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Adam Grant is Asking all AFP 2022 Attendees to Think Again

Apr 15, 2022

In a recent episode of the “AFP Conversations” podcast, Jim Kaitz, president and CEO of AFP, sat down with our AFP 2022 closing keynote speaker, Adam Grant. Speaking this October in Philadelphia, Grant is known the world over as a pioneer of organizational psychology, as his millions of followers, the multitude of readers who have made his books bestsellers, along with the students who repeatedly vote him the Wharton School’s top-rated professor, will attest.

Kaitz and Grant discussed how to change our thinking to evolve the way we work, both on the individual level and at the organizational level, in a time when we're all rethinking how we work, the meaning we attach to work, and the systems and processes in which we're entrenched.

Kaitz: Adam, thanks so much for being with us today. We are really looking forward to having you as our closing keynote speaker on Tuesday in Philadelphia at the AFP conference. I'm really looking forward to hearing you, and I'm looking forward to this podcast with you as well. Your book, “The Power of Knowing What You Don’t Know,” what inspired you to write it?

Grant: You know, there were a lot of things that made me realize I needed to get better at thinking again — and so did a lot of the people I knew. But one of the pivotal moments came in the winter of 2018. I went to a bunch of Fortune 500 CEOs and unicorn startup founders, and I said, I would love to run a remote Friday experiment. Let's give people one day a week to work from anywhere. We'll randomly assign it, and we can test the impact. And every leader I pitched this to balked. They said, we can't do that. People are going to procrastinate. Our culture's going to fall apart. And even if it works, we can't open Pandora's box because then we'll never be able to close it again. What a missed opportunity to think again. We could have had all of 2018 and 2019 to figure out how to make remote work successful before we were forced to do it by this pandemic that nobody opted into.

Kaitz: Just generally, from your perspective, what are the benefits of practicing? I think you would call them “intentional rethinking skills.” What are the benefits for people, individuals and leaders?

Grant: The first benefit is that the faster you are to recognize you are wrong, the faster you can move toward getting it right, which is the goal. What's scary about people sticking to their convictions is that many of our assumptions and best practices were created in a world that doesn't exist anymore. And that means if you want to make smart decisions, if you want to learn, then you need to be as quick to rethink your practices and assumptions as you were to form them in the first place.

Kaitz: One of the specific things you talk about in the book is that we often fall into three mindsets: preachers, prosecutors or politicians. Could you give the audience a sense of the characteristics of what each of those three mindsets are?

Grant: Sure. If you're in preacher mode, you're basically trying to spread your own views. If you're in prosecutor mode, you're attacking somebody else's views. If you're in politician mode, you only listen to people if they already agree with your views. And what's problematic about all three of those approaches is you've already decided that you're right and they're wrong. So they might need to think again, but you have already seen the light and found the truth. And I hope that we could get people jolted out of those mindsets. It's so interesting to me how often these show up at work. My biggest vice is prosecutor mode, personally. When I think somebody's wrong, it seems like my professional responsibility as a social scientist to correct them, and also my moral responsibility as a human being, and I've never gone to law school. You know, we have lots of people who are not religious, who still end up in preacher mode and plenty of people who hate politics that still end up thinking too much like politicians. And so, we need to catch ourselves before we get stuck in these mindsets, because they really do stop us from being cognitively flexible and from adapting and changing and growing.

Kaitz: You have a number of recommendations to start to overcome some of these things, and we'll touch on those. The first one that you talk about is, in order to start this habit of thinking again, you first recommend that we think like a scientist. Can you elaborate on that? Scientists have been getting a bad rap these days, so maybe you need to help us here. But from your perspective, think like a scientist, how does that help us with rethinking skills?

Grant: When I say, think like a scientist, I don't mean that you have to own a microscope or buy a telescope. Although I would put personally enjoy it if more people dressed up like Bill Nye on a weekly basis. But for me, thinking like a scientist means that you don't let your ideas become part of your identity, that you're as motivated to look for reasons why you might be wrong as you are to search for reasons why you might be right.

Kaitz: That is hard for so many people.

Grant: Of course it is, but you know what else is hard? Being wrong all the time because you couldn't let go of your incorrect beliefs.

Kaitz: Unless you're the preacher, and you just think you're right.

Grant: That's true. But at some point, the world smacks you in the face and shows you that you are wrong. And you know, the thing to remember is that every opinion you hold is a hypothesis waiting to be tested. And every decision you make is an experiment that should have been an AB test, but you only ran the A, and you didn't do the B or the C or the D or the E. And what the data show us is that when we teach people to think that way, when we teach business leaders and entrepreneurs to think like scientists and say, hey, your strategy is a theory, your product launch or your service launch, that's an experiment to test your hypotheses, they end up driving greater revenue growth, and they're more likely to pivot as soon as they find out that something didn't work. So, yeah, it can be hard to get into that mindset, but it also has major upsides.

What the data tell us pretty clearly is that if you can think like a scientist, it buys you the freedom to walk away from commitments that turn out not to make sense, which other people have a very hard time extricating themselves from.

Kaitz: The AFP audience are corporate treasurers and corporate people from corporate finance and financial planning and analysis, and you teach at the Wharton School. So you're teaching a lot of the people that go into corporate finance. You know they have to do a lot of forecasting and modeling and … at what point do you say to yourself, I've got enough facts. I've got to make a decision, because they're put in a position where you have to forecast things. So how do you rationalize the scientific method of more facts, more facts, more facts. At what point do you have to say, I've got enough facts now, I'm willing to make this decision or make this forecast?

Grant: I have two ways of weighing in on that. The first one is to say that I ran a forecasting tournament with good judgment over the past year where we had thousands of people submit over 20,000 predictions. And these spend the full spectrum of world events, from who is going to win a given Olympic event to who is going to be the first billionaire to the edge of space, to what was going to happen to the price of bitcoin. And then we tracked the accuracy of their forecasts and found that our best predictor of accurate forecasting was thinking like a scientist, of all the factors we were able to measure. And what the people who thought like scientists did differently in their forecasting was, when they registered a prediction, they made a list of conditions that would change their mind. And then as new information emerged, they saw that as a signal.

For example, let's take Simone Biles with gymnastics. I said, you know, she was going to win the all-around gold. I also said that if she got injured, I would have to rethink that forecast. And so when I see the first evidence that she has a cognitive block, that's something that should probably push me to revise that prediction. The other thing that the forecasters who excelled at predictions did differently is they considered a wider range of possible futures. And the thing to remember about good scientists is, they're always asking what if.

Kaitz: I was just going to say, they're asking good questions.

Grant: Exactly. And so, they were imagining scenarios that other people just hadn't considered. Then of course you can't run the experiment, you can't test the hypothesis, if you can't imagine the hypothesis to begin with. What our best forecasters did was, they said, all right, let me imagine eight or nine possible futures. And now, let me make the prediction that's most likely to come true in most of them.

Kaitz: I think that'll be helpful, and obviously something that'll be on the minds of the audience when you speak at the AFP conference, because that's what they're doing. Whether it’s trying to forecast cash flow, forecast different models or what's going to happen to a particular product line, that's the business they're in. This idea about the scientific approach should be a fascinating discussion at the conference. The second thing you talk about, and you kind of alluded to this, it's so hard, but you say to define identity in terms of values, not opinions. That's hard for a lot of people.

Grant: It is, but you know, if you think about this from … let's think about going to see a doctor. You do not want a doctor who's committed to a set of practices. If this was the 1950s, you would be going to a doctor who says, well, what I do is I'm a professional lobotomist, and I will happily offer you a frontal lobotomy to cure your anxiety, as well as a series of other things that might be bothering you right now. You would want to go see the doctor who says my identity is anchored in the principles that I stand for, not the practices that I follow. That means that my job is to take care of patients, and I'm going to update the way that I treat them, according to the latest data and evidence. That's what I'm asking people to do: to say, you know, who you are is not a question of what you think is true or effective. It's a question of what is important to you and what outcomes you're trying to achieve. And you should be clear about what your goals are, and then be open around the different paths that might get you there.

Kaitz: I've read the book, and I know you talk about the importance of practicing humility. Now, you have a lot of experience with CEOs and leaders. How do they, if you talk to them about this, how do they respond? Because that's not a group that necessarily identifies with practicing humility at times. I mean, could you point to some leaders that you really do believe practice humility, that are able to define themselves in terms of values and not opinions?

Grant: I've worked with some leaders whom I think have done a great job at that. One is actually a military leader, Admiral Bill McRaven. I have the privilege of serving with him on the Defense Innovation Board for a few years. He led the bin Laden raid, as well as the capture of Saddam Hussein. He's an American hero. And despite being the most decorated person in every room we walked into, he was often the first person to say, listen, if you see me making a bad decision, or you think I'm about to make a mistake, it is your responsibility to let me know. And then his voice got loud, because he was in a Navy SEAL, and that's what they do. He said, bad news does not get better with time, and if I find out that you saw a problem with me and you didn't tell me, then we're going to have a big problem.

Kaitz: This is effective.

Grant: And he would go on to actually call out his own shortcomings. He would say, I've been told I have a bad habit of collecting strays, that when I get attached to somebody on my command, I don't want to let them go. I might have them in the wrong role and that could jeopardy jeopardize our mission. If you see that happening, you gotta let me know. And I actually studied this kind of behavior over the last few years, randomly assigning some leaders and managers to not just ask for feedback, but to talk about the areas of growth that they were working on, to share some of the past criticisms they received and low and behold, a year later, their teams were more willing to speak up because those leaders weren't just claiming that they were open to feedback, they were proving they could take it.

Kaitz: I love that part of the book, actually. I was going to ask you about that because that is a very effective tool that you've discovered in terms of how leaders can kind of show their openness. It's bearing your soul a little bit and telling them, yeah, I've made mistakes and here are the mistakes that I've made. And, as you pointed out in the book, that had a much more lasting effect than some of the other tactics that we hear about.

Grant: Bingo. Yeah.

Kaitz: My other favorite is, and I hope I pronounce this correctly, is the Dunning-Kruger effect, and it's dangerous. I love the whole concept of it, of when we lack confidence that we're most likely to be briming with overconfidence. How do you guard against that? I will also say I love the fact that the first rule of the Dunning-Kruger effect is you don't know you’re a member of the Dunning-Kruger club. So how do you address that with leaders?

Grant: The starting point, for me at least, is to have an ignorance list, which should be ever expanding. Anytime you discover something you're not an expert on, you should put it on the list.

Kaitz: I’d never get outta bed. I’d never leave the house, in my case.

Grant: Well, hold on a second though, because what it's supposed to do, if you do it well, is it's supposed to remind you that every single person you meet has expertise and experience that you don't, and it's an opportunity to learn from somebody who's more knowledgeable than you are on something that you've identified ignorance in. So let's take an example that hits close to home for AFP. One of the things on my ignorance list is finance. I know nothing about finance, despite teaching at the Wharton School.

And so normally what I would've done, before I started making my ignorance list, is when interacting with a bunch of finance professionals, I would try to steer the conversation toward my areas of expertise so that I have something of value to offer. And what that meant was, I wasn't learning anything about finance, and I didn't know what EBITDA stood for. Once it landed on my ignorance list, it reminded me, oh, that's something I should be more curious about. I interact with lots of people who are finance experts. Why don't I ask them some of the questions that I sometimes have suppressed in the past so that I can be a little more informed.

Kaitz: And that goes back to practicing humility, acknowledging you don't know something, which I think is a great way to gain knowledge. It kind of fits into that whole practice of practicing humility.

Grant: I'm a fan. I mean, how else do you learn? There's a psychologist who wrote a few years ago that learning requires knowing that you have something to learn. I thought it was such a simple and profound statement, that if I cannot admit that somebody else has something to teach me, I'm never going to get taught.

Kaitz: Here's the other idea that is fantastic: You talk about creating a challenge network, and trying to find a group of disagreeable givers, which I just think is fantastic advice. Can you elaborate a little bit for the audience?

Grant: Sure. We're going to talk about this live as well, so as a preview, we all have support networks. It's the group of people who cheerlead for us and encourage us and believe in us, but rethinking depends on a different kind of network, which I call a challenge network. It's just a group of thoughtful critics whom you trust to be honest with you, so that you can see your blind spots more clearly and work on improving in those areas. The most valuable members of your challenge network are often disagreeable givers who are gruff and tough on the surface, but they're doing it because they want to help. They might come across as a little bit prickly or sometimes a little bit curmudgeonly, but are doing it because they care about your success, or they're very committed to the organization's mission. And those are the people who are willing to give you the critical feedback that you may not want to hear, but you desperately need to hear.

Kaitz: It's really great advice. Here's the last question, cause I think there's just going to be so much excitement to hear you speak at the conference. And I really do recommend everyone read your book; it’s a very readable book, and you just get so much out of it. There's so much angst and stress in the workplace. You see this so much in terms of all that's being written about the Great Resignation, but you write that instead of searching for the job where you'll be happiest, you might be better off pursuing the job we expect to learn and contribute the most to. How should people think about this?

Grant: Well, happiness is hard to predict. We know that from a couple of decades of evidence that very often, when you choose a job, you're indexing on what sounds interesting to you today, but you don't know what you're going to be passionate about five years down the road. You end up then sort of trapping your future self in the tastes and preferences of your present self, which is not something I would recommend to anybody I care about. It's also hard to gauge how enjoyable a job is going to be until you've done it day to day. And so, what happens to a lot of us is, we're kind of seduced by status, and we're drawn to the most prestigious company, or the title that's going to command the most respect. I don't care how much a job impresses somebody else, if the day-to-day experience depresses you, it's probably a mistake. The workaround for that is to say, what can I gauge concretely are a couple of intrinsic motivators? First is how much am I going to learn in this job? Is it going to give me a chance to stretch my skills and to master things that I'm curious about, which also is a great way to futureproof your career.

Second, is it going to allow me to make an impact? Am I going to solve meaningful problems? Am I going to know that there would be people who are worse off if my work didn't exist, and if I wasn't holding this role? If you bet on making an impact, it's pretty hard to be miserable.

Kaitz: I think that's fantastic advice, and I am really looking forward to meeting you in person at AFP 2022 in Philadelphia. Thank you so much for doing this. I look forward to a great presentation.

Grant: It is often sunny in Philadelphia. Can't wait. Cheers!

Treasury and finance professionals can evolve their thinking, open their minds, and build a learning organization. Join Adam Grant this October at AFP 2022 in Philadelphia to learn how. Register by June 3 to save $725