Christian Napier 00:15 - 00:27 Well, hello everyone, and welcome to another episode of Teamwork, A Better Way. I'm Christian Napier, and I am joined by my highly in-demand and super busy co-host, Spencer Horne. Spencer, how are you doing? Spencer Horn 00:27 - 00:34 I am so great. I'm so glad to be with you and our guest today, Christian. Thank you for your patience. Sorry about that. Christian Napier 00:34 - 00:55 No, it was awesome because we got a little bit of a sneak peek behind the scenes as to what you do and you were fired up. And I'll tell you what, I am fired up for this episode because we've got an amazing guest joining us from the other side of the pond. Why don't you go ahead and do the honors and introduce him to us? Spencer Horn 00:56 - 01:29 Yeah, so we have today Philip Shett, who is really one of the world's leading OKR, which if you don't know what that is, Objectives and Key Results Experts, who has built a company called Wave9, the fastest growing AKR OKR Consultancy globally. He's got extensive experience as a director at major telecommunications and strategy consultancy. He's followed roles at Meta and T-Mobile. I have a coaching client at T-Mobile. Spencer Horn 01:29 - 02:17 That is so cool. Phillip specializes in the intersection of prioritization, communication, and process improvement, which we're so excited about talking about today. But unlike competitors who merely rewrite goals or sell certifications, Wave 9 focuses on enabling true value of OKRs through implementing robust processes and structures for organizations ranging from 400-person nonprofits to Fortune 10 enterprises with 150,000 plus employees. And so after 250 plus implementations for clients like ABB, Renault Group, Norwegian Cruise Line, went on them for my honeymoon, and various banks, Philip has developed a pragmatic results-driven approach that really transforms how organizations execute their strategies. Spencer Horn 02:18 - 02:21 Man, does that fire you up or get you excited, Christian? Christian Napier 02:22 - 02:28 Oh my gosh, I cannot wait. I'm super excited. Let's get going. Yeah. Spencer Horn 02:28 - 02:30 So welcome today, Philip. How are you? Philipp Schett 02:32 - 02:36 I'm great. Thank you. Friday evening. Couldn't be better. Spencer Horn 02:37 - 02:40 Friday evening. And remind us where home is. Philipp Schett 02:41 - 03:04 Oh, home is a big, home is a big question these days, but, uh, well I am German right now. I am in Germany, but I moved to the States in 2014. So home is, is a bit of a, well, it's a bit of a, poorly defined term in my world. But right now, and definitely for the holidays, it's Berlin here in Germany. Spencer Horn 03:04 - 03:07 Are you seeing some Christmas markets with the kids and family? Philipp Schett 03:07 - 03:14 Yes, exactly. That's what we're doing here. Just yesterday evening we went to one and tomorrow we will go to the next one. Spencer Horn 03:14 - 03:21 Okay, so what's your favorite treat when you go out to the German market? What do you get that you just can't live without when you're home? Philipp Schett 03:23 - 03:39 So I mean, it's the typical glue vine, right? That's my favorite drink. So yeah, I think I think that's just and, and yesterday, yesterday, I had hot apple juice with cinnamon. And that was lovely, lovely to especially that's more American. Spencer Horn 03:39 - 03:43 So the German is the is the spiced wine. It's kind of warm. Is that right? Philipp Schett 03:44 - 03:48 Yes, exactly. That's something we we love over here. Spencer Horn 03:48 - 03:58 That's great. Well, today, let's get to our theme. The theme is the prioritization paradox. Why smart teams make bad strategic choices. Spencer Horn 03:58 - 04:07 So what inspired you to explore this concept, you know, of the prioritization paradox? Philipp Schett 04:07 - 04:45 You know, I had the pleasure of working like all my life and driven and driven teams. And so in teams where people were extremely motivated, extremely smart, you can imagine right, team and matters and isn't typically well, it's typically pretty smart. And the same at the consultancy that we worked in. And whenever whenever I worked in these teams, I experienced that the the teams that were often like that, I would consider the hardest working the smartest teams and really the the most talented and driven. Philipp Schett 04:46 - 05:28 They were often like super, super overloaded. And they were very often really, yeah, they often the challenges saying no, and saying, Hey, let's deprioritize something, because everything seemed important, and everything seemed urgent. And so the trade that got them there, like the trade that makes you a meta employee, that trade that makes you a partner in a consultancy, the trade that makes you successful, suddenly becomes dangerous once you reach territory where it's just getting too much. And so I saw a lot of team members burning out. Philipp Schett 05:28 - 06:06 I saw a lot of teams just not getting as much done as maybe some other teams and not getting the results that they were hoping for because they were often trying too many things at once and were really poor in prioritizing. And I think that's that's just something that doesn't, it doesn't need to be this way. And if we're all better in prioritizing, and then maybe saying no to a few things, or not right now, that typically makes for better environments for happier lives. And for Yeah, for more sustainable careers. Christian Napier 06:08 - 06:42 Well, That sounds easier said than done, right? Saying no sounds easier said than done because it's hard. So I'm really curious, what is the framework that allows people to discern what to say yes to and what to say no to? Because I find sometimes in my own experience that sometimes I say, yes to the wrong things or no to the wrong things. Christian Napier 06:42 - 06:53 So kind of walk us through that process of figuring out how to discern what we should be saying yes to and what we should be saying no to. Philipp Schett 06:53 - 07:14 Yeah, I mean, you're, you're absolutely right. If, if it would be as easy as Yeah, you just need to say no more than this podcast would be done in a minute and a half. And we would wrap this up and everyone would be happy, right with, with less work. But you're right, it's just not that easy in corporate environments. Philipp Schett 07:14 - 07:48 It's not that easy in startup environments either, where there's a lot of pressure on, on the organization to, to really deliver. And it's not easy in your Yeah, it's not often easy in your personal life either. So let's, let's walk through a framework on on how you can make better prioritization decisions and maybe, maybe realize yourself but also communicate to do the stakeholders that you have, that you need to prioritize. And so let's begin with what is typically happening. Philipp Schett 07:49 - 08:26 So typically, what's happening is that there are certain goals and then maybe you have a revenue goal and maybe you have a new client goal or maybe you have whatever you have a new features goal for maybe if you're in product. And in marketing, you might have a new leads goal, you have some you have some type of goal. And then but that is often like very much leading lagging. So it's a very, it's a very difficult or it is a goal where you can probably still do a million and two things to move towards that goal. Philipp Schett 08:27 - 08:42 And so let me give you the typical goal that I see in organizations is increased revenue, very, very typical goal. And Unfortunately, there are a million and two things for you to potentially lose. Spencer Horn 08:42 - 08:44 Definitely a lagging indicator. Philipp Schett 08:44 - 08:57 Yeah, way lagging, right? But still, still too many, too many leadership teams try and steer a ship with that indicator, right? Oh, revenue is falling. Oh, we need to panic. Philipp Schett 08:57 - 09:19 We need to start new initiatives. Oh, revenue is increasing. Okay, maybe more of what we are doing right now. So it's, it's just a very difficult, difficult way of really prioritizing because you can, you can increase price, you can serve new customers, you can deliver new products, you can maybe spend more in marketing, all of those things can potentially help to increase revenue, but where do you Philipp Schett 09:19 - 09:42 even start? And then, often enough, thinking is much faster than acting, and so, at least for most people, definitely for most people I know, and- Some people talking is more fast than thinking. I might be sometimes in that category too, but- I am in that category, but not Christian. It's good. Philipp Schett 09:42 - 10:07 At least one of us is, is thinking before they before they say something that's that's helpful. So, you know, when you when you have that revenue goal, and then you you want to you start new initiatives, and now you're suddenly realizing, oh, I have way too many initiatives, then it's often too late to say to say no, because oh, suddenly you have invested in all of those initiatives. And now you want to bring them to an end. Philipp Schett 10:07 - 10:36 But then you suddenly realize, oh, we are 80% done for most of them. So basically, you go from a lagging indicator to too many initiatives that you all starred, because it is difficult to reprioritize with these. And then you have so many initiatives that all seem important and that all seem like good ideas. And at the end of the day, that is what makes prioritization so difficult is you're not choosing. Philipp Schett 10:36 - 11:03 My client always asks me, OK, and then we're going to hope that they're going to weed out the bad ideas. you know, that's not really happening, because you probably weeded out bad ideas before, but you didn't weed enough weed out enough good ideas, or maybe even great ideas, because you, you can only do three or four ideas or initiatives a quarter, and then you but you have 10 great ideas. And that's often what happens to good teams. Philipp Schett 11:03 - 11:26 So now, that's the problem. Now, how do we get to a solution? And the solution coming from an OKR consultant, that's probably not a super surprise is a framework like OKRs. So for everyone that is listening and isn't super familiar with OKRs, OKRs is super short for objectives that are qualitative statements that tell us what to do. Philipp Schett 11:26 - 11:34 And then those key results, they tell us if we are on the right track. They are measurable. They are leading indicators most often. So they are leading. Philipp Schett 11:35 - 12:17 they should be leading indicators. So instead of setting a goal for revenue and then having a million initiatives, you set goals for some key results that you identify, OK, if we move these key results, we're actually going to change our revenue, and we're actually going to increase our revenue. So instead of a revenue goal, you might have a goal for increasing the average revenue per user. Still a relatively broad thing, but way way better than the one before, because now teams can actually prioritize some of the some of the decisions or you're saying, Oh, no, we're not going to touch our existing customers with a price increase, price increase, by the way, the revenue, Philipp Schett 12:17 - 12:55 the revenue increase, like the revenue increase for, like everyone who is out of ideas, right can can work sometimes, but Sometimes it can also backfire. So typically, a better idea would probably be, hey, let's, let's find new customers, and then increase the average revenue there. But you get it, you probably get the idea of we're trying to move from overarching and goals that are super bad for prioritization to much more tangible goals. And only then to initiatives, because otherwise, if we we will end up with a million and two initiatives. Spencer Horn 13:07 - 13:25 How often do you see organizations doing that, making that mistake where they make such a broad goal? Because I see it a lot. And what's interesting is there's a lot of smart people running. These are hugely successful companies, yet they keep making the same mistakes. Philipp Schett 13:27 - 13:42 Yeah, it's almost every company. It is almost any organization. And I don't even say that that goal is Like, it's terrible in itself. I mean, I do say that. Philipp Schett 13:42 - 14:15 But even if you have a revenue goal, and even if you can't get away from it, because, well, for whatever reasons, then you, because your shareholders are expecting it, because your board is expecting it, right, many, many reasons for it, you just can't stop there. So it's just really important that you break that down into something much more tangible. So even if you have a revenue goal, and look, Wave nine has one too, right? So it's still it's still but the only real information that that gives to my team is a level of ambition, right? Philipp Schett 14:15 - 14:25 That's really the only value in a revenue goal. And so I am I am setting it, but then I'm very clear on also the how I want to leverage. Spencer Horn 14:25 - 14:30 And let's talk about that. So So can you break down the core differences between outputs and outcomes? Philipp Schett 14:31 - 14:52 Yeah, so and that's And that's a very, very important question now. It's often displayed as binary. Sometimes I feel like it's, or sometimes I would say it's more into continuum, right? It might be an outcome for some and an output for others, but let me clarify it. Philipp Schett 14:53 - 15:17 So an output is typically the deliverable. So you are working on something, so you're putting in 50 hours into marketing, and now you have a new website. And now that website is a is an output, it's a clear deliverable. If you are in a marketing team, if you're writing a blog post, that's a clear deliverable, that's an output. Philipp Schett 15:18 - 15:47 If you're in HR, a new performance plan is an is an output career development plan for like an employee is an output. Now, what are outcomes? Outcomes are like the impact that this output has in the world. And so it's And that outcome is often much more complex than, than creating an output. Philipp Schett 15:47 - 16:07 That's why people are often a bit afraid of setting outcome goals. Because if you're setting output goals, if you say, hey, we want to write 10 blog posts, we want to set. Yeah, we want to create a new website, we want to log we want to launch five new features. If you're doing that, that's, that's easy. Philipp Schett 16:07 - 16:22 That's you have your complete control over that. And it's, yeah, it feels like it feels like you you can actually achieve those it's under it's in your control. Now an outcome is much more complex, right? You have to. Philipp Schett 16:22 - 16:55 So if you're if we are moving to an outcome, that's the impact. So your new website, you're not building the website, you have a new website, at least that's what most people when most organizations have, the website is serving a purpose. And that purpose is, maybe it is lead generation, maybe it is how many new clients are interacting with you, or it is something like Yeah, you are you're trying to get an like more product more people for it to sign up for your services and get in touch with you. Philipp Schett 16:56 - 17:24 So the website serves a purpose and that purpose is the outcome. And that's the goal we want to we want to set. And so organizations are typically very good in setting outputs, and then defining outputs and brainstorming about outputs, and very good in in those super lagging indicators like revenue or profit or, or it goes like this, and very bad in measuring and really setting goals for anything in between. And those are the outcomes. Christian Napier 17:35 - 18:04 So one question I've got for you, kind of following on this conversation. So we're hearing this kind of three-letter acronym, OKR, Objectives and Key Results. Many of our viewers and listeners are familiar with another three-letter acronym, which is the KPI. So I'm curious to hear from you, what are the similarities and differences between OKRs and KPIs? Christian Napier 18:04 - 18:10 when should they, what purposes do each of these serve and when should they be used? Philipp Schett 18:11 - 18:44 Yeah, it's a great question. It's not super easy to answer this question because OKRs are not a super well-defined term or there is no standardization board for OKRs and KPIs neither. So KPIs does mean something else for many, many people. I've met organizations where they were very much true to the key performance indicator, and they only had like five or 10 KPIs that they were actually and those even had a goal. Philipp Schett 18:44 - 19:04 But in many organizations, KPIs just means a metric. And they are often tracking 1000s of them. But I can tell you the way we use them and the way I would recommend to people to use them because they both have absolutely their value. And we are even using a third acronym. Philipp Schett 19:05 - 19:16 We call it AIMS. Some of our clients call it MBOs and others are calling it like long term OKRs. But it's let's start with that. It's the long term goals that an organization has set. Philipp Schett 19:16 - 19:34 And those are, we call them annual impact metrics, aims. And those are the revenue goals that you you're setting in your organization. And then you have your OKRs. And those OKRs tell you how you are achieving and how you're getting to those aims, those longer term, longer term goals. Philipp Schett 19:34 - 20:16 And those again, your outcomes, and you, you make them transparent, you make them for you set them on shorter intervals, and they help you really make progress towards them. And then KPIs, they measure the health of the business. So like, if you're if you're driving in your car, and you you're maybe monitoring your oil temperature, So let's say we plan a road trip from San Francisco to Cincinnati, and we want to start. And now we are setting a goal for, okay, this is the average speed that I want to hit because I want to be fast. Spencer Horn 20:16 - 20:17 You know how long a drive that is, do you? Philipp Schett 20:18 - 20:23 It is a bit of a drive, but I'm sure it's a beautiful drive for much of it. Spencer Horn 20:24 - 20:28 I mean, that's like Berlin to Mumbai. Christian Napier 20:30 - 20:35 Now we better get going, right? I don't think it's that far, but yeah, that's a long ways. Philipp Schett 20:37 - 20:57 It is a drive. So we're going to maybe set a goal for the average hour and average speed. We might set a goal for the number of pit stops and keep that low, because I don't want too many breaks. But I'm probably not going to set a goal for the oil temperature. Philipp Schett 20:58 - 21:30 So, but the oil temperature needs to stay at a certain level, because if it gets too hot, then I might need to set a goal to drive it down again, right? If I'm through the desert Valley, Desert Valley, Death Valley, and then I'm realizing, oh, my oil temperature is going up, then it's bad. So KPIs are like, they are measuring the health of the business without necessarily needing a goal for it. So and that's very often your, your uptime, for example, in many organizations, that's an SLA. Philipp Schett 21:30 - 22:00 And that's really important to track. You have to be your website has to be up, your product has to be up all the time at 99.99% of the time. But you might not have a goal if that's always the case. But if it suddenly gets lower and you're looking at, say, only 98% of uptime, then you might promote that KPI to a key result. Philipp Schett 22:00 - 22:18 And you're now saying, OK, we need to change that from 98% back to 99.99%. So in short, a KPI measures the health of something and of your business, and a key result is often a KPI on a performance improvement plan on a PIP. Spencer Horn 22:20 - 22:34 I really like that. So let's, can I go back to this outcome and outputs? You say the real issue is outcome discipline. What does that mean? Spencer Horn 22:34 - 22:40 And how do you, why is it so hard to maintain? Why do we have to work on that discipline? Philipp Schett 22:41 - 23:25 Yeah. Because if So it's, it's very often difficult for teams to to stick to some, some key results, because they fall back into the old habit of, oh, our lagging indicator is at risk. Let's do something with a few initiatives, instead of maybe trusting the process and saying, Hey, okay, we didn't have a great first month, maybe January, But we are seeing a lot of positive momentum and new leads coming in. Let's stick to this plan and not throw in another initiative. Philipp Schett 23:26 - 23:51 And then so that's one thing, right? It is very easy to fall back into this trap of like, urgency. And, and look, I have a strong bias towards urgency as well. But I, I still and I'm asking all my my team all the time to, okay, let me know if I'm coming with too many ideas. Philipp Schett 23:52 - 24:26 And they very often tell me that that is indeed the case, because we haven't really worked on the other one. So it's really easy to fall back into this trap of doing something because now we feel like, OK, we need to, again, do something new. And then it is also harder often to measure, to lead with these outcomes, because as leading indicators, they should move more often. Like revenue, we are only very few. Philipp Schett 24:26 - 24:37 Not all organizations measure that daily. Some do. Some do even hourly, for sure. But most are only measuring it really on a weekly or monthly level. Philipp Schett 24:37 - 25:19 So it's, it's much more, it's much more, yeah, much more lagging in that sense as well. And so now you're introducing all those new metrics that are much more real time. And now you need to actually look at your numbers once a week, or and look at your Yeah, look at your dashboards once once a week, not only the financial ones, but those, yeah, those marketing ones and those sales ones and those in product and HR. And so that is very often, very often a new, a new muscle where you have to create a discipline of, of looking at those once a, once a week and then reacting on them. Christian Napier 25:21 - 25:44 Okay. So, uh, taking the driving and the dashboard analogy, Uh, and going from San Francisco to Cincinnati, right? If I'm understanding correctly, the KPI is like the dashboard and it's just kind of monitoring like how fast I'm going and- How much gas you have in the tank. Yeah, yeah. Christian Napier 25:45 - 26:02 Tire pressure and- Tire pressure. Speedometer and odometer and all those kinds of things. And the OKR is more like the navigation system, right? Like, okay, I'm, I'm, I'm, I need to get from San Francisco to Cincinnati. Christian Napier 26:03 - 26:39 And these OKRs are going to point me in the direction to make sure that I'm still on track to achieve my goal. I'm still on the path. That may be a wildly imperfect analogy because I'm not an expert in this area. But then where I think part of the problem comes in in organizations is as new things happen, you know, new trends emerge, like AI pops up or whatever, then people in the organization start to question, do we still want to go to Cincinnati? Christian Napier 26:40 - 27:19 Or do we want to go to New Orleans? Or Cleveland? And so we get distracted, like, do we want to change course and head in a different direction? And one of the questions that I have for you, Philip, is, as an organization is operating in this ever-changing environment, we have these OKRs, how do you assess those, the aims, the long-term goals, and the OKRs, and say, yes, we still want to go to Cincinnati, or no, Christian Napier 27:19 - 27:46 it's time for us to change course and we need to head in a different direction. And again, I apologize if the analogy is not a great one. I'm just seeing this in my own experience as well where organizations are floundering, they're not sure where they want to go, or they choose that, hey, I want to go to Cincinnati. And then, you know, events happen, and they decide they want to go someplace else. Christian Napier 27:46 - 27:49 And they end up just driving all over the place and really not ending up anywhere. Philipp Schett 27:49 - 28:15 100%. And so we what we recommend is, so it's let's say, let's look at the two opposite extremes of the spectrum. So at one, in one case, you would maybe say, okay, you should just stick to your goals and be and be like, stick to them for years, right? Set them for five years and stick to them. Philipp Schett 28:16 - 28:35 And you will, you you will end up somewhere nice, right? That that would be one extreme. And the other extreme is, as soon as as soon as something changes in your environment, you should absolutely change your goals. And so the the one is isn't working clearly, because it is it is absurd, right? Philipp Schett 28:35 - 28:50 We would not follow goals for five years blindly, right? That, again, okay, there in the in the former eastern side of Germany, that was actually the five year plan. didn't work out for them, right? That's not something we want to do. Philipp Schett 28:51 - 29:11 But changing our plans and goals like our underwear, that is not a great idea either, because it would be chaos. So those are the two extremes. And now the truth is, as often, somewhere in the middle. Now, in the past, many organizations have set goals for a year. Philipp Schett 29:11 - 29:42 But in the environment we are in, that is very much too, that's very often too long. And so that's why OKRs, we're setting them for a quarter and a quarter. Now you can deviate a bit from that some organizations in like the defense industry, which is going through very slow cycles, they have decided to go with four months, trimesters, works well for them. And then others, the startups we're working with, they sometimes even go for six-week sprints. Philipp Schett 29:43 - 29:57 You have a quarter, and then you divide it into two six-week sprints. And for them, it's working well as well. So your mileage might vary. you stick to the analogy. Philipp Schett 29:57 - 30:23 But we would recommend set goals for a quarter and then make it an intentional exercise to say, yes, these are still correct, or we change them. Don't be like the frog in the water, which who says, Oh, yeah, I'm gonna I'm gonna jump out when it becomes too hard, right? That rarely happens. You want to really make it an intentional decision to stay on course or to change course. Philipp Schett 30:23 - 30:30 And we have found that doing that every 12 to 13 weeks most works best in most environments. Spencer Horn 30:44 - 31:16 really bringing more of an agile mindset into goal setting and directions. I like that. Philip, can you share a story of maybe, you know, you can keep the name quiet, but, uh, or, or, uh, you know, not share that, but of a team that shifted from heavy output thinking to outcome driven execution. You can just maybe share a real life example and, you know, change the names to protect the innocent, but, and what changed? Philipp Schett 31:18 - 31:55 Yeah, 100%. So we. the the one thing so um it's actually near near you uh won't name wouldn't name the organization but it's a hospital group in in ohio and they are so great hospital group and then big hospital group and they are operating operating at mellow hospitals um so they have been very much just monitoring strategic initiatives. Philipp Schett 31:55 - 32:08 And before we before we started, they had 61 of those strategic initiatives. And I love that example, because now And they had some, yeah, some very typical leading 61. Spencer Horn 32:08 - 32:09 That's crazy. Philipp Schett 32:10 - 32:35 So very much like the typical big organization that has all that strategic portfolio management, and then 61 traffic light symbols on PowerPoints, right, and expensive consultants running around the the hallways and saying, oh, where are we with this project? And is this project still amber? Or is it red? And how can we make it green? Philipp Schett 32:35 - 33:04 And so for 61 initiatives, and many of them running for years and being very expensive and being very, yeah, very costly. And then we said, OK, I was with them. And we identified, OK, we need to move to really deliver better healthcare, be more profitable. To really do all these things, we need to narrow down our focus for into a few strategic areas. Philipp Schett 33:05 - 34:03 And they de-prioritized afterwards 40 something, like we only had 20 projects left, 20 strategic initiatives, we created a few new ones, killed 40. And at the end, we had 20, 22 or 23, I don't remember the exact number, but we had a really much smaller sort, yeah, a small set of initiatives, which was much easier to manage. And many people that we were bottlenecks before, because they were on so they were on five or 10 different strategic initiatives, they had to produce deliverables for them, they were subject matter experts, it freed up a ton of resources. And And so they paused these strategic initiatives and then got back to them, got back to some of them later, but then realized that many of them were just following an outdated strategy. Philipp Schett 34:03 - 34:27 They were implemented many, many years ago. And you know that, I mean, you can imagine that, right? If an organization starts something, very many are very bad in stopping something. And so in stopping an initiative and, and not letting it not letting it finish, because there's emotional attachment, because then suddenly you would say, Oh, we we burned all that money. Philipp Schett 34:27 - 34:48 So that we really requires a lot of a lot of, let's say a lot of requires you to be really brave. And so, but you Yeah, you need to do that. And that was a good that was a good example. Earlier this week, or last week, I was in Denmark with another with another client. Philipp Schett 34:49 - 35:29 And that client is going through a huge transformation right now. And that transformation makes them so they were they were an incumbent in Denmark, with a very, like very long history 70% market share in the niche software company. And they are they are now internationalizing, which means many things at once, it means a transition from it means a transition from, like being an incumbent to being a challenger, completely different mindset, right, completely different performance necessity too, right? It's, it's, it's hard. Philipp Schett 35:30 - 35:47 Then they are moving from, like, legacy tech to software as a service. And they are moving from deemed just in one market to multiple markets. And also here, we all of those are very important for them, they were just acquired by private equity. So very important transitions for them. Philipp Schett 35:48 - 36:22 But now they are changing from, oh, we have a ton of strategic initiatives to, okay, we have a few, yeah, a few leading indicators that actually have much better goals, and therefore cutting down on those initiatives. And one good example there is They're using it to really deprioritize some things that they have done for a very long time. A custom event, for example, is something that they have done for a very long time. I'm not going to do it in Q1, because they have bigger fish to fry. Philipp Schett 36:22 - 36:38 But the marketing team, until I was there last week, was freaking out about this event and how important it is, and that they have done it every year. Again, they are deprioritizing some things that just can't be a priority right now. Spencer Horn 36:39 - 37:26 I don't know, Christian, if you felt the weight difference from 61 initiatives, strategic initiatives, to the 20. all of a sudden the the energy increases the as you call it, you know the focus increases and Your ability to actually make shifts happen instead of diffusing all of our energy diffusing all of our mind power and our effort I mean because that's really what we're talking about here that the prioritization paradox, right and and these are smart people and These are, you know, they're running hospitals, they're, you know, they're running major organizations and they make bad strategic choices. Some of it, you said, comes down to inertia, right? Spencer Horn 37:26 - 37:49 Just this is carrying things forward and obviously the investment of time and energy, it's hard to let go of and that's where the courage comes in. I just feel the difference when we narrow our focus. It's not an excuse to let your foot off the gas. It's actually creating more mind space to bring more of your talents to fewer challenges. Spencer Horn 37:49 - 37:54 And that's how lasers cut through steel, right? Yes. Philipp Schett 37:56 - 38:05 And you're making a great point because I'm not... I'm not a proponent of like the four-day work week or four-hour work week. Spencer Horn 38:05 - 38:11 I'm not a proponent of... Yeah, we're not saying we're going to let their foot off the gas now that we have 20 initiatives. That's a third of the initiatives. Well, people are going to be lazy. Christian Napier 38:12 - 38:12 No. Philipp Schett 38:13 - 38:21 No. You're just getting some stuff done actually. Right. Christian Napier 38:21 - 38:46 Well, okay, I've got another question. You're talking about how having so many different things on your plate, initiatives, whatnot, reduces your agility and how you want to be more agile. Another thing that can reduce agility is a lot of bureaucracy in an organization, right? You got a lot of red tape. Christian Napier 38:46 - 39:05 I heard this quote the other day. I don't know who the original, and so I'm just paraphrasing it. I don't remember who said it originally. They said that policy is the scar tissue of organizations, because we have these failures and we create policy. Christian Napier 39:05 - 39:42 And that keeps us from being more agile. And I'm curious to know from your perspective, how, the work that you have done with organizations has allowed them to be more agile, not just in kind of, you know, getting a laser focus, but also, you know, looking at convoluted policies and procedures and processes and say, hey, you know, Do we really need to be doing all this stuff? Can we be more flexible in our approach? Christian Napier 39:42 - 40:01 I mean, what do you have to say about kind of simplifying the way that organizations do things so that they can focus more on the things that really matter the most? Philipp Schett 40:02 - 40:34 It's a great point and something that I had to learn the hard way to, you know, when I when we introduce these processes and these goals in the like 10 years ago, when we really started, I, I wasn't in the US for a very long time. And so I was still looking at the world with a very German lens. And you might have heard about German over engineering. So I was creating processes in organizations that were very much bureaucratic overkill. Philipp Schett 40:34 - 41:08 So and and so that's the that's the thing with any tool, or not any tool, but definitely most tools that I know they can become double edged swords, right? So this can be used to cut down bureaucracy, and it can be used to cut down red tape. But it can also at the same time be completely overused and be and be the red tape and become the bureaucracy. And so I really want to want to highlight that this is something, yeah, to be to be aware of. Philipp Schett 41:08 - 41:21 And before you get excited, right, you can definitely, you can definitely overdose on on OKRs. And you can definitely overdose on on goals. And so You want to be careful there as well. Spencer Horn 41:21 - 41:35 Sounds like you're admitting to a little bit of an addictive personality, because I'm right there with you. It may not be that, what's that wine called? But German chocolate is definitely one of my issues. Philipp Schett 41:35 - 42:00 Yes, yes. And so, yeah, you know, it's important to use the tool in the right way. And that means you have You can't go from, oh, we had 160 initiatives, and now we have 160 metrics. And we want to achieve a change in all of those 160 key results. Philipp Schett 42:00 - 42:29 That would be insanity. And so you really need to make sure that you're using it wisely and say, OK, we are using three to four objectives per team, and then maybe two or three key results. And really the less, less, less is more like less is, is definitely more. So you really want to cut it down to as few key results as possible and then drive change towards those. Philipp Schett 42:30 - 43:10 And then you have the OKR process itself as well, right? You can, you can make that very bureaucratic, meaning You can say, okay, we're going to set leadership OKRs in the beginning, then we're going to set the next level team, and then those need to be approved, and those need to be read out by everyone. And then every team is setting OKRs, and they are going to be approved, and then we're going to give long feedback. Or you just make that a more natural process that probably still starts at the leadership team, but then prioritizes prioritizes velocity before perfectionism and before getting everything correct, right? Philipp Schett 43:10 - 43:58 So you can even the OKR process itself, you can make it very bureaucratic, or you can make it much more leaner and much more agile. And so 10 years ago, I was definitely very much on the strong bureaucracy side. And nowadays, I'm a lot more relaxed and a lot more optimizing for velocity and optimizing for process progress instead of process. Now, also, again, caveat is that if you if you become too let's say, too less fair and too lax on the process, then you are suddenly in a situation where you might have too many exceptions again. Philipp Schett 43:58 - 44:04 And then the process isn't delivering the results you're hoping for either. So yeah. Spencer Horn 44:11 - 44:14 Sorry, I didn't have the chance to warn you that that might happen. Philipp Schett 44:15 - 44:16 Because that's fine. Spencer Horn 44:18 - 44:19 Finish your thought. I'm so sorry. Philipp Schett 44:20 - 44:34 I don't know. I mean, in 10 seconds. You can use okayers to kill bureaucracy or you can use okayers to create bureaucracy. Got to be careful there and and be and less is more. Spencer Horn 44:34 - 45:02 So I have a, I think this is maybe, I don't know, maybe a little bit of a follow on to what Christian just asked, but how can leaders create the psychological safety necessary around not doing more, but doing what matters? I mean, this is a little bit of a dance that you've been talking about, right? I mean, how do you, we want them to not do more, but we want them to focus on really what matters. So that's the shift. Spencer Horn 45:02 - 45:09 It's not about taking our foot off the gas, but that's a that's a that's a tough balance. How do how do leaders create that environment where it's okay now? Philipp Schett 45:12 - 45:55 Yeah, and it's so we call it an organic culture of no. And so that at the beginning sounds almost ridiculous, and maybe not something we want, we really want, right? Why would we want a culture of no, but you, if you think about it, you want the culture where people say no to, yeah, to more initiatives or initiatives that they don't have the capacity for, and would just say yes, because they don't feel secure. And then if people are saying yes to initiatives that they shouldn't have said yes to, you're just ending up with either low quality, or long wait times. Philipp Schett 45:56 - 46:16 And it's the old saying you can you can't really have good cheap and fast at the same time, right. And so that's also true in your organization. And even if people say yes to everything, that doesn't mean that they are actually well in a position to do all of those things. So yeah, you want a culture of no. Philipp Schett 46:18 - 46:43 Now at the same time, you don't want the culture of no to be overused, right? So you don't, you still want high performance culture of no. And high performance culture of no means you have people that are saying yes to everything that they can realistically deliver, but not more. And you don't have people that are just using this as an excuse to do the four hour work week, right? Philipp Schett 46:43 - 46:55 That's still something you have to be hard against and accept no when it's the right thing to do, but don't accept it when it's a lazy excuse. Spencer Horn 46:56 - 47:04 I love that. There's actually a way to say no without saying no, and I love the story. Christian and I have shared this before. Stephen Covey, he's top lieutenant. Spencer Horn 47:05 - 47:22 Stephen Covey gave a strategic initiative, and he couldn't take it, right? But instead of saying no, he said, Stephen, I would love to do that. Here are all my current priorities. Which one of these priorities do you want me to deprioritize while I take on this new one? Spencer Horn 47:22 - 47:36 So it's a way of saying no without saying no, right? For those of you who are listening who may struggle with that. I want to do this, I just can't unless we take something else off my plate. So let's look at that and see what we need to do. Philipp Schett 47:37 - 47:38 100%. Christian Napier 47:41 - 47:58 All right, my last question, and then I'll hand it over to Spencer to kind of ask his concluding question or questions if he wants, is where does Wave 9 the name come from? Philipp Schett 48:01 - 48:11 OK, I love the question. So you know? I'm a, I'm a kite surfer. I moved to California because I wanted to be close to the, close to the ocean. Philipp Schett 48:11 - 48:31 So wave was kind of a logical, logical name, name for this. And I also wanted the company to be a wave or to be a wave for, for this, this change that we are bringing. And then the nine is, well, is interesting. So the nine has different meanings. Philipp Schett 48:31 - 48:53 So first, there are nine hours of time difference between Berlin and San Francisco. And these nine hours have dominated my life for a very long time. I was when I was in Berlin, or in Germany, I was, I was often waking up working late hours, because I was still working with San Francisco. If I was in San Francisco, I was waking up very early to still catch my my colleagues in Germany. Philipp Schett 48:53 - 49:11 So the nine hours of time difference, it's also 9000 kilometers. Which is random, but I take it. And then the nine is, well, it's the end of a cycle and the beginning of a new one. So the end of an OKR cycle and the beginning of a new one. Philipp Schett 49:11 - 49:12 And I like that as well. Spencer Horn 49:13 - 49:19 Christian, you know what it's like doing all those time shifts, don't you? All over the world, you've done them. Christian Napier 49:20 - 49:23 Yep. Yep. All too familiar for sure. Spencer Horn 49:23 - 49:52 Hey, you know, I want to mention something to our listeners that we haven't done in a while. We have a sponsor, uh, in, in, in team diagnostic, you know, team coaching international. And I would love to invite our listeners. If you want to do a team diagnostic to, to scan this, this QR code, if you're watching, if you're listening, you're going to have to, uh, I don't know, you're going to have to email me, but we would really love to have you take a look at what's Spencer Horn 49:52 - 50:19 going right with your team, and this can actually really measure what we're looking at today. I mean, what's the productivity like on the team, and what are the conditions on the team that enable you to sustain that productivity, which is really what we've been talking about today. Smart people are overtaxed and taking on too much and not saying no. These are real, real issues that cause people to burn out, to shut down, to... Spencer Horn 50:19 - 50:37 to leave the company that maybe they even love because they just can't deal with it anymore. I'm sure you've seen a lot of that in your day, Philip, right? And we want to make sure that we keep people engaged and performing at their very best. Well, I have a lightning round of questions for you. Spencer Horn 50:38 - 50:46 Okay. So these are just one really super fast responses. Could be, you know, one word or one sentence. Okay. Spencer Horn 50:47 - 50:56 Outputs or outcomes, what's easier to measure? Outputs. One word that describes great leadership. Philipp Schett 51:03 - 51:04 Authenticity. Spencer Horn 51:05 - 51:18 First thing you'd do if a team brought you 20 top priorities. Ask why. Biggest myth around OKRs. Philipp Schett 51:21 - 51:24 that 70% is success. Spencer Horn 51:26 - 51:33 Slack or email? Slack, for sure. Book every strategy leader should read? Philipp Schett 51:37 - 51:42 The OKR Blueprint coming out early next year by Philip Shat. Spencer Horn 51:44 - 51:46 Most underrated leadership skill? Philipp Schett 51:48 - 51:50 Vulnerability. Spencer Horn 51:51 - 51:55 Easy for you to say. Work smarter or work harder? Philipp Schett 51:59 - 52:12 Sorry, but I gotta say both. I mean, you have to really work hard. I do believe that it's just not, it's not possible to only work smarter, but you also have to work smart. Spencer Horn 52:12 - 52:21 Yeah, great. Good answer. Your leadership style in one word? Adaptive. Spencer Horn 52:21 - 52:25 Okay, excellent. And what does teamwork mean to you in one sentence? Philipp Schett 52:28 - 52:43 In German, the acronym means, oh, great, another one does it. Um, but no, for, for me, it is it is the essence. It's our code. It's the essence of life. Philipp Schett 52:43 - 52:53 It is it is how we make things happen. As as humanity. It is how we make fun. It is how we create value. Philipp Schett 52:53 - 53:01 It is how we sometimes also have our disagreements and have and create energy. Teamwork is everything. Christian Napier 53:12 - 53:30 All right, well, we're gonna look forward to the book coming out early next year, Philip. That's super exciting. And we're so grateful for you taking an hour out of your evening, a Friday evening, all the way over there in Germany to speak with us. That was a great conversation, super. Christian Napier 53:30 - 53:48 educational, informative, and I've got like a million questions, and we could go on for hours. And if people want to connect with you, if they want to learn more about how Wave 9 could potentially help them improve their organization, what's the best way for people to reach out? Philipp Schett 53:50 - 53:58 Yeah, easy. We have a website, wave9.com, and then please connect with me on LinkedIn. I'm there as Philip Shep. Christian Napier 53:59 - 54:21 All right, fantastic. And we'll put links to everything in the show notes for folks who catch this later. And Spencer, you've been helping organizations develop high-performing teams for a long time, and we've known each other for 20 years, and you were doing this even before we met. If people wanna connect with you, how do they do that? Spencer Horn 54:21 - 54:27 Same. LinkedIn. LinkedIn is the place. And if you look for Philip, that's one L and two Ps at the end. Christian Napier 54:29 - 54:29 That's right. Spencer Horn 54:29 - 55:05 I get spelling right. Christian, I mean, so many people look to you for great questions and great insights in their organizations. You know, he's been, Philip, he's been consulting with major organizations, IOC, International Olympic Committee, World Games, FIFA, World Cup, all around the world, these major games organizations, and more. He's now, he's consulting, you know, at a government level on technology, digital transformations, and AI integrations. Spencer Horn 55:05 - 55:07 How can people get a hold of you, Christian? Christian Napier 55:08 - 55:29 LinkedIn as well, just look for ChristianAPR on LinkedIn, and I'm super happy to connect with anyone. And listeners and viewers, we're grateful to you for joining us on this journey. Early next year will be six years, right, Spencer, that we've been doing this podcast. Philip, thank you so much for being with us. Christian Napier 55:30 - 55:40 The week before the Christmas holiday, we're so grateful to you, listeners and viewers as well, Please like and subscribe to our podcast. We'll catch you again so