‘THE VALUE OF WILLPOWER’

‘THE VALUE OF WILLPOWER’

When it comes to leading disruption in one of the world’s most creative, competitive industries, Walt Disney Company CEO Bob Chapek says he’s still driven by the values and techniques he developed as a long-distance runner in high school. “Never underestimate the power of one person’s will to get something done.”

INTERVIEW BY DON YAEGER

WHAT DO MOST Fortune 500 executives have in common? They learned important lessons on the fields and courts of their high school and collegiate sports teams. In partnership with

Chief Executive, former Sports Illustrated editor Don Yaeger hosts our weekly Corporate

Competitor podcast, diving into the convergence of sports, business and leadership.

A recent episode featured Bob Chapek,

CEO of the Walt Disney Company. Before becoming the seventh CEO in Disney’s nearly 100-year history, Chapek served as chairman of Disney Parks, Experiences and Products. During his tenure, Disney

Parks saw the largest investment and expansion in its 60-year history, including the successful opening of Shanghai Disney

Resort and the near doubling of the Disney

Cruise Line fleet.

Now, as he grapples with the digitization of his industry, powerful new competitors like Netflix and Apple and growing the most storied suite of entertainment brands—from Star Wars to Pixar to ESPN—ever assembled under one roof, Chapek says he leans into his training as a distance runner in high school. That’s where he learned the essential values of preparation, hard work and, above all else, grit. What follows are excerpts from the conversation, edited for length and clarity. (You can listen to the full episode at ChiefExecutive.net/how-to-prepare-likethe-ceo-of-disney.)

You grew up in industrialized Hammond, Indiana, both of your parents worked, and you were responsible each afternoon for getting both schoolwork and chores done, but you still loved sports. How did athletics play a role in young Bob?

I ran track and cross-country in high school. And this was not an idyllic meadow that I was running from. I was going from under the smokestacks of the steel mill to under the smokestacks of an oil refinery, past the soap plant that was belching out stuff that I’m sure they’re not allowed to belch out these days. And to some extent, I think it was really symbolic of my whole life. It was about perseverance.

Where I grew up, not everybody went to college. It was all about metal shop, wood shop, machine shop and getting a job upon graduation and going to work for the union at one of those factories.

But I sort of persevered and wanted more. I wasn’t the greatest runner in the world, but I did what I could. And every time I wanted to stop because I was tired, I kept going, and that did become a bit of a metaphor for me trying to run to some place that I’d feel more comfortable and my trying to break the cycle and be one of the few kids who went on to college and did something different and found something else in the world.

Do you have a lesson that you remember from one of those teams you were on, even in this individual sport, that maybe has impacted you over time?

Well, it’s sort of endemic to any team sport. You’re not I do overprepare for turning a double play. It’s not that everything. It gives me kind of coordinated teamwork, more confidence going but it’s support because after all, into it, but it’s also just someone gets the trophy at the part of who I am.” end of the meet, and it’s who’s got the most team points. Everybody was supportive of each other even though you’re not three guys turning a double play. I found that to be as important as the coordination of a double play. Because for every mile you log in a meet, you’re logging 50 miles in training, right? Especially there in the winter, you know, we didn’t have an indoor track, so if there’s a foot of snow, you ran every day. It didn’t make any difference. You ran every day. It takes some support to log your eighth mile in a foot of snow.

When you were out there running, was there something about what it took for you to not stop in that fifth mile and that internal power, that internal drive that you would use as you would progress in life?

One of the greatest strengths in the world is willpower, individual human willpower. I got a taste of it in those situations, you know, when you’re running for the finish line and there’s someone right next to you and you’re trying to cross first. But it really is, I believe, the greatest power in the world. I’ve seen it through my friends battling illnesses. I’ve seen it through my own family battling challenges. I’ve seen it in my own career. I’ve seen it everywhere, in countless places. Never underestimate the power of one person’s will to get something done.

My first job after grad school was with J. Walter Thompson in their Chicago office. They were an ad agency, and they put all the new hires in a cubicle bullpen, essentially, without the walls. So I guess it wasn’t even a cube, it was just a bunch of desks. It was a place where you would either rise up or you would wash out. That was the first time I realized that not everybody starts at the same starting line but through perseverance, hard work, determination, dedication, willpower, you can even things up pretty quickly.

You’ve said, “Luck is what happens when preparation meets opportunity. To this day, I overprepare for pretty much everything.” You create your own luck by doing the hard work.

I do overprepare for everything. It gives me more confidence going into it, but it’s also just part of who I am.

Can you share an example?

I had a habit that I used to do anytime I had to go from a teleprompter, where even though I had a teleprompter in front of me, I had a copy of my speech folded vertically in half in my jacket pocket, just in case the teleprompter would go out. I did this for decades and never ever needed it, but I kept doing it. I still do it.

As luck would have it, I was in a very large room doing a presentation. As the speakers changed, my speech popped up and then it disappeared. I’m standing in front of 1,000 people and all I’ve got is whatever’s baked into my brain. So I very

calmly dip into my jacket pocket, unfold my speech, and just gave it a little differently than I would have had there been a prompter. It was the preparation to have that speech ready to go just in case, backup plan.

To this day, I prepare for third-derivative questions. In other words, say you prepare for a board meeting. There’s the first question, how’s XYZ doing in China? A follow-up question goes one level deeper and then a follow-up question that goes another level deeper, I call it the third derivative, taking someone’s calculus. The third-derivative question, that’s the level—I’m only satisfied when I’m prepared to that extent.

Do teammates ask you those questions, or are you just breaking them down and asking them yourself? How do you develop that as a core competency, especially when you’re in such a massive organization, where sometimes it’s got to feel like steering the Titanic?

Don’t stop: Chapek, top right, credits cross-country running for instilling him with a lasting perseverance. “Every time I wanted to stop because I was tired, I kept going... it became a bit of a metaphor for me.”

I have, as you might suspect, plenty of support from people who make me look good. But what happens is I have a process I go through one week before whatever event I’m preparing for that I call “pencils down,” then I just internalize. I stop reaching out, I stop diverging, and I started converging. I start doing my third derivatives. Five questions in. I’ll go and make an ad hoc call to find out the answer to my question.

I use a very social process in the weeks leading up to the event, but then the last week is very internal with me just playing devil’s advocate, what would I ask myself? That’s how I’ve been doing it for years.

How do you train yourself to embrace new, cutting-edge things?

I call it being on the front end of the wave, not on the back of the wave. In order to succeed in a very rapidly changing world, you have to be a disruptor. You can’t wait for something to happen to you and be the victim of change. You’re best prepared for it if you’re on the front end of that wave and you are creating the change. Disruption is a core competency, I think, of mine. Not disruption for disruption’s sake, but always thinking what’s next. Like it’s been said, skate to where the puck’s gonna be.

Yeah. It’s curiosity. It’s about curiosity. You know, there’s this whole thing with cryptocurrency, NFTs and blockchain. I’m not gonna kid anybody to say I’m an expert in that. But if you have the curiosity to ask the questions, then you become fluent, at least more fluent in it, and you start the cycle that you catalyze that quest for awareness and knowledge. Then you do the next step, which is assimilation, which is where you see what’s possible and then you apply that with vision in terms of where you think you wanna go.

All of a sudden, curiosity turns into vision. If you don’t know what’s possible, how could you know where you wanna go? So it would be real easy if everything furrows in the world and all you had to deal with is the here and now, but that’s not the case, right? Everything changes, changes real fast, particularly now. It’s really about that curiosity to vision cycle that I think is our job.

One of the things you are looking for in people around you is to keep you curious.

It’s a real enabler to stay current. I mean, it’s real easy for folks who have have been

doing this as long as I’ve been doing it to assume that, “Well, okay, I’m not gonna go through the extra effort to figure out what XYZ is.” It’s easy because you can save a third of your time, but you start dating yourself immediately once you do that. I’m not ready to do that yet.

It’s one thing to connect 20 members of an athletic team, another to do it with 175,000. How do you connect 175,000 people?

I always say there’s only two things you do as a leader, you pick the hill you wanna take, what’s that vision, what’s my goal, and then you lead a whole bunch of people up that hill with you. Those are the only two things we do. At Everything you do, its core it’s very simple, if you you have to repeat it, distill it down. In big orgarepeat it, repeat it, nizations, the toughest thing repeat it, and then act is what we like to refer to as the in accordance.” frozen middle. In other words, it’s easy to promote change or cause disruption, create transformation amongst your direct reports. Then the question is how you create ambassadors out of them. So eventually, within a short period of time, you’ve got a complete transformation throughout the entire company. That middle is where it’s really tough because you’ve got people who are invested in “the old way of doing things” and you’ve got to get them thinking differently, but they feel they’ve already got an investment in the way it was. The middle of the organization is generally always the toughest. So you’ve got to get into the organization, you’ve got to create ambassadors out of all of your directs and all of your support teams, the corporate functions, so that you’re not the only person trying to push this.

We talked about curiosity earlier. Are there other aspects of how you keep the imagination required to lead a place as fantastic as Disney?

Well, there are certain qualities that we look for, and the most important one is integrity. But I also celebrate diversity, diversity of thought, diversity of everything. Because if you’ve got 12 people in a room and they all think the same, you may come to an expedient decision, but you will not necessarily come to the best decision. And in a creative endeavor like we have at Disney, oftentimes that diversity sort of sets itself up as, “I’m a business person” vs. “I’m a creative person,” but everything that we do sort of involves the mixture of the two things. It’s not necessarily fine art, it’s commercial art. So the two blend together.

At the same time, if somebody spends five years animating a movie or creating a movie, they’re pretty invested in that. That teamwork, that ability for the folks who tend to be predominantly left-brained or right-brained or whatever, to work together—that’s always been important, but it’s more important now than ever.

What are the ways you go about finding and making sure that you’re bringing in someone who shares an experience different from yours?

To be that effective leader, you can’t just make a statement that we want to celebrate diversity and end there. So one of the very first things I did in this role was establish our six pillars of diversity, things like representation, transparency, things like accountability, community, different factors that we would use to help define our dimensions of this. And now you’re gonna give people something really tangible.

You give them a way to talk about it, you give them a specific goal, and then you can measure that goal. So it’s really important to sort of define it beyond just a visionary statement, but not go so far that you cut off the creativity.

There’s a term I like to use—strategically consistent and tactically divergent. Everybody should be strategically consistent, but diversity in India might look a lot different than diversity in Chicago or a business initiative

may look different. But everyone needs to know that direct-to-consumer is an important initiative for the Walt Disney Company.

What have you learned about storytelling during your years at Disney?

The most important thing we do at Disney is tell stories, but there are good stories and better stories. And the key is to take what’s a good story and make it a better story. To some extent, that’s letting creative people do what they’re best at, and then gently shaping it to make sure that, from a variety of standpoints, it achieves your commercial goal.

So, you’ve got to give lots of degrees of freedom to the people who are the experts at this and not get in the way of their expression. But at the same time, understand that this is something that needs to work commercially for our shareholders. And you have to make a connection with people.

Oftentimes, that connection is done through music, sometimes it’s done through character, but it really is always done through a story. It is about personal connection. When you make a personal connection, it’s about the network of individual connections that then creates like a matrix with other people in their family unit. Take Frozen, look what something like a song “Let It Go” did. It created a fabric, a matrix, throughout the world of a unified experience, a unified idea, permanently burned into the zeitgeist.

What elements do you believe allow a collection of people to gel and become a team?

Shared values. And this starts in the recruiting process. You have to have shared values. As a matter of fact, sometimes the toughest hires you do to fill a role, it’s people from outside the company, particularly the more senior they are, because they haven’t necessarily grown up with the same shared values if they come from a different company. There’s a direct correlation between the long-term success of somebody with how long they practice their art and function outside the company, because it’s a strong culture and we have a lot of shared values.

I don’t know what the average is, but we have many, many, many people with 20, 25, 30, 35 years at the company. So, we’ve got shared experiences and shared values. That is the essence of what a culture is, that frankly is going to way outdate me. This company is way bigger than me, and I inherited those cultural values from the people who came before me, Bob Iger, Michael Eisner, who all created this entity that is going to outsurvive all of us.

We’ve got to be specific about what it is, again, that you’re trying to build and define. I usually try to keep things to six or fewer items because after that the rope becomes too frayed. Everything you do, you have to repeat it, repeat it, repeat it, repeat it, and then act in accordance with it because it will come off as disingenuous if you say it but you don’t do it. You could talk about accountability all you want, but if it comes time for you to be accountable for something and you do some pointing of the fingers in both directions, then you’re not practicing what you preach.

Is there a habit that you’ve built into your daily routine that you think is elemental to who Bob Chapek is?

I don’t think there’s a habit, but there’s a value, and it’s the value of willpower. I don’t have a secret that I wake up early or I do X, Y, Z before I go to bed. It’s not that. It’s about a value. It’s about something to me that’s much deeper, that perseverance, that willpower, that never say no.

There’s been a bazillion things in my career, in my Disney career, where it could have been very easy to throw in the towel. And, by the way, I’m not saying that you chase things that you believe in that obviously aren’t ready for prime time.

There are millions of things I’ve tried to do that have been before their time. Even with a good idea and vision, you could be before your time and have something fail, even though you know 20 years from now it’ll work. But when you know something’s important, have a dogged determination to get ’er done. CE

Former Sports Illustrated editor Don Yaeger is an 11time New York Times bestselling author. He hosts the Corporate Competitor podcast in partnership with Chief Executive.

Innovating Through Disruption

More than ever, companies are beset by challenges–and surrounded by opportunities. To thrive, companies are going to have to do (even) more with (even) less. In our experience, innovating successfully depends on rapidly determining where to innovate, what solution to focus on, and how to build.

BY RICHARD HALKETT, WORLDWIDE LEAD, DIGITAL INNOVATION AT AMAZON WEB SERVICES

CRISES DRAW US BACK TO WHERE WE ARE COMFORTABLE. Through the recent global crisis, many companies focused on preserving capital and hurrying to protect their core business. At times like these, adjustments can be modest; change is more incremental and plans for broader innovation can be cast aside. But the innovation imperative continues, and those who innovate now will thrive in the recovery. First, let’s take a trip down recent memory lane. During the 2007-2008 global financial crisis, when many were concerned about the future of the travel and hospitality industry, innovations in business models, customer engagement, and technology emerged to create the marketplace we have today. Airbnb launched in August 2008, Uber in March 2009, followed by Square later that year. By 2010, we were able to use our third-generation iPhones to conduct business that was not even possible when the first model was launched three years earlier. But these companies were startups with little at stake and everything to gain. What is an established company to do? According to a Harvard Business Review article titled “Roaring Out of Recession,” only 9% of established companies emerged stronger after the Great Recession while 17% went bankrupt, and the rest performed roughly the same as pre-recession. So what did that 9% do differently? They ‘reduce costs selectively by focusing more on operational efficiency than their rivals do, even as they invest relatively comprehensively in the future by spending on marketing, R&D, and new assets.’ Through the ongoing pandemic, companies are beset by challenges–and surrounded by opportunities, too. To thrive, companies are going to have to do (even) more with (even) less. Amazon’s approach to innovation is one way of tackling the challenge. Our customers often ask us how Amazon innovates, and it’s possible that our approach may contain elements helpful to others. In our experience, innovating successfully depends on rapidly determining where to innovate, what solution to focus on, and how to build. To determine where to innovate–the ‘innovation space’–it is vital to rapidly differentiate between one-way and two-way doors. One-way doors are those decisions that are hard to undo–those impacting life and health, major capital investments, or decisions that could damage customer trust. Even during times of crisis, those decisions should be carefully thought through. By contrast, two-way door decisions are easy to undo and offer great potential for learning–more so by taking action than by further analysis. We encourage leaders to walk through the two-way door and see what may be on the other side. Put more bluntly, if your team is motivated to experiment,

CE

the cost is low and there is the chance to learn–why not give it a try? When you have determined where you’re going to innovate, investing in the right innovations is more important than ever. Moving fast can also mean moving further in the wrong direction if you make an early error. At Amazon, we focus relentlessly on our end customer to guide our innovation. In his 2016 letter to shareholders, Amazon founder and CEO Jeff Bezos said, “Even when they don’t yet know it, customers want something better, and your desire to delight customers will drive you to invent on their behalf.” So–very practically–we ask ourselves some searching questions. First, who is the customer? Not a segment of people or a generic persona that could be anyone’s customer, but who is our customer? Next, what is their most pressing problem or opportunity? Again, we try to be very specific. Given the already-massive challenge of innovating successfully, our chances of solving two or more problems at once is vanishingly small. We choose one and focus on it. At this point we have not–yet–even thought about a solution. We are just understanding, empathizing, considering. Then, given this customer with that problem or opportunity, how can we delight them? We enter a process of iteration. We sketch out a solution and–again being specific–describe what the main benefit or opportunity would be to this customer. Have we delighted them? Perhaps not. Does that mean the solution is not yet right? Probably. Or perhaps we have learned something new about by looking at them and their problem in this way and need to go back to the previous step. As we think deeply and iterate, we should end up with a customer, a problem, and a solution. At Amazon, the next step in our process is to produce a document. First, we write a press release as if the product or service has been launched. This helps frame the issue at hand. We focus on the customer’s need and how we believe this solution will delight them, and not how it keeps us competitive or drives profit. We are careful not to use industry jargon as everyone should be able to understand it. The one-page press release is accompanied by ‘Frequently Asked Questions’ (FAQ), where we list all of the questions a customer or internal stakeholder may have–and then answer them one by one. This sharpens the idea, and saves time because a single document should answer most questions a reader may have. We then add visuals which brings the solution to life showing the desired customer experience and workflow. This document is the PR-FAQ, and underpins every innovation at Amazon. It guides our experimentation–which is what comes next. To experiment quickly you need to defray the costs of innovation. This means making experimentation fast and easy by using tools, automation, and agile development to rapidly build, validate, test, scale, or abandon experiments. It helps a lot when you use cloud services where you pay only for what you use rather than capacity that sits idle. And it also means that once you have a winner, you can scale securely and reliably to all your customers at once–without complicated and costly roll-out plans. With these in place, only one’s pride is at stake when an experiment does not work out. But you can embrace the rich lessons obtained at low cost and apply those lessons as you move on to the next project. There is no surefire way to innovate, but you can improve your chances of success. As Jeff Bezos said in his 2015 letter to shareholders, “Given a 10 percent chance of a 100 times payoff, you should take that bet every time. But you’re still going to be wrong nine times out of 10.” However, taking those bets is crucial because, “Big winners pay for so many experiments.” Looking at the world right now, there has never been a time when this is truer.

For more insights and strategies, visit AWS Executive Insights online.

RICHARD HALKETT Worldwide Director, Digital Innovation at AWS