Mastering Transitions: A Strategic Blueprint with Michael Watkins S2 I Ep 10

Join us for the latest episode of the Career Transitions podcast, where we explore leadership, strategy, and success. In this episode, we have the privilege of hosting the renowned leadership expert, Michael Watkins, as we explore the critical moments that define a leader's transition and the strategic disciplines that shape effective decision-making. 

Michael Watkins is Professor of Leadership and Organizational Change at IMD Business School and Co-founder of Genesis Advisers. He is a globally recognised leadership transitions expert and author of the best-selling book The First 90 Days: Proven Strategies for Getting Up to Speed Faster and Smarter. 

Michael has developed proven frameworks and tools to help professionals navigate personal and organisational change challenges. He has spent the past two decades working with leaders as they transition to new roles, build their teams, and transform their organizations. In 2023, Michael was inducted into the Thinkers50 Management Hall of Fame, which recognizes remarkable contributions to the realm of management concepts and ideas spanning many years.

In this episode, Michael shares invaluable insights from his groundbreaking work on leadership transitions. Join us as we unravel the secrets to navigating the challenges of transitioning into a new role, understanding organizational dynamics, and accelerating success.

But that's not all! Michael also unveils his latest masterpiece, "The Six Disciplines of Strategic Thinking." In this engaging conversation, we explore the core principles of strategic thinking that propel leaders to anticipate change, seize opportunities, and drive long-term success. Discover the key disciplines that will transform your approach to strategic planning and decision-making.

Whether you're a seasoned executive or an aspiring leader, this episode is a treasure trove of wisdom that will reshape the way you approach leadership and strategy. Join us as we journey through the first crucial 90 days and beyond, gaining a strategic mindset that can elevate your impact in any organizational setting.

Check out Michael’s works: 

The First 90 Days: Proven Strategies for Getting Up to Speed Faster and Smarter

Master Your Next Move, with a New Introduction: The Essential Companion to "The First 90 Days"

The Six Disciplines of Strategic Thinking: Leading Your Organization into the Future

Harvard Business Review Ten Must Read 

Connect with us on LinkedIn:

· Vanessa Iloste (Host)

· Vanessa Teo (Host)

· Aaron Wu (Producer)

Transcript

[00:00:00] Vanessa T: Welcome everyone to the next episode of the Career Transitions podcast, the podcast where we explore what it takes to successfully navigate through career transitions. No matter which stage of life or career you're at.

[00:00:18] Vanessa I: In our Season 2 finale, we are so honored to invite to our show Michael Watkins, leadership expert, professor, speaker, and author of the widely acclaimed book The First 90 Days, Proven Strategy for Getting Up to Speed Faster and Smarter.

[00:00:35] Vanessa T: It was such a rich conversation that we felt compelled to create two episodes. In this first part of our conversation, Michael shares his thoughts on what it takes to be successful while transitioning in a fast paced, dynamic, and unpredictable world.

[00:00:49] Vanessa I: It was so great to also pick Michael's brains on the rapidly evolving business landscape with the advancement of artificial intelligence and how we all need to evolve with these changes.

[00:01:01] Vanessa T: We hope you enjoy part one of our season finale.

[00:01:12] Hi, everyone. Welcome to our new episode of Career Transitions. We're your hosts, Vanessa Iloste and Vanessa Teo. 

[00:01:20] Vanessa I: Today, we are privileged to have a special guest, a renowned author and leadership expert. His name is Michael Watkins. He's the author of the widely acclaimed book, The First 90 Days, Critical Success Strategies for New Leader at All Levels.

[00:01:36] Michael, a very warm welcome to the show. 

[00:01:39] Michael W: Delighted to be with you today, Vanessa and Vanessa. 

[00:01:41] Vanessa T: Let me introduce you, Michael. Michael Watkins is a professor of leadership and organizational change. He is a globally recognized leadership transition expert and the author of the bestselling book, the first 90 days proven strategies for getting up to speak faster and smarter.

[00:01:58] Michael has developed proven frameworks and tools to help professionals navigate personal and organizational change challenges. He has spent the past two decades working with leaders as they transition into new roles. Build their teams and transform their organizations. In 2023, Michael was inducted into the Thinker's 50 Management Hall of Fame, which recognizes remarkable contributions to the realm of management concepts and ideas spanning many years.

[00:02:29] Congratulations on that award, Michael! 

[00:02:32] Vanessa I: Thanks, Vanessa. Congratulations, Michael, on such a tremendous recognition. We didn't wait for the award to actually love your work. We are both very big fans of what you do, and we actually use the first 90 days almost every month, every time we have a new leader coming on board.

[00:02:49] We have a lot of questions for you on this book that we have used for so many years. The first one was around, you know, the research you made and through the research, what do some of the most successful leaders do when going through this transition? 

[00:03:05] Michael W: Yeah. Thanks, Vanessa. So I think maybe the place to start is just what is it that makes transitions so hard?

[00:03:10] Right? And what makes them so challenging and at its basis, right? It's that you're simultaneously needing to get up to speed and connect and learn about a new organization. Well, at the same time, you typically face pretty high expectations of what you're going to be able to accomplish and timeframes have become pretty compressed, right?

[00:03:28] People need to have an impact. And if you think about those two things kind of operating together, on one hand, you're trying to learn and connect and on the other hand, you try to figure out, you know, how to have an impact. And it's when those two things intersect that it gets challenging. Right? And understanding how to make some of the right balances is crucial.

[00:03:44] And so when I started doing work on the first 90 days, there really was very little out there about how to make a successful transition into a new role. And there really was almost no discussion at that point about onboarding. Right? So the whole idea of onboarding hadn't really even caught fire by that point now.

[00:04:01] Obviously a lot of work has been done since then, and maybe just a little bit more quickly, right? So, so some of the original research I did on this was what are some common traps that leaders fall into, right? When taking the roles. And they haven't actually changed that much in the intervening time that I've done it.

[00:04:17] I mean, I wrote the original version for Sunny Dix in 2003. I did the second edition and in 2013, and I'm actually working now fairly far along with the third edition, but that's something that's kind of remained constant, right? Which is the classic mistakes people make, you know, when they fall into that they fall into.

[00:04:34] And, and the biggest one is the, what got you here won't get you there trap, right? Which is a variation on the comfort zone trap, the idea that you're going to continue to be successful doing the things you've done in the past, maybe only more. And the reality is that, you know, sometimes that works, right?

[00:04:51] Because your skills you've developed are a good match for the new role, but often that's not entirely the case, right? Often you've got to, to be successful, embrace new skill sets, new behaviors. Whether you're being promoted to a higher level or onboarding into our organization from the outside. And there's that temptation to kind of stick with what you know, right?

[00:05:11] And continue to try to leverage it. And, you know, the advice I give to folks about this, and I mean, I personally coach pretty senior leaders these days is figure out what it is that you love to do. And are probably really good at doing, but need to do less of and figure out what it is that you're maybe not so comfortable with, or, you know, don't really enjoy doing so much that you need to do more of.

[00:05:36] And so get fixed in your mind, kind of what's the work you need to do to let go of things, right. And embrace things. And if by doing so you kind of help, that helps you avoid the biggest trap I see people fall into. 

[00:05:50] Vanessa I: Very useful. One of the questions I had was around the fact that this book for me is internationally making sense.

[00:05:57] You know, we are in, I mean, we're operating with Vanessa in Asia and I've been working in Asia for many years. And I can see that your book is really resonating with our Asian audience, whether it's Asian leaders or whether it's like me, a foreigner living in Asia. Is it something you have reflected on, Michael?

[00:06:16] I mean, do you know why your book compared to other American gurus book, if I can use this expression, is actually very, very meaningful across the world? 

[00:06:27] Michael W: Well, so it's, it's a wonderful question. I have thought a little bit about it. Obviously it's wonderful, right? Because you don't know when you launch something like this, whether it's going to translate across cultures particularly well, I think it's in part because what I tried to do was put forward a set of sort of foundational principles for making good transitions.

[00:06:48] But I left a lot of wiggle room for how you apply those transitions, principles. And I also, I think incorporated thinking about what is culture exactly and how do you adapt the cultures into it? And so I think that helped a lot, like that combination of kind of really, you know, having principles that seem to be pretty robust across cultures combined with really kind of acknowledging the impact of culture.

[00:07:12] That's the best explanation I have for why it's happened that plus, you know, I, I'm an engineer originally by training, right? I described myself as a recovery engineer. Right. So there's something about kind of systems and processes and tools that I think again, sort of translates reasonably well across cultures.

[00:07:29] Vanessa I: We can do the business case for you if you need one day for the third edition. 

[00:07:33] Michael W: Well, you know, maybe that's something we can talk about later, right? Which is what's changed, you know, because a lot has and is changing and the way leaders need to take new rules and, you know, some of it remains the same, but some of it shifts in response to changes in the context, right?

[00:07:47] I mean, when I wrote the second edition 10 years ago, No one was doing remote work, right? No one was doing how they're working. No one was needing to onboard into an organization without physically being present in that organization. Technology was not at the level that was it's at today. So even something as simple as that, right.

[00:08:05] Can pretty substantially change the way you need to think about making a successful transition. Global teams, right? I mean, 10 years ago, certainly there were global teams. It's very much more the norm today with the organizations that I work with, that you're leading global teams across, you know, many time zones and trying to figure out how to do that.

[00:08:23] And you may not therefore have a chance to be physically present with the people you're leading that much. So what do you do with that? Like it comes up with a question. It's things like that. And interestingly, right. I mean, I think the basic principles hold up pretty well. But again, the context in which you apply them needs to change to reflect the realities of what you're up against, right? As a leader.

[00:08:45] Vanessa T: Michael, you bring up some really great points about the dynamic changes in, in the world. And you brought up two points that I'd like to, to just expand a little bit on. The first, when you talked about the dynamic changes in the world, the economy and leaders having to ramp up even faster in that compressed timeframe, and I'm wondering what, what advice do you give to leaders, especially in this world where, you know, you're on the job and they're expecting you both to onboard as well as to start performing.

[00:09:14] What do you say to leaders in that space? 

[00:09:16] Michael W: Move fast, I'm joking, but it's a good start, right? You know, like I, I, sometimes I joke these days that it's not the first 90 days. It's the first 90 minutes that you've got to kind of get yourself up to speed. And in some cases, the first 90 seconds, you know, when I wrote the first 90 days, people sometimes write about my work and say, you know, he thinks that transitions take 90 days and actually they take more than that, or they take less than that or whatever, and I'm like.

[00:09:42] I never said that, right? I said, what I want you to do is use that first 90 days as efficiently and as effectively as possible. Get yourself as far up the learning curve, as deeply connected in the organization, having the impact you want. In that 90 day planning timeframe, because it's a great timeframe for thinking about it.

[00:10:01] I don't think that's changed. What has changed is what you need to accomplish in that 90 days is more than it was before. Right. You have less time to learn and connect than you had before. You've got to begin to make decisions probably earlier than you might want to. That's tricky, right, to do that and it's a real balance.

[00:10:18] And, and it actually, it gets to a second big trap I see leaders fall into, which I call the action imperative, right? The feeling that you've got to do something to prove that they, whoever they are, did the right thing in putting you in the job. And often that pressure comes from the inside with leaders.

[00:10:35] And you just have to be careful, you know, that you're not making decisions or taking actions earlier than you actually need to, right? Because sometimes the time pressure sort of starts inside you, as opposed to with the real context you're operating in. But that said, the reality is people are expecting you to have an impact earlier.

[00:10:54] Right. And faster than you, than you did before, because competition's moving so fast. Technology's moving so fast. The, the environment is so turbulent right now, politically and economically that you have to be able to be moving. And oh, by the way, you need to be nimble, right? You need to be agile, kind of has a particular meaning, right?

[00:11:13] With agile methodologies, agile, nimble, in the sense of being responsive, I think is a real imperative these days. And by the way, that's a connection to something that we talk about a little later, which is strategic thinking, right? Yeah. The new book on strategic thinking I have out, right? 

[00:11:26] Vanessa T: Yeah. 

[00:11:26] Michael W: Just came out yesterday, right?

[00:11:28] Vanessa T: Yes. We can't wait to get to that too. Michael, I just another follow up question. You talked about the new ways of working about hybrid working and how that has changed significantly in our workplaces over the last 20 or so years. We see that so much more post COVID and it has made onboarding quite different, especially when you need to onboard leaders in many cases over zoom. What's that been like and, and how do you see leaders managing that effectively? 

[00:11:57] Michael W: Yeah. So I think there's a couple of pieces to it, right? There's the, you as a leader, onboarding someone remotely, but there's also you as a leader onboarding remotely. And I think they're both interesting.

[00:12:07] I think that onboarding somebody effectively onto your team, in some ways, it's easier because you can get there. Technology delivered to them, you can get them up to speed doing things. You can connect them to the systems of the organization in some sense, easier than you could. But it's also harder because you've got to be helping them learn and connect.

[00:12:27] And I view learning and connecting as the two fundamental pillars of a successful transition. And what that means is you've got to help them more typically, and you've got to be more structured in doing it because. The natural process of osmosis of meeting people when interacting and learning just doesn't happen if they're not physically present.

[00:12:46] Right? So the answer usually is be more planful, be more intentional, be more structured in how you both help with the learning process and not just learning about the technical dimensions of the organization, but the culture, the networks of influence, help them connect, right? Be a little more proactive and helping people connect to the right key stakeholders in the organization.

[00:13:08] That I think is really the core of it. And then as a new leader onboarding, you kind of face a parallel set of challenges, which is how do you really get to know your team? When you're not physically present with that team, right? And in general, I recommend if it's humanly possible to get together physically with people as early as you can, or get out to meet people.

[00:13:28] But sometimes it's just not possible. Right. And so you've got to go through the process of assessing your team and building your team, operating virtually. And that's really, really challenging to do that work. Yeah. So. Yep. So both sides, both the onboarding someone and onboarding yourself, they're both pretty challenging in a remote work environment.

[00:13:47] And then. A colleague and I at IMD, it's a business school I teach at, did some writing about how you lead differently when you have people together physically versus operating virtually and how you really make sure that that precious time when you're actually physically together, you maximize the impact of that time to do innovation, connection, culture creation, things that are much harder in general to do when you're operating remotely.

[00:14:12] Vanessa I: As a coach, Michael, is it changing also your way of working? Like, are you also changing your approach compared to 10 years ago because of the remote working approach? 

[00:14:23] Michael W: For sure. And not just the coaching, but also how I do a team. My executive teamwork has changed a lot as a result of this. For sure. I mean, I have CEO level clients that I've never met in person.

[00:14:34] I live in Switzerland. I often coach people. I'm coaching a very senior leader on the West coast of the U S with a nine hour timeframe. Right? So we meet late in my day, very early in his day. We meet every week, but I think one of the interesting learnings has been about sort of what you really can do effectively virtually and what you can't.

[00:14:52] And my experience has been, you can coach pretty effectively one to one through the virtual modality, right? Surprisingly well, right? When it's just you and someone else in the room. When the pandemic struck, we very quickly as an organization, I should say, in addition to my MD role, I'm also the co founder of a executive coaching company called Genesis.

[00:15:12] We had to pivot very completely to operating fully. Virtually, unfortunately, most of our coaches were already doing a good piece of what they were doing virtually already, but we took programs that were being delivered in person and within a couple of weeks, turned them into fully virtual programs. And I think one of the things we learned that was really fascinating to me was that you can actually do group coaching, small group coaching of people and transition very effectively right across the virtual mode.

[00:15:39] And so the programs we teach now, they are 100 percent virtual with a lot of small group coaching and a lot of individual coaching and they have at least a level of impact and certainly they're a whole lot easier for people to participate in them. When we used to do the same sorts of things in person.

[00:15:56] Vanessa I: Very good to know that everything needs to be adapted. 

[00:15:59] Michael W: It does. 

[00:16:00] Vanessa I: Yeah, it's true. One of the things you have talked about, Michael, at the beginning of our conversation is the need when you, you transition to balance the observation, the building relationship together with getting results quickly. And we have seen that in situations of business turnaround, we have seen that in, in startup.

[00:16:20] What is your advice about this tension? How do you advise your clients on how to live with the tension? 

[00:16:27] Michael W: Well, I think it's so again, a great question. And I think the starting point is just to recognize the range of tension and you've got to try and find the right balance, right? I think what you're also sort of connecting to is, is one of the core models that I developed for the first 90 days, which is the STARS model, right?

[00:16:42] Start up, turn around, accelerated growth, realignment, sustained success. The basic idea there is the way you transition into a new role depends a lot on the type of situation you're inheriting, right? Or more typically the mix of situations you're inheriting now. And so to take your example, Vanessa, of a turnaround, right?

[00:17:00] You have to typically move a lot faster on the turnaround than you do in a sustaining success or realignment situation. That's the bad news. The good news is you typically have more of a burning platform to make change happen, and so you can move pretty quickly. You can make some tough decisions pretty quickly, but it's still necessary to do some pretty deep, but quick assessments of the organization and really identify what the priorities are.

[00:17:26] And again, if you're operating virtually, that's really, really tough, right? And often what it means is you've got to get on the road and do a lot of diagnostic and connecting work. But I do think that the key thing here is just to recognize. What type of situation, or maybe it's two or three, a mix of startup and realignment, right?

[00:17:44] Are you facing and what does that mean for how you, as you noted, how do you manage those balances correctly? What piece do you need to have? And what then are the implications for how you're going to spend your time? I mean, I coined the term realignment, which in contrast, it would turn around, right?

[00:18:00] Turnaround, crisis driven reactive change, alarm bells ringing, lights flashing, need for fairly rapid action. You've got to sort of triage and make good choices so the business survives. And then build from that back out again, realignment is something I coined as a more proactive change challenge. You're starting to see difficulties in the business, or you see an opportunity that needs to be pursued.

[00:18:25] You don't have a burning platform for change. So how do you mobilize people? Right? How do you educate people about the need for a change? And so it really also gets to your leadership style, right? And I described the leadership style for a turnaround as a warrior kind of ethos, right? Whereas for a realignment, it's more like an educator kind of approach.

[00:18:45] Does that make sense? 

[00:18:46] Vanessa I: Yes, it does. And I think in this part of the world, it's actually very relevant because we have seen a big impact of the COVID crisis. I think many, many businesses around us that were actually thriving need either realignment or complete turnarounds. And I think this is something for some of our colleagues, something that might not be very easy because if you have been in markets where there has been a growth of 20 or 25 percent for 20 years.

[00:19:15] Getting into a situation where getting five percent growth is, is already a big achievement is a very big change of mindset and requires a lot of new skill sets or relearning, unlearning the growth and relearning new skill sets. So it's, your style model can be used also after onboarding. Just to see exactly where you stand as a leader and make sure that you adapt yourself to the context.

[00:19:40] So I found, and one of the things I wanted to share with you as well, which I mean, I'm not sure anyone has used your book before is that I've read your book in case of failure after the failure. To actually identify in order for me to reflect and to learn how to do a better job as an HR professional.

[00:19:58] And I've always found the reason in your book why the person had failed. 

[00:20:03] Michael W: Interesting. No one's ever used it for post mortems before that I'm aware of. 

[00:20:07] Vanessa I: So from a marketing point of view, it's not very appealing because you don't want to say too much. 

[00:20:13] Michael W: Buy my book so you can see all the mistakes you made.

[00:20:15] Right. I love it. No, I don't think that's going to work. 

[00:20:18] Vanessa I: But as an HR professional, I can tell you it's very, very useful. It's extremely useful. And usually it's in the middle of the book when I'm rereading it. And I have this aha moment in the corporate world is also very important to be able from an, an HR perspective to explain why things sometimes don't work.

[00:20:36] Right? And there is a lot of alignment to be done in order to agree on what happened and how we can do better. So yeah, your book is very useful in that sense.

[00:20:46] Michael W: It's super interesting. And you're making me think of something else too, right. Which is also recognizing when the state of a business is changing and you need a different kind of leadership too, right?

[00:20:55] It's another, another way to apply the framework you've got. Businesses and leaders for whom accelerating growth has been what they have done for a decade, right? And all of a sudden we need to realign or we need to sustain success or we need to even turn things around. It requires a pretty fundamental reorientation.

[00:21:12] And I do see examples where the leadership that has taken a business to one point and then the state of the business changes, it's not the right leadership to take it to the next point. I mean, you see that most notably in startups, right? Early stage startups, often climate equity funded. They reach a point where they're now going to head into accelerated growth and all is going well, and that may require a different kind of leadership than the startup leadership, right?

[00:21:36] And it's not uncommon to see leadership teams change a lot when businesses move between different stars situations. 

[00:21:44] Vanessa I: We could use it also for the beginning of the year, like when you are thinking of your objectives and trying to see the objectives still relevant. I think this is another way we could also consider the style model without being in a failure situation, just asking yourself the question, reflecting and doing some self introspection around, okay, I've created my three year roadmap or my five year roadmap based on a certain thinking, and then I'm looking into my business, I'm, I'm looking that the business is not doing as well as what I thought, or is doing better than what I thought.

[00:22:19] And then it requires even the functional leaders like us to also change their priorities or change their role map. Yeah, no, 

[00:22:26] Michael W: it makes complete sense. There's a few other ways I've seen folks use the STARS framework that I think are sort of connected to the conversation, right? Getting your team aligned around what the challenges are that you're up against, right?

[00:22:37] And I, I sometimes when I work with leadership teams, let's say it's a multi business organization, let's talk about what division A state is and division B and division C and really get the team individually to identify where they think the different businesses are and then have a very great conversation about why does Vanessa Teo think it's realignment when you, Vanessa, I think it's a turnaround of how are we going to really get aligned on it. 

[00:23:00] I think it's also useful sometimes for leadership development purposes. We've had a leader who's had a whole career of doing accelerated growth. Now we need to broaden them out to manage different star states. So I think that the model actually has been surprisingly broad in its application.

[00:23:17] And I, and I never thought about it, I mean, when I created it originally, that that's what would happen, right? I had a very specific purpose, which is how do you, as a leader, understand the situation and kind of match your strategy to that situation. But the more experience we've had with the SARS model, the more applications we kind of see out there, right?

[00:23:34] Along the lines of what you're describing. 

[00:23:36] Vanessa I: And now when you are working with all these organizations, Michael, what are the organizations that are doing the best when it comes to onboarding? What are the things that you're seeing that really make a difference? You must see so much. I'm sure you have so much to share.

[00:23:52] Michael W: Well, it's changed a lot. So again, I would have to kind of put it in context. And when I started doing this work, very few organizations paid attention to onboarding in any deeper sense. They hired people, they kind of threw them into the new role and away you go. Sink or swim kind of mentality. I used to call it leadership development through Darwinian evolution.

[00:24:11] You kind of see who survives and who doesn't. And then the onboarding kind of idea kind of caught hold and people understood that there's real benefits to getting people up to speed faster. So let's do a good job of it. But so many organizations focus more on kind of what I think of as the technical elements of onboarding, like, so make sure you've got the right equipment.

[00:24:31] Your credentials are all in place, orient you to the business. So feed you a bunch of information about the organization and how it works. And far fewer did the work of integrating people into the organization, right? And there's a difference between onboarding and integration. Onboarding gets you onto the ship.

[00:24:49] That's what we mean by onboarding. Integration makes you part of the crew and really more deeply connects you into the organization. And that work is much more about stakeholders and connection and culture and really learning to be part of the team that you're a part of or teams that you're connecting with and the organizations that do it best, do those things both.

[00:25:08] Well, right. They onboard people in the technical sense. Well, and they, they focus on the integration piece of really getting people connected and productive in the organization. 

[00:25:16] Vanessa T: I really like how you talk about this whole piece about integration, because sometimes as HR professionals, we do spend a lot of time helping new leaders get on board.

[00:25:26] And then after that, it's the what happens after. And I think it's really, yes I'm with you. 

[00:25:32] Michael W: Have fun right? Cause, you are on board the ship. 

[00:25:33] Vanessa T: And we expect you to perform and to, and to continue loving us as a company, but the reality is so different. It's, it's really this integration process and that integration journey that actually takes even longer oftentimes than onboarding does. 

[00:25:47] Michael W: Absolutely it does. 

[00:25:48] Vanessa T: Yeah. 

[00:25:48] Michael W: A hundred percent. Right. And also then connecting that to the development process, because getting someone on board and getting them integrated is great and super important. But to get them fully effective in the role or prepared for the next role, we're now needing to connect the work of onboarding and integration to the work of developing and assessing and developing people, basically. And that's an ongoing process, right? As you two know, well, it's the talent management cycle and action, really. 

[00:26:16] Vanessa T: Michael, talking about this dynamic environment that we're living in, artificial intelligence, it's the, it's the thing that has hit us.

[00:26:23] It's almost in so many different aspects of our lives. You've done some work in that space too. And we'd just love to hear a little bit more about your thinking on this. And if you could just share what you think it means to professionals, careers, and how we can all continue to thrive in this new reality, what's some of your thinking on that?

[00:26:43] Michael W: Oh, super. So. There's a school of thought today that says this is all just one big hype cycle like every other hype cycle, right? And we're kind of at the peak of the hype and the peak of the hysteria. And I guess it's possible that that's true. But I think it's much more likely that this is a fundamental technological shift that we're in the midst of, and it's really going to change pretty much everything.

[00:27:04] The analogy that's used is just to things like the steam engine or electricity, right, and its impact. But those technologies that are called general purpose technologies, because they have such wide ranging economic impacts and social impacts. They unfolded over decades. This is unfolding in the course of years.

[00:27:22] And so part of what's so challenging that this is speed at which this moving and speed means it's harder for people to adapt. It's harder for organizations to adapt to what's going on, right? There's also so many unknowns still about the technology. There's the level of uncertainty about how quickly it's going to develop is just enormous.

[00:27:42] There was a, an article that came out a few days ago where the group did a survey of 2, 700 researchers. And one of the questions they asked is, how soon will AI be able to do everything a human can do only better, everything, everything a human can do only better. The median estimate was 2047. But 5 percent of the researchers thought it could be true by 2027, right?

[00:28:06] That's Three years from now. Yeah. So that's the magnitude of uncertainty, but it's also the magnitude of impact we need to be anticipating. And there's kind of a discussion about, are you an AI optimist or an AI pessimist? And the AI optimist point to what are real serious benefits that are going to come from innovation, scientific discovery. We're already seeing it in things like drug discovery, right?

[00:28:31] Where it's accelerating the process. And the pessimists unfortunately tend to focus more on the kind of like the existential end of the world, AI will destroy us all kind of scenarios. And it's possible, again, those same set of researchers, they came up with 5 percent probability that the AI really will destroy humanity, right?

[00:28:49] But to me, I sort of fall a little bit more on the pessimistic side of this while acknowledging the real benefits of what's going on, not because of the existential risk, but because of the impact on society, the impact on the economies, the impact on employment, the impact on people's sense of self worth.

[00:29:06] What do we do when machines can do anything we can do better? And again, I think if this unfolds over decades, I think we've got a reasonable shot at adapting. If it unfolds over five years. It's going to be highly, highly, highly disruptive, right? In ways that I'm not sure we can fully anticipate. So if you go in a little bit deeper into the company level, I'm doing work with organizations these days on dynamic planning for AI impact.

[00:29:32] And so one big mistake I see companies make is kind of reacting to the current state of the technology. Versus anticipating where it's likely to go. So looking at ChatGPT 4 and saying, Oh my God, it can do this and that. And we need to adopt. Yeah, of course we need to do that, but we need to be thinking about ChatGPT five, six, seven, eight, nine.

[00:29:52] What progressive impact is that likely to have on our organizations? How do we get the plan for that? How do we do scenarios about what could happen, right? How do, how do we prepare organizations for reality? That could be very, very challenging. So that's where my head is these days. I should say I'm not new to AI.

[00:30:10] Some of the original doctoral work I did at Harvard years ago was about early rule based AI systems and knowledge management systems. And I've kind of been interested. I'm an engineer again, right? Originally through the many years of this, my oldest son, who's 25 and living in Toronto is launching an AI startup.

[00:30:27] And he knew me well enough to know that I'd be interested when ChatGPT came out originally. And so a week after it was launched, he sent me a like and said, you have to look at this, right? And so I started to dig in. I was among the first of my colleagues IMD to see this and get a sense of what the likely impacts would be.

[00:30:47] And that sort of led to the interest I've had, the writing I have. I now am on the business school's AI steering committee, which is pretty fascinating because there's a whole set of applications around education that are kind of, again, pretty mind blowing. So. I'm working on some projects myself with groups of students and yeah, super interesting and fun.

[00:31:04] I don't want to depress you by the way. I am an optimist about the human race. I think we will get through this. I don't think it's going to extinguish the species, but I think it could be pretty bumpy. And obviously if you add climate, it could be very bumpy. As a species, humanity will get through this.

[00:31:19] I'm pretty optimistic about that. 

[00:31:21] Vanessa I: Thank you, Michael. And that brings us to the end of part one of our season finale. Catch part two of our conversation with Michael Watkins coming up very soon.