Transcript: Stanley McChrystal and Todd Bradley

July 23, 2013: 6:53 PM ET

Todd Bradley, Executive Vice President, Strategy, HP and retired Gen. Stanley McChrystal joined Fortune's Pattie Sellers at Brainstorm Tech.

Below is an unedited transcript:

PATTIE SELLERS:  Welcome to Lessons in Leadership.  I'm Pattie Sellers.  I am a Senior Editor-at-Large at Fortune, and I have a broader timing job that is all about live media.  So I really feel like this is live media.  And I'm really thrilled to be here.

I actually oversee our most powerful women franchise, a lot of us, Stephanie Mehta and a couple of my other colleagues, Nina Easton, and Leigh Gallagher.  And it's actually nice being up here on stage with two kind of real guys.  It's a little bit of a change for me.  (Laughter.)  It is, and we decided to mix it up.  Adam Lashinsky was going to do this, and I was going to do the other one.  And we decided to get a little creative.

So thanks all for coming.  It's really great to see a full room.  We're going to get to your questions and comments early because we want to make this as much of a conversation as possible.  Keep on eating, and we don't mind the noise.  And feel free to go outside for dessert if you'd like.

MORE from Brainstorm Tech

So I think probably most of you know General Stanley McChrystal.  If you haven't read his book last year, you should.  I have read it.  It's terrific.  And he is a tired four-star general.  Today commander of the McChrystal Group, which he started last fall, and we're going to hear all about that.  He's also, you don't think of him as a corporate guy, but he is also on the board of Navistar International and JetBlue, and a technology unit of Siemens.  He is the former commander of U.S. and International Security Assistance Forces, and he was commanding U.S. troops in Afghanistan, and you kind of grew up in commanding special forces.  And was the developer and the leader of the insurgency strategy in Afghanistan.

Todd Bradley is one of the commanders of Hewlett-Packard.  He just got a new job.  He is now EVP of Strategic Growth Initiatives including HP's efforts in China, no less, and very focused on China, but staying here in California.  He ran the ‑‑ what was it, is it like $65 billion printing and personal systems division of HP, and has been at HP for how many years, Todd?

TODD BRADLEY:  Eight years.

PATTIE SELLERS:  Eight years, and before that has a really impressive resume having run and revived, turned around Palm, and spent some time at FEDEX and GE.  So real business.

I want to start out with Stan because I think to get this conversation going it's important to understand your perspective on how you even make a transition from military leadership to advising business leaders, and how the two worlds relate.

RETIRED GENERAL STANLEY MCCHRYSTAL:  Thanks.  I grew up in the military, my father was a soldier, my father's father was a soldier, my wife's father was a soldier, all my brothers, and what-not.  So we were always on the federal dole.  But also I had no business experience at all.  And, to be honest, if this was a room of just military officers, at some point in the meeting somebody would rap the table and say, "Damn it, business would never do this.  Business is squared away, they would not be as inefficient as we are, and they'd make decisions more rapidly."

And I grew up with just this idea that they were very different, business was full of god-less bastards who were after money, and that the military was altruistic and idealistic, but not very efficient.  Since I've gotten out and I work with businesses, I've found there were huge values in business.  But in every business meeting somebody raps the table, and they look at me and they say, "You'd never be this stupid in the military, would you?"

I usually go, "No, we wouldn't."  But what I found is, every time you start to talk about a different line of business, whether it's government, whether it's foundation, at the end of the day you're dealing with people, and you're trying to get people aligned on a set of values and a set of objectives.  You're trying to get them to work together.

So what we've found is that our ability to relate is much easier than we thought.  We have to learn the nomenclature in each business we work with, and some specifics, but we find ourselves very comfortably dealing with people, because we develop relationships very quickly, but then we also find that their problems are ones in many cases that we've experienced.

PATTIE SELLERS:  So what does the McChrystal Group do, and why is Todd up here with us?

RETIRED GENERAL STANLEY MCCHRYSTAL:  Well, Todd and I are friends.

TODD BRADLEY:  Do you want me to answer that?

PATTIE SELLERS:  You can jump in, Todd.

TODD BRADLEY:  The same answer.

PATTIE SELLERS:  Why don't you say, Todd, what the McChrystal Group does.

TODD BRADLEY:  I think, to add to Stan's comments, we've worked together with the McChrystal Group for about a year.  And what you really see are the commonalities.  First off, if you think about this conference, it's focused on technology, it's focused on lots of entrepreneurs, but really at its root it's all about leading, about leading new businesses, new innovations; about driving both business innovation as well as product innovation.

And like many large companies, as you get large, large organizations maybe even better said than large companies, the ability to keep that middle moving aggressively, making decisions, kind of moving out of the traditional decision-making hierarchy is important, it's enabling.  It enables you to drive and grow, and move exceptionally fast in markets that we're all in that are all evolving quickly.  Some like the PC business, frankly, changing at its foundation.

So when a couple of colleagues introduced me to Stan and some of his team, the natural discussion is what happened in whatever place in the world Stan and his guys were.  But the true value came from the way they deployed tools, tools available broadly, to increase the speed of execution, increase the efficiency of execution.  All key verbs in things we all need to do no matter what size our company is.

So they brought a set of experiences, a set of tools that were completely analogous to many of the challenges we had in what's been a huge technology business that's now changing exceptionally rapidly, almost weekly.  And so that was the benefit.  That was the desire, how do we change this outcome?  You take the proverbial how do you change the tires while the car is moving?

PATTIE SELLERS:  So let's hone in on one example here.  You had a need for more speed.  You had a familiarity with helping to transform the military into a more agile, flexible, organization focused on a very different enemy from the past.  How did that apply?  What did your conversations go like?  And how did you help HP think about this?

RETIRED GENERAL STANLEY MCCHRYSTAL:  Sure.  A little background on how I came to believe that, first off, all of us have been parts of small teams before, whether they're sports teams, or families, or startup companies.  And there's a magic about a small team.  They know what each other thinks.  You can finish each other's sentences.  Things flow.  And you stay aligned because it's very easy to.

Big organizations, whether it's an army, or a government, or a company, have traditionally had trouble because you have to develop layers for control.  You start to have processes ‑‑ read bureaucracy ‑‑ you start to have all the things that make it more difficult to be agile.

Now for most of history that was always the reality, but it didn't matter because mass still triumphed.  Even at this very small organization, be it military or business, they still at the end of the day, they couldn't overtake the behemoth.  That's all changed.  Technology changed in two phases.  It changed in the 19th Century in warfare with railroads, telegraph, repeating rifles, and things like that.  That was the first change.  And it changed the relationship between size a little bit.  The West, for example, most of the West dominated most of the rest of the world, even though they didn't have population advantage.  But it changed dramatically about 15 years ago.

And what happened suddenly is what I call the power of one.  Suddenly technology allowed a single individual, if they carry a backpack weapon, or they're sitting at a computer, they could not only create disproportionate effect, but they could get disproportionate value from that effect by propagating it.

Think of the two Boston marathon bombers.  Two knuckleheads with pressure cookers, now they did a hateful crime, but they petrified America, they caused us to focus on us for days.  And think about that, that's just two people doing that.  So the power in this case is two ones.  And so what happened is suddenly big organizations were vulnerable.  In Iraq what we found is Al Qaeda operated as a very small focused, fast organization and suddenly, although we were good in small teams by counter-terrorist forces, we were a big organization in reality.  So they were faster and more focused.

So you say what do you do?  Now you've got a tip, the small organization has this vastly increased capacity.  Fortunately, at the same time technology enables big organizations to change.  Instead of trying to get big, you know in business how we say if you don't grow you die, what I'd tell you, what we're trying to do now is shrink organizations virtually.  What I mean by shrinking is, shrinking the distance between people.  Shrinking the different perspectives, getting people aligned, we can use technology.  And what we did in the joint special operations command is every day every soldier in the command was on a 90-minute video teleconference and we talked through the whole fight.  Where are we, what are we doing, we were in 27 countries.  And so for 90 minutes we're all getting aligned.  It was the most incredibly efficient use of time we have.

PATTIE SELLERS:  How many people was that?

RETIRED GENERAL STANLEY MCCHRYSTAL:  By 2006 it was thousands, probably 8,000 or 10,000.  I should notice I've got with me a guy who worked with me for many years there and Chris Fussell who left the service not long ago, 15 years as a Seal, the last 10 in Seal Team Six.

PATTIE SELLERS:  And did you lead those 90-minute video ‑‑ like a videoconference?

RETIRED GENERAL STANLEY MCCHRYSTAL:  Pattie, I orchestrated them.  I wouldn't say that I led them, because what I wanted was this conversation across the command.  I wanted the combined wisdom of the organization.  I didn't want it to come to me, the old wise one, to make a decision, because I wasn't that wise.  But, together we were pretty wise.  And as we pass information the right answer tends to come out.

PATTIE SELLERS:  And Todd, how does this relate?

TODD BRADLEY:  I was just going to go there.  I was just going to say, and I think those challenges ‑‑ the military may have a different enemy.  All of us have different competitors every day.  For me we move from Dell and IBM to the Chinese, to the Japanese.  Some nimbler, some working under less and less constrained regulatory environments, different channels, different routes to market, a continual evolution of the competitive landscape and the ability to use ‑‑ not really to use, the ability to increase the speed of execution.  The ability to accelerate the tactics to win competitively is what was so, so critical when you get to a mature market, a market where you have to take share in order to grow, a very, very different dynamic than when you're just riding the ‑‑ when you have the tailwind of establishing a market.

PATTIE SELLERS:  So what, Todd, is there anything that you can cite specifically that you have thought differently about in the last year, or actually done to address that need for speed and a lot of this need for speed seems like it has to do with shortening lines of communication.

TODD BRADLEY:  You know, I don't think about it in terms of shortening lines of communication.  It's more about, I'll use a word empowering, but it's in essence creating the culture where the mid-tier of an organization has the courage to execute, has the courage to go out and win every day.  Frankly, wakes up every morning, the sales rep in Pittsburgh, realizing there's some guy in China trying to take lunch off his table.

PATTIE SELLERS:  So what's the evidence that the mid-tier person in Pittsburgh has more courage to execute than ‑‑

TODD BRADLEY:  Look, I think it's an evolution, right.  It's a continual evolution.

PATTIE SELLERS:  But, I mean what did you do to give that mid-tier person in Pittsburgh the courage to execute?

TODD BRADLEY:  I think it's a whole series of things.  First you have to create the ability to fail without punitive results.  You have to take the risks of what does it take to win.  And frankly, you have to create ‑‑ you have to move out of what Stan referred to of this decision making tree of up to the wise person and down.  And say look make the decision today.  And that's what we've done and you've seen it, frankly, you've seen it in some of the share gains we've had and the ability to continue to drive.

PATTIE SELLERS:  Yes and I mean everybody in this room knows that HP is a company that has had a parade of leaders, a parade of leaders at the top, a lot of CEOs who ‑‑

TODD BRADLEY:  That was politely said.

PATTIE SELLERS:  Hey, I can relate.  I work for Time, Inc.  We've had a parade of leaders, as well.  But, I mean, honestly, I know from ‑‑ and I've been at Time, Inc., for 29 years.  I've been at Fortune for 29 years and the fear of change and the sort of paralysis that can come from not knowing who your leader is, and not knowing what the next CEO will want, in terms of strategy, it's very difficult.

RETIRED GENERAL STANLEY MCCHRYSTAL:  Can I?

TODD BRADLEY:  Let me make a point and I'll flip to you.

RETIRED GENERAL STANLEY MCCHRYSTAL:  Yes.

TODD BRADLEY:  I think as leaders there's the seminal point where you decide to take that responsibility, personally, professionally, culturally, of moving into a leadership position.  I think every step of the way you're challenged and tested.  When I look back at the past eight years at HP we've had a whole host of those tests and challenges.  The spin off, don't spin of the PC business, a complete leadership challenge.  And the ability to communicate broadly, effectively, aggressively, and frankly the willingness to do that is what kind of pulls an organization through that knothole.  The ability to do it broadly with partners, customers, in that case governments, is as paramount as employees.

So I think there's a ‑‑ I think it was either Bill or Dave who created the mantra of management by walking around.  It's a longer walk when you have to do it in 174 countries.  But, that is a very, very true, real concept.  It's a true, real tactic.  I think Stan accomplished it with aggressive use of video conferencing tools, frankly, of social networking tools that we all need to move from just the consumer realm to the business realm.  What are the business applications for a direct video link?  What are the business applications for a Facebook or a Twitter type of application, and they're the kind of things that we looked at.

RETIRED GENERAL STANLEY MCCHRYSTAL:  I think Todd's point that it's leadership at its core needs to be hammered over, and over, because we sometimes talk about centralized or de-centralized.  And at one point by 2006 in Iraq, or actually across, we were in 27 countries, I could sit and in a room I could watch every one of our operations, a feed from a predator, in real-time, and through my laptop computer I could listen to the radio communications down to the individual level on any of the operations.  So I could watch it, I could listen, and I could talk.  I never once talked, because these communications give you the ability to micromanage.  And because people have the ability to reach you the first thing they do is they go, wow, I don't know if the general wants me to make this decision, so the earlier they call you and they check, and they go, sir, do you want to do X.  If you make the decision you made the decision forever.  And what you've got to do is say, I don't know, what do you want to do?  And you have to push that down.

But, at the end of the day the outcome is like the yin and the yang, you're never going to get a lot of military officers using this for the symbol.  It's not centralized, because technology will allow you to shorten communication lines.  You can speed up traditional processes if you want.  But, you're just doing the old thing faster.  And yet complete decentralization, if you decentralize most organizations they're just chaos, because they don't know.  So what you're trying to do is get a melding where you are, decentralizing decision, but you are centralizing shared consciousness.  Everybody gets smart about what the situation is, what you're trying to do, what the challenges are, that sort of thing.  So you're giving everybody contextual understanding and then you're saying now you know as much as I do, make the decision.

PATTIE SELLERS:  That's a really interesting concept.  So decentralized decision-making, but centralized, shared consciousness?

RETIRED GENERAL STANLEY MCCHRYSTAL:  Yes, ma'am.

PATTIE SELLERS:  And you ‑‑ what did you just say, you know as much as ‑‑

RETIRED GENERAL STANLEY MCCHRYSTAL:  The theory is everybody knows everything all the time.  Now you never get there.  But, what I learned as a leader is I had to change.  Instead of being the wise man who sat down this thing, they come up with me for decisions, and I make Solomon-like decisions, instead they would come up with things that I'd say, okay, I called it thinking out loud.  Here's what I heard, here's what I conclude from what I heard, here's what I think we're going to do about it.  And it kind of let everybody in the command hear whether I understood the problem right, and they could correct it right there.  They could hear the logic and then when the orders went out they go, okay, this is what we're trying to do.  Now, if the orders then don't make sense and they've got to adjust, they know what we're trying to do and then they can make orders with confidence.

PATTIE SELLERS:  So when you were watching and listening to those, what was that again, what's the terminology that you used when you were in that like command center?

RETIRED GENERAL STANLEY MCCHRYSTAL:  We called it a situation awareness room and it was the live, full-motion video.  It's just like what you're doing.  It's streaming video from a predator, or a different kind of aircraft.  You can watch each one of your soldiers maneuver.  You see in some cases you have three or four up, watching three or four angles of the same thing.  You can listen to them.  But, here's the deal.  It gives you the illusion of situational awareness.  One of the things I had to understand ‑‑ I had to keep reminding myself is I'm watching, but I'm not on the ground.  I don't feel how cold it is.  I don't feel how tired.  I don't hear the crack of the bullet.  I can't make the commander's decision for him and I don't want to.  What I want to do is try to appreciate his situation so that then we can start to say, what can we do to help, not tell him what to do, but what can we ‑‑

PATTIE SELLERS:  And they knew, all of these soldiers knew, that you could see everything and hear everything.

RETIRED GENERAL STANLEY MCCHRYSTAL:  Yes.

PATTIE SELLERS:  But, you didn't want to speak, because that would just change their mindset.

RETIRED GENERAL STANLEY MCCHRYSTAL:  Well, and it would, as soon as a person from higher reached in suddenly you confuse everybody, who is running the show here.

PATTIE SELLERS:  That's great.

TODD BRADLEY:  Look, I think the inability to micromanage a large organization is the broader point here, whether it's Stan's responsibilities in his former role, or the 50,000 people that work in the printing and personal systems business.  The skill to provide direction, to provide resources, to create, a wise man once said vision without execution is a hallucination.  To be able to provide the vision and strategy, as well as enable the ability to execute is a huge, huge challenge and opportunity and people always say, well, what do you get from a McChrystal group, that same perspective on an organizational challenge, an operational challenge is what we saw and what people like HP, and Seagate, and others have engaged with these guys to work on.

PATTIE SELLERS:  Who has a question?  We have two mike handlers in the room.  Please identify yourself.  There's one back here right now.  Yes, please stand up.

QUESTION:  Hi, it's Michael Schrage.  I'd like to second what you said about General McChrystal's book.  It was an excellent book.

PATTIE SELLERS:  My Share of the Task.

QUESTION:  And the question I'm going to ask actually is to both of you, but it's based on a theme that you really didn't quite develop in your book, which deals with large organizations.  What does leadership mean when there is, shall we say, an ambivalent commitment to effectively prosecuting the mission, the strategy, et cetera.  I think it's fair to say that HP's travails reflect, to be charitable, ambivalence and confusion about commitment, both on the governance level, and the CEO level, once upon a time.  Both in Iraq and Afghanistan, it's fair to say that the perceived level of commitment was mixed.  How can you be an authentic leader with ambivalent support?

TODD BRADLEY:  I'll start.  You're being charitable apparently.  But, look, I think in senior leadership roles in those environments your responsibility is to dilute that ambivalence, to create certainty, to be in front of your people, your customers.  Don't forget, ambivalence is far more ‑‑ has far broader effects than just the X number of people in your organization.  Material effects on customers, material effects on suppliers, frankly, material effects on governments who have made commitments to you in my world.

So your ability to in some ways shelter, in some ways provide the wall between the ambivalence of what's happening above people, which by the way nobody can have an effect on, and focus people on what they can affect.  How do we build great products, provide great service, win in the marketplace is the true leadership challenge and what's enabled us.  The team of people at HP, we built the largest, most profitable PC company in the world and kept it there for eight years through enormous amounts of ambivalence.  I mean my book, if I ever wrote a book it might be a little different than Stan's.

PATTIE SELLERS:  It wouldn't be called My Share of the Task?

TODD BRADLEY:  Could be, my share of the task was pretty big.  But, that title is already taken.  But, I think really that clarity of mission, that clarity of responsibility; shareholders expect that degree of return and execution.  And that's what you have to communicate.

RETIRED GENERAL STANLEY MCCHRYSTAL:  I could not agree more with Todd.  It's your role to try to give as much clarity to your subordinates as possible and to your partners.  Like in Afghanistan the problem was all of our Afghan partners read the same newspapers and so they go, I know, General McChrystal, you're trying hard, et cetera, but it doesn't look like you're going to have the time or support to do what it is you want to do.  And you have to deal with that without being disloyal up the chain, or to anybody else.  At the same time, you've got to try to get the job done.  What I try to do in Afghanistan, because that's really where I faced what you described, I tried to say, okay, I understand the ambivalence, but you have told me to do this.  I know you've got doubts.  I'm going to run as hard as I can to try to get this thing and I'm going to try to convince the team to do it, and I hope the ambivalence will reduce as we make progress.  But, it's not an easy one.

TODD BRADLEY:  The last point I'd make about these types of situations is the opportunity that's created for your competitors to take advantage of that situation astronomic.  I mean my good friend David Roman is here in the room somewhere, who works for one of our larger competitors.  Their opportunity to take advantage of that is astronomic.  I will tell you, we have a competitor now here in the United States who is going through a little bit of their own, what's a good word, turmoil, uncertainty, challenges.  And to have them focused on that versus winning in the marketplace is a huge opportunity.

RETIRED GENERAL STANLEY MCCHRYSTAL:  Can I throw one more, just because it's so powerful?  My Share of the Task comes from the Ranger Creed, and the Ranger Creed has got a line that says, I'll never leave a fallen comrade to fall into the hands of the enemy.  The underpinning of that promise each ranger makes to each other is trust.  Every time a ranger, or it really applies to other units, as well, goes on a target, they know their buddies are going to bring them back.  They may have been wounded or killed, but they know that.  There's absolute belief in that.  When you don't build that kind of shared trust with each other everything gets just really hard.

PATTIE SELLERS:  Fantastic.

Yes.

QUESTION:  Steve Swanson, Mayo Clinic, for General McChrystal.  What's the secret sauce for leadership selection and development in the U.S. military?  So if you had to pick one thing for the selection of the right people, and one thing for the development of them, what would they be?

RETIRED GENERAL STANLEY MCCHRYSTAL:  That's a great question.  And I'm going to talk about elite units, because they have more refined selection processes.  What we did was you start with good candidates from across the force.  Part of it is a test of their values, really trying to make that sort of a crude cut, a test of things like IQ and all, and that sort of a crude cut.

At the end of the day what you're looking for is somebody who won't give up.  You want to give somebody a problem and when they look at the problem, they start with the mindset that says I'm going to solve that problem.  Part of our selection processes, the last part, is this long navigation thing, a week, and you're guaranteed to get lost.  The question is, at some point, it's not a question of whether you're a great land navigator it's a question of how you respond, because people want to see what you're going to do when it gets tough.  I think that's true.  We really want that kind of person not just in that organization, but in most, I think it's true in business, or whatever.

TODD BRADLEY:  I was going to say that.  I don't think it's any ‑‑ the other session taking place right now is exceptionally interesting about the CEO as the chief personnel officer.  And it's a very, very interesting and important concept.  I think there's probably no bigger decision you can make than a hiring decision.

I grew up very early in my career with Fred Smith at Federal Express, before it was a billion dollar business.  And Fred always had a very simple philosophy that he, to this day, leads Federal Express with, and that's people, service, and profit.  So if you take care of, hire, train, motivate people, they will take care of providing your customers with phenomenal service, phenomenal products, who in turn will provide your shareholders with exceptional returns.  And whether it's Federal Express or Hewlett-Packard or General Electric, that same theme is consistently true.

PATTIE SELLERS:  So I'm not sure if the second part of your question was answered, which is about leadership development.  And I'm not sure quite what the question is.  Just repeat that part of it.

QUESTION:  So once you have selected the character and the values and someone who won't give up, what is it that you do to nurture that person's leadership skills so that they can get results at the end?

RETIRED GENERAL STANLEY MCCHRYSTAL:  The military actually does this very well, because most of the military's time is spent in training.  You're only at war episodically.  It involves education.  You've got to have repetitive education at each level because it's got to be refocused for the level they're going.  But that's pretty standard.

The other thing is you've got to put people in challenging jobs where they feel over their head.  You've got to take them out of their comfort zone, even though you've prepared them for one thing, given them all these skills, you've got to put them somewhere and they've got to feel like, oh, my god, I'm trying to tread water and I'm going to go down.  And if they do go down, you've got to ‑‑ unless it's a values thing, you've got to pick them up, shaking them off, and let them move on.

We struggle with that last part of it in the military.  We have trouble with that.  But putting people in that very disorienting position, we all think back to the job that changed us most, and it was the one where you'd go home to your spouse at night and go, holy smoke, I don't think I can do this.

PATTIE SELLERS:  Todd, do you practice what Stan preaches, put people in jobs where they feel over their heads, disoriented, drowning?  (Laughter.)

RETIRED GENERAL STANLEY MCCHRYSTAL:  We don't say that.

TODD BRADLEY:  First, I think career development is a mutual obligation.  As somebody who has run a very, very large organization, we have an obligation to hire and prepare people for increasing roles of responsibility.  We have an obligation to help them be trained, not just academically but in the field.

And at the same time, I think our employees have an obligation to raise their hands and take those tough jobs.  I would much rather have someone who has taken a very difficult assignment and done okay as opposed to somebody who has had the wind at their back for two years and done well.  Give me the guy who has gone to Western China and opened a sales territory, or build a product, as opposed to somebody who hasn't take that leap.  We live in a truly boundary-less world, and you need people that have had those experiences.  Frankly, it's difficult, right.  It's difficult, and I think you have to accept that it's not for everybody.  And that's fine.  That's great.

PATTIE SELLERS:  Yes.

QUESTION:  Todd, you mentioned something earlier ‑‑

PATTIE SELLERS:  Can you identify yourself?

QUESTION:  I'm sorry.  I'm Dan Levin from Box.  You mentioned something earlier that's very near and dear to my heart, which I would paraphrase as, you need to convince people that they're better off doing a lot of stuff and making the occasional mistake than doing a little stuff and being perfect.

So, General McChrystal, my question to you is do you agree?

And, Todd, my question to you is, do you have any wisdom to share for all the leaders in this room about how to create that kind of culture?

RETIRED GENERAL STANLEY MCCHRYSTAL:  I completely agree.  And you've got to understand that most organizations create processes that do the opposite.  They allow people to hide behind process over making decisions, and what-not, and you've got to ferret that out.

TODD BRADLEY:  First, I think there's a degree of intelligent risk-taking that needs to be pervasive, intelligent, calculated risks that are understood.  I think at the same time, the ability to celebrate, not just those wins but celebrate the learning we have from the loss is what's important.  My ability, or anyone's ability, your ability as a senior leader at Box to stand up and say, look, this was a great decision, and this is why it failed, and this is what we learned.  That's a very enabling communiqué.  It's easy to always pump out the "turn the crank of great things."  You guys have a lot of tailwind, a lot of wins.  But what was the loss?  Why did we lose?  What did we learn?

PATTIE SELLERS:  When did you first feel, believe that you became a leader?

TODD BRADLEY:  Me, me or Stan?

Look, first, I think that there are a whole host of things through your career that test your leadership.  As you step up the different levels of an organization, take on new challenges, I think that moment that Stan talked about when you go home and you say, god, what am I going to do?  And then you wake up in the morning and know it.

For me it was when I went to run Palm.  I'm a firm believer that nothing is ever as bad or good as it's presented in the press, despite all your best efforts, Pattie.  Palm was actually a situation that was actually worse than worst.  Through a phenomenal amount of hiring the right people, getting the right structure, getting the right products, understanding the customer, we were able to turn that business around and grow it very aggressively.  And they're kind of lessons I've taken with me for a long time.

You know, I'm a big believer in ‑‑ we'll talk a lot, and everybody I've watched, we talk a lot about we're inspired by product innovation.  We're inspired by phenomenal products that we see here.  I get very inspired by that.  But I also get very inspired by business innovations.  I think of Uber as a business innovator.  I think of Box as a business innovator.  They're changing the way business is done.

RETIRED GENERAL STANLEY MCCHRYSTAL:  I'd break it into two parts.  I started as a leader, like all my peers, where you are a platoon leader, and a company commander.  And you go through a part of your career where, because you're trained well enough, you're just about as good as anybody in your unit.  You might be the best soldier or you may not.  And that's probably true up to about battalion commander, about five-six hundred guys.

Once you get to the next level, guess what, you're not anymore.  You now have a breadth of capabilities with specialties you don't understand, and you're never going to understand.  And the higher you get, the more that comes.  So people would come in to brief you, and as I got more senior I suddenly realized someone is briefing me on something that technologically I don't get.  I don't know the people very well, because it's a big diverse organization.  And so I learned that I try to look in their eyes and decide on them, and I would start making a big bet on how confident did they seem, how credible did they seem, and what people say.

And so I think that's a different level of leadership, and you're suddenly taking responsibility for things that are on trust, and you can't be there on the ground to fix it.  And you're motivating people that don't get to see you very often, and that takes some different skills, because the one time they see you in a year they're going to call home or write home about it.  And if you're a jerk that's what they're going to write home.

And so I suddenly realized that I'm seeing people every day that are only going to ever see me once and, therefore, my leadership had to be slightly different, different than it can be with someone I'm with a lot.

TODD BRADLEY:  The other thing I think I would tell you is while there's always that, I think, seminal moment for everyone, I also think you're continually tested and continually evolve, because we live and work in such a dynamic world.  I thought I was a pretty competent leader right up into the point we announced that we're going to maybe spin off our PC business.  I will tell you that takes a whole different set of leadership skills.  One to lead through that, and then to lead through, well, you know what, just fooling around, we're not.

PATTIE SELLERS:  Yes.

TODD BRADLEY:  So I would tell you those tests are kind of continual and I think you wake up more than once and think about what am I going to do to fix this.

PATTIE SELLERS:  Yes, right here, Amy.  Identify yourself please.

QUESTION:  I'm sorry, Amy Webb, I'm the head of Webb Media Group, we're a digital strategy agency.  So we started out by talking about how much technology has enabled efficiencies and I think it's pretty safe to say that in the past few years technology has presented some equally big leadership challenges, not just in the military and the government, but also in the private sector.  So I'm hoping that you could both look ahead five years, and given what we know about people leaking all kinds of documents, and there being so many ‑‑ the people who are at the sort of top level of command are so far removed from the technology that's being used on the ground, what do you think needs to happen over the next five years in order to make sure that component of leadership is not falling apart?

RETIRED GENERAL STANLEY MCCHRYSTAL:  I'll start.  In 1991 right at the beginning of the Gulf War I was over there and we lost an AC130 gunship with a crew of 13, I think.  And it was shot down and all of them were lost.  And in those days what they'd do in that situation is they'd shut off all communications in the unit so that nobody could call home until they could do official notification of spouses.  And that was to be thoughtful, so somebody didn't see it on TV, or hear it from someone else.

Well, they didn't close it well enough and a bunch of people called home.  So what happened to some of these surviving spouses is they knew a plane had gone down.  They saw it on the news.  And then they heard from other wives, I got a call from Harry, he's okay, I got a call from Jim, he's okay.  They didn't get a call.  And that was a very cruel way to find out.  So the first attempt was to tighten communications, take away things like that for good reasons, and to prevent.

By the war in Iraq and Afghanistan, after 9/11, that wasn't possible anymore.  That was first tried, but now every soldier has a cell phone.  And they have a computer, no matter where they are and they can communicate.  And they do, they call home every day, or many of them do.  And so what we had to realize was, you don't try to stop it.  You don't try to stop cross communicate even official stuff, passing of intelligence between us and CIA.  What you do is you say, okay, that's a reality.  What we're going to do is we're going to try to make as much value of that reality and, in fact, speed it up.

Now, it brings some challenges.  Increased transparency brings increased transparency.  And if you're an idiot people figure that out quicker.  And if you're ‑‑ I was 90 minutes a day on a video teleconference, it doesn't take them long to figure out whether I am or not.  And so what you're challenged with now is this reality; you shouldn't be doing things that you don't want.  But there are things that are better not out.  The thing I struggle with most is the two factors are the speed at which information moves prevents it from being vetted.  It prevents it from being corrected.  And so a new story goes out, it creates this, or even a tweet or whatever.  People get all a-fluster, and then by the time reality is understood there's a lot of people who have acted, or over reacted.  And we've seen that.  I've lived that.

PATTIE SELLERS:  So I mean I think most ‑‑ I don't mean to interrupt you, but you're leading to another question I had, which is what do you do when you either screw up or you have a major setback and how do you think about leadership then?  I'm just going to interrupt you for a second, but probably most people in this room know that Stan resigned from the Army at the height of his career, because of quotes that were in Rolling Stone Magazine by some of his aids about the Obama administration and talk about communication moving at the speed of light, and not having the ability to do anything about it.

RETIRED GENERAL STANLEY MCCHRYSTAL:  Pattie gave the guts of it.  That was a guy who had been embedded with us on and off, wrote an article, attributed quotes to members of my staff that really made it seem disloyal, or at least not professional.  Six months later, after the IG investigation, they determined that much of what was in that story was not substantiated.  But, you didn't read it on the front page.  So what do you do?  I got woken up at 2:00 in the morning and said, we've got this big problem.  I read this story.  I was completely surprised by the story, starting with the title.  And I was floored.  But, I'd been around long enough to know the import of this and what was going to happen.

So you make some decisions right then, whether the story had been correct or not there wasn't going to be time to really sort that out before decisions would be made.  And so rather than try and do a big investigation and contest it I made the decision right then that I was going to offer my resignation, and the president could take it or not take it and I was going to say I'd do either way.  But, I also made the decision at that point that what I was going to try to do from that moment on, because your life changes, it changes completely, and you think about it, you say, okay, something has come out and suddenly you're on the news every five minutes with people with versions of it, your father is watching it.  Your wife is watching it.  Your son is in college watching it.  And you think about the impact.  And you can't stop that.

And so what I did was I said, well I decided to myself, that that was an inflection point in my life.  And I couldn't change that now.  You can't change the past.  And what I was going to try to do is conduct myself every day for the rest of my life in a way that would cause anybody who saw or dealt with me to say that's not congruent with the tone of that report.  So rather than take on the report directly I decided to take it on indirectly and just try to disprove it by my conduct.

You pay a big price when you do that.  Silence hurts.  When you keep your mouth shut and you don't write about it, you don't talk about it, and every day you want to scream.  You want to scream out every day, a little less every day, but every day you do.  And so most leaders go through something like that and in the future more and more are going to go through that.  And I guess what we've got to do is each of us have got to try to get ourselves as mentally ready as you can.  You can't get yourself completely mentally ready.  But, get yourself ready to what's important to you, what's the core of you, what can't people take away from you, and realize that you can give away, if you give to other people the opportunity to determine your dignity, or your sense of self-worth, if you outsource that to them, they can leave you in a bad place.  So you've got to decide.  I mean that's a little too personal, but it's a fair question.

PATTIE SELLERS:  Thank you for that.

Yes.

QUESTION:  Mehdi Maghsoodnia, CEO of Rafter.  So I've been building teams for 20 years and you mentor people, you nurture them, you make them into leaders, and once in a while they fail.  And it's the hardest thing when someone you have trained to be a leader fails.  And you mentally sort of get to a stage where you think they can scale or they can execute, can you speak to how do you handle that situation?  First like how do you recognize when that moment comes?  And then how do you handle it, especially when the team has a lot of sort of tribal bonding, they're tight?

TODD BRADLEY:  Look, first I think it gets recognized by results.  I think it gets recognized by behaviors.  And I think broadly teams when you're talking about the types of small teams, in some ways know that but can't self-police.  And I think recognition by the individual acceptance by the individual and the handling of that situation is what's most telling about the organization, the humanity of how that's dealt with, assuming this person has been a contributor and to Stan's point, hasn't done something unethical, is what it's about.  And it's, I think, a combination of honesty and integrity and straightforward communication.

RETIRED GENERAL STANLEY MCCHRYSTAL:  I grew up loving baseball and I used to pitch and late in the game the manager comes out to the mound and he asks the pitcher, you know, how do you feel, can you keep pitching?  And you'll always say yes, I think I can, coach, I'm good.  I mean that's the answer I want form the pitcher, whether I'm going to move him out or not, because you want them emotionally.  So leaders don't see it, just like Todd said, they have a difficult time.  And I'm separating people who are unethical.  You just cut them away and don't worry about it.  But, someone who is trying hard and can't do it, the one thing I've found is I was slow to pull the trigger, and I was because I cared about them, I wanted them to succeed, and the problem was everybody below them saw that long before I did.  And they are saying, why doesn't he move them.  So they're thinking either I don't know, or I don't care.

So typically I was late on it, because it's the hardest decision to make, by far.  People say putting people in harm's way.  That's not a hard decision.  You do what you have to do.  Removing, firing somebody when you know how much it's going to hurt is without question to me the most painful thing a leader does.

TODD BRADLEY:  I totally agree.

PATTIE SELLERS:  Have you gotten better at it over the years, both of you?

TODD BRADLEY:  I don't know if you get ‑‑ well, I guess you always get better at it as you evolve, as your skills as a leader improve and mature and grow.  I guess the humanity you bring to those situations improves.

QUESTION:  Do you do more early?

TODD BRADLEY:  Morally?

PATTIE SELLERS:  Earlier than you used to.  Do you wait less?

TODD BRADLEY:  I don't know that you can answer that honestly.  I think every one of these is an individual assessment.  I would like to tell you yes, but I can't honestly say every time yes.

RETIRED GENERAL STANLEY MCCHRYSTAL:  I think about it earlier.

TODD BRADLEY:  I agree with that.

RETIRED GENERAL STANLEY MCCHRYSTAL:  I hope I pull the trigger earlier.

PATTIE SELLERS:  We have time for a couple more questions.  Yes, right here.

QUESTION:  Mike DeFranco, founder and CEO of Lua.  I just want to start by thanking you guys.  It's been a really inspirational panel, especially for a young founder myself.  Books like The Art of War and The Five Rings really inspired me to start my company.  And growing up with Army Rangers as my grandfather and my uncle, I really liked the parallels you make with picking someone.

As I was telling Patricia here actually, I learned how to ski on these mountains.  My first run my grandfather took me up on a double black and said, well, you're going to get down one way or the other.  (Laughter.)

TODD BRADLEY:  Gravity at that point.

QUESTION:  So I had two questions.  My first question was, we're just starting this company up now, as we started looking to the future you begin to predict that at some point an equal competitor is going to approach you and enter the market.  And so as people that have been there before, both in war with evil enemies or with a very similar product entering the market at the same time, what do you tell your team as that moment happens, and if you begin to lose share or battles, how do you inspire people to continue marching forward?

And my second question was just is there a book that you would recommend that inspired you that brought you to where you are today?

RETIRED GENERAL STANLEY MCCHRYSTAL:  That's great.  I'll start on that.  I think it's a terrific question.  I think that you're going to have competition.  One of the challenges we faced in the counter terrorist force is the forces; the individuals and the teams were very, very good.  Our culture was excellence.  And as we started these wars after 9/11, we'd been successful before.  It just kept proving out that we were excellent.  Every time we went on a target, we did well, that sort of thing, et cetera.

The problem is we weren't winning.  And sometimes you can be excellent and you can be misaligned for the challenge that you're facing.  And so people derive their sense of self-worth, at least in our organization, from their excellence.  So what we tried to do, and I tried to do in the force is change that.  I tried to say, it doesn't matter anymore, the only thing that counts for us is winning.  We used to joke, if it's stupid and it works, it ain't stupid.

So let go of ‑‑ sometimes you're asking people to let go of the very thing that has given them their sense of status and self-worth and asking them to operate differently.  I would put operators like Chris, gifted SEAL leader, kicking down doors, and put him in an Embassy somewhere to deal with the Ambassador for six months, which is like purgatory.  And he's thinking, I need to be out ‑‑

PATTIE SELLERS:  You did that?

RETIRED GENERAL STANLEY MCCHRYSTAL:  Yes.  I did it to him.  (Laughter.)

PATTIE SELLERS:  You stuck with him.

RETIRED GENERAL STANLEY MCCHRYSTAL:  But that's where they were most able.  So that was the courage to change what we were doing, and how we were doing it.  But, again, the better the organization is the harder it is.  If everybody is all screwed up, they're willing to change because why not.  But if people are pretty good, and that's what the problem is, if you're successful for a while and then a competitor comes at you, and the first thing you're going to do is you're going to try harder, you're going to pedal faster.  And then you're going to work seven days a week, and you're just going to say if I pedal faster I get in front of him.  Then you realize they're driving a car, and you've got to change.

TODD BRADLEY:  I think you have a very, very unique opportunity.  And I say that because you have the opportunity to build a competitive culture from day one.  You're operating assumption day one should be, this is such a phenomenal business opportunity people are going to come after me with a vengeance.  And I want to build a culture in my company that's about winning.  Winning ethically, morally, within the foundation of what we want to create.

And let's just assume somebody is going to act competitively, act like somebody wants to take your lunch every day.  Do that day one, and when competitors come it's a rallying cry to do better.

I was going to answer the second part of your question.  First I would read Stan's book.

PATTIE SELLERS:  The book, yes.

TODD BRADLEY:  I was fortunate enough kind of early to work with some phenomenal leaders that I've learned from, people like Fred Smith, and Jack Welch, who have written books, but sometimes the reality of working with those guys is different than the printed word.  So very, very strong, if you look at guys like that who have built and led phenomenal companies.  I think there's phenomenal learnings in there.

PATTIE SELLERS:  Stan, is there a book that you've read that helped you think about leadership?

RETIRED GENERAL STANLEY MCCHRYSTAL:  There's an old novel that many Army officers have read called Once an Eagle.  And it's about two leaders in parallel up through a career.  It's a leadership book.  It's about two different styles of leadership, two different sets of values.  And it's a long slog, a lot of sort of historical novel stuff, but it's extraordinary in how it reminds you about values.  And I've re-read it about four times just because it does that.

TODD BRADLEY:  To kind of circle back, I think mentors are as if not more important.  Mentors who can talk.

PATTIE SELLERS:  I'm going to take the last question.  What is the one area that prevents you from being the A-plus complete leader that you would like to be?  And what has a mentor or advisor to you told you to help you improve in that area?

TODD BRADLEY:  So I think the tendency to want to go very, very ‑‑ in large organizations, I have to do this from the context of my world.  We ship twelve things a second.  And the tendency to want to hear that phone call that says this screw is broken in the center of Taiwan and go fix it is a huge thing to stop.  To learn the ability to provide that vision and resources, and frankly protection and enable teams is a ‑‑ I don't know if I would use the word "challenge" but it's certainly something that you have to learn and evolve to as you move into larger organizations.  We all have, as I was accused of by one of Stan's compatriots, if you ask the guy where to park the car, he's going to tell you.

PATTIE SELLERS:  And has any CEO who you have worked for or advisor over the years given you a particular piece of advice in terms of helping you?

TODD BRADLEY:  There's a guy named Mike Neal, who is the Vice Chairman of General Electric, and he took a little copier business and turned it into GE Capital, which is a pretty big deal.  When I first went to work for Mike, and we met, and he's like look this is the way I do this.  I don't work with a lot of staff.  I kind of have the staff that they tell me I have to have.  I don't do a lot of presentations.  I don't want a lot of presentations.  If you have trouble or need anything call me.  If there's anything I can do to help, you call me. Other than that, we hit our numbers.

And there's an empowering piece of that that's, I don't know if the word is refreshing, but it's just like unleashing.  And that's probably mine.

PATTIE SELLERS:  Great, thank you.

TODD BRADLEY:  And by the way, I'll say, I'm going to caveat this before I say this.  Our work with the McChrystal Group is based on results.  I have enormous respect for Stan and his team, but they continue to work with us, because they continue to drive tangible results.  So from a competitive perspective, they're in a competitive market, we're in a competitive market.  So that being said, Stan has given enormous amounts of advice.  You know, when you get into large companies you have lots of people that like to help, lots of people that ‑‑ and Stan has been very, very helpful to me of understanding on not how do you say look, forget Pattie she works in finance, and I'm not going to pay any attention to her, I'm going to do what I want to do, but how to flip that model and make it inclusive, as opposed to alienate, include.  And I think of all the work, fine work that they've done for us in the past year, for me personally that's been my biggest learning.

PATTIE SELLERS:  Stan?

RETIRED GENERAL STANLEY MCCHRYSTAL:  Thanks, Todd.  I think what I'd come down to is discipline.  Most of us know as leaders what we should do.  We may not know the actual answer to a decision, but you know how you should treat people, you know that you should provide good guidance, and yet often I don't.  And I kind of ‑‑ the difference between what I know I should do, or who I should be and who I am, that's what you go to bed every night, you kick yourself a little bit for the things you didn't do, or for me every once in a while I'll speak my mind in a way that I probably shouldn't.  I describe that as giving feedback.  And my wife constantly reminds me that I was not put on this earth to give feedback to everyone.  But, that's the thing.  It's really discipline.

A mentor that's actually helped me, we've got a retired sergeant major who is in our firm, who was a Delta Force sergeant major and he joined us.  And Todd knows him well.  And he pulled me aside several times, but once he pulled me aside recently and he said, listen, sometimes you get in a bad mood, or curt, and I get into the office there and I act that way.  And he goes, you don't understand, that has huge impacts on all the young people.  You think you're causing a little wind to get people motivated and what you're doing is you're causing a hurricane.  You're turning their world upside down.  And you are disheartening them.  And it's really true.  So it's that kind of mentoring that's really helpful for me.  It's sort of constant, hey, pick up your game.

TODD BRADLEY:  I think at the same time to create the environment to enable that is also a huge leadership challenge, whether it's at HP, or your company, or Time, Inc, right.  To create that kind of environment where people feel safe doing that is critical.

PATTIE SELLERS:  That's right.

Thank you, Stan.

Thank you, Todd.

Thank you everyone for coming.  (Applause.)

END

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