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0:11 What we're really here to talk about is the "how." Okay, so how exactly do we create this world-shattering, if you will, innovation? Now, I want to tell you a quick story. We'll go back a little more than a year. In fact, the date -- I'm curious to know if any of you know what happened on this momentous date? It was February 3rd, 2008. Anyone remember what happened, February 3rd, 2008? Super Bowl. I heard it over here. It was the date of the Super Bowl.

0:40 And the reason that this date was so momentous is that what my colleagues, John King and Halee Fischer-Wright, and I noticed as we began to debrief various Super Bowl parties, is that it seemed to us that across the United States, if you will, tribal councils had convened. And they had discussed things of great national importance. Like, "Do we like the Budweiser commercial?" and, "Do we like the nachos?" and, "Who is going to win?" But they also talked about which candidate they were going to support.

1:12 And if you go back in time to February 3rd, it looked like Hilary Clinton was going to get the Democratic nomination. And there were even some polls that were saying she was going to go all the way. But when we talked to people, it appeared that a funnel effect had happened in these tribes all across the United States. Now what is a tribe? A tribe is a group of about 20 -- so kind of more than a team -- 20 to about 150 people. And it's within these tribes that all of our work gets done. But not just work. It's within these tribes that societies get built, that important things happen.

1:46 And so as we surveyed the, if you will, representatives from various tribal councils that met, also known as Super Bowl parties, we sent the following email off to 40 newspaper editors the following day. February 4th, we posted it on our website. This was before Super Tuesday. We said, "The tribes that we're in are saying it's going to be Obama." Now, the reason we knew that was because we spent the previous 10 years studying tribes, studying these naturally occurring groups.

2:13 All of you are members of tribes. In walking around at the break, many of you had met members of your tribe. And you were talking to them. And many of you were doing what great, if you will, tribal leaders do, which is to find someone who is a member of a tribe, and to find someone else who is another member of a different tribe, and make introductions. That is in fact what great tribal leaders do.

2:37 So here is the bottom line. If you focus in on a group like this -- this happens to be a USC game -- and you zoom in with one of those super satellite cameras and do magnification factors so you could see individual people, you would in fact see not a single crowd, just like there is not a single crowd here, but you would see these tribes that are then coming together. And from a distance it appears that it's a single group. And so people form tribes. They always have. They always will. Just as fish swim and birds fly, people form tribes. It's just what we do. But here's the rub. Not all tribes are the same, and what makes the difference is the culture.

3:17 Now here is the net out of this. You're all a member of tribes. If you can find a way to take the tribes that you're in and nudge them forward, along these tribal stages to what we call Stage Five, which is the top of the mountain. But we're going to start with what we call Stage One. Now, this is the lowest of the stages. You don't want this. Okay? This is a bit of a difficult image to put up on the screen. But it's one that I think we need to learn from.

3:43 Stage One produces people who do horrible things. This is the kid who shot up Virginia Tech. Stage One is a group where people systematically sever relationships from functional tribes, and then pool together with people who think like they do. Stage One is literally the culture of gangs and it is the culture of prisons. Now, again, we don't often deal with Stage One. And I want to make the point that as members of society, we need to. It's not enough to simply write people off.

4:12 But let's move on to Stage Two. Now, Stage One, you'll notice, says, in effect, "Life Sucks." So, this other book that Steve mentioned, that just came out, called "The Three Laws of Performance," my colleague, Steve Zaffron and I, argue that as people see the world, so they behave. Well, if people see the world in such a way that life sucks, then their behavior will follow automatically from that. It will be despairing hostility. They'll do whatever it takes to survive, even if that means undermining other people.

4:44 Now, my birthday is coming up shortly, and my driver's license expires. And the reason that that's relevant is that very soon I will be walking into what we call a Stage Two tribe, which looks like this. (Laughter) Now, am I saying that in every Department of Motor Vehicles across the land, you find a Stage Two culture? No. But in the one near me, where I have to go in just a few days, what I will say when I'm standing in line is, "How can people be so dumb, and yet live?" (Laughter)

5:15 Now, am I saying that there are dumb people working here? Actually, no, I'm not. But I'm saying the culture makes people dumb. So in a Stage Two culture -- and we find these in all sorts of different places -- you find them, in fact, in the best organizations in the world. You find them in all places in society. I've come across them at the organizations that everybody raves about as being best in class. But here is the point. If you believe and you say to people in your tribe, in effect, "My life sucks. I mean, if I got to go to TEDx USC my life wouldn't suck. But I don't. So it does." If that's how you talked, imagine what kind of work would get done. What kind of innovation would get done? The amount of world-changing behavior that would happen? In fact it would be basically nil.

6:00 Now when we go on to Stage Three: this is the one that hits closest to home for many of us. Because it is in Stage Three that many of us move. And we park. And we stay. Stage Three says, "I'm great. And you're not." (Laughter) I'm great and you're not. Now imagine having a whole room of people saying, in effect, "I'm great and you're not." Or, "I'm going to find some way to compete with you and come out on top as a result of that." A whole group of people communicating that way, talking that way.

6:32 I know this sounds like a joke. Three doctors walk into a bar. But, in this case, three doctors walk into an elevator. I happened to be in the elevator collecting data for this book. And one doctor said to the others, "Did you see my article in the New England Journal of Medicine?" And the other said, "No. That's great. Congratulations!"

6:47 The next one got kind of a wry smile on his face and said, "Well while you were, you know, doing your research," -- notice the condescending tone -- "While you were off doing your research, I was off doing more surgeries than anyone else in the department of surgery at this institution."

7:01 And the third one got the same wry smile and said, "Well, while you were off doing your research, and you were off doing your monkey meatball surgery, that eventually we'll train monkeys to do, or cells or robots, or maybe not even need to do it at all, I was off running the future of the residency program, which is really the future of medicine."

7:18 And they all kind of laughed and they patted him on the back. And the elevator door opened, and they all walked out. That is a meeting of a Stage Three tribe. Now, we find these in places where really smart, successful people show up. Like, oh, I don't know, TEDx USC. (Laughter)

7:36 Here is the greatest challenge we face in innovation. It is moving from Stage Three to Stage Four. Let's take a look at a quick video snippet. This is from a company called Zappos, located outside Las Vegas. And my question on the other side is just going to be, "What do you think they value?" It was not Christmas time. There was a Christmas tree. This is their lobby. Employees volunteer time in the advice booth. Notice it looks like something out of a Peanuts cartoon.

8:11 Okay, we're going through the hallway here at Zappos. This is a call center. Notice how it's decorated. Notice people are applauding for us. They don't know who we are and they don't care. And if they did they probably wouldn't applaud. But you'll notice the level of excitement. Notice, again, how they decorate their office. Now, what's important to people at Zappos, these may not be the things that are important to you. But they value things like fun. And they value creativity. One of their stated values is, "Be a little bit weird." And you'll notice they are a little bit weird.

8:43 So when individuals come together and find something that unites them that's greater than their individual competence, then something very important happens. The group gels. And it changes from a group of highly motivated but fairly individually-centric people into something larger, into a tribe that becomes aware of its own existence. Stage Four tribes can do remarkable things. But you'll notice we're not at the top of the mountain yet. There is, in fact, another stage.

9:13 Now, some of you may not recognize the scene that's up here. And if you take a look at the headline of Stage Five, which is "Life is Great," this may seem a little incongruous. This is a scene or snippet from the Truth and Reconciliation process in South Africa for which Desmond Tutu won the Nobel Prize. Now think about that. South Africa, terrible atrocities had happened in the society. And people came together focused only on those two values: truth and reconciliation. There was no road map. No one had ever done anything like this before.

9:45 And in this atmosphere, where the only guidance was people's values and their noble cause, what this group accomplished was historic. And people, at the time, feared that South Africa would end up going the way that Rwanda has gone, descending into one skirmish after another in a civil war that seems to have no end. In fact, South Africa has not gone down that road. Largely because people like Desmond Tutu set up a Stage Five process to involve the thousands and perhaps millions of tribes in the country, to bring everyone together. So, people hear this and they conclude the following, as did we in doing the study.

10:23 Okay, got it. I don't want to talk Stage One. That's like, you know, "Life sucks." Who wants to talk that way? I don't want to talk like they do at the particular DMV that's close to where Dave lives. I really don't want to just say "I'm great," because that kind of sounds narcissistic, and then I won't have any friends. Saying, "We're great" -- that sounds pretty good. But I should really talk Stage Five, right? "Life is great."

10:43 Well, in fact, there are three somewhat counter-intuitive findings that come out of all this. The first one, if you look at the Declaration of Independence and actually read it, the phrase that sticks in many of our minds is things about inalienable rights. I mean, that's Stage Five, right? Life is great, oriented only by our values, no other guidance. In fact, most of the document is written at Stage Two. "My life sucks because I live under a tyrant, also known as King George. We're great! Who is not great? England!" Sorry. (Laughter)

11:18 Well, what about other great leaders? What about Gandhi? What about Martin Luther King? I mean, surely these were just people who preached, "Life is great," right? Just one little bit of happiness and joy after another. In fact, Martin Luther King's most famous line was at Stage Three. He didn't say "We have a dream." He said, "I have a dream." Why did he do that? Because most people are not at Stage Five.

11:39 Two percent are at Stage One. About 25 percent are at Stage Two, saying, in effect, "My life sucks." 48 percent of working tribes say, these are employed tribes, say, "I'm great and you're not." And we have to duke it out every day, so we resort to politics. Only about 22 percent of tribes are at Stage Four, oriented by our values, saying "We're great. And our values are beginning to unite us." Only two percent, only two percent of tribes get to Stage Five. And those are the ones that change the world.

12:13 So the first little finding from this is that leaders need to be able to talk all the levels so that you can touch every person in society. But you don't leave them where you found them. Okay? Tribes can only hear one level above and below where they are. So we have to have the ability to talk all the levels, to go to where they are. And then leaders nudge people within their tribes to the next level. I'd like to show you some examples of this.

12:38 One of the people we interviewed was Frank Jordan, former Mayor of San Francisco. Before that he was Chief of Police in San Francisco. And he grew up essentially in Stage One. And you know what changed his life? It was walking into one of these, a Boys and Girls Club. Now here is what happened to this person who eventually became Mayor of San Francisco. He went from being alive and passionate at Stage One -- remember, "Life sucks, despairing hostility, I will do whatever it takes to survive" -- to walking into a Boys and Girls Club, folding his arms, sitting down in a chair, and saying, "Wow. My life really sucks. I don't know anybody. I mean, if I was into boxing, like they were, then my life wouldn't suck. But I don't. So it does. So I'm going to sit here in my chair and not do anything."

13:19 In fact, that's progress. We move people from Stage One to Stage Two by getting them in a new tribe and then, over time, getting them connected. So, what about moving from Stage Three to Stage Four? I want to argue that we're doing that right here. TED represents a set of values, and as we unite around these values, something really interesting begins to emerge.

13:44 If you want this experience to live on as something historic, then at the reception tonight I'd like to encourage you to do something beyond what people normally do and call networking. Which is not just to meet new people and extend your reach, extend your influence, but instead, find someone you don't know, and find someone else you don't know, and introduce them. That's called a triadic relationship.

14:10 See, people who build world-changing tribes do that. They extend the reach of their tribes by connecting them, not just to myself, so that my following is greater, but I connect people who don't know each other to something greater than themselves. And ultimately that adds to their values.

14:28 But we're not done yet. Because then how do we go from Stage Four, which is great, to Stage Five? The story that I like to end with is this. It comes out of a place called the Gallup Organization. You know they do polls, right? So it's Stage Four. We're great. Who is not great? Pretty much everybody else who does polls. If Gallup releases a poll on the same day that NBC releases a poll, people will pay attention to the Gallup poll. Okay, we understand that. So, they were bored. They wanted to change the world. So here is the question someone asked.

14:57 "How could we, instead of just polling what Asia thinks or what the United States thinks, or who thinks what about Obama versus McCain or something like that, what does the entire world think?" And they found a way to do the first-ever world poll. They had people involved who were Nobel laureates in economics, who reported being bored. And suddenly they pulled out sheets of paper and were trying to figure out, "How do we survey the population of Sub-Saharan Africa? How do we survey populations that don't have access to technology, and speak languages we don't speak, and we don't know anyone who speaks those languages. Because in order to achieve on this great mission, we have to be able to do it. Incidentally, they did pull it off. And they released the first-ever world poll.

15:43 So I'd like to leave you with these thoughts. First of all: we all form tribes, all of us. You're in tribes here. Hopefully you're extending the reach of the tribes that you have. But the question on the table is this: What kind of an impact are the tribes that you are in making? You're hearing one presentation after another, often representing a group of people, a tribe, about how they have changed the world. If you do what we've talked about, you listen for how people actually communicate in the tribes that you're in. And you don't leave them where they are. You nudge them forward. You remember to talk all five culture stages. Because we've got people in all five, around us. And the question that I'd like to leave you with is this: Will your tribes change the world? Thank you very much. (Applause)