The Most Important Management Book Of All-Time

On this episode of Seeking Wisdom, DC and DG discuss former Intel CEO Andy Grove and his book High Output Management – which just might be one of the most important management books of all-time. Plus DC shares one secret tell that will show you who your next great manager might be.

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Like this episode? Be sure to leave a ⭐️⭐️⭐️⭐️⭐️⭐️ review and share the pod with your friends! You can connect with DC and DG on Twitter @dcancel @davegerhardt.

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In This Episode

0:47 – Introduction of the book covered in this episode, High Output Management by Andy Grove.

1:07 – How Andy Grove has made an impact

2:28 – Why it’s important to pair your learning with a moment in time

3:05 – Main lesson of the High Output Management: be conscious of how everything you do reflects on the people who work for you.

3:30 – Additional lesson: everything you do/don’t do counts and says something about you to your team.

4:17 – Be able to model good management and leadership for your team, as perception is reality

5:01 – “The streets are watching” – your team looks to you for cues on how they should act.

5:30 – Additional lesson: A manager’s output equals the output of his organization plus the output of the neighboring organization under his influence

6:27 – The secret to getting promoted is to go beyond doing 100% of your job

7:05 – DC and DG’s bonus tip on how to spot a natural born leader and your next great manager

8:15 – Additional lesson: saying yes means saying no to something else

9:30 – Be straightforward and leave the interview gimmicks alone so as not to leave the wrong impression

10:44 – Hiring is luck, so the interview process needs to be scientific

11:53 – Management should adjust based on talent and knowledge and the Task Level Maturity approach

Books Mentioned In This Episode

High Output Management by Andy Grove

Full Transcript

Gonzalo Veloz: Whenever you’re ready.

David Cancel: Is he too discombobulated?

Dave Gerhardt: I think we’ve flustered him.

DC: We’ve got him flustered that mustache [crosstalk 00:00:10]

DG: Send us in here.

DC: And we’re back.

DG: Yes.

DC: We’re back for an episode with the old unc’.

DG: Yes.

DC: The young nephew.

DG: Yes.

DC: And Gonzalo who’s wearing a mustache.

DG: Yup.

DC: What are you talking about today?

DG: So we’re talking about… This is one of my classic tricks, which is, you send me a book.

DC: Oh Oh.

DG: And then a couple of weeks after I say we’re going to talk about this book on the podcast.

DC: Great.

DG: This book, we’re talking about a classic, a classic that it’s taken too long. Look at that Apple Watch. I talked about false beliefs today and I use Apple Watch as an example. Which is right now false beliefs that are holding me back from buying Apple Watch.

DC: Oh you gotta get it.

DG: But that’s for a separate…

DC: Look at that. Look at that…

DG: That’s for some secret… The young lion on the cover.

DC: The young lion on the photos.

DG: Wow.

DC: Huh?

DG: 3:43 PM which means we got to rock. So we’re going to talk about one of the all time classic, classic books today, which is High Output Management.

DC: Why didn’t you me that before?

DG: Andy Grove, cause I think spontaneous DC is my favorite DC.

DC: Oh.

DG: I want you…

DC: If you would’ve told me I would have done jumping jacks.

DG: Tell me, tell me why you tell me why this is such a classic book to you. I got notes, so…

DC: I brought it out…

DG: You broke it out recently?

DC: Yeah. So Andy Grove, legendary, CEO… Intel.

DG: Intel.

DC: Rest in peace. RIP Andy Grove.

DG: Yes.

DC: And if read a lot of the books that we’ve talked about in past. Like Hard Thing About Hard Things from the homie, Ben Horowitz. If you read some of the early tales of The Coach of Silicon Valley. If you read some of the stuff that we’ve talked to on the past, then you’ll know that a lot of the stories that they talk about come from the management secrets of…

DG: Andy Grove.

DC: Andy Grove. Right. If you think about John Doerr and his book on…

DG: OKR’s.

DC: OKR’s, right. All of these things, they all make reference to one man, that one man is Andy Grove.

DG: Yeah.

DC: So I’ve read this book a bunch of times in the past and… but it was a lot of this stuff that you could learn from this book in the early stages of Drift were not applicable yet, but as we always say, you have to revisit books. And I was in the library at home.

DG: Okay.

DC: And I was looking through my perusing [crosstalk 00:02:22]through the stacks and I came upon this book and I was like ‘wait a second, now’s the time, now’s the time in Drift’s history’.

DG: Yes.

DC: Where we’re at the right size, where we can take actually lessons from this and implement them.

DG: Cause I think we first brought it at Drift, it was like 2015. There weren’t a lot of teams, there weren’t a lot of managers.

DC: Yeah.

DG: There were basically no managers.

DC: No managers.

DG: The only concept you could take from it was like how to run a one on one.

DC: Exactly.

DG: But that’s a blog post.

DC: Which is important. Yep.

DG: It’s an important one. We should… we’ll talk about that.

DC: Yep.

DG: But yeah, this was… you texted me a couple weeks ago and said re-read and I said ‘ oh, I read this one’ and you said ‘no no re-read it now.

DC: It’s time to re-read this…

DG: Because it’s time and I think… man, that’s why I wanted to do this podcast is because I think so much of what we about is it’s pairing your learning with the moment in time. And so we talked on the last episode about like seeking out what you want to go learn about and so for this one it’s like, if you’re at a phase where you’re at a company or becoming a manager, your companies growing, scaling, and this is where I go seek out this book,

DC: Totally. [crosstalk 00:03:15] I know that a large company if you’re working with, like you said, teams and managing, this is the book that you wanna read. High Output Management.

DG: Yes.

DC: So many lessons in this book.

DG: So I’m going to give you a couple highlights and like we usually do on these-

DC: Softballs.

DG: book reviews as softball, you right. One of the main lessons from Andy Grove, and this is something I learned from you a lot, which is, be conscious of how everything you do reflects on the people that work for you.

DC: Hmm.

DG: That means everything.

DC: You can’t see me now unless you’re watching us on the YouTube.

DG: Which you should be.

DC: By the way, Gonzalo need some subsscribers.

DG: Yeah.

DC: I’m leaning back in the chair soaking it in. All right, this is an important one that I always harp on, which is that everything counts.

DG: Everything counts.

DC: Right, every move you make, the way you carry yourself, every piece of communication, the way that you organize the studio, all of these things. The way you organize your office, the way you organize your day, like all of these things count and they say something about you to your team and these are the subtle clues that people pick up on and they will follow you.

DG: I think this is one that I had to learn for example, just to get to like make it more personal, which is like, okay, we had different conversations. I had different conversation with you throughout my progression over the last couple of years, which is like, ‘okay, you want to be director’ here’s what this means now.

DC: Yep.

DG: Then you’d say stuff like ‘Oh, you’re a director now. That means you can’t do this. Right?’.

DC: A huh.

DG: Then the next shift was like ‘oh, you’re a VP now. That means this’. And I was like ‘why the hell does he always say that?’. And then when you read this, this is exactly [crosstalk 00:04:50]be conscious of how everything you do reflects on the people that work for you. If you want to show other people on your team what management and leadership looks like, you have to be able to model that yourself.

DC: One hundred percent.

DG: And that doesn’t just happen at 2:00 PM when we’re in a meeting, but that’s 8:15 if I see you out on the sidewalk, that’s, you know, 7:00 at night at a bar or whatever.

DC: Yes.

DG: Right? And that stuff has to go through all levels which is, if somebody only sees you from nine to five as this professional person.

DC: Yep.

DG: But then you have after work stuff, president’s club, all this other nonsense [crosstalk 00:05:22] The reflection there, you always say this to me, which is, perception is reality.

DC: Yes, yes. And plated the position that you want. So if you want to be in a new role or if you’ve taken on a new role, the level of responsibility as the Great Jay Z –

DG: Yes.

DC: would you say ‘the streets are watching’.

DG: Streets are watching.

DC: Okay.

DG: Yeah.

DC: And what that means is that your team and the people around are watching you for cues of how they’re supposed to act now and so how they’re supposed to carry themselves and they are doing something that we’ve always talked about, which is they’re looking to you because they want to model the stuff that you’re doing and reproduce it. So if you’re modeling that behavior…

DG: Yep.

DC: That’s what they’re going to model because they’re going to think bad behavior equals getting me into the same role.

DG: 100 percent. And in the same vein of that, he also said ‘a manager’s output equals the output of his organization, plus the output of the neighboring organizations under his influence’.

DC: A huh.

DG: Okay?

DC: See it all has been written.

DG: Explain that.

DC: It’s been written.

DG: Explain that.

DC: This is the Bible.

DG: Explain that.

DC: What this means is that… and this is why I care about so much about all the details across the team, it’s not only with single team and how they carried themselves that sets the tone for the group of the company or the greater team, but it’s all those teams and other role models, right? Peer groups, we call them peer groups that you’re surrounding yourself that actually modeled behavior as well. So even if you have a great running team and you’re modeling good behavior, if you associate yourself or if your company lets other peer groups model bad behavior, then your team is going to average down to those people around you.

DG: I think you also have to be… you say this a lot, which is like the secret to getting promoted is to not just do 100 percent of your job.

DC: No.

DG: One hundred percent doesn’t get you promoted.

DC: One hundred percent is your job.

DG: One hundred percent is your job. This to me means, you want to be great? You have to show you can influence other teams, right?

DC: Yes.

DG: Because if you’re this great marketing leader, but all you can do is influence the people in marketing, how far are you going to make it? You’ve got to influence sales, customer success, product, all those people.

DC: One hundred percent and one thing I’m going to give you a little bonus for all you listeners out there.

DG: Okay.

DC: Don’t forget to leave a six star rating.

DG: Sure.

DC: After you hear this bonus. The simplest way that you can go about by identifying which builds on this principal. You’re the future leaders in your organization. Get your pens out, get ready.

DG: Yes.

DC: Here’s how.

DG: Okay.

DC: Look, observe your company and observe the team.

DG: Yeah.

DC: And look towards the people and the desks that people naturally congregate around.

DG: A huh.

DC: That is your next wave of leaders. So if you have people on your team who are yet not leaders, but people go to them all the time to get information, that hang around their desks asking questions-

DG: That’s a next level one.

DC: That’s next level of judo.

DG: That’s like the water test. That’s real good.

DC: That’s a six star rating [crosstalk 00:08:24]right there. If they naturally go over there, that is your secret tell that that person probably is exhibiting leadership ability without having the role yet and so you might want to double down on those people within your team. Those are natural born leaders, right. Okay [crosstalk 00:08:42]

DG: How’s that, the secret tell to finding your next great manager.

DC: Look at this. Look at this. That’s why we give him all the words.

DG: Come on. The secret tell… we’re gonna have… that’s gonna be separate. That’s pretty damn good. [crosstalk 00:08:51]

DC: Sometimes I give too much.

DG: Ultimately you do… Yeah, it’s okay, you know, give, give, give, give, give.

DC: Give. Eventually they ask.

DG: Then sometimes they ask. Maybe they… they ask, I love the flip. I don’t want to give all the tips because we want you to go read this book. But there’s a couple which is like saying yes means saying no to something else. Default to no.

DC: Yes.

DG: And one of the decision making exercises that I’ve learned and observed from working with you, DC, is you always do this thing where you lay out before you make a decision, you lay out the guard rails.

DC: Yes.

DG: And say, ‘I don’t know what the decision is, but let’s lay out the guard rails. Okay, we’re doing hyper growth. We want it to be… We want it to feel like this. We want it to be this many people, minimum. We want to be this’.

DC: Yep.

DG: Then from there we can start to figure out how we make the decision.

DC: Yep.

DG: Or you’ve also done… I’ve seen you and [Elias 00:09:39] do this is like what are the things that we’re saying no to?

DC: Yes. Most important.

DG: Write them out and that’s invert.

DC:  Invert. And that’s one of the hardest things because we all, especially myself and [Elias 00:09:50] love saying yes to everything.

DG: Yeah.

DC: But we have to start by saying no. That’s why we believe so much in the book. The one thing why we give it out to every person who starts at Drift, because you have to figure out what are the real big rocks and what’s the inverse of that, which are, what are the things that you’re saying no to today in order to focus your time on the things that are actually gonna move the needle forward for your business, for your life, for your love.

DG: I got three more things that I can’t skip any of them because they’re all good.No interview… Andy Grove, this is 1985, before all this [crosstalk 00:10:24] stuff popped up with the Google interview and all this other stuff.

DC: Yeah, yeah.

DG: No interview gimmicks. And you believe in this too, there are no interview gimmicks. Be straightforward, gimmicks could leave the wrong impression.

DC: Totally.

DG: So his whole interview process was no quiz, no trying to figure out the size of a manhole cover [crosstalk 00:10:39] I’ll never get a job anywhere.

DC: Yeah, yeah…

DG: No interview gimmicks.

DC: No interview gimmicks, none of the old Microsoft techniques at the round hole cover and all this stuff. And I used to be part of teams and companies where I would observe people using those things, but those things only screened for one thing, people who like to solve puzzles. So like, if you want to use a lot of puzzles in your interview, then you’re going to get a lot of people who like solving puzzles.

DG: That’s so true.

DC: The problem with getting a lot of people who want to solve puzzles, and I’ve lived through, is life is not a puzzle.

DG: Yeah.

DC: It’s not a game, right, like most of coming in and doing an exceeding and doing the work as a Bill Walsh would say, is hard work. You know very little amount of your time is spent on pure intellectual curiosity and you know, solving puzzles and doing all of this kind of stuff. Very little of your work is that. So much of it is just moving the ball forward. And if all you care about solving interesting problems, it’s going to be hard work for you any place you go.

DG: Do the work. A second to last thing I want to talk about is he said hiring is luck.

DC: A huh

DG: So therefore the interview process needs to be thorough.

DC: Yes.

DG: This is why we care so much about making the interview process scientific and you talked about this a lot because hiring is hard.

DC: Yes.

DG: The odds of people is gonna be stacked against you.

DC: Stacked.

DG: So that’s why you need to measure and track and be scientific in the hiring process.

DC: Yeah, and staying within… creating those guard rails for your hiring process, staying within those and repeating, being repeatable in the interview process. It’s also luck so you’re going to have to go into it understanding that there’s going to be a high failure rate.

DG: Yep.

DC: Right. You can try to…or at least a failure rate

DG: Yep.

DC: And that you’re never gonna be perfect. And I think some people try to get paralyzed in the interview process because they want perfection and they want never to be wrong. But as Andy Grove has said ‘you will be wrong’. You will have issues there. Where you want to do is approach in a scientific approach, have some guard rails, when you do have failures, learn from those failures. That’s the hardest part. And if you can learn from those failures, optimize the process going forward, you’ll get better little by little, but it’s going to mean incremental approach to getting there versus a perfect solution.

DG: Last one, then we’ll wrap. Management should adjust based on talent and knowledge. Low… these are my rough notes so God knows what this means. Low, more hands on and various specific, high, hands off act as a resource to help.

DC: Yup. You know what this means… this is the most famous part about this book and What’s it called again? Is it TRM or TLM? This is like task level maturity because what he calls it, it’s either task level maturity… yes it’s task level maturity. And this is the most famous thing from this book, right? And we’ve talked about this, he coined this in 85 right ’cause he’s a G.

DG: Yes.

DC: But we’ve talked about this in the past and said we’ve used examples like Colin Powell.

DG: Yep.

DC: We’ve used other people.

DG: Yep.

DC: I would [crosstalk 00:13:39]

DG: Bill Walsh Standard of performance.

DC: Yeah, and what he has with the TLM, the task level of maturity thing is to say that every person who comes in takes a role and is doing some task. Depending on the maturity that they have in that task, maturity that they have within that domain within that task, is going to be… is going to determine how much in the weeds you’re going to have to be with that person and the more maturity that they get overtime with a specific task, the more you can pull away and give them more autonomy and control over that task.

DC: And so Colin Powell would say that in his book, he talked about one of his books he talked about how he would train new Chiefs of Staff and say ‘Hey, this is my approach. When you come on, I’m going to be in the weeds. I’m going to be you know, breathing down your neck for every decision. And as you gain experience, I’m going to slowly pull away up until one point you’re going to notice that I’m not around anymore and that you are making all the decisions’ And that’s the TLM, task level maturity. He had an approach to doing that, not only for Chiefs of Staff, but for every role within the company and teaching that inside.

DG: It also gives context and makes the role more of like an apprenticeship.

DC: Yes.

DG: Which is like, if you’re not there yet, not a knock, but I’m going to be there with you until you get there.

DC: Yeah.

DG: Or as you grow and you hire more specialized people, you’re a CEO, you’re not going to know more about sales than somebody who runs sales.

DC: Nope.

DG: But that’s going to be different, right, then your hands on with somebody in the weeds in the early days.

DC: Yeah. The good thing about being a CEO is that I don’t know more about anything than anybody.

DG: Right. But you have to… but you have to be able to say ‘well, I’m a resource, how can I help, what are the potholes in your area and how do I solve them?’.

DC: Absolutely.

DG: So that’s it.

DC: So you have a huge shortage of six star ratings.

DG: It’s like people forgot.

DC: Yeah.

DG: It’s like a button is not working.

DC: Maybe the buttons…

DG: We should check. Is there a bug? Is that my file bug?

DC: Someone file a bug, an Apple.

DG: Please.

DC: Maybe Apple’s working against us.

DG: Please.

DC: Or something but we need six star ratings. Gonzalo has a little mustache… a big mustache, I should say for Movember.

DG: A big mustache.

DC: Big mustache. He looks like my dad. And he’s sad though, even though he has a lovely mustache he’s very sad because he does not have six star ratings to look at all day long. He does not have any G2shout outs. He’s a young man. He needs a little love. You know, he needs more love than the two of us. So give him a little love. Six star ratings only and subscribe on YouTube. Hit us up on the IG. That’s what the kids called the Instagram.

DG: Come… come to the IG.

DC: Come to the IG.

DG: We’ll give away some books.

DC: We’ve got lots of stories. We give away book. Follow us on twitter, holler at us. Much love.

DG: See ya.

 

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