Satya Nadella is building the future (Transcript)

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ReThinking with Adam Grant
Satya Nadella is building the future
May 24, 2022

[Theme Music]

[00:00:00] Adam Grant:
Hey WorkLifers, it’s Adam Grant. Welcome back to Taken for Granted, my podcast with the TED Audio Collective. I’m an organizational psychologist. My job is to think again about how we work, lead, and live. Today, my guest is Satya Nadella, chairman and CEO of Microsoft–where he’s worked since 1992. He’s widely admired for transforming the culture, building the cloud business, and steering a 700% gain in shares. His approval rating on Glassdoor is nearly perfect, and this conversation will give you a sense of why: he exudes care, curiosity, and humility. He’s also a big fan of cricket and poetry. And as a computer scientist, of course he loves data–and Microsoft has gathered quite a bit on the future of work. So enjoy.

There was a time and I'm not going to locate it, but you can, when Microsoft was externally known [00:01:00] for a lot of internal competition, forced rankings that pitted people against each other were pretty popular and you came in and challenged that dynamic and said, look, we want to collaborate. We want to be one Microsoft.

[00:01:09] Adam Grant:
Can you help us understand how you made that change?

[00:01:13] Satya Nadella:
Being essentially the first non founder CEO, I felt the real need to, in some sense, refound the company or borrowing the phrase that Reid Hoffman users, which I like a lot, because from time to time, companies need that moment where you need to reground yourself and starting with. The sense of purpose and mission, like why do we exist? And if we sort of disappeared with anybody, miss us to remind, because I think every one of us who work in any company need that anchoring in order to then go on to make all the decisions and work we do. And then the other one was to really put forth the culture that we aspire to.

[00:01:52] Satya Nadella:
And that's where I bought it from Carol Dweck's work on growth mindset. Uh, which has been a godsend to us because, you know, it's really helped us go from this, know it all to learn it alls. And that mission and culture has given us, perhaps Adam, more of that permission to look inwards, look to what systems, processes, behaviors, make us successful in the first place and reinforce them. And then the same thing, what systems, processes, and behaviors make us sort of not successful. And then.

[00:02:25] Adam Grant:
So, is this the future? Are we in it right now? Or what is it coming?

[00:02:30] Satya Nadella:
You know, we definitely are in it and it is going to evolve. I think our expectations of what to read and how we work have gone through a real structural shift, but I think we're still figuring it out in terms of this next phase, before long-term trends truly step up.

[00:02:50] Adam Grant:
Satya you made one of the most profound comments I've heard through the whole pandemic. When you said we should stop thinking about remote work, like a switch, and think about it more like a dial. I'd love to hear you elaborate on that and how it's affected your thinking at microsite.

[00:03:03] Satya Nadella: If you take a two by two grid where you say people are either together or remote and are collaborating synchronously or asynchronously in the previous era. So to speak before the pandemic, you could get away by creating some norms and sort of forcing people into one or two quadrants. Whereas now, All the four quadrants at any given time have to be excellent in order for work to get done collaboration, to happen. Take just even one of the data points, Adam, which is the triple peak, right. We knew. And even going into the pandemic, we had a bit of it, right. But now it's clear. I mean, I, every night I'm triaging just before going to bed, all my mail preparing for my next day, this lots of asynchronous work I do. So in particular, supporting time shifted like in a multinational company, a lot of the meetings are happening across time zones. I think we now expect us to both Gordon Corey synchronously participate in them. So I think that's one area. Uh, where we have to really think about a synchronous synchronous work, as much as we think about remote work. The second thing that I would say is the physical space even is changing. Right. But why are people coming into work? What type of meeting should we even do when people come into work? Somebody said to me, space is the ultimate collaboration tool that was refined in a 200 year period, right after all. Based, they've done a lot of work to define it. We're just not going to trade it away, but we're going to use it perhaps differently.

And then the last thing I'd say is me onboarded something like 50,000 employees during the pandemic. I mean, and so that means we have learned demon. What does onboarding look like? What does knowledge, capital or accumulation of knowledge, capital and learning look like inside of a corporation where you can start delivering. In the flow of your work versus you having to go offline to build that you have to substitute for some of the things that happened in a physical workplace. So those would be the three things, at least when I think about flexibility, thinking about hybrid work as a dial, it's more about really rethinking how people collaborate, how people learn, how you use physical space.

[00:05:21] Adam Grant:
Well, I'm a big fan of rethinking for obvious reasons. And I want to try to speak one of your languages. Can we double click on each of those themes that you just raised? It's double click the right lingo here is that we're looking for. Okay, good. All right. I'm trying to speak a little bit more texts. So, first one is this idea of the triple peak. Your data have shown that about 30% of people are not just becoming most work active in the morning and then the afternoon, but again, just before bedtime. I'm trying to figure out if this is a good thing or a bad thing. On the one hand, I think it meets the desire for flexible hours. On the other hand, it's probably bad for disconnecting and getting a full night's sleep. So how are you thinking about managing that?

[00:05:58] Satya Nadella:
It's a great question. And I think a lot more research, quite frankly, fundamentally has to be done, right. Because one of the ways we even think about the broader definition of productivity is more thinking about collaboration and obviously all the output metrics learning is another one, but well-being is one of the most important pieces of productivity. So the reason why I think a little bit of the hybrid peak is definitely going up is the desire that everyone has. For flexibility. And so that paradox, if you need flexibility, and yet you're trying to get work done. Some of it means the work day does get spread out. So this is one of those places where at least we are trying to say, what is the way to build even into the system of work, our work assigned. We have the right nudges, right? One little feature we added, even for example, an email like this was even before pandemic, we started, which is especially the higher up in the auger you are. And you send a lot of emails over the weekend. That's the shortest way to destroy a whole bunch of people's weekend, uh, and sort of be able to set the norm and the expectation that you don't need the response. Back some of that will also be very helpful. So I think we'll need to learn the soft skills. Adam. It's not about a tool, but it's good old fashioned good management practices that we need in order for people to have their wellbeing taken care of.

[00:07:21] Adam Grant:
Satya, are you saying that even you refrain from weekend emails?

[00:07:25] Satya Nadella:
Well, you know, I am learning at them every day. You know, one of the things that at least I'm getting better [00:07:30] at, I would say is being able to set that expectation. And quite frankly, the other thing that I feel most proud of is creating a culture where people are willing not to ake a male from the CEO and just feel that they have.

[00:07:43] Adam Grant:
Let's talk about space. You did an internal analysis at Microsoft showing that over 60,000 people, when they had to shift to remote during the pandemic, their networks got more siloed and more static. And we know from decades of evidence that that's bad for learning and innovation that you end up with all this redundant knowledge instead of fresh perspectives.

[00:08:00] Adam Grant:
So how are you tackling that? Both in a remote hybrid world, but also as people potentially aren't in the office at the same time, all that.

[00:08:08] Satya Nadella:
Just yesterday. I was reviewing some research, which our folks are doing on. What are people coming back to work for? In fact, what team norms are emerging? What are managers deciding to congregate people for? Is it onboarding? Is it some design session? Is it some mentoring? Because that's another thing that we realized that in order to do even good, one-on-one personal mentoring sometimes having the manager one-on-ones probably help a lot. So we are trying to come up even with the taxonomy right now of just even best practices that we are seeing in order to then say, this is how the physical space then has to change, how we are building out our physical space so that it's more modular, literally, you know, just like how digital tools have the malleability. Can we, to some degree create the same, even with the physical space, but that's how we're approaching it.

[00:08:58] Adam Grant:
You talked about onboarding a little bit. What are you finding about effective onboarding with 50,000 people who have never been physically in the same room together?

[00:09:06] Satya Nadella:
The biggest biggest thing that we found is that direct connection to your immediate manager, right? You had an onboarding, people went for the onboarding week or day. And there were lots of other people who sort of helped you with many things. Whereas now the full service concierge is now your manager and unless your manager cares and takes the responsibility of onboarding you, everything from, Hey, are all the benefits provisioned? Are you having any challenges with any of the paperwork? To making the introduction to all the people who are needed both inside the org, outside the org? Right. There was this one fantastic practice of a very senior leader who got hired in and I learned from one of my direct reports was how he took the, you know, real care and introducing the person who came into Microsoft to all the people personally, like he would in fact, set up the team's call and make the introduction and then leave the team's call so that then she could actually have the one-on-one with the person.

That type of deep care for onboarding being taken by even the first level manager, even interns. In fact, we saw this, you know, interns who want to come back to Microsoft or those who had a great manager who took real deep care in their experience. So that perhaps is the biggest thing that we are trying to make sure we build into our managerial capability.

I think tech companies in general have had this thing about, "Hey, it's all about technology and management is not the critical thing," except everybody's realizing and waking up and saying, "look, leadership and management and technological excellence, both go together. "And we actually have to put our money where our mouth is. Focus on building that managerial capability. And so we have this framework, Adam, called model coach care, which is sort of the thing that we say every manager needs to sort of exhibit in terms of real skills. And I'm glad we got that started a few years before the pandemic, and it's really helped us a lot during the pandemic. But I think that it's now become really clear to me that the company's success depends on great everyday management.

[00:11:24] Adam Grant:
That approach of model coach care, I think has been central to one of the major culture changes that you've spearheaded I've found in some of my latest research that it's not enough just to admit that you have things to learn. it's helpful to ask for feedback and open the door, but what's much more powerful is to actually criticize herself out loud.Because that way you're not just claiming that you're receptive, you are proving that you can take it. And one of the things I've admired about your leadership for a long time is the humility and vulnerability that you show that you're not afraid to admit when you don't have all the answers or when you made a mistake or got something wrong. Can you talk to us a little bit about how you built the confidence to share your mistakes and what that looks like doing it effective?

[00:12:03] Satya Nadella:
That's a great question that comes from, I think, feeling very secure, right? The psychological safety that one creates around you, especially the more senior you are becomes, I think, super important. Uh, and to your point, one technique of that is to share your own fallibility because that gives confidence to others. Feeling secure leads you to be more vulnerable. But then the real issue is systemically. How do you help people feel secure? And so that is where the cultural element of having psychological safety as being a first class thing. That's talked about where people are not jumping down people's throats. The first time they admit a mistake, which by the way, I do sometimes. And then I have to check myself right. In my last staff meeting somewhere asked me this question, "Hey, when somebody sort of sends a mail where you know, something's wrong, what do you do?" And I thought about it for a while. And I said, you know, the first thing that comes to mind of course is, I want to send back a flame mail to like the next person, but then at good times I check myself and say, God, you know, all that will do is cause that person to be more stressed. But I got to really look at the systemic issues here and then help them recognize to fix it. So the more introspective VR and creating these safe zones and psychological safety as a cultural thing, as opposed to any one individual being vulnerable from time to time, I think is probably the most.

[00:13:35] Adam Grant:
One of the things that that surfaces for me is the challenge, especially for people from marginalized groups to have that psychological safety. Um, we, we know it's that much more difficult to, to speak up, whether you're raising a problem or bringing an idea, uh, when you are not resembling the dominant majority in the room. And I know that's something you spend a lot of time on and care deeply about what guidance do you have for leaders and managers?

[00:13:58] Satya Nadella:
That's a fantastic point. In fact, that is the crux of it. Right. Which is that everyday practice or figuring out what is the lived experience of the people in your team. So when you think about when in the model, coach care that last element of care, it's that extra level. I thought that you put into-- "Who are all the people on my team?" The reality is all of us have different histories, different backgrounds, different daily events impacting us. And so being able to deeply have empathy for that and then making sure that their voice is heard in a meeting, that flexibility we talk about is being exercised to help people do their very best at work while they can take care of everything that's needed in their life. That is what I think is the big thing that I think we're all--I would say we're much more capable today just because of what the trauma of the pandemic has haught us that. Now the question is how do we exercise it? I think the impact of what's happening broadly in the world on any employee at this point cannot be separated from how the employee feels at work.

[00:15:15] Adam Grant:
Are you ready for a lightning round?

Satya Nadella:
Let's do it. Okay.

Adam Grant:
Ground rules looking for between a word and a sentence you could pass once if you want.

Satya Nadella:
Okay. Makes sense.

Adam Grant:
All right. You can pass more times if you want. But I always think it's fun when, when we dragged that extra answer out of you. So, first question is if you weren't in tech, what job would you most want to have?

Satya Nadella:
I'll trade with you.

Adam Grant:
[laughs] I don't want your job because I'm not qualified, but I think you'd be pretty good at mine. Ok, organizational psychologist, Satya's future career--teaching at a business school near you. Watch out. What is the case for working at Microsoft as opposed to other tech companies?

[00:15:51] Satya Nadella:
If you want to make others cool join Microsoft, if you want to be cool to join somebody else.

[00:15:56] Adam Grant:
I like it, making other cool. Worst career advice you've ever received.

[00:16:01] Satya Nadella:
I'll sort of say that the best career advice I got is don't wait for your next job to do your best work. So the worst would be the compliment to it.

[00:16:09] Adam Grant:
Got it. Something you've rethought in the past.

[00:16:12] Satya Nadella:
The role of multinational companies in terms of building bridges across people.

[00:16:20] Adam Grant:
More important in society, poetry or cricket

[00:16:25] Satya Nadella:
[laughter] Poetry in cricket.

[00:16:28] Adam Grant:
What does that mean? I have to ask a follow up.

[00:16:29] Satya Nadella:
Cricket to me, I can go on and on, is the game that has taught me everything that needs to be about leadership life and outlook, and I love poetry. And so anytime I see a great spin bowl or bowl to me, it's poetry now.

[00:16:44] Adam Grant:
All right, I'll take it. I have to now watch cricket to understand what that means. I'll get back to you. As far as being a learn-it-all is concerned. It seems like one of the last people in human history to successfully pull that off was DaVinci you're on your way. What is the next thing that you're excited to learn that you don't understand now?

[00:17:01] Satya Nadella:
What I am most excited about right now is: What are the drivers of next level of economic growth? I want to learn, how do we shape the democratization of technology such that healthcare is better, education is better, the energy transition happens faster. We all get better mechanisms of credit,-- because I think tech as it's today expressed is too narrow than dumps of its economic impact. And that's what needs to change. And I want to learn everything.

[00:17:38] Adam Grant:
Well, we have our marching orders for the next few years of research, then stay tuned. Stephanie, out of the lightning round. One of the things that I love most getting to sit down with leaders that I look up to is not just hearing them talk about how they think, but actually observing them in action and getting them to see them do what they do best. And speaking with your team, and also having seen you a few times over the. As we've interacted. I know one of the things you excel at is just motivating people to do things they think are impossible. And I wondered if we could do a quick role play to get a taste of how you do that. So the scene is we've got a bunch of faculty at Wharton who liked to do their own independent work.They're very much kind of living in their own silos. They don't collaborate as much as we might. Like we don't even necessarily have a school mission that they rally around. And I kind of like my independence. That's why I chose this field. I've been tenured and it's something that gives me lots of freedom. Can you motivate me to collaborate more and to show up at the office occasionally and full disclosure, I don't want to do it.

[00:18:37] Satya Nadella:
The motivation has to come from what it is that you as a researcher are trying to do and how teaming can help you do that better. Right. Even at Microsoft, quite frankly, we're trying to emphasize, Hey, great teams are important, but great teaming is the currency. And in fact, one of the phrases I use getting to yes, on unmet unarticulated needs of customers is what requires great teaming. So in your context, it would be like, "Hey, that research paper, that research output will be better. You will have more fame and fortune. If you team better with your colleagues."

[00:19:14] Adam Grant:
And if I'm not motivated by fame or fortune, but really just enjoy my freedom and my intellectual exploration.

[00:19:22] Satya Nadella:
Think about like, what is the source of intellectual exploration, it sort of your own ability to learn from others. And so therefore your colleagues, I always think about the daily routine, the number of people I meet and how I was able to go explore new things because of the people and what I learned from them.

[00:19:40] Adam Grant:
And that, I mean, when I think about what it means to be a learn it all, or a lifelong learner is you genuinely believe that you can learn something from every single person you interact with.

[00:19:48] Satya Nadella:
There's a thing that I look at as my learning system. If there is one, I picked it up from my dad. He had this diary, he would write every day where he would sort of put tasks, done. People met. Ideas generated to act on. And the source of basically the ideas generator to act on our people and also the work you did. And so to me, it's a continuous system

[00:20:11] Adam Grant:
That is such a simple way to take the, the to-do list that everybody gets stuck on and say, wait a minute, I should also have a to meet and to learn list. Absolutely. When you talked about model coach care earlier, I was wondering how your views about care have evolved, especially in the last two years.

[00:20:27] Satya Nadella:
Yeah. I mean, I think it's the biggest thing that I've realized is that the. Thinking about everybody is going through some tail event and, you know, and you need to be able to be there as a manager, as a team and a set of coworkers when that tail event happens. And that doesn't come without you being tuned to asking the question, observing what's happening around you and the needs. And so that sort of, and then again, it's a little bit of creating that safety, right. When you have the need, let's just create an environment where people come to support you. Uh, because I mean, I always think I'm going to be spend a lot of time at work and work needs to be the community that even supports you in your life. And how do we create an environment that allows for that natural flow? That's what I like the word care as part of core, management.

Adam Grant:
I do too. And it's, it's something that I think a lot of people have neglected for a long time. And in part, because they're thinking too much about how do I, how do I extract the most output out of this human and make them as much of a machine as possible, as opposed to saying, wait a minute, there are tasks that we outsourced. We want humans to do the work. That's really hard to squeeze every single ounce of, of effort out of, and that means we need them to give them the space to invest in their own wellbeing. We need to give them time to incubate creative ideas. Why, why are there still so many leaders who don't quite grasp this?

[00:21:59] Satya Nadella:
You know, in fact, one of the other things we've been thinking and studying. Knowledge work and even first-line work right for the first time re the digital tool and the proliferation and the use even in first-line has gone up very heavily. And some of the data that we are seeing there is, for example, there's a lot of stress in first-line work. A lot of the first-line workers feel disconnected from the company. The managers in first-line in fact are the most stressed because they lack the support and the connection from the company. Right. I think I've always go back to saying, how do we help managers feel like they're supported? One of the things Adam, that a lot of people sometimes come to me and my Microsoft analyst say Satya at the top, people get it, people at the bottom get it. In the middle of there's all this problem. And I look at it--for most of my 30 years of professional career, 32 years now, was in the middle. And so I do know those are hard jobs, right? Because you have all these deadlines that you need to meet. And then you have people who work for you who have all these tail needs and, or just regular needs. So you get squeezed in the middle in some sense. So therefore, if anything, I've come to recognize to the very core of your question, unless we create the empowerment, the space, that capability in the middle so that they can care for that people it's just not going to happen.

[00:23:23] Adam Grant:
That reminds me of some classic sociology evidence showing that when people are micromanaged at work, Over the next decade, they actually became more controlling and authoritarian at home with their own children. Like they were deprived of freedom in one domain, and then they, they almost, they overreacted and, and over corrected in a different domain. And I think what you're describing is something very similar that when, when we put too much pressure on managers, then they end up restricting the freedom of the people that they're.

[00:23:48] Satya Nadella:
One of the things I always think a little bit about is managers who take risk away and then create different metrics for people and unconstrained--that's like a habit we all have to develop, right? Because otherwise, if all the risks have to be taken by somebody else who is working on your team, then you're creating an environment where it just will be very, very hard for people to feel that they can have a more holistic way that they can be productive.

[00:24:18] Adam Grant:
I want to ask you about one of your favorite topics, which is gaming. You've had Xbox for a long time, but you've made major investments recently. There's obviously a while ago there was Minecraft, but more recently you bought Activision. What's driving that big focus on gaming.

[00:24:31] Satya Nadella:
It's been 20 years since we've had X-Box.We love gaming. In fact, you go back to PC gaming even before X-Box a flight simulator is as old as Microsoft. So we've been in gaming throughout. I always say that the idea of. Soft sort of day would be you get up in the morning and, um, you'd write some code and then you do some documents and collaboration and play games. So that's kind of the three identities of Microsoft that sort of our core. So one of the things to me. As the 3 billion people playing games, uh, we know that gaming can be, in fact, it's the biggest entertainment category that is digital category. There is, but it also creates I think, sense of joy and community, which is unparalleled. And quite frankly, when people talk about what this next generation of immersive experiences and metaphors is, guess what. Games we've been building matters like worlds for many, many decades now. And now we can even think about gaining as a pretty horizontal capability that is probably going to inform this very next phase of the internet that people describe as the map.

[00:25:39] Adam Grant:
I'd love to hear more from you on the metaverse. Are we going to be having this conversation with our avatars in five years? Is this just second life with better technology? Where do you see this all going?

[00:25:48] Satya Nadella:
I do think of it as just the natural evolution of the internet. It's the next phase where you have more increasing digitization of people, places and things. Having the embodied presence in a meeting like this, where you and I can both have spatial audio, real eye contact, and be able to look around and have a sense of space. These are all things today that of course have to be done with a headset. But even in 2D, when, you know, mesh two teams launches later this year, I am very excited about even how people are able to go on and take advantage of avatars, as you said, and some of the capabilities like spatial audio, even on 2D surfaces. I have always thought that the killer app here is embodied presence. Presence is already been video. Presence has been definitely massive during the pandemic and now being able to have more of a spatial embodied presence, I think is much more doable the next time we have any place to be.

[00:26:49] Adam Grant:
Satya as always. This has been a treat. Thank you so much for joining us.

[00:26:53] Satya Nadella:
Thank you so much, Adam. It's always a pleasure

[Theme Music]

[00:26:59] Adam Grant:
Taken for Granted is hosted by me, Adam Grant and produced by TED with Cosmic Standard. Our team includes Colin Helms, Eliza Smith, Jacob Winik, Hannah Kingsley-Ma, Aja Simpson, Michelle Quint, Banban Cheng and Anna Phelan. This episode was produced by Samiah Adams. Our show is mixed by Rick Kwan. Our fact checker is Meerabelle Jesuthasan. Original music by Hansdale Hsu and Allison Leyton-Brown. We featured this conversation as part of the Wharton Future of Work Conference.

[00:27:23] Adam Grant:
We featured this conversation as part of the Wharton future of work conference.

[00:27:29] Satya Nadella:
We are building out physical space so that it's more modular literally

[00:27:33] Adam Grant:
Saying that my desk is, can be made out of Legos

[00:27:35] Satya Nadella:
More or less, at least you should be able to make your desk appear in different places at different times, depending on the type of work you're going to do on that given day.

[00:27:47] Adam Grant:
I spent a lot of my childhood preparing for that. So I think that will go very well.