Institute business and Society Program. It is my great pleasure today to welcome to the screen with me two fellow travelers of the business side a program come longtime friends of her work hoosier deep knowledge i would say about both the forces any ideas that influence business decisionmaking. The business and Society Program as a take a look at rogers book, a couple of for visit to fully engage with, think black hawk, but also to shift the mindset of Business Executives, what you believe to be true and what they design their businesses to achieve. Over these goals are in pursuit of Better Business outcomes. Rogers brandnew just released today book, hank you roger for being part of this writing muste a part of this journey, fits squarely in this domain. The book is called when more is not better overcoming americas obsession with economic efficiency. Both alan and roger are known to many of you. Roger martin is professor and former dean of the school of management at the university of toronto where he started the institute there. He is the author of any number of books. We will put in the chat of bio you can look at to learn more about roger. Finally, alan murray, thank you so much for joining us. Alan is a chief content officer and editor in chief for fortune. His ceo daily call is how i start my day, every day. I would like to turn to have te conversation over to alan. We posted their bios the chat and alan is going to engage the audience in questions, that you can post in the q a box. After where the opportunity to learn more about roger and his recommendations for business. With that, alan, i will turn it over to. Judy, thank you for inviting me to do this. Thank you for all the good things you do at the business and Society Programs. Roger, thank you for letting me be the first interview. I am very excited about that cause i have read the book and had to say based on everything ive ever read or study tour talk to people about in business, its heresy, heresy. Hratic actually. Youre right, your heretic. I want to dive right in with that issue because so many Business Leaders i know of spent the whole lives learning how to increase efficiency of their organizations. Think about the whole sigma discipline. Its all about increasing efficiency in your organization. It would be interesting to see how much Business Schools do that is focus on the issue. You say thats the wrong goal. What is the goal . It is at the wrong goal and it is an obsessive goal when there is a limit to how much more efficiency you should try to wring out of whatever you are doing. That is the fundamental error which is Business Schools, businesses, world economists all said we should worry about efficiency. Adam smith said it way back when. Make factories more efficient my division of labor. Portuguese people should grow wine. Raised ship and make will because will be more efficient if theres a long history o recognizing efficiency is a good thing, but at a certain point and that was around 40, 50 years ago or half a century ago it headed into an excessive level where there was efficiency and the single unitary goal. What happened 40 or 50 years ago to set us on this track . I think to a great extent milton friedman, famous New York Times Magazine Article business is business is business saying business must have a single unitary goal of increasing the value to shareholders, serving shareholders. Also a great scholar sort of double down on that and made a very powerful argument starting in 1976 about Apple Corporation if it didnt have that singular goal, it would know how to make decisions come in to confuse and do that would into being ineffective for the shareholders. That will happen in the 70s and thats a decade i think where ts notion of the should be a singular goal, should be efficiency and that efficiency they believe would make the world a better place. Less expensive products and more value for shareholders and investors, et cetera, et cetera. Th stop thinking about the question of is it just that, or is it a little more complicated picture . That went out the window. It is just that. Its not logic, some history behind that. We see so often so many compelling examples of what a single measurable goal, the effect it can have on people. This is what we are doing. Everybody get behind it. We are going to measure it on a monthly bas and we are going to clock your results. I think it wears them pretty quickly. You can tell my stories about the given project, put a man n the moon, a single goal. But when asked a the question,f you keep doing that and keep doing that and keep doing that and keep doing that, in due course you get to her as a say in the book more is not better. So i think the pursuit of efficiency, that good things for america, for the first 200 years is good for the country. 17761976 i would say it was a net positive. I think its just when you keep doing that often, the world has changed and so that goal is no longer a kind of perfect and you start doing things that are excessive. Give us some examples of what efficicy has led business astray. Well, i think it has led business astray in how much it has ground down the wages of labor to a point where he you have gotmployees in much of retail employees sleepwalk through the stores in the Shopping Experience is a miserable one. That is efficient staffing and Efficient Labor cost. But what is the result . Cosco took a a look at that and said you know what, heres were going to do. Were going to do something different. We are going to pay people way more thaninimum wage. [witnesses were sworn in] acosta make make over 20 bucks an hour, 23 average for folks, and the figure what efficient staffing looks like. If action they will say we will add some. What . What on earth, how can you run an organized, store with that kind of attitude . It just happens to be one of the absolute most beloved most successful, gigantic retail in america by saying yes, we care about efficiency but we care about other things, too. We care about the shopper experience. I dont know if you go to cosco but lots of people go to cosco and they love it. They love the way they tated by the staff for how to make decision. The staff are knowledgele because they going to stay there a long time and they g awesome what youre doing and do it with a certain joy. That is in contrast to if we only worry about efficiency in terms of labor costs, hourly wages, staffing level, you are not going to produce that robust good for the customers. How does your discussion which you write about very compellingly in the book about efficiency, how to set type into this conversation were having these days about stakeholder suppercaseletter, moving away from shareholders and moving towards paying atttion to multiple stakeholders . There is a lot about that than i like. What that is, they move away from saying there is one singular goal, and as long as you do that thing, you are all fine. That is shareholder maximization. The interesting thing that shareholder maximization as a wrote about in previous books is ever since weve had that as aa goal, shareholders have done less well than it did before. Which gets back to a clever guy who like aristotle, long, long time ago said if the person says if they set out to live a good life, to society and their fellow man and woman, they are likely to end up happy. So the pursuit of a given goal, singlemindedly doesnt actually get you that goal. I think theres been a recognition, this pursuit of shareholder value is not terribly effective and its not great for society because the sacrifice in society. I like the notion of moving away from that singular goal to the notion of stakeholders, plural, as more than one so you have to balance them. What i am not so keen on is the lack of leadership that is being shown, including my business roundtables inroviding tools for doing that. This book is an attempt to do that, provide the ways of doing it because my experience is when you dont have the tool, human beings dont have a tool, they just dont do the thing that they might want to do. I want to get back to solutions in in a little bit bi want to understand the problem better before we get there. Interesting you peg the turning point of 40 or 50 years ago. You had the friedman article but which also had was a rising ecosystem of corporate raiders, private equity, shareholder activists, all of whom felt that the people who ran Large Companies use multiple goals as excuses. I didnt agree on shareholder return but i am doing really good over here onhis thing for that thing. Which is an understandable human dynamic that for them forcing discipline around a single metric was a means of accountability, and without they feared you wouldnt have accountability. I agree. That is again where i say there was a values to the push for efficiency. Your life can be made easier by having a singular goal but i would just want anybody to be aware be wary of what you wish for. That is what is happening. You might get things you did not think you would, and one of the things we have gotten, i think quite by accident, i do not think anybody like dr. Evil plant the great massive income inequality with the top 1 doing better than it is evident industry by far. Nobody couldve said hey, we want that. It was the outcome of taking one lever and pulling it superhard. We are going to that efficiency lever and it is spurred in part by corporate raiders saint and let you do that we will come and get you, make people think even though its not true that shareholder value pregnancy was legally your requirement. Primacy we pulled it superhd and get something other than we thought. So give me some other examples of where that went wrong. There are many classic historical examples of where it went right, right . Look at what toyota did for the productivity of the automobile industry. Look at what sam walton did for the efficiency of the retail business. Talk about wages as one example where you feel like this has been taken to an extreme to give us a couple other examples. I would say, i would never use toyota as an example. Tell me why. If theres any company on the face of the planet up in heaven would be clapping for would be toyota because they rest things that are wasteful, that had no meritorious the way it is organized come , the y treats employees, all those things they have an understanding of an ecosystem and its the right amount of slack. I would also say sam walton did as well. In sam waltons era aides were we treated and beloved, and after his passing it just got pushed to such an extent that they are now, lets been, for 100,000 police, thats a lot, 100,000 employees come so theyre turning it back in the right direction, but, i mean, most unfortunately, retail, much of hospitality has pursued efficiency to the point of having workers that turn very quickly, 70 turnover in the hotel business. Annual turnover. If you are served by summit, the average hotel. Onhe way to a 16 month career in that company. Is the problem primarily in the labor market or do you see this and of the parts of other rporate markets as well . Ure. We are pursuing efficiency in capital structures, right . Thats we get like toys r us or i heart radio, perfectly good companie going bankrupt because they were loaded up with all sorts of that because that was a quote efficient capital structure. Covid, right . Weve had efficient amounts of ppe in all hospitals, right, according to all the efficiency folks, and efficient number what is less known, but studies coming out of this now, how tightly nursing staffing, because nursing staffing is the biggest variable cost and hospitals. They kept getting squeezed on to be perfectly efficient, that and purchase a ppe, all of was efficient but it wasnt resilient at all. And i would i dont think david ricardo, he didnt say no to the ever mean that you should open up every economy to everything. He just noted that you should focus your resources on the things you were better at but trade policy has pushed efficiency to an extent that is just not it does matter when we wipe out an industry that economists used to think that, you know, these workers will find the ways to other industries. Now people have shown definitively that no, if there is a huge human toll to some of the trade policies, theoretically it sounds great, but it is not making for a resilient economy at all roger, who significant portion of the book where you attack promoter scores. Scores. I found fascinating. I w in a meeting of ceos of Large Companies, it was an off the record conversation i cant identify them but i dont need to because we are talking about how you create a consumer centric company. Went around the room basically 90 saw the mps score as the main tool for focusing on consumers. Its been adopted by businesses. They see it as a useful tool. Whats so bad . Let me start by saying i put in the same category as edward bending. Hes a great guy, very smart, came up with the whole idea of customer loyal here but it just shows what happens when you take a goal, so the goal is more loyal customers and his work shows keeping existing customers was more effective than losing a bunch of them and having to get new ones. Thats more expensive. The goal is to keep your customers, and that then gets translated into a measure, right, model that says we want to have customer loyalty. The model says heres the things you do to keep your customers and then we will measure it the motor score. What happens over time is something that scholars call that score become seen in the persons might as exactly the same as as a goal. We will have little customers if we have a high nps. Its not true. Its just a measure of that. And then what you get key to understanding things like what if we create incentive programs arent getting a high nps . I tell the story in the book of two of the last three cars i bought, the salesperson at the end of the process told it is going to be getting in nps survey and instructed me to give them tens on everything. All that did was make me feel like i never want to deal with that car company again, and havent actually because it just turned me off so much. The pursuit of nps by providing incentives for people, employees to try and generate high nps had the oosite effect that the model intended. That is a greater danger when you have one goal, thats the wells fargo story. Our one goal and go and desire is close customer relations. More aounts. Gets translated into number of accounts per customer and somebody says okay, i know how to get that up. I will open up accounts for customers. Whats wrong with that . Its wrong when you didnt ask them and he didnt want it and it didnt know about it. That cost billions and billions of dollars and shattered the reputation that are taken 100 years or more to build. Thats the nps kind of story and it happens in the nonbusiness sector, too, with test scores for students. When you have a single goal, life is not that way. One of the things i said everybody is, ask yourself is this how you operate . In your life you would never pick a single goal and exclude all other goals. I dont think so. Not for anything important. Not f anything longterm. Made on the first tee of a golf run you would have the goal of getting in 85 or 90, whatever. You would realize that if that was your only goal for that round and did nothing to do with having a good time with your partners, enjoying wide open outdoors, taking a couple of good shots but thinking hey, i could use some day. You will have aiserable time, right . Its just not the way life works. Life is complex. Its a complex, adaptive system. Its not a simple mechanistic system where you can say theres the lever, i must pull back one lever and everything that will happen on the basis of pulling back one lever. Life doesnt work that way. Why . Why do we think think the compl work that way . Why do we think an economy will work that way . I wish like some of my, summerlike coral icon coral icon were sitting here. Business people not that smart. You cant get to might benefit that smart actually. You can get your mind about the complex ecosystem. Simplification is essential for setting and achieving goals. I think he would and i think to a point he would be right. What happens when you go past a point . Thats basically what im saying is we had definitively, clearly gone past that point where again the idea of if you just take what you said about carl icon, take that as the truth, that is now the truth. And when she simplify and how would we know what simplification . With some metric how simple fight things are. Oh, its having a Small Corporate Office so lets fight it but in the Corporate Office and its that simplification or lets break it into pieces. All of the things can have value but when you take them to the extreme and that the only thing youre thinking about and thats the only thing youre telling your employees, thats what you would get. Lets turn to solutions. What do you do about it . There are things Business Executives, political leaders, educators, citizens can all do. One of the things i would say Business Leaders did is listen dont listen to what you think dennings said, which listen to him say a limitation of slack is not being efficient. Theres a proper amount of slack in system because they are not kind of simple and linear as you think they are. You can say having no excess ppe is a good idea until the nt pandemic comes along. So stop with this elimination of slack and recognize that an amount, a nonzero amount of slack is the right thing to achieve. Second thing i would say is, pick multiple goals. Be Like Southwest Airlines where you say our goal iso be the lowest cost airline and highest Customer Satisfaction and highest Employee Satisfaction and the most Profitable Airline in america. You say youve got to be kidding me. Look at the 50 your track your record of southwest as being all of those things simultaneously. What that will make you do is be more creative. If you are more creative you have a strategy that is harder to replicate. Not a strategy that is date easy to replicate. Outsource everything to china, vietnam, whatever anybody can do that but can you build an airline like southwest . Can you build a hotel chain like four seasons . No, becse its more complicated but that means embracing mtiple measured and not getting into this circulation thing. I would also say its super important for Business Executives to return the back on again at least a half century trend in the world of this is towards reductionism. We have marketing, sales, operations, h. R. , et cetera. Break it down, perfect each one and then add them back up. Thats how all Business Schools are organized. Thats how companies are organized and each of these domain have expertise. The problem is as Peter Drucker before he passed away told me, he said roger, there are no accounting problems, new marketing problems come to finance problems. There are only business problems. Which you have to admit is right. However, the teach businesspeople to identify is this a marketing problem next get out my Marketing Toolbox and treated as a marketing problem. That type of reductionism is creating companies that think they are being efficient but they are being narrowly shortterm efficient and broadly longterm, testily inefficient and ineffective. The last thing i said businesspeople, it is what it is, which is dont believe that seeking a monopoly position is a good thing to accomplish. Most would say no, no, no, thats what i want. Thats exactly what i want. The problem is if you look at the history of monopolies it doesnt indwell. If you look at the companies that have maintained a position in the dow jones 30 for the longest time you will notice the ones that sta around for a while have great competitors and are not monopoly. Why . Its because everybody if theyre going to be good at something you need practice and training. If youre going to be penis jeff to practice and have training and go to competition. A pianist that if your basketball player or a call for you need training from competitive action. If youre a monopoly you dont have any. And so youre just not going to do things that make you better if you are a monopoly. That raises the question of how much of this is different in time frames between shortterm and longterm. There are ls of, i mean, efficiency will fill your pocket in the short term in lots of ways and to cutou in the long term in lots of ways. A monopoly example, the wage example of being among them. What we are talking here the difference between a shortterm focus and a longterm focus . I wouldnt say its all about that but that is a big piece of the puzzle. Again its a mechanistic view. If you break time into tiny chunks and optimized for each hind chill, that not necessarily optimize you for the number of those time periods. Itshe same form of reductionism. What seems fine in the shortterm will end up when you add up a bunch of those the kind of arranges for you in the longer term. That is a piece of the puzzle though i would consider all riants of this idea that we understand the mission was enough to break it into little chunks, and when we add them up they will be all fine. I do not believe it will be all fine when you add them up. We have a lot of questions. Im going to go to t questions in just a minute, but as an educator how do you train a new generation of businesspeople to get their headsround this . What do you have to undo . What you have to do . And height into that how to get the superstructure in place, e metrics you need in order to be successful at managing in the way you are suggesting . Thats an ongoing challenge. To answer the first question, what we need to do to teach business students now is give them tools, practical tools forcing it part of this is a marketing problem and part of it is dont know, a finance problem. How do i take those models and integrate across them ask Business Education has almost completely drop back and punted on that. Basically said thats hard and are not going to d it. They claim to teach general managers. They dont. They for sure do not. I have done it my ente life, try to get that kind of thing instild. Thats the fundameal thing that has to happen. We have to train them to do with clashes between models rather than picking, im going to pick this and call it a marketing problem and apply to the Marketing Tool that i was taught. Ats the notion. On those tools we are just going to have to build a new and better toolbox. How you can think about what you pay, how you train your workforce, how you show your workforce to create jobs, good for society and better for you to make more money, there are things like heres the government structure. What weve got to do is there are lots of environmental footprint measurements kind of entity. What we need to start to do, and i dont know if they will listen, they need to start cobbling together a set of tools so they can say to their ceos if you want to do what we said in our statement, you aually want to live that, heres a set of tools you can deploy to do that. If they dont, there just go to contue to keep doing what youre doing now because those are the tools they learned in business school. Thats how they had to do thing things. On that, if the first set of tools is a reasonable set of metrics, there has been some interesting work done by the big four accounting for 4040 with the World Economic forum under their ivc, International Business council, which just put out aeport last week. Brian moynihan put a lot of into that. Its a step in the right direction . I think so. I have not looked at it but that effort is, if its what you say, it sounds tool based. I am just one practical guide. And unless someone has a tool fr something, they are not going to do it. People did not trade options to do it the theorem. People did not advertise on my into Google Reader of the tool to allow them to figure how many clicks they got for a dollar of content. When you develop a tool people start doing the thing. If you dont have a tool they are just not going to do it. You just want a full toolbox and the equity sitting there with a hammer . Thats right. Right now with anybody send it with a hammer and wondering why things are lurching in o particular direction. Because thats what happens when have one tool. Let me turn to the questions and please put your question into the q a. Click on the q a. One question, i dont have a name with that but what do you say to a ceo who says that growth is their objective and their goal . The title o your book is when more is not better. Is growth a bad objective . Yeah, singular. Lets think about it. Growth with no concern about profitability for example, result in you being bankrupt fairly quickly. Silicon valley is a separate issue. Right. Most of them run out of cash. As a gigantic survivor bias in our minds when it comes to Silicon Valley. As part of like i would say we would like to achieve this much growth and at the same time build more loyal customers with a pduction capacity including our people that will enable us to maintain that over a long period of time. That is a useful set of goals were as growth is not, in my view. Heres a couple questions run the notion of the role that finances flakiness. What role has financials a a st of ecomy had to play in making the problems of the last 50 years . Also related, what role has the Federal Reserve or treasury had to play by reducing Interest Rates and creating bubbles . On the second one, on the fed, i think the fed labors under the delusional misconception of the understand how the Machine Works and they know what levero fall and how much to get the results they want. Its delusional, absolutely and utterly delusional. They may be the smartest people out there, the best economists but nobody knows this thing. I do believe the fed played a significant role in the creation of the financial crisis. Its just a back often realize you dont know, and all you can do is make a little tweak and watch. Dont think you can do it all. In terms of financial position, in my own view i think for much of the 20th century, the part of the 20th century where america really came absolutely to the four as the worlds most most powerful superpower, it had an advantage of the finest Capital Market in the world, depots, brought us come most efficient, most trustworthy. That gave American Companies that huge advantage and thats one of the reasons why there are just more big multinationals that were able to go global. In the last 20 to 30 years, it is turned around, so our financial system, our Capital Markets are a deficit that American Companies have to overcome. The Financial Markets now, Capital Markets now serve traders first. Basically it are set up to serve first the company, so issuers, it was to let them grow second, investors so they could participate in the issuers attempt to grow. And then as an afterthought, traders. Everything about that come they are set up further number one for traders and the other two, who cares . And as you know from covering it in fortune, weve had many Public Companies now, Public Companies are shrinking in numbers. Private companies are growing because they are essentially fling the public Capital Markets which are now making their life miserable. The financial position has slowly but surely kind of made america less and less effective as an economy. Another question here. Do you think ceos can make the right decisions to pursue the right set of goals when theyre mainly focused on the share price of the company and mainly incentivized to be focused on the share price of the company . Basically they have to be insubordinate. There are a bunch of insubordinate ceos out there, thank goodness, but this is te thing people do not understand about these incentives. If you do not try too maximize your incentive, youre being insubordinate. If youre not working it your governance body, the board of directors says heres how were going to in sync you and the number one incentive that outweighs all others is shareprice, because that will give you the biggest payout. You insubordinate if you do not work in the next year to when you get judged on how you did to maximize your shareprice, then the board asks the question, why we you so obsessed about the shortterm shareprice and not building the company . Its like louis in casablanca. Im shocked gambling is going on here. Its like what are you people thinking . Thats the problem. The problem is incentives typically work too well. In this case the subordinates ceo says thats what they told me to do and i will go do it. It turns out there are lots of ways to increase shareprice. The hardest one is to build the business and make it more profitable. Thats the hardest one. The easiest one physical talk up your stock at the right type on wall street. Another easy one is ushaped Financial Accounting practices. They wonder why are we getting shady financial practices taking shortterm, not taking any shortterm investment, cutting our r d, kiting why is our ceo doing that . Wake up. You asked them to do it. Stock compensation is a bad idea. Ive written an entire book about it. It is a fundamentally bad idea. While your topic is a particularly good one for the covid era, when we sing importance of resiliency and the limits of efficiency, the book was put to bed before covid ever hit. You are precedent. I actually think i was precedent but i also start the work in 2013. In 2013 the socialism did not pull at all well. Bernie sanders was not a National Political figure yet, andow both are. What does that tell you . What does the fact that socialism holds well with young people and bernie sent as a powerful force in the Democratic Party . Whats the signal you are getting from tho . The signal is Democratic Capitalism is not considered the absolute de facto standd. Its now considered a choice. Before that it was what we did. And that is because it is fail to deliver . It is failing to deliver what its always delivered and what it needs to deliver, whi is a rising prosperity for most americans. The median family, id use that as a proxy. If the median family is not moving ahead, then the swing voter is a moving ahead smartly and the swing voter is going to say, you know, i dont know about this system. This system isnt delivering for me. They made a vote in 2016 on that. Lots and lots of exit polls asking why did you for trump what did you really think is going to this . I would say no, no, no, no, i i just wanted to blow it up. And what was brexit . Brexit was a blow it up. So i think when you get frustration there is more of a question of what is a fundamental system the Great Depression, globally that happened and during the Great Depression there was a major shift towards socialism, fascism and communism in western europe and in asia, parts of asia. America said were going to stay with Democratic Capitalism. But if you look at the numbers, that median number person did better faster in the Great Depression than they have done since 1976. Thats what i was worried about and to think were getting what you would expect from that. Is capitalism in crisis . Democratic capitalism capitalism is it at all. Chinese capitalism is doing awesome. Totalitarian capitalism is doing just fine. Thirty years ago we did know that was a thing. But it is its doing just fine. Its precious come what i think of, and im being too modest about this, but to me the combination, wonderful combination of democracy and capitalism is precious. Having the majority of people decide in a democracy on how were going to run the company and that way will be mainly by ownership of productive assets in private hands, that combination is wonderful. That combination is getting darn close to crisis point. Question here, roger, and youve already refer to it about a double standard in a setting. The business aggressive applies to keep worker wages at the market while at the same time boards of directors insist their executive be paid above market because they are above average. No, no, no. Boardrooms are all around the coastline of lake will be gone. [laughing] where everybody must be above average. It is a double standard and workers are responding in the way workers to respond. Workers are responding by objection. All the engagement numbers that come out just show deadly low engagement. It is whitecollar and bluecollar. They are saying i am going to invest in other things come in fast in my church activits, invest with my family as opposed to, im going to invest my all in myob. Its a complex system and adaptation of labor that is being treated miserably is to simply not give its all. You can walk into a costco and see what a difference is when they give their all. It is an awesome customer experien. Its fun. Go to the club store. Its fun because they are happy. They want to help you. They care about costco get if you say the white object this kind of stuff on your shelf . Chances are like next week when you come back, theyll talk to her boss and talk to the bosses boss and is on the shelves and youre like how did this happen . Is because everybody listens. Its not nirvana but so i think the double staard has a consequence, and the consequence is being felt in being felt broadly. Globalization of supply chains, in pursuit of efficiency. Was it a mistake . Taking it to the extent it has been taken, absolutely. One simple way is to just take a job that is protected by a set of rules and regulations that were democratically agreed upon in the u. S. For safety and work conditions and the like, and putting them in a jurisdiction where there are lower standards. Ofn dramatically lower standards, and how does that make for a resilient initial economy . So you think those rules and regulations are whats good for the economy, and you say at the same time, but you can opt out of those. Because thats beneficial to you in the short term. Do we believe in that construct or not . We are getting what you would expect. Sort of sprising, surprising thing, all our jobs of the exported. What exactly did you expect . What adaptation did you expect to that . There just isnt a hell of a lot of logic at working it. Think something i a good idea and take it to the ultimate extreme. Yeah, okay. Thinking something is a good at it taking it to its extreme, a question about amazon in the q a. Amazon is on its way to becoming a useful monopoly. Whats the problem . Whats the solution . Is there a problem . I think of amazon as a kind of stock, it took stockett asked, is what were doing truly sustainable or not . I think they could end up being a useful monopoly for a long time. If instead they say because we can get people to work for us at this price, we will do it, and have sort of twotiered workforce where the lucky prograers and the rankandfile live hand to mouth, come look below a living wage, they will slowly but surely create the feats of their own destrtion. I think they have a choice and i dont know how they will make it. What i would say is that i think right now, the walmart ceo, has a huge, huge task, unbeliebly huge task of digging walmart out of, i dont know, 50 years, 25 years years, im not exactly sure, of using the systemic strength of walmart in the pursuit of a single minded goal, and its a fight, its an existential fight. Can you make walmart a place where people enjoy coming to work, to have a fulfilling time and of customers look at them and say, they are having a good time. They are not like shuffling around like zombies because had to work a shift that ended at 1. Because who cares . Who cares about the life . We just care about getting the right number of shifts on the floor. I would say amazon has an opportunity not to put itself in a position to use a, 15 years from now where nothing works at amazon because people dimension has been ignored entirely. That is the kind of resilience and sustainability i would be saying its their priority now. Its easier to do when youre e on top than when youre under siege. Let me ask more broadly, what role do these tech platforms play in this . Theres clearly a different kind of economics at stake that i thought when i taught microeconomics. Theres close to zero marginal costs. There are clear benefits to everyone from getting more people on the platform. How does that affect the dynamic . Its part of what i talk about in the book, the parade of outcome. Here at the tail of the long come you can see in the distance, tale of the distribution. What i would say is that we have to eorce antitrust the way it was designed in the late 1800s, sherman and clayton early 20th century. It is a wellknown fact in Silicon Valley that the tech giants have killed kill zones. Im sure youve heard the term, have identifiable kill zones where they will kill anything that is in that zone near them. Either kill it by buying it for a fortune or grinding it out of business. And that is predatory behavior of the sort we have laws on the books that are not being enforced because theres the efficiency defense now of monopolization. So it doesnt matter come in your view it shouldnt matter that google is more efficient or amazon is more efficient if theyre making it impossible for others to compete within next you have to take action . Doing it in a predatory way. And unless you think sherman and clayton should be abolished, they are still in existence, right . They were put there for a good reason. Its because we want dynamic efficiency, not bad efficiency. So yes, tomorrow it may be more efficient if facebook buys instagram. Its the same programmers and all of that, but 20 years from now is a going to be as much innovation . With a be as much innovation for instagram after it eviscerates snapat under its steel toed boot . Doubt i i just have never seen that. Monopolies exist to serve themselves. Thats what your Cable Provider tells you and your cable goes out. Last question before turning back to judy. This comes from heather wilson. What role should the board play in transforming companies away from efficiencies to a broader set of goals . Make sure you can stay on the goal. And then internally consistent basis for the tradeoff y make otherwise you have a dull boring strategy but those are hard jobs. That would be my advice for great stewardship. Thank you for a great conversation and thanks for taking the time to do this. Now and cspan2s booktv, television for serious readers. Welcome back to our centennial speaker ser