My guest for Episode #344 of the My Favorite Mistake podcast is Mike Chaput, President and CEO of Endsight. Mike's favorite mistake was making “have a sense of humor” a core company value — a choice that inadvertently permitted blame-based behaviors, including a rubber chicken shaming ritual, until Deming's principles taught him that humor must be subordinated to respect.
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My guest for Episode #344 of the My Favorite Mistake podcast is Mike Chaput, who became a CEO at 24 before he had ever managed anyone, read a financial report, or closed a deal. Four years later, his first company was bankrupt. When he co-founded Endsight in 2004, he was determined to get the fundamentals right — starting with company values. Drawing on Vern Harnish's Rockefeller Habits and the “life raft exercise,” Mike and his co-founders landed on four values, including one that sounded great: “Have a sense of humor and take enjoyment from the day.” The problem was that elevating humor to the top of the values hierarchy gave permission for behaviors that undermined psychological safety — including hanging a rubber chicken on the cubicle of anyone who made a mistake.
The turning point came at UC Berkeley's Haas School of Business, where professor Sarah Beckman introduced Mike to W. Edwards Deming. Deming's Point 8 — drive fear out of the workplace — hit hard. Around the same time, a sales leader told Mike bluntly that the organization felt like it was always looking for someone to blame. The rubber chicken was not harmless fun. It was a shame ritual that caused people to hide problems, rooted in a values hierarchy that placed humor above respect.
Mike shares the framework he now uses to test whether values are working: if everyone followed them perfectly, would all your problems go away? If yes, you have a culture management issue. If no, the values themselves are incomplete. He describes how Endsight replaced blame with structured problem-solving — problem registers, value stream managers, A3 thinking, and hoshin kanri-inspired strategy deployment. The conversation also draws on Primed to Perform by Doshi and McGregor to explain why command-and-control leadership pushes teams into reactive “prey animal” mode, while clear vision paired with the right values turns teams into coordinated predators pursuing shared goals.
Key Themes and Questions You'll Hear:
- Why “have a sense of humor” as a core value inadvertently created a blame culture
- How a rubber chicken shaming ritual revealed a broken values hierarchy
- The two domains of CEO leadership: vision and values
- Why Deming's Point 8 — drive fear out of the workplace — changed everything
- How to test whether your company values are actually working
- Problem registers, value stream managers, and structured problem-solving as replacements for blame
- The motive spectrum from Primed to Perform: why fear-based leadership destroys performance
- Predator teams vs. prey teams — and what pushes people into each mode
- Why changing your mind as a leader is a sign of strength, not weakness
- How hoshin kanri creates vertical and horizontal alignment across an organization
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- Full transcript
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Why “Have a Sense of Humor” Was the Wrong Company Value — with Mike Chaput
Introduction
Mark Graban: Hi, welcome to My Favorite Mistake. I'm your host, Mark Graban. Our guest today is Mike Chaput. He is President and CEO of Endsight. He bought his first company at age 24, later rebuilt from that early failure, and went on to grow a business to $35 million in revenue and 140 employees. He now leads Endsight and advises other high-growth companies, bringing a practical perspective on leadership, culture, and sustainable growth.
So Mike, welcome to the podcast. How are you?
Mike Chaput: I'm great. Thanks for having me on, Mark. And thanks to your listeners for their time and attention on this podcast. Looking forward to talking to everybody.
Mark Graban: I'm glad we're all here together, and there's a lot we're going to dig into later about leadership and culture and some shared perspectives we have. Maybe we'll find some differences to debate and discuss in the name of a good conversation. But as we always do on the show, we're going to dive into the first question. I don't know if this is going to connect to something from your bio or a different story, but Mike, what's your favorite mistake?
Going Bankrupt at 28 — and Why That's Not the Real Lesson
Mike Chaput: It's kind of funny. I went bankrupt when I was 28, so everybody wants me to talk about that. I'm happy to do that — it was a good learning experience. But a lot of the mistakes that led to that were inside of the decisions we made when we bought the company. They were very hard to learn from. “Don't make bad deals” is kind of the high-level summary.
Mark Graban: The high-level summary.
Mike Chaput: Don't be a really naive kid and jump into water that's too deep for you to swim in. Something like that. But not so much to learn from that specifically. So I wanted to take a different direction and actually talk about my business, Endsight.
The Two Domains of CEO Leadership: Vision and Values
Mike Chaput: I'm writing a book and I do some public speaking, and my belief — the thing I'm trying to get out there — is that the job of a CEO is really along two domains, the right hand and the left hand, so to speak.
On one side, let's call it vision. The CEO needs to paint a picture of a future state. It needs to be compelling. It needs to be clear. It needs to have the requisite detail, and they need to get alignment on it. That's the first domain.
The second domain — I want to call it the domain of spirit. You've heard it called the CEO as spiritual leader. But it's really the domain of values, the behavioral norms that, if followed, would manifest the vision. If I could snap a finger and everybody just did those things, my vision would manifest.
So you've got vision and values. When leaders get those two elements right, I think they summon what I call the spirit animal of a predator. They put their team into goal-seeking land. They get their team acting on the dopaminergic system, where your feel-good chemistry lives. They get them out of limbic land, where fear and anxiety live. Work becomes better.
I actually think that if you can align people on goals, it's the fundamental basis for community, because they see each other as collaborators toward the goal. Typically, when you see factions, it's because people don't think they share the same goal. So if a leader gets those things right, they can really set their organization up well.
My favorite mistake is actually in my own experience on the domain of values.
Becoming a CEO at 24 with Zero Experience
Mike Chaput: Being 24 and being thrust into a CEO role — when I became a CEO, I hadn't managed a human being. I didn't really know how to read a financial report very well, if at all. I hadn't sold a deal. If you took a list of all the things you need to be able to do to run a business, I hadn't done any of them.
In my desperation, I just read everything I could get my hands on. I was commuting, so I was doing audio CDs at the time, putting books in. The first time I heard about values, it was actually in Jim Collins and Jerry Porras's book Built to Last. Then it came up again in several other texts. It took me a really long time to get past even more critical bottlenecks — like selling deals — before I could really pay attention to values.
Mark Graban: Sorry to interrupt, but how much later did you start Endsight?
Mike Chaput: To give the timeline: I was 24, that was 2000. We ran the first company, PCS Networks, from 2000 to 2004. That went bankrupt. We started Endsight in 2004.
It's been a minute. Endsight is a fairly mature organization now with hundreds of customers, 140 employees, and $35 million in revenue. But at the time when we started it, it was me and three co-founders and two or three other people we knew from the first company. It was nothing.
The Life Raft Exercise and Choosing the Wrong Values
Mike Chaput: We decided we wanted to establish values. I had met Vern Harnish through Entrepreneurs' Organization — it was called YEO back then. Vern came and spoke, and I actually have a signed copy of his book Rockefeller Habits.
Funny thing is, I kind of thought he was a hack when he spoke. I thought he was just stealing other people's ideas. But then I read the book and I thought, “Oh man, this is pretty good.” It's like an instruction manual on how to create a vision, which he calls the one-page business plan. It's a form you fill out.
My partners and I decided we wanted to do that, and we struggled mightily. We couldn't align on the values. We couldn't figure out what the values should be. We didn't know what good values looked like. We had no idea how to determine a purpose. We were in survival mode. It was very difficult for us to think about some kind of existential purpose when you're just trying to pay your bills.
But we came up with what we thought were good values at the time. There were four values. One was “do the right thing for the customer.” We had an intuition that if you took care of your customers, things would be good. We had one called “take pride in your work and don't cut corners” — that had problems too. One was “take the long view” — that's actually pretty good and is still kind of part of our domain of values.
But my favorite one — the favorite mistake, so to speak — was this value: “Have a sense of humor and take enjoyment from the day.”
Even as I say it, it sounds pretty good. It sounds like a place I want to work. Which is why it's my favorite mistake — I didn't understand why that fundamentally wouldn't manifest the vision.
A great set of values is something that, if followed perfectly, would manifest your vision. Those four values weren't very good, in retrospect. They weren't clear enough. They weren't easy to remember. They didn't have the entirety of what we needed. They weren't a complete and comprehensive set of instructional behavioral values that was going to manifest our vision.
The way we came up with them was a tactic Vern had in Rockefeller Habits called the life raft exercise. You brainstorm the best employees you ever had and imagine you're in a life raft. Who would you want with you if you were stuck? You do that exercise, which usually ends up being your founders and a handful of other people you really liked. Then you brainstorm all the attributes of those people and look for commonalities. Inside those commonalities, you create your values.
We came up with “have a sense of humor.” I still like humor a lot to this day. I think levity is really important. I think optimism is really important. But when humor is at the top of the hierarchy, it permits things. That's what I didn't understand.
The Rubber Chicken: How a Joke Became a Shame Ritual
Mike Chaput: One of the things that manifested in our organization was a rubber chicken — a comedic prop.
Mark Graban: A plastic rubber chicken comedic prop.
Mike Chaput: Exactly. The way we first came up with it was through a peer group I was part of. At the end of our two-day meetings, we would do this thing called the Great Idea Contest. There was a member of the peer group that mailed it in every time, and it was really bothering Josh and me. So we brought the rubber chicken to the peer group meeting as a joke. If you got last place, you got the rubber chicken. We were tired of noncompetitive ideas.
That's how we came up with it — a rubber chicken to disincentivize bad behavior. It was funny, everybody laughed, and we thought, “Hey, maybe we should do this internally.”
This is a bad idea, by the way. Don't do the rubber chicken on your team. I'm telling you, don't do it.
So we created this thing where, when one of our team members made a mistake, the rubber chicken would end up hanging on their cubicle. We thought it was in good fun. We thought it was a fun way to disincentivize bad behavior. We thought it was funny.
Discovering Deming and Driving Fear Out of the Workplace
Mike Chaput: In 2009, I joined the executive MBA program at the Haas School of Business at UC Berkeley. At the time, they did a joint program with Columbia Business School. In my second semester, I took operations with a woman named Sarah Beckman.
Mark Graban: I know her, actually. She was a guest professor at MIT when I was studying operations and management there.
Mike Chaput: She's great. She was the one who introduced me to W. Edwards Deming and lean philosophy. I started reading some of these things.
One day I was on a sales call with our sales leader at the time. Something had happened and people were mad at him, and he said to me, “One thing I hate about this organization is that it feels like we're always trying to figure out who to blame.”
That hit me like a ton of bricks. I realized, yeah, we kind of do that. We justify it by saying we're trying to problem-solve. But after reading Deming — if you've read Deming, you can imagine the story. If you haven't, I recommend you check out his body of work.
Mark Graban: I do know where you're going. I recommend to the listener, if you haven't read W. Edwards Deming, check out his body of work.
Mike Chaput: Deming came up with 14 Points of Management. Point 8 is something everybody should know: drive fear out of the workplace.
Deming figured out in the 1940s or 1950s how critical this was for leaders. What he determined was that leaders need to be able to see error. If they can't see problems in their organization, they can't apply any problem-solving techniques to fix them. And when workers are afraid of being blamed — afraid of getting a rubber chicken — even though that might seem small, that shame and reputational risk will cause them to hide problems from leaders.
It's a cultural problem. If you want to be a great organization and you have people who are afraid of retaliation and retribution, afraid of non-straightforward action from their leaders, then you're going to leave a lot of high performance on the table.
Mark Graban: Yeah, absolutely.
Why Humor Must Be Subordinated to Respect
Mike Chaput: It started to click for me that we had elevated humor in the wrong spot of the hierarchy. Humor needs to be subordinated to something. It's okay — it's even great — so long as it's subordinated to another idea, another principle. And that principle, as you probably know, is respect.
Deming went to Japan and worked with Toyota. One of Toyota's core values is respect for people.
Mark Graban: And they even in recent years still give credit to Dr. Deming, even though he passed away more than 30 years ago.
The Escalation of Commitment and the Courage to Change Your Values
Mike Chaput: There are a couple of things to break down here. It was really, really hard to invent those values. They don't sound that interesting, but the number of meetings and debates we had — it was like an impossible task to come up with those things with my three really opinionated co-founders.
It was impossible to come up with them, but we did. It was even harder to get alignment on them. Then we had to put all of our reputation capital on the line with everybody we hired, constantly trying to rally commitment around these things.
There's a well-documented bias called the escalation of commitment. If you've put your reputation on something, it's very difficult to want to reverse course. We even fault politicians for this. We call them flip-floppers.
If you're out there listening: changing your mind is a very noble act. It's brave. It's courageous. If you have better information and you change your mind, that's something to be celebrated as a leader. There's nothing worse than being stubborn and full of hubris about your ideas.
Mark Graban: I agree. Especially in business, that's a sign of strength and confidence — to say, “I've gotten more data, I've learned something, I tried something, it didn't work, and I've adjusted.” I've had two active sitting members of Congress on the show — Will Hurd and Adam Smith from Washington — and I talked with both of them about how it's a shame that voters seem to punish you, or the political pundits label someone a flip-flopper. It's hard to even admit a mistake as a politician. I'm glad they did.
Mike Chaput: It's one thing if you betray solid principles to be a populist. I think that's the problem. But if you've really become educated and you're changing your mind because of new data, or the world has taught you something, I think it's noble.
Why Jim Collins Got One Thing Wrong About Values
Mike Chaput: I want to go back and reference Jim Collins because I think he did something bad for the business community. I idolize the guy. I've read every single one of his books and I think all his ideas are fantastic for the most part. But he had this one line in Built to Last — it was something like, “Values should last the lifetime of a leader.”
So you're already psychologically biased to keep your values because they're hard to create and you don't want to change them. And then, especially if you're given permission by somebody like Collins — this god-like thought leader in the business community — who says, “Don't change them.”
I'm on a campaign to get people to realize that your values probably need work. They're probably not easy to remember. They're probably not very clear. They probably don't encompass all the philosophy you need.
When I realized our values were wrong, it felt like an impossible challenge to take on. But I had a lot of conviction that it needed to be rectified.
The favorite mistake, so to speak, is that I got the values wrong. What I want to share with your audience is this: you really only have two levers as a CEO. It's complicated to be a CEO, but I think it's easiest to understand if you distill it down to your business strategy — essentially your vision — and the philosophical beliefs that make up the identity of your team members, your culture. If your values are off the table, you're competing as a CEO with one arm totally tied behind your back.
How to Test Whether Your Company Values Are Working
Mike Chaput: How do you know if your values are right or wrong? It's actually pretty easy. Are you manifesting your vision at the pace that you think you should? If you are, keep your values the same.
But if you're not making traction toward your vision, then you have to go back and look at the problem. There's a very simple question: if everybody just did these values perfectly, would all of our problems go away?
If the answer is yes, then you've got an operational issue with managing your culture. But if no — if everybody did this stuff and you're still not innovative enough, still not doing things well enough — then the behavioral philosophy is not encompassed appropriately in your values. Your values probably need to be wider. They need to include more things, or they need to stop permitting certain things that are actually in your way — such as hanging rubber chickens on people's cubicles.
You've got to stop permitting things that are getting in your way, and you've got to cultivate the appropriate behavioral norms and philosophical ideas necessary to manifest your strategy.
When Should a Startup Focus on Culture?
Mark Graban: There's a lot to dig into there. One thing I hear you raising is the question of whether it's worth hours and hours of meetings, especially in the early stages of a startup. Is that the best use of the CEO's time and the team's time? I'm not saying values aren't important, but the discussion and trying to hammer out company values as opposed to everyone just sharing their own beliefs. One of my values would be: I think it's counterproductive and awful to blame individuals for systemic mistakes. But I don't know if that would be a shared value at a company I was starting with other people.
Mike Chaput: Life is hard and we have a hard time with gray. We have a hard time with high-fidelity thinking. We want to simplify everything so we can interact with it.
The reality is something like this. As a human being, if you're suffocating, you're not really worried about your next meal. If you're not suffocating but you're really hungry, you're not thinking about much except your next meal. If you have air and food, you're probably just thinking about shelter. If you get that too, you might be thinking about relationships. And if you get that too, you might be thinking about self-actualization. That's Maslow's hierarchy.
Businesses operate a little bit the same. If you don't have a customer and you don't have any employees — if it's just you and your co-founder trying to get something done — you're pretty low on the hierarchy. You're not thinking about community building. You're not thinking about becoming the best version of yourself yet. And I think that's okay.
It's not necessarily always linear, because you're in these phases where the next bottleneck you need to solve requires some level of culture. You might get culture just well enough to get to the next milestone, and then you figure out you didn't get it right and you've got to go back.
In a very early business, you're really focused on the go-to-market, the product fit, what the strategy is going to be. You're not managing a big team. You've got a small team, usually hand-selected, usually highly committed. Usually equity stakeholders. Culture building isn't quite as important in that early stage. But as soon as the business becomes operational and you're going to bring a bunch of others in, it becomes pretty darn important, pretty quick. You have to figure out where you're at and what's the next bottleneck. That requires discernment, and that's something that's developed over time.
Mark Graban: It might be, to borrow a different phrase from Jim Collins, a different book title — focusing on values once you're no longer in survival mode helps you go from good to great.
Mike Chaput: Right, or accelerate growth. The encouragement is this: you have a problem. You want to go somewhere and you're not getting there. There's one of two reasons why.
Either your strategy isn't particularly good — what you're doing isn't valuable enough to the marketplace for them to reward you with the growth and profits you want. You have to change the nature of what you're delivering. Maybe you need to do it more efficiently so you can charge less. Maybe you need to solve the problem in a more unique and differentiated way. That's a strategic problem.
Then there's the cultural issue: you're having a hard time getting your team to lock in and do the necessary things. They're not motivated. People are quitting too early. They won't put documentation in the system. They're not doing their timesheets. That's a cultural issue. They don't care about what the business needs them to care about, and you haven't cultivated the appropriate emotional connections to the activities necessary to win.
From Blame to Problem Registers: How Endsight Handles Mistakes Now
Mark Graban: Can you give an example of how you or others in your company react to a mistake today? How would you handle it if someone feels safe to come and tell you about a mistake they or a team made?
Mike Chaput: I love that question. We don't call them mistakes. We call them problems.
Semantics are sometimes more important than we think. A mistake has an implication that somebody did something wrong. A problem leaves room — we don't pretend to know why the problem is happening.
Mark Graban: In some organizations they don't even like to say “problem” because to them that seems to imply blame and punishment. They'll say, “Can we call them opportunities?” But I think regardless of the language, the language might feel dangerous if people are being punished.
Mike Chaput: Right. But we call them problems, and what we do is we have these things called problem registers. We have a system that captures all of the problems — things that didn't go the way we hoped they'd go. When they don't go the way we think they should, they get logged on a problem register.
The idea is to cultivate the beliefs and norms so that when things go wrong, they get reported through a chain of command and end up on a problem register.
Value Stream Managers, Pods, and the Matrix Structure
Mike Chaput: What do you do with a problem register? There's another piece of infrastructure that sits on top. There are some roles and some rhythms. Let me talk about the roles.
We have a role called a value stream manager. At Endsight, we have five service delivery pods that serve five different groups of clients. We have a legal pod that only does law firms. We have a wine industry pod in Napa Valley. We have three commercial pods that have a mix of customers inside, mostly geographically focused — one is San Diego and Orange County, and two are here in the Bay Area.
The pods have a bunch of roles. For example, inside a pod we have a help desk. We have a position called a help desk value stream manager that manages that function across all the pods to make sure there's uniformity and consistency across all five service delivery pods.
Mark Graban: It's like a matrix organization.
Mike Chaput: That's exactly what it is. You can find this concept in Lean Thinking by Womack and Jones. We added some of these roles where we had a lot of repeat work, so that the problem register would roll up to the value stream manager and they could run an A3 or some kind of structured problem-solving process against these problems.
They can also sort through the problems in terms of their frequency and impact. We can say, “This problem happens, but it's very low impact and doesn't happen very often — we're going to let that fire burn. It might show up again because we're not solving it. But these problems are high frequency and high impact, so we're going to prioritize these.”
Why Transparency About Priorities Matters
Mike Chaput: Let me talk about letting fires burn. One of the things that happens is if an employee raises their hand and says, “I have a problem,” and you don't work on it, that employee can get really frustrated. “I told you this problem happened and nobody did anything about it.”
One of the things that having problem registers and showing what you're working on does is that when people see those problems occur again, they don't get super frustrated. They know to just record it again. They know that if it happens enough, the frequency and impact is going to start escalating and it'll eventually get worked on. There's disclosure about what you're working on and what you're not working on, so people can operate knowing there's some sanity to how you're dealing with this.
Mark Graban: What I hear you saying is that people would hopefully not feel ignored, but recognize that there's prioritization happening.
Mike Chaput: That's exactly right. Otherwise people think, “I notified you just like you asked me to that there's a problem. Nobody did anything with it, so why do I even bother?” Then they get frustrated and give up.
What you want is great two-way communication. You communicate the problems to us. We're going to communicate back to you what we're working on and why. And you keep communicating the problems, because that might escalate the priority.
The value stream manager without visibility from the people doing the job is going to be very ineffective. They've got to have the people on the ground collaborating constantly on what's happening.
Hoshin Kanri: Strategy Deployment That Goes Up, Down, and Across
Mike Chaput: Then there's a rhythm. We've taken the best of the one-page business plan, the EOS structure, and layered lean principles on top.
What we do at Endsight from a vision-building perspective is start with a big, hairy, audacious goal — to use a Jim Collins idea. What are we trying to build in 10 years? What are we trying to become? Then you say, if we were on perfect track to that, where would we be in five years? The line has to go through the BHAG. Then, if we were going to get to our five-year goals, where would we have to be next year? And to get to that one-year spot, what problems would we have to solve quarter by quarter to roadmap our way into the next year?
That's the first part of vision setting and business planning. But then we use the hoshin kanri process, which goes down and then up. You've got to cascade this business plan down to the front line. They meanwhile have to cascade up to you what they're seeing as the most important problems. Then you start selecting what you're really going to work on and how.
Not everything is done on an A3. Some things are assigned out on a quarter-by-quarter basis using priorities and rocks. An A3 would be something where we don't really understand the solution very well yet. We just understand it's a problem. Somebody's got to go understand it really well. We've got to come up with measurements.
Mark Graban: And you do some root cause analysis.
Mike Chaput: Go to the gemba, watch, talk to customers, talk to employees. When we're talking about quarterly priorities, it's more like we know it's a problem, we actually have a really good idea how to solve it, we've already selected a tool, we've got to implement it, there's going to be training. That makes its way into a quarterly priority.
You're using a combination of rhythms for certain problems, a combination of problem-solving methodologies, and a combination of business planning. One is more of an annual rhythm, and one is this hoshin kanri process where you're cascading down and cascading up. You have this up-down vertical communication with your organization such that everybody's aligned.
It's a lot of work, but it is the job. It's also what makes the job fun. There's a parable of a guy who walks past a worker and says, “What are you doing?” He says, “I'm laying bricks.” He moves on to the next guy: “What are you doing?” “I'm laying bricks.” He goes to the third guy: “What are you doing?” “I'm building a cathedral.”
Mark Graban: There's vision and purpose.
Mike Chaput: That subtle change is the difference. When people are working on the problems, they become cathedral builders. They're part of the process of becoming, rather than just a cog in a system that frustrates them. You want to include your team in the process of becoming. That's what makes it fun to work for a company that's visionary, that has a good vision, and that's communicating it down while input is going up.
Mark Graban: You described that process of strategy deployment. It's not simply top-down goal deployment of telling people what the priorities are and what the measures are. That lean management style of strategy deployment is both top-down and bottom-up. There's back and forth, input, and collaboration.
Mike Chaput: One thing I should mention — and if my business partner were here, he'd be jumping in — is that it's also horizontal. You might have a problem in your organization that requires a horizontal peer to solve their problem before you can solve yours.
For example, let's say you're in finance and your biggest problem is collections. But the root cause is that the documentation making its way to billing is terrible. Every time you go to collect, the bill is confusing because people don't know how to put the documentation and the time entries in any better. Now you've got this horizontal chain problem that needs alignment. The finance team can't solve their collections issue until the professional services team solves their documentation issue.
There's horizontal communication that has to occur and align as well. Otherwise, you just have frustrated people who can't solve their own problems. That's the hoshin kanri process — gaining up-down alignment and horizontal alignment so everybody knows where we're going and we're all working on things that balance each other.
That's the job of management. It's not easy, but it is the job.
Why Command-and-Control Leadership Creates Prey Animals
Mark Graban: One final question. You mentioned W. Edwards Deming, and one of the things he advocated for — that I know you talk about — is moving away from command-and-control management. That style where the leader has the answers, the leader barks orders, and the workers just execute. Could you share your thoughts on how that kills creativity and ownership in a team?
Mike Chaput: Maybe I'll say it differently. Your job as a leader — I talked about strategy and culture, but there's a thread there, which is motive. You really have to think about the motive of your team members.
We're at a day and age where we understand this at a scientific level. There's a book called Primed to Perform. The authors are Doshi and McGregor. What's essential to understand is that motive can be a derivative of the work.
If I love the work, there's no derivative. I'm motivated because I get joy from doing the work. The first derivative is purpose — I may like the work, or maybe I don't, but I really believe in its impact. The second derivative is potential — like somebody working as a law clerk because they want to become a lawyer. Maybe they don't even care about the law firm's mission so much, but they see it as a stepping stone. Those are one, two, three.
Once you get to the fourth derivative, performance starts to fall off a cliff. The first three are correlated to high performance. This is well documented and well studied.
The next one is economic pressure. When people are working primarily for money, you can almost guarantee their performance is going to suffer. They'll still work because they need money, but they're going to be in low-performance land.
The derivative even below money is emotional pressure. If people are working because they're afraid — afraid of consequence, afraid of someone yelling at them — their performance is even worse.
The last one is inertia. They don't even remember why they're motivated. They're doing it because they did it yesterday and they've lost track of why they're doing any of it.
As a leader, you need to manage that. When you're barking orders at people, you're creating emotional pressure. You're not making it play for them. You're not providing them a purpose. You're not explaining to them what the impact is going to be. You're not connecting to their self-actualization, their individual purpose. You're strictly saying, “If you don't do it, I'm going to yell.”
Mark Graban: Or threaten to fire them, which adds economic pressure on top of it.
Mike Chaput: Right. It's not theory, by the way. The data is undeniable. The only reason to go read Primed to Perform is if you can't take this on faith and need to go through the research yourself. It's not my idea. It's very well researched. Deming knew this with his Point 8. He knew it before the research. It was intuitive to him, but now we have data.
Lions and Zebras: Predator Teams vs. Prey Teams
Mike Chaput: Another way I've described this is that command-and-control puts your team in the limbic system — the fear and stress response. They become prey animals. They adopt the animating spirit of a prey animal.
Mark Graban: The amygdala, the reptile brain.
Mike Chaput: And by the way, that amygdala grows. It starts consuming a bunch of brain space. It's this little tiny center, but once it starts going off, it captures the whole brain. You stop being able to think clearly.
I think lions and zebras are a great way of describing this. When a pride of lions attacks a zebra, they don't just randomly attack the herd. They actually communicate which zebra they're going after. Then they carve that zebra out of the crowd. It's deliberate. It's coordinated. They're a team. They're in predator land. That's where you want your team.
When prey animals get attacked, they go crazy. They're all trying to confuse the lions. When a beehive gets kicked, it goes crazy. When you put your team into prey animal land, you're cultivating chaos. You're destroying coordination. You're moving people from the dopaminergic system — the feel-good chemistry that makes work play — and you're putting them into limbic land.
It's not good for people's wellbeing. And your performance is going to really, really suffer. It's unnecessary. It's no place you want to work. It's just very immature leadership. It's your own limbic system and you're trying to spread it to your team.
If you're nervous, go meditate. Don't go start yelling at your team. If you're nervous about your goals as a leader, you've got individual problems to sort out. You can't solve your problem by coming to your team with your hair on fire. You've got to get your stuff together.
When we don't hit goals at Endsight, the first thing we have to do is remind ourselves: we've been here before. We paid some price for this wisdom. Let's not abandon it. It's not the first time. It's not going to be the last time we made a mistake or didn't hit our goals. So let's figure out what to do about it thoughtfully and carefully — like a pride of lions going after a very specific target. Let's not get into limbic land.
That's what people want from their leader. They need a calm, steady state. Bring everybody back together and point them back toward the target.
Wrapping Up
Mark Graban: Mike, thank you for sharing a lot of your insights — not just from your reading, but from your hard-fought learning and practice across different companies and experiences in leading people. I really appreciate you sharing so much with us today. Our guest again, Mike Chaput. Check out the show notes for a link to his LinkedIn profile, to his website. I'll make sure there are links to some of the great books and authors you mentioned here today.
Mike Chaput: Mark, may I make a quick plug to your audience? I'm launching a podcast, and if you're interested in any of these ideas, you can find me at mikechaput.net. That'll lead you to subscribe to the podcast. I'm having guests on and we talk about ideas, philosophies. These are senior leaders that aren't anywhere else on the internet — people I've made friends with over a career. So if you like this podcast, you might like mine. My goal is simply to share great ideas with people who are interested in them.
The other plug I wanted to make is this: if you've made it all the way to the end of this episode and you haven't liked and subscribed, commented, or shared — I know it's distasteful as a thought leader, as somebody who's out here making podcasts, to constantly ask everybody for the same thing over and over again. But whenever I'm a guest, I like to make this plug, because we don't really get paid for this. We're doing this for you, the audience member. It's a passion project. We believe in these ideas. We think the world's going to be better if people get good at leadership and go out there and win.
If you thought this was good and you haven't already done so, like and subscribe to Mark's podcast. That would be super helpful. The internet works on crowdsourcing. If you can help separate the good content from the bad, you're doing a lot of other people a really big service.
Mark Graban: Well, thank you. Please rate and review, as they say. Neither of us is doing the podcast today out of economic fear. It's more about striving for learning and self-actualization. Mike, thank you. I look forward to listening to your podcast. I really enjoyed what you had to share and I look forward to the kind of guests you're going to put together on that show. Really appreciate you being here.
Mike Chaput: Thanks, Mark. It was a lot of fun. Thanks for the time and attention again to your audience, and we'll see you next time.
Mark Graban: All right, thanks.