The Creative Power of Constructive Conflict

What if conflict isn’t the problem — but the engine of innovation?

In this episode, innovation expert Jeff DeGraff joins Russel to explore why adaptability isn’t about reacting to change — it’s about embracing ambiguity, practicing paradox, and creating constructive conflict inside your teams.

They discuss:

• Why over-alignment kills innovation
• The difference between reacting and adaptive thinking
• How small experiments build momentum
• Why culture isn’t a “thing” — it’s how leaders lead
• The role of vision in holding chaos together

If you’re leading through uncertainty, AI disruption, or organizational tension, this conversation reframes how real innovation actually happens.

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Transcript

Russel Lolacher: And on the show today we have Jeff DeGraff and here is why he is. Awesome. Jeff is an advisor to Fortune 500 companies. Top speaker on innovation, a professor at the Ross School of Business at the University of Michigan, and he's founder of Innovatrium.

His thoughts on innovation are covered by Inc. Fortune, psychology today, lots of others. He's written several, several books, including Leading Innovation and Innovation New, and he's written a couple recently with his partner Staney DeGraff, which includes the innovation code, the creative power of constructive conflict and the art of change, transforming paradoxes into breakthroughs and their latest, like I said, the man writes the latest is the creative mindset, mastering the six skills that empower innovation.

And he's here. Hello, Jeff.

Jeff DeGraff: Russel, thanks for having me on.

Russel Lolacher: Thrilled to have you here. I love the Michigan represent hat there for you there, sir. Nice. Nicely played. We're getting into adaptability to opportunity, which is how do we prepare? Well, you know what? I'm gonna get you to define it. We're not there yet, but before we kick all this off, I have to ask you the question I ask all my guests, Jeff, which is what, sir, is your best or worst employee experience?

Jeff DeGraff: Well, I, I wanna give you both, if you will. So the best I I was asked about a number of years ago to help save a venerable English institution, Reuters, the big news organization. And what we did was we, we worked with a bunch of employees at Reuters to come up with a experience that was.

Really remarkable. And so we rented an old lorry warehouse. You know, a truck warehouse brought everybody in from the organization, the key people if you will. So it's like, like a hundred people. And we said we have to rebuild this thing. And a lot of people, I think, came intending to quit. It was very kind of interesting 'cause it was really a perilous situation.

And at the end of the, all of this, this very participative seemed like chaos. How are we gonna rebuild this thing? The employees, not only the two or three employees that told me they were gonna quit, not only didn't quit, the employees decided to buy an enormous amount of Reuters stock, and it became the beginning of the transformation.

And let me, the, the postscript is kind of interesting because Reuters eventually became acquired by Thompson, the Canadian company. And ironically, they took the CEO of the acquired company Reuters, and made him the CEO of, of both Thompson and Reuters. Thus saving Reuters, the people who were in Reuters decided how they were gonna make the change happen.

It was very empowering. It was a very good moment in time. Now, the other side. I got I was brought in by a group of people for a healthcare organization, which I will not name. And it became sort of the opposite. It became kind of arguments, negligence, and the entire, the entire sort of bringing everybody together just turned out to be chaos.

And and, and, and, a lot of finger pointing. And so, so sort of the, kind of, the key is this is when you bring a lot of people together, how do you get 'em synced up? How do you get 'em on a shared vision? And in the second case. I brought a group in and the person who was kind of in charge of this was a real negative Nelly, if you will.

And so it wasn't, we're going towards something, it was all the things that were wrong with the world. So that was my best day, if you will, and my worst day, and there's probably hundreds others because I don't do so much work in this space that kind of fall into both categories.

Russel Lolacher: So from those lessons learned, even though you don't do that work in. How did either of those change your approach to organizations like that? Because you went in there where one culture was obviously pretty healthy, pretty supportive, and the other one not so much. Did it affect how you approach those relationships moving forward?

Jeff DeGraff: Yeah. In, in in full disclosure, I've, I've been in over half of all the Fortune 500. I do, you know, I've done thousands of these in my career. The, the challenge is this, here's what affects me. You, in all of these situations, there needs to be a person who serves like an impresario at the opera.

There, you need to find the person who has credibility with everyone. Has a sense of doing the right thing sort of above their own self-interest, if you will. That's certainly true. But, but I wanna add to that a really silly thing that I think most people overlook, which is, do they create energy? I mean, I, I'm sounding very kind of new agey here, which is a little uncomfortable for me.

But do, are they able to create energy? And because that creates momentum and energy and momentum is always moving forward. That really did affect me and it's affected me my whole career. I look for that and I've got a lot of stories about, you know, I have Steve Jobs advisor when I was young, and we could talk about sort of people who are good at that.

And the other side is the people who are, who just have a lot of, I call 'em black holes. They suck all the energy out to people who do that. And you kind of have to be very careful about who's at the center of these communities.

Russel Lolacher: Fair enough. And sometimes as you're coming in to work with them, you have no control over that, and you have to work with those people regardless of what they're giving you or not giving you in those situations. For sure. Yeah.

Jeff DeGraff: True.

Russel Lolacher: Adaptability seems like one of those positive attributes that organizations, and I guess, oh, there could be a negative sign to adaptability too, but before I go down that rabbit hole, I'm kind of curious.

To your way of thinking. Jeff, how do you define adaptability? Because we're gonna go down the conversation of adapting to opportunity.

Jeff DeGraff: Yeah.

Russel Lolacher: Would you, how would you even define the phrase.

Jeff DeGraff: yeah. I would say it's a funny thing. I would say there's a high tolerance. Of ambiguity, incongruity and paradox, and what that means is. In a world where you know that X marks the spot, that's basically project management. And I come from my doctorate's in what we would now call artificial intelligence.

And artificial intelligence is gonna take all those jobs like that. And it already is. So look at what's happened with the software industry. Anybody's a programmer, a packet switcher, network person, those, you know, they, they're hemorrhaging these jobs because X marks the spot. It can be done better by a machine.

So the notion of adaptive thinking is what I'm really talking about is how do I think through an ambiguous situation. So lemme give a, my favorite example. Innovation is what we call in business school. This is a physical term, is a convex form of value. And what it means is it pays in the future. And why that's important is there is no data on the future.

And the number one form of resistance to innovation is excessive data collection, right? Your listeners will know they've been to the meeting, about the meeting. They've seen the report about the report. You're stuck in the planning cycle. You're terrified of ambiguity, right? So the notion is it's not that you don't do research, and it's not that you don't plan.

It's that what's happening is you have to make real time adjustments. So your strategy, the minute you, you start, you have to adjust. So good. Let me give you a good, really good example. Go back and look at your 2019 strategy. Any of your listeners to their organizations. Well, we had a pandemic, right? That wasn't worth the paper it was written on.

And the real question becomes, how did you navigate through a pandemic? And well, people will go, well, that, well, that was a very unusual thing. No. No. Read th acidities. Read ous. Read the Bible. Pandemics happen all the time. Go back in our own history, you know, whether it was the, you know, whether it was the Spanish flu or polio or whatever.

Things are always happening like this. So the notion is we make plans and then our problem is when we get disconfirming feedback cognitively we're unable or we're paralyzed, we're afraid to adjust.

Russel Lolacher: And maybe I'm oversimplifying this, but I'm trying to figure out the divide between adaptive thinking and just reacting to change.

Jeff DeGraff: Adaptive thinking is more than just reactive. Adaptive thinking is actually forward. It's proactive. You're sensing, there's a term that my colleague at Columbia Rita McGrath coined called Discovery Driven Strategy, and it's a really nice term and my. My mentor, Bob Quinn, calls this building the bridge as you walk over it, so it's not reacting to the world, it's being in a high, high awareness state. Of what's happening to you and where what you had planned to have happened isn't going on. And again, the, there's where this issue is extremely important and the things that I work on is, for example, in mil, the military, because if you're not adaptive, that, you know, things don't end well. Or, or in the, the in the operating room, right where.

Surprises are part of the normative behavior, if you will. You're going to always have surprises. Now, of course, that's an extreme example, but on our regular basis we have a lot of examples like that, you know, you turned in the report and you were expecting it to get to, it was gonna be, well, you thought you're gonna get a good grade, and it wasn't.

So the question becomes not the reaction, but were you aware of what was possible and do you have the facility to actually adjust? To make mid-course corrections to it. That's the key.

Russel Lolacher: So. Apologize for my bluntness here. Why do we need to, because I mean, there's organizations, many organizations that are not like this. They'll be more leaning into the react. We reacted well, checkbox, moving on. Right. As opposed to what you're talking about of adaptive thinking. What is the benefit to leaders to have this approach versus the just going with the flow?

Jeff DeGraff: Oh, that's a great question. I'd put it to you this way. If the world turns out to be the way you planned it to be, what's called good continuation, then your innovations are incremental and anybody can do them, and any fool will. Right. The notion is the more variant your re, your anticipatory maneuvers, the more variant your responses are, the more likely, the more valuable or the more innovative your organization's going to be.

And in a world where the speed and magnitude of change is greatly increased, right? All of our old theories, you know, Jupiter's Gale and all the stuff that we learned in business school, those things are getting thrown out the door because of inflection points. And it's almost, it's almost become banal when people talk about this is the greatest period of change.

Well, always, today is always the greatest period of change. You're a farmer in Leone, France in the 14th century, and the Crusades come back through your town and two thirds of your town dies of the black plague. Well, that's the biggest period of change, you know, and I will say that the inflection point that we're going through now. Really ai, which we've been waiting for since the nineties. I mean, we haven't seen an inflection point like this since the real tech revolution in the mid nineties. So it's not just ai, it's what's happening with clean energy. It's what's happening with bioengineering, which is gonna be the huge one. You know, if you think about Jennifer Donda, who won the Nobel Prize for mRNA technology and you think about how before last Christmas we basically mapped all 200 million human proteins. You know, this is, this is kind of scary stuff, you know, we're able to do stuff that I'm not sure morally we're prepared for. But the point I'm trying to make is in times of these inflection points, right, the, the, the highly adaptive, sorry to sound like Darwin here, the highly adaptive.

Are the ones who are gonna survive. And let me give you one example that your listeners will get. You know, think about all the big tech companies and how when COVID hit, they had the best strategies. They planned everything and they all got caught with their pants down, right? They, they were outta chips.

This platform, big platforms collapsed first couple days. This little company called Zoom. Which basically didn't have a great strategy, but they had a very adaptive business model. They're the ones that won big, right? And the people that had all the best strategic planning in the world are the ones that lost big.

And that's a perfect example of where we're at.

Russel Lolacher: Then are we looking at everything as an opportunity? I mean, we threw out, you've talked a bit about hugely negative events, COVID Black Plague, but also possibly. Horrible and or fantastic events, AI disruption and this sort of thing. So if we're adaptive leaders, are we looking at everything as an opportunity or are we looking to survive certain situations?

Like what is opportunity? Okay.

Jeff DeGraff: is both. I think great innovators are constantly, they have two things that are very interesting and I think it certainly reflects my own personality, so I'm projecting here one. You have to be dissatisfied with just about everything. This doesn't work as well as it should. This isn't the way this should work.

So there's a part of me that goes around and thinks about how I'd redesign everything, right? But the other part is you have to have this incredibly optimistic, only almost naive sense of destiny. So I'm certainly part of that and I'm part of that generation that went to the moon and made miracle drugs and built the net.

I'm part of that generation, you know? Okay, boomer, right? I'm, but that was part of what we did. Right. And you can see both aspects in the extreme. In my generation, you see the, the, the sense that, you know, technology will solve all of our problems. And the other sense, you know, the reactionary sense that the world's gonna end tomorrow.

But I, I, to me, a great example of this would be. You know, AI is leading to, you know what, people are just cutting and pasting. But it will also lead to, you know, the ability for nuclear power actually to be responsible nuclear power because it needs to support ai, but it will also create a lot of clean energy.

Right. And that will lead to what that will lead to. All kinds of people in the world who are, who disempowered or maybe under, you know, underutilized will have opportunities that they don't, don't have today. So there's always, this is sometimes referred to as Russel as the Maker's dilemma, right? And what it means is the acts can be used to do something really wonderful. You know, farming, build a house, but it can also be used for negative things. And that's unfortunately the human condition. The more we innovate, the, the, the better things get, but also the other things happen as well.

Russel Lolacher: Do we maybe have to shift our thinking around what failure means then?

Jeff DeGraff: Yes, and I, there's two parts to this and I've, I have a axe to grind here.

Russel Lolacher: I like your segue from acts to acts, but yes, go.

Jeff DeGraff: Yes. There's a lot of, there's a lot of stuff written about. You know, ev you have to fail and everybody has to fail and all that. And I'm, I'm a, I'm a champion wrestler. I, I was a, got through college super fast. I mean, I'm, I wanna win, right?

So I hate failing. I hate it. So when people talk about failure's, okay, and it's all, I'm like, if, if failure's okay and you like to fail, then maybe you're a failure, right? But I think that there's a second part to this, which is. Failure is part of it, right? So I'm saying yes, failure is absolutely part of everything we need to do, but I'm also saying you don't need to like it, right?

I, I think there's this sense of destiny that we have to have so that when you're failing, it's kind like when you're at the gym and you, you know, that you didn't weigh out at the right number and you did, couldn't quite get, you couldn't quite bench press what you thought, right? So there's a part of that.

I'm not asking your listeners to think that's great, but there's another part saying that's part of the journey. And so when you go to the locker room and you sort of deal with this, you gotta go, I gotta come back tomorrow. I'm going to, I'm gonna do better tomorrow. That wonderful sense of optimism that you need in order to be successful at this.

Russel Lolacher: We're talking a lot about how internally we may have to rethink everything that we were raised, led, managed, trained, but there's this, and you talked on it, is this, there's this need to resist things because we like to stay in our comfort. We like to stay with habit, so how can we adapt when our own mindset is basically going, I don't like change.

There's already been too much change, and now you want them to completely change how they. Do everything.

Jeff DeGraff: Now I would like to start by admitting that I'm a terrible hypocrite as a lot of innovation people are. So I like to drive the same car I've driven for since the early two thousands. I like to sit in the same seats at the stadium. I have, I have a lot of. I have a lot of non-change behaviors and, and can become extremely passive aggressive when I'm trying, when people try and push me out of things like that.

So, so, so I would say in one sense you have to have one foot on something that's stable, right? Because, because we're human beings. But the other part of this, I would say is notice when people really change. They don't really change when things are okay. They only really change twice. So think of it like a bell curve, right?

They change when in a crisis because the risk of trying something radical and the reward of staying where they're at is reversed. You're going through a divorce, you, you know, you lose the job, you lose the house. Somebody close to you passes away. You have a health issue. Why do people change when those things happen?

Well, because risk and reward is reversed. It's the same reason that the first trillion dollar company, apple was trading below $5 a share in 1997. When you're almost dead, you know, you, you take the safety off, right? I don't know else to put it. The same is true when you're on a roll. We call this risk capital when you're on a roll.

The risk of trying something radical and the reward of staying where you're at is reversed. So, you know, your, your, your company's, you know, just got, you know, just got a huge contract. You just graduated. You're in love. Now. Here's what your, your listeners need to understand. It's not the 80 20 rule.

It's the 2080 rule. It's easier to change 20% of your life, 80% than it is to change 80% of your life. 20%. Lemme repeat that. It's easier to change 20% of your life, 80% than it is to change 80% of your life. 20%. We have it backwards and the issue is. Those areas of crisis or opportunity is where people change. So I, I'm coming back to, I don't like to change, right?

But I find those places in my life where I, where, where changing. Appropriate. And I work from the outside in and I think that's when we look, when we look at people, whether they're losing weight or getting the better job or getting through school, that's kind of how they do it. So I, the whole idea of going big or going home, I love the fact that most of those smart Alex have gone home.

That is not the way to do this.

Russel Lolacher: Is there anything you'd recommend for leaders, for employees to really start embracing? So you're saying it's a baby step approach before we do burn bridges? Oh, you know what? I'm gonna change the entire way I eat tomorrow, Jeff. I'm gonna change, you know, my entire way I approach my team tomorrow. Is it?

Just getting comfortable with just minutia change. Is that before the big stuff comes?

Jeff DeGraff: I think it's I'm gonna put it a little bit differently. If you think about how a venture capitalist who actually knows what they're doing, 'cause half of 'em are completely clueless and that's why they go away so quickly. Business school professors are allowed to say that. What a venture capitalist who's really successful will do is they'll look at, let's say a disease state.

Let's say they're looking in medicine and they will invest in four or five companies, but a little bit of investment. We call this a round. I want you to think your listeners to think of it like their life where they're giving very little money or very little time to an experiment, but the experiment is quite radical.

The experiment is quite different. So this is what we call hedging or differentiating. So what you're doing is you're creating a funnel. At the top of the funnel, you're trying little things very quickly and you're getting confirming or disconfirming feedback. You're getting reality, but you're creating momentum.

You're creating momentum in your life. You're creating energy in your life, and very quickly you're gonna draw that down. And you're gonna draw it down into the things that actually work. So think of it, the five small experiments become two bigger experiments. The two bigger experiments becomes one thing that you think you can actually do.

Right? And that to me is a perfect example of how people actually change in a way that's highly productive.

Russel Lolacher: How do you know it's working? Because it's great that we're doing this, but how do you know you're moving the needle or you're just checking boxes to try to shift the needle for yourself?

Jeff DeGraff: It depends on what you consider valuable. I, I'm, I'm very much against the notion that, remember, innovation has to show itself. It has to be articulated in the world, but it very much against the notion that value is just money. I mean, it could be that you wrote, you wrote the first chapter of a novel that you wanna write, and you've been, you've been stuck on it for three years, and finally you've got it where you want it to be.

So you're getting momentum, you're getting confirming feedback that this is kind of the thing you want it to produce. And a lot of times it's a surprise. It's better than you thought it would be, right? So, and a, you know, so I don't think confirming and disconfirming feedback has to come from the outside world.

You know, it's like, you know, it's like, you know, the old, but they teach you in catechism. I'm, you know, I'm an old Catholic. Right. You know, so the, you know, that sometimes doing a good deed is its own, you know, it's its own reward. And I, I really think that one of the challenges we're having right now, which is I think really hard for people to understand.

I think the big challenge right now is we're, we're looking too much. To everyone else, and we're not paying enough attention to our own inner compass so that we let too many people in our head. So even on this, on this on this wonderful podcast, I'd say, you know, take what, what, take what resonates and get rid of the rest of it.

Get people outta your head. That's why I go on these really long walks every day, and part of it is just to figure out what's worth keeping and what do I need to just kind of let go of.

Russel Lolacher: It's one of the things that came up really quickly when I started the show was that it's called Relationships with, you know, relationships at Work. But very quickly I learned the most important relationship you have is the one you have with yourself, the one that you're, that inner monologue, that inner conversation, that inner that time you need to spend on your own because you're not good to anybody else, and you're not making those strong decisions until you're right with you.

Jeff DeGraff: Yeah, I would even add to that about innovation, one of the trademarks of a classic innovator, and of course everybody's different, and there there's a variation, but what's called self authorizing behavior, and that means that there's a compass inside your head, that sense of destiny. And you're gonna start moving towards it.

And the more that you socialize this with other people, and I think that that's important to do that the more exposure you have to people trying to course correct for you, and the hardest part is really keeping true to that compass. What is it? So I, I'm not saying you should exclude people and I'm certainly big on you need to listen to, but you shouldn't listen to everyone.

You need to know who to listen to and when something really. Resonates with you. It almost feels like a sign, you know, I don't know how else to put that, but I'm on airplanes all the time. I'm one of those, I'm, I'm, I'm just, I've just passed 2,500,000 miles on Delta, right? So I'm on airplane all the time and I, I hear people all the time say, well, I put earphones on and I don't talk to anybody in the airplane.

I talk to everybody in the airplane. 'cause you don't know where that great, where, where you're going to get that nugget. And yeah, you have to wade through some chatty Cathy or whatever from, you know, Minnesota wants to talk about the weather, whatever it is, right? You have to wade through that, and that's, that's okay too.

That's a good human skill to, but somebody will add something and that goes into that, that inner workings about self authorizing behavior. What can I do with that?

Russel Lolacher: So I'm glad that you brought in the other, the you know, maybe it's a team you work with, maybe it's your colleagues. How do you know they're the right people to support adaptability, to support innovation, to support this way of thinking? Or they're worth avoiding? Because you said don't listen to everybody, but then what, what are we looking for?

Jeff DeGraff: in fact, one of the things that I'm known for obviously is this model, the competing values framework or the innovation code, which is actually, you know, used from everything how to build teams to predict stock prices, right? So my, my big contribution to this model was. Innovation is created through the creative power of constructive conflict.

And it's a really funny thing because it's very contrary to what people say. So people look at the political environment and go, oh, the world's coming to an end. I'm like, no, when the, when people disagree, there's constructive and destructive conflict. So I don't wanna make, I don't wanna mix up the two.

Constructive conflict is respectful. It's that we, you know, we, we, we respect other people, no prejudice, but all ideas are challenged, right? And this is what's supposed to happen at universities, for example. You know, you're supposed to have, you're supposed to be having discussions. And the reason is constructive conflict produces generative hybrids.

It produces better ways, new ways of doing things, right? And the interesting thing is when I go back to the beginning of my career. Building Domino's Pizza was one of the things I did when I was really young. Right. Well, for Tom Monaghan. Right. And one of the things I know started noticing right away was what we call creativity clusters.

These places that produce mostly intellectual property in the world, there's a lot of people in there who have very different ideas. And these different ideas, these different worldviews are what we call dominant logic. These different dominant logics when put together in a, in a respectful, resourceful way, almost always produce outcomes.

And that becomes the real argument, I think for, for diversity, particularly diversity of thought. Right, which comes from different human experiences, right? So it's kind of a, you know, the human experiences are the key ingredient. So the object about this, when you talk about how do we deal with that at work, is I intentionally put these different kinds of people together.

It's like a dinner party. You have to sit the people together. Who are respectful of each other, maybe admire each other, but have very different ideas, and then listen to the conversation because that's where all the good stuff happens. The death of innovation is apathy. The death of innovation's over alignment.

That's project management. That's a day at the races, and anybody can do that, and the machines are gonna be doing that. What we really want in this world is we want difference, but we want respectful differences. This makes sense to you. So that's how I deal with it. How I and how I pick people is I don't pick them individually.

I pick how they go in the team. So think about like the Avengers assemble the Avengers, right? They're all super powerful, have egos are challenging people and sort of the Avenger stories. All the movies are basically, they go like this. They were super good at something individually and then something came into their life.

A nemesis that was just too big for one of them. Then they actually have, then they go through this period of. Creating real trouble for each other. And I don't wanna make it sound like they love each other because they're, they have issues, right? We all do. But eventually they figure out how to work together.

They build new ways of doing things. And so I really like that. My favorite movie out these days, which is of course, controversial on this subject is Oppenheimer. And if you look at the whole history of the project dealing with, dealing with the, the groups he had to deal with, you're getting a pretty good look at how that really, how it really looks.

So your listeners, if they go watch Oppenheimer, you're getting a pretty good look of how you put these teams together, what they're really like. But what they're capable of producing. Now, of course in that case, that's not something we want people to be producing, but it's a good, it's a good case study.

Russel Lolacher: I love that you got us to the Adam bomb. Jeff nicely.

Jeff DeGraff: Sorry about

Russel Lolacher: It's all good.

Jeff DeGraff: Let's hope for nicer things. How about that?

Russel Lolacher: But diversity is something I wanna talk about because we will have this team and we're building this team, but not everybody reacts the same way. And if you're talking about encouraging. Constructive conflict. There will still be people that like, I don't like conflict at all.

They'll shut down and it stops any innovation from happening because they're not being engaged in the way they prefer to be engaged. Do you approach them differently? Do you adjust or do you say they just don't fit?

Jeff DeGraff: No, you approach them differently. I would say the way I like to put it, going back to my Avengers analogy, the most important Avengers, Nick Fury, who doesn't have any great, you know, superpowers. What he is, is he manipulates and coalesces and negotiates and. He works like the impresario at the op opera.

He works with the divas to basically get them to work together. And some people are very and this even happens general generation wise. It happens in different parts of the world. So I do a lot of work in Asia. Like East Asia, Southeast Asia you can't, they're not Americans. You can't deal with conflict that way.

You have to pull conflict out in a much more subtle way. So you have to work with the idiom or the, the rituals or traditions of that culture. And I think it's particularly true in generations. So I'm a boom. Boomers, we competed for everything and we're in my model, what we call what the compete quadrant.

Right? Every, we still at Michigan. Great. On a curve. You know, don't send your ducks to eagle school. You have a lot of that kind of you know, energy. We're going to the moon, dammit, right? That sort of stuff. Our children are not like that. Our children are the opposite. Our children are collaborate culture people.

It's how are we doing? And you know that, that, you know, and that I'm not making fun of it. I'm saying you have to talk to that generation. And of course I'm generalizing here. You have to talk to generation differently. You have to be more, you have to be a little more nuanced. You can't be so direct. You have to talk to values as opposed to goals.

Right? The same is true for. Entrepreneurs who wanna talk about vision. You know, when you're gonna talk to the people who actually are the contractors who have to build it, you have to talk about process. And again, in, in my work, I go into the details of this, but the key is exactly what you're saying and that comes back to where we started this conversation.

Your role as a leader. It's like being a game show host, right? You have to keep track of the, the game and you have to keep track of the score, but your real job is to be working with the contestants so that they're engaged, they're all gonna be different so that they're creating energy, right? And that no one is kind of on their heels.

Right? That's the hard part. And it if, if you think about being a parent. I have three kids. You can't, you don't raise your three kids the same way. They're all gonna be different. And so each one kind of gets a, a variation of your parenting skills.

Russel Lolacher: It, it lends to something that I, drives me nuts, which is when you'll see this online a lot. Like, what's your leadership style? And I'm like, if you have one leadership style, you're a horrible leader. You have to adapt based on who you're working with, who you engage with. Sometimes it's very domineering.

Other times it's very collaborative. Other times it's very passive. But if you don't have all

Jeff DeGraff: put a slight, I'm gonna put a slight adjustment on that saying, I think leadership styles are like being right-handed. They're left-handed. We, and you can always tell what somebody really is by what they do when they're under stress. Right. So, you know, my leadership style under stress is very much that kind of invent your way out of it.

But here's the point that I think is important. Some people have a lot of range. I don't. So what I do is I have quite a. I have a ensemble around me. I know who to go to, so I'll give you a great example. You know, I built the In Atrium, I'm the architect, the Intellectual Edge Alliance, 14 programs, 45 countries around the world.

It's gotta be one of the largest ecosystems in the world for innovation. I don't run it right. I have other people run it. They're better at running it. I don't hire. There are people who are better at hiring. I'll give you a great example. I'm somebody who I can tell you immediately. This person is capable of this.

What I can't tell you is whether they're going to do it or not. I never know why. And so part of it's being aware of what your superpower is and what it isn't, and then turning to somebody who has that superpower and going, I think this person would be great. And then they always come back and go, well, you know, they're not gonna do this because here's what's going on in their life.

And I'm like, oh. That's a blind spot. So I have, I hope this makes sense. You don't have to be in charge of a company or a big ecosystem, just have friends. You know, I, I, it's very funny you talk to there's a lot of young people on my hallway here at the University of Michigan, and, you know, they're, they're in the, the phase of dating and figuring out kind of who to, it's charming, right?

But it's really interesting to see those people who are kind of going through this cycle where it's not working. Right. And what's really charming is they'll find, they have, they'll have a friend. 'cause the doctoral students are just across the street from me here, just across the hallway. They'll find a friend and they'll kind of get, you know, what do you think of this?

And sometimes you, when you listen in, the friend will have some information that's the blind spot for the person. And you'll go, okay, they're getting this. That's, that's personally important to them. They're finding, they're finding their person.

Russel Lolacher: I, I. I love the idea of the friends idea of it, of just work with people you want to work with, like working with, enjoy, working with. But that doesn't always, that's always not the case. You don't get to choose. A lot of the times you are a leader that is assigned a team, or you are, it's thrust upon you. Do you approach it differently if you're like, well, you can't be my

Jeff DeGraff: have to, yeah, you have to manage. I'm, I'm not. The friend word bothers me. I'm not sure we're supposed to be friends. I'm also not sure we're supposed to be happy. I'm, again, this is the old Jesuit in me. I, I'm, what I'm sure is that we're supposed to make meaning, and we're supposed to be doing positive things in the world, right?

Those are not interchangeable terms, right? So the whole idea of. I, the whole thing's about me being happy, I'm like you know, you know, happy hours at five o'clock and take a cruise with your friends. I mean, that's just not for me. Right. To me, meaningfulness is different and everybody. In the world has a ability, and I don't wanna use the word disability, but a lack of ability in some areas.

And so in, there's two parts to what you're saying, Russel and I wanna acknowledge them differently. The first part is, there's always gonna be somebody who doesn't have an ability that they should have to be here. And you have to manage to that by having other people support them, by you supporting them, by finding them additional resources, sometimes by putting 'em on the bench and managing around them.

Right. You know what is what Bismarck's famous saying, don't let other people's in competencies become your failures. Right? So you have to manage that. But that, I wanna make sure that everybody understands you have to be kind about this because we have skills and don't have skills that are just there.

That's whether it's biological or gift from God or whatever you believe about the world, that's not somebody's fault. On the other hand, there are varied people who. Don't wanna be into some situation and they're trying to sabotage a situation. In that case, there's kind of two things you can do. If you have power, the first thing you need to do is a limit, is move them out.

And I've had many conversations with, and particularly with women, with women who get into a senior position, there's some guy who's mad about it. And the first conversation you have is that person needs to go. And then there's this reticence. I'm just giving my real experience. It's not, it's not for everybody, but I've had this for thir, you know, I've been doing this for 40 years and saying, you need to get rid of this person because they're going to try, they're gonna do everything in their power to, to, to subvert you here.

And so if you have power, just better. I do it in a humanitarian way, but move 'em along. Right. And that's my view. But the other part is when you don't have power, basically what you have to do is neutralize that person. And the way you do that is pretty simple. Negative people are almost always in the reactive position.

They're gonna tell you what's wrong with everything. And the way to solve that is to say, boy, that's a really good point. What would you do here? And when they actually come out, now they're, now they're exposed to a reactive position. Now you can attack, right? And so the notion is pretty quickly, you know, you try and neutralize that person.

Now remember, this is not for people who are genuinely involved. They're really trying, these are people who are trying to stop the group. I'm trying to build on what you're saying, being negative. So what you're trying to do is to. Is to limit the amount of damage they can do. Now, of course, they can go underground.

And I teach this thing at Michigan and all around the world that I'm really well known for, called How to Win a Bar Fight. It's a terrible term, but remember I'm from a blue collar neighborhood. I came to college as a wrestler. I got through it as a teamster, right? And the notion is there's a way to basically take these negative people and neutralize them, and it's sort of a whole stream.

But in order to do that, you have to understand how organizations actually work. Right. How, what the organizational model is so that you're not doing damage. You're not a, you're not an aggressive person. It's like a keto, it's like when they attack, here's how you deflect it, right? Here's how the organization does this so that basically they're neutralizing themselves this, and I don't like this negative kind of discussion because I think most people you can bring along, right?

It's only, it's only a very rare person who's kind of in this very caustic black hole kind of place.

Russel Lolacher: Bringing in the larger culture into it, bringing in the larger mission, vision, and all that. What is corporate culture's role when it comes to adaptability, when it comes to creating an environment?

Jeff DeGraff: I am gonna say something that's very controversial, particularly being where I'm at at the University of Michigan, which is famous for this. I don't believe, I don't believe in culture, the way people talk about it. Culture isn't a thing, it's an attribute of things like beauty. Quality, right? So when we talk about culture, it doesn't exist as a thing.

Culture exists in two ways that are profound. Culture exists in how leaders lead and culture exists in how we work. So those are the two things. And if you don't believe that, what's the first thing we do when we acquire an underperforming a company? You, you know, you, you slot out the leaders because that's where the culture is emanating from.

And if you've got a high performing co company, you golden handcuffs, you try and hang onto that person for a while, right? So culture is really an aspect of leadership. It's really not separate from leadership. So I wanna start with that. And then the second thing I wanna start with is that culture is how you work. Do you listen to other people? Do you, do you know, you know, are you creating momentum? Do, do people get to have, you know, variations? Are they, are you working through paradoxes? Right? The, that's what makes those cultures like this. I have a great story around this. There's very young man. I was advisor to Apple.

I'm, but way too young to be part of this. There was a guy named Mike Mueller who was one of the original Apple guys, and he was a German guy who had an English car and he would drive his car, you know, the wheel on the wrong side, up and down 4 0 1, scared the dickens outta me. And he'd take me to places and he'd go, what do you think of this company?

And I was trying to be smart. I think I'm like 25 at the time. Oh, this is great. They have good strategy goes. Yeah, I never invested in it. You know, and it'd be a IBM company or something. And we, we, after about the third time, I'm kind of catching on and getting sandbagged here, right? So he finally takes me to this company and it just, it feels like chaos to me.

But you can just feel the place. Hum. So now I'm catching on and I'm like, okay, this feels like a company that's moving, that's got a culture that people are doing stuff. They're exhibiting, self authorizing behavior. They're probably making tons of mistakes, but, well, that company was Oracle, right? Which of course becomes this great company.

But the point that he understood that I didn't understand as a young man was when you see that kind of work. Right. We're putting this name culture on it, but it could work in a million different ways. It doesn't have to be, you know, crazy entrepreneurial culture that to me, how you work tells me everything about what the culture is.

And one of the things I learned building Domino's Pizza was, you know, you watch some kid who was 16 years old in a hot Dan Washington, you know, run up the road. And you'd go, that's culture, right? For some reason, that young person thinks that it's important to get this pizza to somebody in 30 minutes, right?

So I hope I'm making sense about this. So when people do these big culture change programs, there's very little evidence that these things work, right? The way culture change really works is you change the leaders, right? Or you change how the leaders lead. Of course a lot of times is really the key and you change how it works.

Now, the one thing I will say that that really supports what you're, where you're going with this, Russel, is this, when we start looking at dynastic organizations, organizations that have scale and are sustainable, there's three things that they have. And it's not technology. They have, they have the, the culture, the competencies, and the communities that are sustainable.

So if you look at. The University of Chicago down the road, it's been around for about 130 years, has 101 Nobel Prize winners. Right. Lots of conflict, but constructive. Sometimes not, but mostly, yes. Sometimes it spills out into the journals and there's a little, you know, there's a little pushing and shoving, but it's, you know, it's all, it's all polite.

You look at this and go, okay, how is it every time that there's a, a whole new trend or something goes very direct, how come they're on top of it? Right? And the same thing if you look at technology in Carnegie Mellon or MIT or you look right where Michigan, right? You start seeing that, that that leadership piece that sits at the center of this, that what your listeners are supposed to be doing, that leadership piece of, of modeling.

Of giving that energy, of bringing these differences together in a way that's purposeful, that matters. I if I can give you an example of something I worked on. So behind me, I have a patch from I. The United States government I worked on the COVID vaccine, not the actual vaccine, but how do we get a billion vials and how do you get a billion needles?

And what was interesting about that to me was at the beginning, they had a very clear way of trying to do this, which clearly didn't work, and it was really getting called into that was not a lot of fun. But the, but the concept very quickly became the small shots on goal. We had almost 500 of them that went into phase one of the Food and Drug Administration of the United States, which is how we do things here.

And very quickly we're, we're drawing them down into 169 phase twos and we had nine therapies that were temporary, you know, provisionally approved in seven months. We took a seven year process and did it in seven months. The reason that that worked is once we got to this part where we had 500 shots on goal, we had our culture, we had our competencies in that group, and we had our community, and we had one thing that held everything together.

We had a goal, we had a shared goal. We had one vision. So the chaos, remember the press said, we forgot how to do this, and we all took our stupid pills and we didn't. The chaos. Was held together by this vision, and more and more as we drew down, there were these imps, these people who hold these communities together, who deeply understand the width.

Not just the, not just the depth of these communities, but how these communities inter relate. And more and more, as we got to the middle of this, it became an issue of who can hold these communities together.

Russel Lolacher: I love that you are doubling down on the importance of vision, mission, and goals. Because adaptability, you can adapt and look for those opportunities all you like, but if there's not that bought in clear direction, I remember going to a conference once and he told everybody to close their hands and close their eyes and point North everybody pointed in a million, well, not a million different directions, but a lot of different directions.

Then he said, open your eyes North. Is that way. Okay, now everybody point North and everybody was in all together pointing in the same direction. But we just assume people know these things. We don't spend the time and the communication and the effort. We just put it on a poster or a website. How much have you, I mean, I love that example of we had one goal.

Our culture fed the goal. don't leaders take visions and missions more seriously?

Jeff DeGraff: Oh from your lips to God's ears. I would say a couple things though about this. I'd say a vision is a work in progress. Vision is like being an explorer where you haven't, you're Lewis and Clark, you haven't been here before. You, you build the Canadian Railroad, whatever metaphor you wanna use.

So there's two parts to it. You need to be listening. Your vision can't be. It's not a heroic vision. This whole idea of it came fully formed from my forehead, like Athena is nonsense, right? You're listening to the people who are worth listening to. Now, this is a first important point that you're getting at Russel.

You're right on this, which is know who knows. Stop listening to pe. You know, every idiot has a opinion on things, and they're all they, and some of 'em are, are the most popular people on the web. Stop listening to people don't know. What, tell me what, in your experience doesn't have to be education. One of your experience qualifies you to make a comment about this.

I know that I went to high school with this kid who lived behind me who flunk biology sitting next to me and during the COVID it was all the, the Mr. Anti-vaxxer. I'm like, well, if you were. An epidemiologist or something, or a virologist, I might listen to you, but you flunk biology. You don't even understand how this works, so you're probably not somebody worth listening to.

So step one, do listen, but know your blind spots and know who to listen to. Step two. The, the second piece of that is listen to your scouts who are at the edge of the circle. They'll tell you, they'll give you confirming or disconfirming feedback where you're wrong. So being the captain isn't just, we're going here, it's navigating.

And incidentally, some of the best captains, and we keep, I'm using the pronoun, him or, or, you know, some of the best captains I've ever met are women. So just remember, this is not a everybody, everybody is capable of doing this. Everybody in the whole world. And I have experiences with all of that. So, so that becomes key, right?

That whole navigation piece.

Russel Lolacher: So if I'm listening to this wrapping up, we've we're almost outta time. I can't believe that. So we have. Someone listening, going, okay, I want to be more adaptable so I can find those opportunities so I can go down that path. What are they? What are they starting to do, Jeff? Like what is the first thing they're doing tomorrow to sort of lead down the path of being intentionally adaptable for those opportunities?

Jeff DeGraff: Yeah, three things. Right off the bat the past is the past. It's all going forward right now. Right? That's key. Make paradox your practice. The, the concept that, that I think is so important is that paradoxes and ambiguity and incongruity are not, they're not things that are to be worked through for change.

They are the change. They are the essence of the change. And if you don't have ambiguity, paradox or incongruities, you're not changing. You're making iterations to what you're doing. You're still in X marks the spot. And I think the, the whole idea of, of all of this is to start with inquiry, not with content.

I mean, the notion is, are you starting like this? Are you starting like this? You know, are you a, are you a learner? Learning. In my opinion, learning and innovation or learning and change are inextricably combined, but you're, it's all about, you know, building the bridge as you walk over it. Are you learning as you do this?

And if you're not getting any smarter doing it, you're probably not swimming out far enough. So, and again, this is why I'm a terrible hypocrite. You know, I will tell you that in my, I, I'm very uncomfortable swimming way out, and yet I swim way out every day. Why? Because it's the only way, right? So it's like, it's like eating your broccoli or I don't wanna make people to make it sound like it's all great and heroic and I'm gonna love it 'cause you're not.

But the notion is, what's you're gonna love is that your, your, your abilities. Are going to greatly expand doing that. You're gonna meet different kinds of people. You're gonna, you're gonna know, you can solve different challenges and that's my favorite thing, Russel, of all of this is when somebody figures out that they have an ability, like a super skill that they didn't know they had, I'm like, it was there the whole time.

Russel Lolacher: That is Jeff DeGraff. He is an advisor for Fortune 500 companies, top speaker on innovation, professor, as he is sitting right now at the Ross School of Business at the University of Michigan, and he's the founder of Innoatrium, which creates sustainable innovation ecosystem for large organizations. And he's a prolific writer, but his latest book he co-authored called The Creative Mindset, Mastering the Six Skills That Empower Innovation.

Thank you so much for being here, Jeff.

Jeff DeGraff: Thanks for having me on Russel. I appreciate it.