically trained musicians can play a variety of genres, But most musicians cannot play all genres. You know, from a guitarist perspective, it's very different the technique to play blues, to play metal, to play fingerstyle versus Travis picking. These are techniques that are hard and you can spend a lifetime learning all of these techniques but typically mastering maybe a subset of them. And so 1 of the questions that I have is when we tie this kind of this musician analogy
24:36 - 25:07
Christian Napier: to what we're doing in our corporate lives or in our professional careers, we could become a bit distracted by trying to be all things to all people. Yes, I can play the blues. Yes, I can play country. Yes, I can play metal. I can do all of these things. But at the same time, I probably need to focus on having a core set of values that will allow me to adapt. So I don't spend all my time trying to be all things to all people. So when it comes to looking at resilience and being able to
25:07 - 25:43
Christian Napier: navigate these very tricky situations, how do you keep people from becoming distracted by the shiny new objects that appear every day so that they don't get overwhelmed. I can't do it because, you know, there's too much change, there's too much unpredictable. There's so many changes in the market. It's really hard. But at the same time, creating a kind of a core that allows you to be resilient and adaptive. I don't know if that question makes any sense or not, but it just came to my mind when you talked about this musician analogy because I think it's
25:43 - 25:45
Christian Napier: a really good 1.
25:45 - 26:30
Dr. Nadya Zhexembayeva: Of course. So let me clarify that. When I talk about playing an instrument and being able to address any challenge with the exact same instrument, I'm talking about exactly that toolkit. So I'll give you an example. Many years ago, I had a client over 10 years ago, and that was a massive manufacturer of 100, 000 employees. And they realized that they need to start renewing themselves on the faster rate. That building exact same thing for years and years at that point, the oldest product chemically and physically was exact same for over 63 years. The same plant,
26:30 - 27:07
Dr. Nadya Zhexembayeva: same production, they improved it a little bit, continuous incremental change, but no real reinvention, nothing radical. And they realized that they don't exactly know how to reinvent. So 1 of their solutions was creating a corporate venture capital fund, which is what many organizations do to drive innovation and understanding that trying to innovate in the middle of operation is sometimes not effective. So they started the corporate venture capital fund. And their request to us was to come up with tools that will allow them to keep some level of discipline in the organization, but at the same time,
27:07 - 27:45
Dr. Nadya Zhexembayeva: allow creativity and freedom and adaptability and agility to happen. And we looked around, and we haven't seen any decent tool. I had the luxury of working with 1 of the classics of strategy in the world, Henry Mintzberg. For many years we taught together. So Henry, the father of emerging strategy, that's exactly the type of philosophy or theoretical background. If you think of Michael Porter deliberate strategy versus Henry Mintzberg emerging strategy, Henry is definitely much more adaptive methodology in nature, but the tool was not available. So we invented it and then reinvented it 16 times. It's now
27:45 - 28:23
Dr. Nadya Zhexembayeva: in version 16. It's called Stellar Agile Strategy Canvas. Ooh, I'm shaking my table. I'm getting excited. Stellar Agile Strategy Canvas is universal for any type of problem. It is an implementation tool that allows you to have a strategic discipline, but at the same time, built in agility and flexibility. And we had people use that tool for personal reinvention when they're trying to exercise more, for team reinvention when they're trying to organize the team differently, for contracting between a company and its client. For example, a CEO of a marketing agency uses that tool as a part of
28:23 - 29:01
Dr. Nadya Zhexembayeva: a contract now to create flexibility in implementation of the agreement. We've seen that used at the highest level of the board in a company, but also at the medium levels in every function across every type of reinvention. That's what I mean that the tool can be pretty universal and there if they are developed with strong science, but also very close to the ground, right? Ear to the ground. The tools can serve quite universally. Now, does it mean that they solve the issue of shiny objects? To a degree, but there is an element of a mindset and
29:01 - 29:41
Dr. Nadya Zhexembayeva: culture as well. What we see is that you need a dance between the discipline and flexibility. And without that strong relationship, this respect between the 2 sides, the 1 that likes to blow things up and the 1 that likes to keep things steady. Without relationship between the 2 and a well-oiled process, reinvention on a continuous basis, regular, timely, proactive reinvention cannot happen. And then we are always in a reactive mode. We are always following somebody else's lead, whether it's the technology that just disrupted us or a new regulation just disrupted us or a new boss that
29:41 - 30:20
Dr. Nadya Zhexembayeva: just disrupted us. We're always in a reactive, we cannot catch up firefighting mode rather than proactive trend watching and sometimes even trend setting mode. So there are plenty of ways to keep our team focused, but it starts with a process. It starts with a routine, regular, repeatable process, the way you think about taking a shower. If I don't take a shower on a regular basis, I begin to stink. Same with our teams, same with our products, same with our brands, same with our business models. There must be a regular process where we are not inventing how
30:20 - 30:30
Dr. Nadya Zhexembayeva: do we take a shower on the regular basis. We exactly know where is the water, what kind of soap we use, how to turn on the faucet and on and on and on.
30:32 - 31:11
Spencer Horn: So you were talking about do I have a backup internet system or electrical backup? My wife and I visited Lebanon twice in the last 3 years. And hopefully Some of our friends are listening from Lebanon, wonderful people, but talk about living disruption. I mean, they haven't had a president for like 4 years and their government is constantly in turmoil, but they have cisterns and they have, you know, UPS systems and batteries and everything that they need to be independent because things are going – they're going to go wrong and they're prepared. And I'm not Christian, so
31:12 - 31:46
Spencer Horn: we felt both my wife and I, we have got to start right now. We have food, storage, and that sort of things, but so let's get back to, we were talking about some of the, you know, the titans of this whole innovation and reinvention idea, people like John Cotter, Clayton Christensen, my son-in-law studied under him at Harvard and you know, just the innovators dilemma and you know, the innovator solution But they were still I mean talking about the time that they were doing all of their their preaching and teaching and writing That wasn't in the the
31:46 - 32:22
Spencer Horn: 200% volatility rate that we're talking about today. So you talk about every organization, every individual, every living organism has a life cycle. And that's healthy. But we have to tie this idea of life cycle back into the timing that you were talking about earlier and the gut feelings that I feel right now that there are changes in my industry. Like I just shared about my industry. And you say that when you start seeing the changes and your business is changing, that's too late to innovate. Can you talk about that
32:22 - 33:00
Dr. Nadya Zhexembayeva: please? Absolutely. So we all stand on the shoulders of giants. I'll start drawing now. And I absolutely stand on the shoulders of giants as a theoretician, as a professor of management and as a strategist. Of course I stand on the shoulders of the most amazing strategists going back in history to Greeks and Romans and all the way through now. Yes, of course, if we're talking about seventies, this is deliberate school of thought, which is Michael Porter, who is the godfather of that school of thought and emerging school of thought, which is Henry Mintzberg. A bit later
33:00 - 33:42
Dr. Nadya Zhexembayeva: than nineties, we have the rise of Innovator Dilemma, Clayton Christensen concepts, John Cotter's concept, and tons of others that did amazing job speaking about the need for renewal. So That idea is not new. This idea that everything goes through a life cycle. We go to the peak of our performance, and then if nothing happens, goes into decline, whether that's your product, right? It was very popular and then stopped, fax machines. Or your brand became very popular and then disappeared or your business model or whatever else and of course every scientist will show you that in order
33:42 - 34:23
Dr. Nadya Zhexembayeva: to move forward you need to reinvent start so-called the new s-curve That's the name and the theoretical framework or in academic speak. What we don't recognize, however, is 2 elements. 1 is that the research from a wonderful book called Stole Points, if you would like to research or you can just Google Harvard Business Review article on why you need to reinvent before it's too late. That research shows that if you are reinventing on the decline, chances of you going back to your own peak performance are only 10%. At this point economically the resources are not there
34:23 - 35:00
Dr. Nadya Zhexembayeva: to finance reinvention. Emotionally we are too afraid so we don't have enough blood supply to the brain to rethink and come up with fresh ideas. Politically, we're all afraid of who will be the scapegoat. So we're playing games instead of aligning, and on and on and on. Which means we need to reinvent on the upswing. But if we do it too early, we will be killed by economics. It's not economically or technically or regulatory viable yet. So there is this golden moment, which means the question of reinvention is not so much what to reinvent or why
35:00 - 35:26
Dr. Nadya Zhexembayeva: to reinvent or how to reinvent, but it's actually when. If you go too late, you will die. If you go too early, you will die. When is the key thing. So you can use the existing business model to finance your new business model. For example, Spencer can use the income from his speaking business to finance a second line of business that will allow him to stay afloat in the middle of volatility. Like we're experiencing right now.
35:26 - 35:31
Spencer Horn: You call that the slash people, right? That they have all these different streams of.
35:32 - 36:11
Dr. Nadya Zhexembayeva: Absolutely. So hopefully more of us will become slash people. It's a terminology from another great book you can also Google up. Slash people are people who have a lot of slashes behind their name. So I'm scientist slash, entrepreneur slash, author slash, and most of us are becoming slash people because we need multiple sources of income and multiple careers. Now the research we do in ReInvention Academy specifically is to understand when because that is the core question. And there's data that we collect is the data that drives a lot of our work. And we discovered this year
36:11 - 36:54
Dr. Nadya Zhexembayeva: that, because we are in the middle of 2024 research, that every fifth company in the world currently is reinventing every 12 months or less, every 12 months or less, faster than the budgetary cycle. That's your suppliers, that's your customers, but more importantly, that's your competition. So if that is the case now, you can no longer rely on some of this beautiful classic work that was groundbreaking at the time it was made. I only can bow to Clayton Christensen for giving us innovators dilemma. And I also have to recognize that at the speed of which we're going
36:54 - 37:34
Dr. Nadya Zhexembayeva: right now, looking at changes at isolated one-time event is no longer productive. When this was happening in the past, every 75 years, so I only needed to jump about half of the cycle, which is 37 and a half years, of course I would never have that capacity in-house. I would outsource it to consultants. Of course I would not teach my employees creativity and reinvention skills. They would need to use it only once every 37 years. They would retire before. Why would I rock the boat internally if I won't need this output for 37 years? If today
37:34 - 38:17
Dr. Nadya Zhexembayeva: the median in this year is somewhere around 6 across all companies including monopolies and manufacturing companies half of that cycle is 3. We're talking about reinventing every 3 years media number, every fifth company in the world actually reinventing every year or less, some every 2 to 6 months. That speed of change means reinvention is now a daily business and it's everyone's business. All management is change management. That's a difference. Continuous reinvention versus one-time project reinvention. Those are 2 different games, 2 different principles, 2 different ways of thinking about our careers and 2 different ways of running
38:17 - 38:18
Dr. Nadya Zhexembayeva: our organizations.
38:30 - 38:55
Christian Napier: Well, I think for listeners of this, we need to take a screenshot there, Spencer, and make sure we include it in the show notes so we can see that really powerful graph that you presented, Nadia. I want to ask you about that. You mentioned that because the change is happening so rapidly in more than a fifth of companies they're now reinventing more than once a year, less than every 12 months.
38:55 - 38:57
Spencer Horn: The budget cycles, why even make a budget?
38:58 - 39:39
Christian Napier: Right, so it doesn't align with with the regular business cycle, you know, administrative business functions and so do you see companies in your research are they starting to look at their kind of underlying administrative practices to to accelerate from 5 year plans to 3 year plan your strategies to you know from these annual budget reviews and annual performance reviews to doing things on a more frequent basis so they can be more proactive and hitting that sweet spot of change to reinvent themselves? Are you seeing changes in how organizations are behaving?
39:40 - 40:20
Dr. Nadya Zhexembayeva: Of course. I actually wrote a Harvard Business Review article on that, and we'll make sure you guys have a link in the show notes as well, specifically on adding agility to your budgeting systems. And we work with companies to build a reinvention-ready system so that they are not killed by their own internal practices. Agile dynamic budgeting is 1 of those practices, but also much more adaptive way to strategy, completely different principles of thinking about your workforce and creating massive flexibility in your workforce. We went as far as creating modular manufacturing systems with some of our manufacturing
40:20 - 40:57
Dr. Nadya Zhexembayeva: clients, which means you don't need to lock in the entire factory into decisions that will make it impossible for it to switch to a different product in the next 2 to 3 years. It needs to be much more adaptive in nature. You should be able to switch between different products and services faster than that you ever used before. Yes, there is a range there. So it's not like you're producing, I know, stainless steel today and plastic chairs tomorrow, absolutely not. But looking at the trends moving forward and thinking of what variations and what industries may need,
40:58 - 41:38
Dr. Nadya Zhexembayeva: what kind of chemical and physical properties of a stainless steel, you can create much more flexibility and not lock yourself in into a plan that will only make money in 20 years and you only have 5 years of that product demand available. So we see companies who are beginning to move in that direction, my worry is that not fast enough, that the disruption is moving faster than the companies adapting to it. And building a company based on the principles of continuous reinvention is happening. I was honored after 10 years of ReInvention Academy writing, reading, publishing, speaking
41:38 - 42:21
Dr. Nadya Zhexembayeva: to anyone who will hear, working with actual businesses and on and on. I was honored to see that continuous reinvention was selected as the number 1 priority for global executives in the 2 years in a row, 2024 and 2023 PwC global CEO service. So 4, 000 CEOs of largest companies in the world, all set, continuous reinvention is it. The issue is nobody has invested enough time to actually learn how to do it. And unfortunately, most of our business schools still teach traditional administrative practices, traditional operations, traditional accounting, traditional strategic planning, it's beginning to change. And I'm
42:21 - 42:58
Dr. Nadya Zhexembayeva: happy to say that we're running a lot of that tide and being very proactive to vocalize it because the last thing I want to see is another country collapsing or another economy collapsing or another company destroying livelihoods of thousands and thousands of its employees because it didn't learn to reinvent on time and therefore got destroyed by the disruption. So yes, it's happening. And yes, it needs to accelerate. For that, of course, we're always happy to share article. We'll make sure to send you guys with the show notes, the downloads that we have available for free. 1
42:58 - 43:09
Dr. Nadya Zhexembayeva: of them is the download to this book, the Chief Revention Officer handbook. It's now used universally in tons of organizations, and we would love to hear your feedback on that as well.
43:10 - 43:57
Spencer Horn: Well, thank you for that. You know, you were talking about early on that we have change really trained out of us. And I work with lots of organizations that struggle with change. And the theme of our podcast is teamwork. So could you share just some practices that leaders can help their teams and really get this idea of... So we're not outsourcing to consultants. We're not creating an autonomous team that's only focused on disruption, but how do we become disruptors, every 1 of us? And how does the team environment or teamwork help facilitate that? How can we
43:57 - 44:01
Spencer Horn: be better as a team at reinvention and being more resilient?
44:02 - 44:48
Dr. Nadya Zhexembayeva: Absolutely. Here are a few things that we've tested that work well. Number 1 is to create an easy fun ways for people to get into uncomfortable position and do well. So small things such as rotating who is running team meetings, making sure that the baton is passed from person to person so that they can see the job of facilitation, the job of agenda creation and so on and learn to see world from different perspective. We also see that regular moments, so Friday, re-invention breakfast or every second or every month, last Thursday of the month. You have
44:48 - 45:31
Dr. Nadya Zhexembayeva: a little bit of time to celebrate what things worked in terms of reinvention in the last week, 2 weeks or a month, and what things you would like to increase or focus on in the coming months. This kind of practices work very well. Using humor is very important. So finding memes or showing short clips that illustrate the reality of constant reinvention being necessary also helps. We also highly promote using free reports to run team meetings on a regular basis throughout the year. So usually there is about 1 report every 2 to 3 months that gives you
45:31 - 46:06
Dr. Nadya Zhexembayeva: a kind of gentle kick in the butt to talk about what does it mean for our company, what does it mean for our team. In January, that's a World Economic Forum's risk report. In the spring, there are a couple of reports from CEOs and there are a couple of reports on the speed of change. Summer is Gallup state of the global workforce report. And you can place them throughout the year and plan that about once a quarter, you will look at those reports and facilitate a team discussion on considering this data, how should we function better
46:07 - 46:47
Dr. Nadya Zhexembayeva: as a team to be able not to survive disruption but actually thrive in it, monetize it, make it a source of our strengths and make it a source of our joy. So this kind of regular routine activities is the most important thing, that this is not a once in the blue event, or not in the blue moon event, that it's a regular, regular practice, Changing small things, concentrating on low hanging fruit, asking your team anonymously to vote their top 5 suggestions on what should be reinvented in the team, and then implementing 1 every few months. No
46:47 - 47:15
Dr. Nadya Zhexembayeva: overwhelm, no adding new things to the to-do list, but removing things, making things more streamlined and easier. Those routine practices is what allows us to move from occasional sporadic reactive to late reinvention to proactive systematic, this is the way we live, this is like breathing or riding a bicycle reinvention. Those would be some starting ideas, but I would love to hear some of yours, guys.
47:15 - 47:53
Spencer Horn: Well, first of all, I love what you said and that ties into making time every day or week at least for reinvention. And I love how you, 1 of the things that you're talking about that I think is so important is addressing the overwhelm and the stress and the anxiety that people are feeling like, oh my gosh, since 2020, we are feeling there are people that are actively sabotaging our company because they're quiet quitting and they're actively sabotaging and only 23% are actively engaged. So people are suffering in the workplace, and you're saying, hey, this can
47:53 - 48:26
Spencer Horn: be fun. We can make this fun, and we can take time. And I love, so you talked a little bit about the how. The when was the big question that you really focused on. But the how, things like this agile methodology is we're going to change our focus. And when we say change, we're not adding. And that's an important message that you shared. If we're adding something, we have to subtract something. And I think that is a really important message for our listeners. Christian probably has a comment, but while he's thinking, I'm going to add a
48:26 - 48:53
Spencer Horn: few comments to the broadcast that we've had. This is from Nerdan. Thank you, Nerdan. She says, Thank you, Nadia, for sharing so valuable and eye-opening, great conversation. Thank you for your comment. We also have Bernie Richie. Love the reinvention techniques for optimizing teamwork in volatile and swift moving times. Super insightful. Thank you both for your comments. Christian, what ideas do you have? You're the smart 1 here.
48:56 - 49:39
Christian Napier: I have more questions, because I find this absolutely fascinating. I love the idea of having these quarterly publicly available reports to look at and discuss and I'm curious in your experience because those reports are very macro you're kind of looking at what's going on in the world. Are there certain are there certain measures that people should be looking at within their own organizations as well that are potential leading indicators of change because they have to be some leading indicators because if they're not then we missed the curve that you drew and We're too late. And so
49:39 - 49:59
Christian Napier: so when you're working with organizations You know in addition to these kind of quarterly global reports with it. I think it's a awesome idea What should they be looking at internally that could potentially help them flag, upcoming disruptors that they can address proactively?
50:01 - 50:50
Dr. Nadya Zhexembayeva: Love that question. Spencer already mentioned that some years ago, when I was studying and working with companies that are pretty much killing themselves by refusing to adapt to change, I coined this term Titanic syndrome. And it came from a wonderful, wonderful course. I was executive MBA director and professor in a business school and a fellow professor from Spain, the amazing Juan Serrano, would do this analysis of Titanic and break down how Titanic team, essentially, by making assumptions of themselves being unsinkable and unbreakable, destroy themselves, that their own mindset and their own culture was behind it. So
50:50 - 51:35
Dr. Nadya Zhexembayeva: looking at the movie and looking at what I was seeing in the corporate world, putting the 2 and 2 together, Titanic syndrome as a concept came about. And this is the idea that many systems are actually self-destroying themselves by refusing to anticipate change in a quality manner, design change in a quality, timely and efficient manner and implement change in a quality, timely, efficient manner. So we put together using research across those 3 areas because anticipating change historically is the job of strategists, economists, foresight, and futurists, specialists, and trend watchers. Designing change historically is the job of
51:35 - 52:18
Dr. Nadya Zhexembayeva: R&D people, innovation people, creativity people, design thinking people. And implementing change is historically the job of project managers, Agile Scrum Managers, Change Managers, and so on. And historically, those 3 camps don't talk to each other and they don't even share each other's science. So we looked at the 3 camps and we put together a very short back of the napkin, just starting conversation questionnaire called the Titanic syndrome diagnostic. It's all based on actual science and experimentation in research that shows that if you do this, your chances of reinventing on time go up. And we put together
52:18 - 52:58
Dr. Nadya Zhexembayeva: this 15 question questionnaire. Again, we will provide you a free link. You don't need to rush to buy the book. I don't even know if it's still in print, but we'll make sure the PDF is there and you can take the test yourself or your company today or whenever this replay is available. The good news about that diagnostic that it serves as both the diagnostic but also as a solution for actual treatment because those 15 markers give you a specific thing you can do to improve. For example, the very first 1 is measuring how close-minded you
52:58 - 53:31
Dr. Nadya Zhexembayeva: are versus how open-minded your organization in terms of the sources of data? Are you only looking in a small box of the data that impacts your operations and your future? Or are you actually looking around, not in your direct competitors, not just at your suppliers, not just at your industry, but things that can come out of a left field like the new regulation. That is a call to action. If you are scoring poorly on that specific item, you know exactly that it's time for you to start talking to people you don't normally talk, reading reports you
53:31 - 54:05
Dr. Nadya Zhexembayeva: don't normally read, scanning trend, watching reports or looking at other sources of disruption that you don't normally scan and stuff like that. So yes, there are early markers and they all would be in 3 categories. Are you good at anticipating change on time? Are you good at designing change? And are you good at implementing change? And there are different things that you can look at in all of those 3 categories that can help you score yourself and be a bit more diligent and nuanced in your scoring.
54:14 - 54:50
Spencer Horn: Well We're coming up against it. We have 2 more comments. 1 of them's a question. If we have time, Nadia, and then maybe 1 last thing. And before, as we end, we forgot to tell you, would you just stick around afterwards so we can say goodbye to you after we end the show, if you don't mind. But Olga, I think you know Olga. And so she's enjoying the conversation. Thank you, Olga. But here's the question from Prince Aduremi. Hold on, let me get that on here. Owaudi, And he says, insightful and valuable presentation, Dr. Nadia, how
54:50 - 55:01
Spencer Horn: do we ensure alignment between leadership, continuous strategic reinvention efforts, government policies, and evolving needs of customers in a disrupted market? Wow.
55:03 - 55:47
Dr. Nadya Zhexembayeva: The only answer to the question is building a system. This cannot be done as a, okay, let's add it to our to do list. Let's make sure that this is item number 47 we do on Sunday evening, because during the day and during the work week, we have our mainstay job. No, we've seen a range of organizational design that allows for this alignment to be somebody's job, but it must become a full-time job for some portion of your organization. It can be done in a somewhat independent organization that could be a new department or could be
55:47 - 56:35
Dr. Nadya Zhexembayeva: corporate venture capital fund, or it could be a new legal entity within the group. This especially works in highly regulated industries, such as banking or pharma, where it's not easy to do things that are radical within the perimeters of the mainstay business because it is legally impossible. But most organizations today actually recognize that this is becoming a full-time job. So I mentioned PwC study from 2023. That was first time continuous reinvention was named the number 1 priority of every CEO. Year and a half ago, PwC study of 2023, at 47% of CEO time went to reinvention,
56:35 - 57:15
Dr. Nadya Zhexembayeva: but they actually wanted it to be 57%. So their desire was to actually up the game. And across the investment, over 60% of all investment was going towards reinventing the business, not preserving the current business. But CEO, even if they give 57% of their time and most of the money in the company, they cannot do it alone. So there has to be this new integrative unit built that connects across strategy, innovation and change. And that's where the new chief reinvention officer concept comes along. Some companies call them chief transformation officers, but they are not on implementation
57:15 - 57:56
Dr. Nadya Zhexembayeva: side. They're equally on anticipation side and design side. So it's really marrying the strategy with innovation, with change in project management. And unless these disciplines marry and they're all working together as 1 unified methodology and 1 unified system, it won't work. We see companies moving that way. Sometimes it's chief revenue officer. Sometimes it's former strategy head. We've seen even at the state level, the state of North Dakota was the first to have, I think North, maybe South, was the first to have the chief reinvention officer at the state level. We are predicting that ministers of reinvention
57:56 - 58:38
Dr. Nadya Zhexembayeva: will start showing up in governments and we see a rapid, rapid attention to the idea that all management is reinvention. Everyone's job needs to include that. But somebody's job needs to be 100% focused on this because you all know urgent always eats important. If we don't isolate and give full attention to this work, whether it's during the week, there's protected time, or it's in terms of work design, a protected team with its own budget, its own responsibilities. If we don't do that, firefighting will always push this agenda to tomorrow and tomorrow and tomorrow. And then we
58:38 - 59:16
Dr. Nadya Zhexembayeva: are at the spot where we are already in the decline and it's 10% chances of success. And that's why the data shows that since only this century, so only since 2000, 52% of Fortune 500 companies are already off the list. So just in the last 24 years, 52% of Fortune 500 companies, which are the strongest and the fastest and the most untouchable, already fell off the list because they failed to reinvent on time.
59:17 - 59:28
Spencer Horn: Well, I hope you're working to get this material into curriculums of universities, because it sounds like we have to do some reinvention of our education system.
59:30 - 59:38
Dr. Nadya Zhexembayeva: Absolutely. Absolutely. That is where it has to start. We're still teaching 10-year plans as if as if the
59:38 - 59:39
Christian Napier: the the
59:39 - 59:45
Spencer Horn: the MIR plan. Absolutely. So, Christian, what do you say?
59:46 - 01:00:00
Christian Napier: I think this is awesome. I want to have a separate conversation with you Nadia because I work in state government and I've got a lot of questions about public sector and how they could benefit from this but for any of our viewers
01:00:00 - 01:00:13
Speaker 1: And listeners who are tuning into this, listening to it later. If they want to connect with you, Dr. Nadia, to learn more about what you do and how you can help organizations in this...
01:00:13 - 01:00:14
Speaker 2: The Re-Invention Academy.
01:00:15 - 01:00:23
Speaker 1: ...Stellar Agile Strategy Canvas and so many other things, What's the best way for them to connect with you?
01:00:23 - 01:00:50
Speaker 3: Of course, learntoreinvent.com so it's a word learn number 2 and reinvent.com learntoreinvent.com you will get tons of free downloads that you can test first. I always say, don't believe me, try on your own. It's not a spectator sport. It's not about listening and watching. It's about rolling up your sleeves and actually doing the hard work, but hopefully fun work. We have- She says, I
01:00:50 - 01:00:52
Speaker 2: can't get muscles watching her do pushups.
01:00:52 - 01:01:32
Speaker 3: No, unfortunately, I wish it was by osmosis or something, but we're doing our own pushups, that's it. So I do invite you all to grab some of our resources. We also host about every few months a free open event also because I come from a very, very impoverished background. So I want to make a lot of our materials available to anywhere around the world. Very often volatility is not in pretty places but in the most impoverished places. So we have live events that are business school quality but they are available for everyone called in reinvention labs.
01:01:32 - 01:01:41
Dr. Nadya: Easy reinvention lab you can come to LinkedIn, go to my profile, you will always find a link to something that will make you play a bit with these ideas.
01:01:43 - 01:01:53
Christian: Well, thank you so much, Dr. Nadia. And Spencer, you've been helping teams for decades, improve their performance, viewers and listeners tuning in, how should they connect with you?
01:01:53 - 01:02:17
Spencer: Just reach out to me on LinkedIn, just Spencer Horn, you can find me there. And Christian, I, over 20 years, I've been honored to know you and be your friend. And I'm so glad that every time I'm with you as a co-host here, I always am so impressed with what you do. And I know the body of work that you do with your clients and how can people get ahold of you?
01:02:18 - 01:02:32
Christian: LinkedIn's easy just look up Christian Napier on LinkedIn and I'm happy to connect with anyone. So Dr. Nadi again thank you so much for joining us and listeners, viewers, please like and subscribe for a podcast. We'll catch you later.
Links:
Download free 85-page preview of "The Chief Reinvention Officer Handbook: How to Thrive in Chaos" and get the Titanic Syndrome Diagnostic and the STELLAR Agile Strategy Canvas TODAY: https://www.learn2reinvent.com/handbook
Join our crowd-favorite free live Easy Reinvention Lab coming up on October 2-4, 2024: https://www.learn2reinvent.com/lab
Get on the waitlist for the Reinvention Summit in Dublin, Ireland, April 29&30, 2025: https://www.learn2reinvent.com/summit-2025