Secrets to successful teamwork

We all work in teams, from families, to companies, and everything in between. So what's the secret to doing it better? This hour, TED speakers share surprising strategies for successful teamwork. Guests include activist Hajer Sharief, social psychologist Amy Edmondson and private equity investor Pete Stavros. Original broadcast date: September 20, 2024. TED Radio Hour+ subscribers now get access to bonus episodes, with more ideas from TED speakers and a behind the scenes look with our producers. A Plus subscription also lets you listen to regular episodes (like this one!) without sponsors. Sign-up at: plus.npr.org/ted http://plus.npr.org/ted See pcm.adswizz.com https://pcm.adswizz.com for information about our collection and use of personal data for sponsorship and to manage your podcast sponsorship preferences. NPR Privacy Policy https://www.npr.org/about-npr/179878450/privacy-policy

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Manoush Zomorodi?

  This episode's sponsor is HubSpot, which offers the following message: What if instead of updating your CRM, your CRM updated you? HubSpot's self-updating CRM keeps your customer context current so you can win more deals. Learn more at hubspot.com. This is the TED Radio Hour. Each week, groundbreaking TED Talks. Our job now is to dream big. Delivered at TED conferences. To bring about the future we want to see. Around the world. To understand who we are. From those talks, we bring you speakers and ideas that will surprise you.

• 0:37Speaker 01

  You just don't know what you're gonna find.

• 0:39Manoush Zomorodi?

  Challenge you.

• 0:40Speaker 01

  We truly have to ask ourselves, like, why is it noteworthy?

• 0:42Manoush Zomorodi?

  And even change you. I literally feel like I'm a different person. Yes. Do you feel that way? Ideas worth spreading. From TED and NPR, I'm Manoush Zomorodi. On the show today, teamwork.

• 1:00Speaker 02

  So I grew up in Tripoli, Libya.

• 1:02Manoush Zomorodi?

  This is Hajer Sharif. And when she was a kid, her parents would gather her and her siblings together every Friday night. We've all heard of family meetings, but these were a little more intense.

• 1:18Speaker 02

  This was a very formal process. People think like, yeah, it's a family. You come together like sometimes, you know? And I'm like, no, you don't understand.

• 1:27Manoush Zomorodi?

  They were called Friday Democracy Meetings. At 7:00 PM, everyone would convene on the floor in the living room.

• 1:36Speaker 02

  So we would be sitting down on mattresses.

• 1:39Manoush Zomorodi?

  There was a formal agenda, an appointed secretary.

• 1:43Speaker 02

  My mom would likely be the one taking notes.

• 1:47Manoush Zomorodi?

  And of course, there were snacks.

• 1:49Speaker 02

  Like, we would always have like fruits and like nuts. So like, you know, the meeting would start. There was like a proper structure.

• 1:59Manoush Zomorodi?

  The point was to bring all of the family's issues to the meeting and decide collectively how to proceed. Topics ran the gamut, from negotiating bedtimes to what food to have in the house.

• 2:13Speaker 02

  Like, we need more Nutella at home, you know?

• 2:17Manoush Zomorodi?

  Navigating sibling disputes.

• 2:19Speaker 02

  Yeah, so this is about solving a disagreement before it escalates to a fight.

• 2:26Manoush Zomorodi?

  And how each member of the family could pull their weight, including when her youngest brother was a toddler.

• 2:33Speaker 02

  That he should tidy his toys every time he plays. And if he forgets, we need to remind him.

• 2:43Manoush Zomorodi?

  So these meetings were fair and collaborative. But outside, it was Libya in the 1990s. The country was under the authoritarian rule of Muammar Gaddafi, and gender roles were very traditional.

• 2:56Speaker 02

  The woman is still the one that has to like cook and clean the house, even if she works, you know? So there is like gender inequality to a very great extent, and we didn't have a democracy. So my dad wanted to have that for my family.

• 3:14Manoush Zomorodi?

  So inside Hager's home, things were different. Everyone had a voice.

• 3:21Speaker 02

  I still very clearly remember him saying, "This is like a safe space for you.

• 3:29Speaker 02

  And if you say anything to us as a form of criticism, we're not gonna like hold this against you outside of this meeting."

• 3:37Manoush Zomorodi?

  What happens at Friday democracy meetings stays at Friday democracy meetings. I love it.

• 3:44Speaker 02

  Yes, yes, yes, yes.

• 3:47Speaker 02

  I mean, what we discussed in these meetings were family affairs. But this system really challenged the traditional family structure. There were no power dynamics of like parents and kids. And that really made us understand every problem also have a solution. If everyone comes together on equal basis, and if it's a safe space where there is trust, then we can really solve these issues.

• 4:23Manoush Zomorodi?

  Even in a country whose citizens had no voice, those family Friday democracy meetings made Hajer feel like she had a say in her life. Which brings us to today's show. How Teams Work. Ideas about changing group dynamics and building trust in families, between colleagues, and even in entire institutions. When Hajer became a teenager, she realized there was one topic that had never come up in those family meetings. The fact that every night, as the only girl in the family, she had to do the family dishes.

• 5:05Speaker 03

  I was always the only one who was asked to wash the dishes while my brothers didn't have to do anything about it.

• 5:12Manoush Zomorodi?

  Here's Hajer Sharif on the TED stage.

• 5:15Speaker 03

  I felt this was unjust and fair and discriminatory, so I wanted to discuss it in the meeting. As you know, the idea that it's a woman or a girl's role, role to do household work is a rule that has been carried out by many societies for so long. So in order for a 13-years-old me to challenge it, I needed a platform. In the meeting, my brothers argued that none of the other boys we knows are washing the dishes, so why our family should be any different. But my parents agreed with me and decided that my brothers should assist me. However, they could not force them, so the problem continued. Seeing no solution to my problem, I decided to attend another meeting

• 5:59Speaker 03

  and propose a new system that would be fair to everyone. So I suggested, instead of one person washing all the dishes used by all the family members, each family member should wash their own dishes. This way, my brothers can no longer argue that it's not within their responsibility as boys or men to wash the dishes and clean after the family. Because the system I proposed was about every member of the family cleaning after themselves and taking care of themselves. Everyone agreed to my proposal, and for years, that was our washing the dishes system.

• 6:40Speaker 02

  After my TED Talk, you can't believe the number of messages and emails I got from all around the world of women who said, "That story about the dishes, you have no idea how it resonated with us." And every time I talk about this story, I feel like one important thing to say is that, you know, this is not about who's washing the dishes. This is like an example of like how a structural issue would make someone not as equal to others. And like, I understood where they came from,

• 7:24Speaker 02

  my brothers, because it's true. Because like, in Libya, like, it is the women and the girls who does the dishes. Now, maybe things has changed a bit, but like, 24 years ago, like, this was like a no-brainer, right? So, why out of the thousands and thousands of young boys and the thousands and thousands of young girls who accept to do the dishes every day, why am I the only one who's challenging this, right? So, this is the structural issue I was talking about.

• 7:55Manoush Zomorodi?

  What strikes me about that, though, is in some ways, your parents were very clever in that they stopped you from being a rebellious teenager because you were given parameters. You were motivated to change the system from within because you had some power.

• 8:14Speaker 02

  Yeah, very true. And you know also about this like childhood experience, how it impacted me and my siblings growing up, you know, once we became also like young adults and wanted to experiment with life as well, right? Like, we had this trust relationship with our parents that we would literally tell them everything.

• 8:42Manoush Zomorodi?

  So I want to understand the cultural difference right now because here in the United States, we talk a lot about how young people are more politically motivated than ever.

• 8:57Speaker 02

  Yeah.

• 8:58Manoush Zomorodi?

  You know, not all young people, obviously, but there is a sense of wanting to have your voice heard. But we have to recognize that is not necessarily the case in many countries around the world. What is it that you feel a lot of young people need to hear in order to feel more motivated?

• 9:24Speaker 02

  Yeah. You know, I think regardless of where it is geographically around the world, I think the one thing that anyone who wants their voice to be heard should be willing to hear someone's else's voice as well, especially when this other voice is not aligned with your political thinking and maybe even not aligned with one's values and principles, you know. It also means to have a system in place that would treat everyone's voices equally,

• 10:07Speaker 02

  at least in terms of like having an opportunity to be heard without being judged, but also having a safe space to be heard. And I think in our societies now, especially now with social media and everything, you know, it's becoming more and more difficult for people to hear each other.

• 10:33Manoush Zomorodi?

  So if someone listening to this conversation, a parent, is thinking, "I want to do this. I'm gonna, I want to have democracy meetings with my family." How should they go about doing it? How should they get started?

• 10:50Speaker 03

  I think a first thing is really to believe in it. Because it's a foundation that's gonna help the kids when they grow up, you know? So there is also an aspect of self-development there. And I see this a lot in me and all my siblings, where we're never afraid of confrontation. But it's also about how you ask questions. It's also about how you discuss things that bothers you or even point out to things that you disagree with in a way where you're not judging the other person or the other group, but you're really trying to understand, right?

• 11:35Speaker 03

  And I think this is a skill that we need in life. Every family is its own mini-political system that is usually not democratic. Because parents make decisions that affect all members of the family while the kids have very little to say. Similarly, politicians make decisions that affect the whole nation while the people have very little to say in them. We need to change this. And in order to achieve this change systematically, we need to teach people that political, national, and global affairs as relevant to them as personal and family affairs. So if we want to achieve this,

• 12:19Speaker 03

  my proposal and advice is try out the family democracy meeting system. Because that will enable your kids to exercise their agency in decision-making from a very early age. Politics is about having conversations, including difficult conversations that leads to decisions. And in order to have a conversation, you need to participate. If you include your kids in family conversations, they will grow up and know how to participate in political conversations. And most importantly, most importantly, they will help other engage. Thank you.

• 12:59Manoush Zomorodi?

  That was Hajer Sharif. She's a human rights activist and the co-founder of the Together We Build It Foundation. You can see her full talk at ted.com. On the show today, how teams work. I'm Manoush Zamirodi, and you're listening to the TED Radio Hour from NPR. We'll be right back.

• 13:30Speaker 04

  Stay tuned for the following announcements and messages from our sponsors.

• 13:35Speaker 05

  This message is from Synchrony Bank, who wants to remind you to stay flexible. Not the yoga-bending circus-performing kind of flexible. Financially flexible, like with their high-yield savings account. Stay flexible at synchrony.com/NPR. Member FDIC.

• 13:51Speaker 04

  This message comes from Google Workspace with Gemini. One subscription that does it all. Personalized AI and premium business versions of Gmail, Google Docs, Drive, and more. Try it free for 14 days at goo.gle/workspacewithgemini. This message comes from TED Talks Daily, the podcast that brings you a new idea every day. Learn what's transforming humanity, from balancing AI in your critical thinking to surpassing discoveries about the adolescent brain. Find TED Talks Daily wherever you listen.

• 14:27Manoush Zomorodi?

  It's the TED Radio Hour from NPR. I'm Manoush Zamirodi. On the show today, what makes teams work? When the stakes are low or incredibly high?

• 14:40Speaker 06

  In a hospital setting, care is provided 24/7. And there are shifts of people coming and going. So communication is critical.

• 14:52Manoush Zomorodi?

  Julie Marath worked in hospitals for 40 years, first as a nurse and then as a hospital administrator.

• 15:00Speaker 06

  In different disciplines that are involved in the care of patients have different vocabularies. So it's learning to talk to one another. Physicians, nurses, pharmacists. There's surgeon and anesthesia. And so the ability to listen, respect.

• 15:22Speaker 06

  Talk to one another and not around each other is absolutely critical.

• 15:28Manoush Zomorodi?

  And while that kind of open back and forth between colleagues might sound obvious and very much expected now, Julie says when she got her first nursing job in the 70s, that kind of communication just didn't exist. She didn't even know it was possible. And she found her job very isolating.

• 15:48Speaker 06

  Doctors talked to doctors, nurses to nurses, and people interacted around tasks, but not as a cohesive team.

• 15:59Manoush Zomorodi?

  So, asking questions, raising concerns, speaking up about mistakes, it didn't really happen. Each person was kind of on their own.

• 16:09Speaker 06

  It was lonely, you know. There's a lot of responsibility when you're caring for people. And I think that was the predominant feeling, that if a mistake was made, if an error occurred, people went underground. They didn't talk about it. They didn't learn from it, but rather saw errors and failure as an inevitable part of providing highly complex, interdependent care.

• 16:47Manoush Zomorodi?

  She soon learned that this culture could lead to catastrophic results. And a warning here, Julie's story includes details that are upsetting.

• 16:57Speaker 06

  A really early experience that I had was a child going for an operation, and the child died. And the nurse caring for the child never came back to work.

• 17:18Manoush Zomorodi?

  Julie says that maybe there had been an accident, maybe an issue with anesthesia. There were rumors, but only rumors. No one knew for sure what happened.

• 17:29Speaker 06

  And no one ever communicated what happened to the child or to the nurse.

• 17:38Speaker 06

  It's haunting even after all this time that secrecy is so damaging.

• 17:46Manoush Zomorodi?

  What Julie saw was actually indicative of what was going on in hospitals all over the country, widespread medical errors. But it wasn't until the 90s that researchers began looking into why these mistakes were happening. One Harvard researcher in particular.

• 18:03Speaker 07

  I mean, if you really stop to think about it, we're dealing with very vulnerable people in very complex situations. So of course, things go wrong. You know, the only question is, do we catch and correct them quickly enough to save lives?

• 18:19Manoush Zomorodi?

  This is Harvard Business School professor Amy Edmondson. Back when Amy was a graduate student in the 90s, she was studying organizational behavior, specifically teams and how they work. And her first project was to pinpoint why hospital errors happen, the kind of errors that Julie had seen.

• 18:39Speaker 07

  I was invited to go into a couple of our teaching hospitals here at Harvard to study as part of a larger study of coordination breakdowns. And so I was, as a budding social psychologist, I was going in, observing patient care units, joining meetings where people were talking about how they worked together, what worked, what didn't work, and all the rest.

• 19:06Manoush Zomorodi?

  She wanted to understand why some teams seem to make more mistakes than others.

• 19:11Speaker 07

  And my hypothesis is, I think this is obvious, I meant it to be obvious, was that the better teams, better coordination, you know, better leadership would have, ta-da, fewer error rates. But that is not what the data were saying. I had a reverse result. The data were saying that better teamwork was associated with higher error rates, not lower.

• 19:40Manoush Zomorodi?

  That must have seemed really strange to you, that the strongest, most motivated teams had the most errors?

• 19:47Speaker 07

  Oh, yes. And my thinking starts literally spiraling out to, what will my next career move be now that I'm going to have to drop out of graduate school? So I, you know, I calmed myself down and I thought about it. Well, what might explain this result? You know, and of course, you know, one possibility is that good teamwork really is problematic, but I just couldn't get my head around that explanation. And, and the more I thought about it, I was, I was suddenly struck by a possibility. And the possibility was maybe the better teams don't make more mistakes.

• 20:28Speaker 07

  Maybe they're more willing and able to report the mistakes that happen. You know, most of us don't like admitting mistakes and I don't think they did either. But they were more committed to the idea that only by their willingness to admit mistakes could patients get the best possible care. Then later I was able to show some evidence that this was likely the case. You know, that they were, they were more open, they were more honest, they were more sensitive to the nature of the work that they did.

• 21:01Manoush Zomorodi?

  Amy didn't end up failing graduate school. She actually went on to do decades of research and is now one of the world's foremost experts on teamwork. Her research is perhaps one of the main reasons why workplace culture has shifted its focus from individuals to teams. And decades after her first hospital study, Amy still says good teams talk openly about their mistakes, even if it goes against our natural instincts.

• 21:31Speaker 07

  It turns out that no one wakes up in the morning and jumps out of bed because they can't wait to get to work today to look ignorant, incompetent, intrusive, or negative. No.

• 21:43Manoush Zomorodi?

  Here's Amy Edmondson on the TED stage.

• 21:46Speaker 07

  No, on average, we'd prefer to look smart and helpful and, you know, positive and helpful. So, um, so the good news about all this is that it's very easy to manage, right? Don't want to look ignorant? Don't ask questions. Don't want to look incompetent? Don't admit weakness or mistake. Don't want to look intrusive? Don't offer ideas. And if you don't want to look negative, by all means, don't criticize the status quo. Okay. Now, this strategy, the, the, the good news about this very successful strategy is that it works for self-protection. The psychologists call this impression management. And there's a great deal of evidence that we're quite good at it. We learn how to do this sometime in grade school.

• 22:28Speaker 07

  By the time we're working adults, it's all but second nature. Have you ever had a question and you look around and you don't ask it? No one else seems to be asking. Maybe you're supposed to know. You think, "I'll figure it out later." Right? So why does this matter? It matters because every one of these moments, every time we withhold, we rob ourselves and our colleagues of small moments of learning.

• 22:55Speaker 07

  And we don't innovate. We don't come up with new ideas. We are so busy, unconsciously for the most part, managing impressions that we don't contribute to creating a better organization. Nurses don't call. The pilot doesn't speak up. The executive doesn't say anything. So, the good news is that not every workplace is, in fact, this way. There are some workplaces where people absolutely wake up in the morning, if not eager, at least willing and ready to take the interpersonal risks of learning. I call these special workplaces ones that have psychological safety.

• 23:38Speaker 07

  Now, I'll define psychological safety as a belief that it's absolutely okay, in fact, it's expected, to speak up with concerns, with questions, with ideas, with mistakes.

• 23:50Manoush Zomorodi?

  So can you tell me more about psychological safety? You know, radical candor was invoked for a little while where you say, whatever comes to mind, you put it out there.

• 24:00Speaker 07

  Yes.

• 24:01Manoush Zomorodi?

  Kinda?

• 24:02Speaker 07

  Sort of, yep.

• 24:03Manoush Zomorodi?

  But are there some sort of real basics that you think are crucial to creating that psychological safety in a team?

• 24:11Speaker 07

  Yes, and, and in defense of radical candor.

• 24:14Manoush Zomorodi?

  Okay.

• 24:15Speaker 07

  I think, I think Kim Scott is, is very clear that she's not talking about brutal candor. Like, what, what makes it radical is how unusual it is, but it matters to the quality of our interactions and ultimately the quality of our work.

• 24:30Manoush Zomorodi?

  Yeah.

• 24:31Speaker 07

  Now, part of the way you build it is you call attention to attributes of the work that require us to be this way. Like, if you're in, in a healthcare context, you say, you know, the complex, interdependent nature of the work we do means that we are vulnerable. You know, breakdowns will happen. If you're a team leader, medical director, in a setting like that, you are frequently making reference to the vulnerability of our processes to break down, not because we're not any good, but because it's literally the nature of the work we do.

• 25:04Manoush Zomorodi?

  Mm-hmm.

• 25:05Speaker 07

  You know, if you're an innovator in a tech company, you're saying, you know what? No one has ever done anything like this before. So, we're trying something new here. All ideas welcome. And all critiques and concerns are doubly welcome. Let me just suggest three simple things you can do so that that nurse does make the call, the pilot does speak up, the executive even, reveals his concern about the takeover. First, frame the work as a learning problem, not an execution problem. Recognize, make explicit, that there is enormous uncertainty ahead and enormous interdependence. We can't know what will happen.

• 25:47Speaker 07

  We've got to have everybody's brains and voices in the game. That creates the rationale for speaking up. Second, acknowledge your own fallibility. Right? You know you're fallible. Say simple things like, "I may miss something I need to hear from you." This goes, by the way, for subordinates and colleagues, peers alike. That creates more safety for speaking up. And third, model curiosity. Ask a lot of questions. That actually creates a necessity for voice. And so, these three simple things can go a long way toward creating the kind of workplace where we can avoid the catastrophes you saw coming.

• 26:33Manoush Zomorodi?

  So, that is how to approach a high-stakes project. But what about when things go wrong? What is the best way to give feedback to maintain that psychological safety? You write in your latest book that leaders should be kind, but not nice. Please explain, what is the difference there?

• 26:53Speaker 07

  Right. You know, when we say we're being nice, I'm not going to criticize you because it wouldn't be nice. I'm going to say, "Oh, that's, you know, really very good work," when I actually don't think so. And the point I'm trying to make is that's not necessarily kind, or at least it's certainly not caring. Because if I cared enough about you and your future, I'd care enough to give you more honest and constructive feedback. And nice is the easy way out. And nice takes care of me, makes me comfortable in the moment, but it doesn't take care of you, and it doesn't take care of the future.

• 27:27Manoush Zomorodi?

  I mean, that kind of stunned me a little bit. In your new book, you talk about one way of diagnosing a healthy failure culture. You say, "How much of this do you usually hear?" And the list is, "Do you usually hear good news? Do you usually hear progress? Do you usually hear agreement? Do you usually hear all's well?" And then you say, "If you do, that's terrible."

• 27:47Speaker 07

  Yeah. And again, context matters, right? Because if you're on the Toyota production line, that's probably okay, right? Because 99.9% of the time, it is all going according to plan. But if you're in a scientific laboratory, and you're hearing, "Yeah, every single experiment is working just great, and I agree with you, boss, on every idea you had," you should be disappointed at that. Because that's not what a good lab looks like. Now, most of us are neither on the assembly line nor in the scientific laboratory. We're somewhere in between. And yet... Even in the middle, I would argue that if you're only hearing the green and no red, it's probably suboptimal.

• 28:31Speaker 06

  Hmm.

• 28:32Speaker 07

  It's probably a sign that people don't feel comfortable enough to say what's really going on. Now, at this point, in describing and teaching about these things, most managers I talk to start to get a little nervous, right? They say, "I get it. I understand how this could really help people learn. I understand, and I want to hear about errors. But are you saying I have to dial back a little on excellence? Is it no longer possible to hold people accountable for great results, to hold their feet close to the fire?" And I say, "No." In fact, when I'm talking about psychological safety, I'm essentially talking about letting up on the brakes, right?

• 29:17Speaker 07

  I'm not talking about the gas. I'm not talking about motivation. There's a lot out there on motivation, and it's really important, and it's important to understand it. But it's equally important to free people up, to really engage and not be afraid of each other. If you're only talking about people's accountability for excellence and not making sure they're not afraid to talk to each other, then they're in the anxiety zone, and that's a very dangerous place to be.

• 29:47Manoush Zomorodi?

  Yeah, and some people might say, "Well, you know, I've got college tuition to pay. I just want a job. I don't really care about the end product. I'm fine with this. I'm fine with phoning it in. It's fine."

• 30:01Speaker 07

  Yes, and I think that's a shame for two reasons. If I'm a customer, I'm thinking, "Ah, this product's fine, but maybe it could have been even better." And organizationally, it's a real shame, because what that points to is a leadership and management deficit, where the organization's leaders or managers have failed to inspire you enough for you to want to give it your all, and they have failed to clarify that that's what good looks like, right? That there is almost no such thing as just play it safe around here. We're more disappointed in you if you're someone who never has a failure than if you're

• 30:46Speaker 07

  someone who has intelligent failures and learns from them and helps other people learn from them also. Right? So it's, you know, it's, it's, you know, I think it's kind of a profound thing, right, that is often not communicated.

• 31:01Manoush Zomorodi?

  I want to make sure I ask you, you know, somebody listening is thinking, am I doing this right? Am I running my family, my work team, my pickup softball team well? What are some questions they should ask themselves when it comes to taking your, the team forward for the win, you know, for the joyful win?

• 31:21Speaker 07

  Yeah. I think the way you do that in your team or in your family is you articulate as best you can, a sort of compelling aspiration for us as a family, as a team. And then you sort of raise with a curious mindset, the questions of like, what will it take for us to do this well? You make it a team problem solving opportunity. You invite everyone in to be thinking about and co-creating the journey that lies ahead.

• 31:57Manoush Zomorodi?

  That's Amy Edmondson. She's a professor at Harvard Business School. Her most recent book is called The Right Kind of Wrong. You can watch her talks at ted.npr.org. In a minute, more about what motivates employees and brings together teams from the perspective of an investor who wants to change how companies incentivize their workforce.

• 32:22Speaker 08

  When it works, this is the most amazing thing that can happen inside of a business, not only for the business, but for the people, for the community. We talk so much about inclusive capitalism, it drives me crazy. And this is it. Like, you want inclusive capitalism? Well, then people need to be included in ownership. That's it.

• 32:40Manoush Zomorodi?

  On the show today, what makes teams work? I'm Manoush Zomorodi, and you're listening to the TED Radio Hour from NPR. Stick with us.

• 33:00Speaker 04

  Stay tuned for the following announcements and messages from our sponsors. This message comes from Synchrony Bank, who wants to inspire you to keep dreaming and saving smart to make those dreams real. Open an account and dream on at synchrony.com/NPR. Member FDIC. This message comes from Google Workspace with Gemini. Ever notice how every new AI tool asks you to explain your business to it all over again? Google Workspace with Gemini skips that. You get Google's AI built right into the premium versions of Gmail, Google Docs, Sheets, and more. No new tools, no extra logins, just one subscription that gives you personalized AI right inside your actual workflow.

• 33:42Speaker 04

  Try Google Workspace with Gemini at goo.gle/workspacewithgemini. This message comes from TED Talks Daily, the podcast that brings you a new idea every day. Learn what's transforming humanity, from balancing AI in your critical thinking to surpassing discoveries about the adolescent brain. Find TED Talks Daily wherever you listen.

• 34:06Manoush Zomorodi?

  It's the TED Radio Hour from NPR. I'm Manoush Zomorodi. On the show today, what makes teams work? And how worker satisfaction can be crucial to a company's bottom line.

• 34:22Speaker 09

  Can I just talk about how much I hate my frickin' job?

• 34:25Manoush Zomorodi?

  There has been some disheartening news about how employees are feeling these days. Take the TikTok genre of people complaining about their jobs.

• 34:35Speaker 09

  I hate working. I hate it. I hate it.

• 34:41Manoush Zomorodi?

  Hating on work isn't new, but it has become more acute.

• 34:46Manoush Zomorodi?

  A recent Gallup poll found that 70% of American workers don't like their jobs. And between 15 to 20% are actively disengaged, meaning they're phoning it in or even planning to leave. Today is my last day.

• 35:05Speaker 09

  I want to quit my job so bad.

• 35:07Manoush Zomorodi?

  But why? Amazing effort, great effort, OK effort, piss poor effort, I'm getting paid the same. Well, it's often because workers feel like the boss doesn't even notice whether they're working hard or hardly working.

• 35:22Speaker 10

  If you just feel like a number somewhere, you're probably just going to go punch a clock and get their numbers and move out. And I'll be honest with you, I've worked for some pretty big companies before where I'd been there a year, two, three, and never even met the CEO.

• 35:36Manoush Zomorodi?

  That last voice was Josh Ryan. Josh worked at a company in Arthur, Illinois called CHI, where people used to feel like the C-suite didn't care. Back in 2015, the garage door factory had a serious morale problem.

• 35:52Speaker 10

  Working in a factory is sometimes a miserable experience. Right? Like, most people come here and they have to do the same thing over and over and over again.

• 36:03Manoush Zomorodi?

  This wasn't helped when the company was bought by a private equity firm.

• 36:08Speaker 10

  They'd gone from, you know, a guy who started in the backyard of someone's house here in Arthur to a group of owners from New York. People were a little skeptical, and that's one of the major reasons why.

• 36:22Manoush Zomorodi?

  If you're not familiar with how private equity works, investors buy a company that's not living up to its potential. And within a certain number of years, they try to turn the company around with the goal of either selling it or taking the company public. It's a high-risk, high-reward strategy. If it works, the company survives. People may keep their jobs, and the investors make a lot of money. If it doesn't, sometimes investors decide to cut costs, cut jobs, and shut down parts of the company so the rest can be sold off at a profit. Or they go through all of that to eventually file for bankruptcy.

• 37:04Manoush Zomorodi?

  So being bought by private equity can be very stressful for employees and make bad workforce morale even worse.

• 37:13Manoush Zomorodi?

  But that's not what happened at CHI. Instead.

• 37:18Speaker 08

  Business basically tripled. Our investors made 10 times their investment. So it was the best investment we had made since the 1980s in a company that makes garage doors.

• 37:30Manoush Zomorodi?

  This is Pete Stavros.

• 37:32Speaker 08

  I co-head global private equity for a firm called KKR.

• 37:37Manoush Zomorodi?

  Pete has told the story of how he turned CHI around a lot. He saw what the problem was right away. Unhappy employees were dragging down the company.

• 37:49Speaker 08

  So imagine you're working in the factory. Your daily work, you really have no control over. You know, it's just that old line manufacturing mindset of kind of, do what you're told, keep your mouth shut, do your part and go home. Safety in the plant was a disaster. So, you know, if we, if we just ran out our, hey, if we're going to own the business for five, six, seven, eight years, the data would have said, pretty much everyone in the plant at some point is going to get hurt. It was that bad.

• 38:19Manoush Zomorodi?

  But you saw something in it. What?

• 38:23Speaker 08

  So the, the manufacturing model was like, kind of brilliant. You looked inside and wow, this company could take even more market share, could grow even faster. But we've got to get the workforce engaged if we're going to improve quality, improve lead times further, customer satisfaction, reduce waste, reduce inventory. That's going to only happen with the entirety of the workforce in, in the company. It's not going to come from a dictate from the office of the CEO.

• 38:51Manoush Zomorodi?

  So to get those workers engaged in their jobs, Pete used a tactic that's considered very unusual and by some even antithetical to private equity. Employee ownership, meaning each employee is given a stake in the company, which turns into a cash bonus if things go well.

• 39:12Speaker 08

  It's a free incremental benefit meant to be retentive and motivational, just like for a CEO. Now, if you give someone stock, their expectations of you as a company just went up. Cause if I'm an owner, I want to know what's going on. I'd like my suggestions heard. And I'd like information on how I'm doing. How does what I'm doing every day tie into the big picture? Where are we headed as a business? How can I help? What are the big things that the leadership team's looking at? I'd like to look at that stuff. So that's what the model is. It's an ethos.

• 39:46Manoush Zomorodi?

  And what's the promise then at the end? Or is there an exit plan? Because that's usually the deal, right? With private equity.

• 39:53Speaker 08

  So upfront, what we communicate is very conservative. This is equity. You're not paying for it, but there's no guaranteed payoff. But what we communicate, we say, if we hit our plan, and that means we all need to perform and do our jobs, but if we do, you know, you'll earn around a year's worth of your income. So if you make $75,000, if we do our job, you'll get another $75,000 when we sell the company or take it public.

• 40:17Manoush Zomorodi?

  So what ended up happening with CHI?

• 40:21Speaker 08

  So it took eight years, but everything went way beyond our expectations. And that spans from how employees felt, what happened to engagement scores and quit rates and worker safety. And what they yielded financially was way beyond our expectations and their expectations. So, you know, we had, on average, frontline employees make about $175,000. But many of those, you know, were not the long-tenured folks. So the folks who had really been there earned six and a half times their annual income. So we had factory floor workers make half a million dollars. Truck drivers make $800,000.

• 41:03Manoush Zomorodi?

  Life-changing money.

• 41:04Speaker 08

  Life-impacting amounts of money. And so many stories of people getting out of debt and really turning their lives around financially.

• 41:13Manoush Zomorodi?

  Like Josh Ryan, whom we heard from earlier.

• 41:17Speaker 10

  So we got enough money that I put money away for all four of our kids to go to college, right? I started a college fund for all of them that has a decent amount of money in it. We upgraded our house. We, you know, put a large chunk of money down on our house. So people around here still talk about it like it's, you know, the greatest day in their lives because it might have been the greatest day in their life.

• 41:39Manoush Zomorodi?

  Here's Pete Stavros on the TED stage in 2024.

• 41:43Speaker 08

  Today, I'm going to try to convince you that broadening employee stock ownership is the single most important thing that we can do to lift up workers and to make companies stronger too. Only a tiny percentage of workers are granted stock ownership in their companies, and most workers have no wealth. And it is, in fact, stock ownership, or the lack of it, that is by a mile the biggest driver of wealth inequality. It could give us a form of capitalism that is actually inclusive, and I believe it could literally change the economy.

• 42:16Speaker 08

  I've been pursuing this idea most of my adult life. Twenty-five years ago, as a graduate school student, I dove into the history of employee ownership, and I published a paper on the topic in 2002.

• 42:28Speaker 08

  Then, a handful of years later, I got my first real leadership position at the company I still work for, KKR.

• 42:35Speaker 08

  And I was put in charge of investing in and improving industrial companies, mostly manufacturing businesses. And that was a great opportunity to start experimenting with different ways of sharing stock ownership with all employees. In our early efforts, the most important thing we got right was making sure that stock ownership was free and incremental for workers, not a trade for wages or other benefits. But we got plenty of things wrong. We didn't communicate well. So if I said something like, "We'd hope to sell a business in five years," that often led to employees literally counting the days or growing suspicious if things took longer. We didn't share our financial information, so people didn't know how the business was doing. You see, ownership is about a lot more than just giving out stock.

• 43:20Speaker 08

  It's about trying to create a whole different type of culture, an ownership culture.

• 43:26Manoush Zomorodi?

  I mean, we talked about CHI, but do you have the data to know whether there will be many more CHIs, that that company wasn't just a one-off?

• 43:37Speaker 08

  So we've done this 50 times over 15 years, and we've done this in the United States, Western Europe, Vietnam, Japan. We've done this all over the world. Of the 50, we've exited something around 15, and they're among the best deals we've done. And we've had third parties look at the performance and have said, these are outliers to the positive. Like, this is from a financial perspective working. And then the impact on the workers is indisputable.

• 44:09Manoush Zomorodi?

  I mean, I'm trying to put myself in the headspace of someone who works for a company that you've bought. And let's say I've been there a long time, and I like the changes you're making. And then, you know, it turns out, OK, KKR is ready to sell, and I get a big check, and that's great. But then I'd be terrified. I'd be like, what happens now? This was a fun experiment. But I guess what responsibility do you feel to the long-term well-being of the people whose lives you've improved in the short term?

• 44:45Speaker 08

  There's a bunch of components to that. So one is a responsibility to make sure people are prepared for a financial return like that. And we take a lot of care to offer financial coaching, both along the way and then at the end. And then in terms of the company that may be coming in to acquire it, in our experience, it is attracting a different type of buyer. And even if it's a similar buyer we would have had 10 years ago, they're thinking differently. Like, oh, my goodness, look at this culture that's been created. How do we retain it? How do we replicate it? You know, because it's hard to take away. So, once we get this into these companies,

• 45:27Speaker 08

  my hope is this becomes a self-perpetuating system, and it just grows exponentially over time.

• 45:36Manoush Zomorodi?

  What if a company had offered to buy it that didn't provide employee financial support and sharing and profits and those sorts of things? Would you have sold the company anyway?

• 45:49Speaker 08

  We are fiduciaries and most of our money is, where it comes from is people's retirement funds. So we manage a lot of like teacher pension money, for example. And our obligation to them is to maximize their returns. So yes, that is what we have to do. Now, having said that, the types of buyers who are attracted to a business like this, they tend to be very values aligned. So I think that this is, this is not a silver bullet. It's not like if we could just do this, the economy is going to be okay. And, you know, the social contract, which is so broken with frontline workers is all going to be fine, but we got to start somewhere.

• 46:32Speaker 08

  And this is certainly, in my mind, an unequivocally positive step.

• 46:37Manoush Zomorodi?

  Pete, this has been such an interesting interview because you've gotten a lot of press over the last year. And frankly, the only good things people have to say about private equity these days are often related to you and this idea of bringing employee ownership into companies. And I guess I'm wondering why you decided to do this strategy through private equity? Why not use another means? Because there are other ways. There are cooperatives, there are paying people higher wages, so many other ways to make sure people feel valued at work.

• 47:14Speaker 08

  Well, this is the tool that I have access to. And yeah, there's lots of different ideas out there, you know, with respect to cooperatives. And I don't mean this in any kind of a derogatory sense whatsoever. I think anything that gives workers a stake is amazing. Cooperatives have not scaled is just the fact. The aggregate revenue of all the cooperatives, you know, adds up, in total adds up to a, you know, one decently sized public company, one. So the opportunity with private equity is scale. KKR, if you add up the employee base for all of our companies, we employ like 800,000 people. So, you know, one public company that I worked with not related to my KKR duties,

• 47:58Speaker 08

  but Harley-Davidson, I spent time with the CEO, thinking through how we could implement broad-based employee ownership with their union. We ended up doing it. It took a while and it impacted, again, not minimizing it, but impacted maybe, I think, 4,000 workers, which is great. But if we could get one additional major private equity firm to say, you know what, we're going to do this everywhere, that could be a million people.

• 48:21Manoush Zomorodi?

  I want to just use the last few minutes that we have together to talk about a moment on stage. You played a video, it was a PR video, about some of the employees who've received cash payouts.

• 48:38Speaker 08

  This is what we did.

• 48:39Manoush Zomorodi?

  Every cent that we get back, we earn. You know, employee ownership models that you've brought to them.

• 48:46Speaker 08

  They deserve to be applauded because they earned it.

• 48:49Manoush Zomorodi?

  And you got pretty emotional up there, Pete. You teared up.

• 48:58Speaker 08

  All right. Try and explain that again.

• 49:01Manoush Zomorodi?

  And, you know, we've just talked about strategies and capitalism and turnaround ways of getting companies off the ground, blah, blah, blah. But what you're getting out of this, other than financial gain, it feels like it's really close to your heart.

• 49:18Speaker 08

  Yeah, part of the emotion for me is my dad. You know, my dad was a frontline worker, felt very mistreated. His union was constantly fighting with the company. He operated a road grader for 40-plus years in suburban Chicago and never felt listened to, never felt respected, never felt like he had any stake in the outcome. He used to talk all the time about how, as an hourly employee, you have these really weird incentives, where you don't want to work too hard or be too productive because your hours go down and your paycheck follows.

• 50:01Speaker 08

  And so my dad always dreamt of giving him and his colleagues a chance to build wealth. So, you know, part of the emotional impact for me is thinking about my dad.

• 50:14Speaker 08

  And a lot of times, frontline workers at companies, they have never been recognized ever in their career, like ever. Forget about getting asked for suggestions. They've never been recognized. And so they become an owner in the business and they're moved to tears just upon the grant of the stock. When it works, this is like, this is the most amazing thing that can happen inside of a business, not only for the business, but for the people, for the community.

• 50:47Speaker 08

  We talk so much about inclusive capitalism. It drives me crazy. And this is it. Like, you want inclusive capitalism? Well, then people need to be included in ownership. That's it.

• 50:58Manoush Zomorodi?

  That was Pete Stavros. He's the co-head of Global Private Equity at KKR. He's also the founder and chairman of the nonprofit Ownership Works. You can see his full talk at ted.com. Thank you so much for listening to our show about how teams work. This episode was produced by Katie Monteleone, Matthew Cloutier, Chloe Weiner, and James Delahoussaye. This episode was edited by Sanaz Meshkinpour, Rachel Faulkner White, and me. Our production staff at NPR also includes Fiona Giren and Harsha Nahada. Irene Noguchi is our executive producer. Our audio engineers were Robert Rodriguez and Gilli Moon. Our theme music was written by Ramtin Arablouei.

• 51:43Manoush Zomorodi?

  Our partners at TED are Chris Anderson, Roxane Highlash, Alejandra Salazar, and Daniela Balarezzo. I'm Manoush Zamirodi, and you've been listening to the TED Radio Hour from NPR. Stay tuned for the following announcements and messages from our sponsors.