Creating Dignity at Work | Bob Chapman

Good to be here. Look forward to dialogue.

I describe myself as a typical business background: accounting degree from Indiana, MBA from Michigan, joined Price Waterhouse and was doing well in public accounting when my dad invited me to join the family business in 1969. So I kind of left the professional world to join a family business which was pretty much a broken 100-year-old company that my dad had invested in. So they made machinery for the bottling industry. So typical business background, running after public accounting for two years, then being a steward of an older family company.

Simon Sinek and I, who is one of our biggest supporters, described leadership and parenting — it's identical. Caring is not being nice, any more than parenting is being nice. Caring is making sure that those people in your span of care have the chance to feel safe, valued, and that they have a future. So I would say to you that caring — and this is what we want for our kids. We want them to be who they're intended to be and appreciated for that. That's what we want for our 12,000 team members, is to see them as somebody's precious child that is in our care and that we allow them to be who they're intended to be through our business organization.

Well, it's not only 12,000 people. It's from China to India to Serbia to France to Japan. So, just from an audience standpoint, what I'm going to talk about is not an American issue. It is a global issue. We have it in America, but we find it's true everywhere. And so what we're really trying to do — I always say a leader's number one responsibility is to give those people in their care a grounded sense of hope for the future. So they can decide to get married, to have children, buy a home, that they can count, trust us, that they have a future with us as long as that works out for us both.

So my primary responsibility is to make sure they have a future. So how do I do that? It's not about — again, it's much bigger than being nice. That's why we use the word care. It's about making sure we have a business model that is going to be robust and give them a sense of safety that we're not going to end up with issues where we have to hurt people to make the numbers work. Like we're seeing a tremendous amount of mass layoffs right now between UPS and Amazon and you know all these companies. And how would you like to be asked to join these legendary companies and then one day someone walks up and says, you know what, even though we invited you into the company, we've told you what a great future you have, we need to improve our earnings and we can do without you. It's devastating for the people impacted. And so my hope is that we never have to do that to somebody. That we design a business model so robust that we don't have to use our people to make numbers. We care for our people to give them a future and they feel safe and valued.

Well, the one that is talked about the most is — so a tiny bit prior to '08-'09, we had developed what we called the Guiding Principles of Leadership, or a constitution of our stewardship of our people. It was kind of an eclectic process, and we just — and so we actually articulated that we measure success by the way we touch the lives of people. That was our overriding statement.

And I had been out — because when we developed that, our Chief People Officer Rhonda Spencer said, you know Bob, a lot of companies have good statements on the wall, they just don't live them. She didn't mean it as a challenge, but I took it as a challenge. And I started flying around the world, sitting down with team members, saying, this is what we believe in. How are we doing? So I had this cadence of talking about our values. And '08 happens — unprecedented in my history.

And I go to my board — so it happened in the September-October time of '08. I go to my board meeting in January and I walk into the boardroom and the first thing my board says to me is, don't you need to lay off people? And I said, why do you say that? And they said, well because everybody — I mean everybody — is laying off people. I said, well we got a pretty good backlog. I checked, you know, right now I think we're okay. And they said, are you sure you're not being an optimist, Bob? And I said, I don't think so.

So maybe six weeks, eight weeks later, I was in Italy visiting our operations in Italy and I got a text that our largest single customer, who had a big order in our backlog that was giving us work, called to say, stop. Stop.

It's one thing to not get a new order. It's one thing to lose the orders that you've gotten. And I sat in my hotel room because prior to embracing our Guiding Principles of Leadership, I would have done what everybody else did. That's what we're trained to do. It's not personal, but Mary, Bill, we're going to have to let you go because our orders have dropped by 30 or 40%. I'm sorry, but we just don't have the work and financially we can't afford you. And I was trained that that's what we do. It's not pleasant, but it's a responsibility to respond to these economic challenges by letting people go.

And I sat in my hotel room thinking about this journey I'd begun of the Guiding Principles of Leadership to care for people. And I said, if we let people go in this crisis, we are going to hurt people. And it caused me to think in a different way for the first time in my life. And I said, what would a caring family do if a member of the family had a crisis? We'd all take a little pain so that nobody had to take a lot of pain. It led me to an idea that I never heard of, never thought of, but it led me to say, what if we all took a month off without pay?

Okay, whenever you want. So there's some value to you when you know — it's when your kids are off school or your parents. And so I text back to the United States. I said, look, I got an idea. By the time I get back to the States, help me understand how we could do it. We're going to ask everybody to take a month off without pay. By the time I landed, they were ready to disseminate this to our global organization.

You can't believe the response. It was unbelievably positive because people had this cloud over them: oh my god, are we going to get let go? And what does it mean? And all of a sudden the sun came out. And the interesting thing — because we had never tried it, never heard of it — the reaction was unbelievable. Some people who had, I'll call it, been around a long time, well off in their life, said to a young person, I know you just had a baby. This job's important to you. You can't really afford to take it. I'll take two of your weeks. Okay. I didn't ask people to do that. Never could. People did that spontaneously.

Okay. And volunteered to take somebody else's time, and morale went up dramatically because we're safe. And the other beauty is — you say, well, how did people feel about losing a month's pay? It's a little bit like contributing to a charity. They didn't feel the company was doing it to us. They were doing it for their friends to keep their jobs. So it was an act of benevolence, of caring for others. It was amazing the way people reacted to that.

And so we got — you know, who knew what the economic crisis — we got through that crisis without letting anybody go. And as normality started to settle in, nine months, twelve months, whatever it was later, our business just almost exploded with demand. Why? Because we had validated our culture. We had kept our talent and we were ready. We didn't have to go hire people and train people. And it was a major statement to our global company that we believe in what we say. We measure success by the way we touch the lives of people.

So it was the first time we had ever done that and the reaction was — I mean Simon Sinek talks about it all over the world because that's the biggest story. Because look at what's happening right now in our country. Mass layoffs. Do you think those people are thinking about the people that they're going to lay off or they're just looking at the severance package that they have to give them by law? Okay. It is really horrible because I guarantee you those boards do not talk about psychological damage and the damage they're doing to these people that they say sorry to. The short-term view is we have this pain right now which is going to be financial pain that we're going to experience because we don't have the demand to support all of these people.

People working — I mean the way they came together because they felt safe.

Okay. And again, I guarantee you in these large, very profitable companies that are laying off tens of thousands of people, it is done for one reason: to give the investors what they want — more profits. Okay. It is not — and there's no human part of that discussion. It's because, you know, we're worried about the share price, our EBIT multiple, what other companies are doing. I guarantee you the reason you see all these companies doing it is because right now you can do it and everybody says, well, everybody's doing that, so good job. And nobody talks about the human impact of doing that. Oh, they'll find another job. We'll pay them six weeks, so they'll be fine. And they'll find another job. There's a good job market. I guarantee you that is not — what I say to you, it is purely a financial decision to improve profitability.

And right now, I'm just looking at one of the — usually, oh, it's because AI, we're going to replace thousands of these jobs with AI. Oh, your public relations people told you to say that because they're all worried about AI. Okay. AI is not — natural attrition would allow you to over time, you know, adjust to AI's contribution. Okay, but we don't teach companies to care about their people. They care about their investors. Shareholder supremacy. And so they're not bad people. They're not taught to care. They're taught to use people to achieve goals.

Some people say, how do you justify this expense of this university where we teach human skills? How do you justify this? And I said, did you just ask me how do I justify caring? I mean seriously, and I look back at him and said, how do you justify not caring when you look at the people that you have the privilege of leading, knowing the psychological damage you're going to do to them? Do you care about those people? Because if you — you wouldn't fire your kids or lay off your kids, but you'll lay off engineers, you know, if you see them as functions.

You treat them as functions. If you see them as somebody's precious child that's in your care for 40 hours a week, it changes everything. I don't need to justify caring. Okay? And I would say to you, have you ever heard a company justify the procedures they go through for safety in terms of safety glasses and hard hats? No. Why? Well, because we don't want injuries. Why don't you want injuries? Because our workers' compensation cost goes up.

I think it is disgusting that somebody would have to justify caring for the people they have the privilege of leading. If you heard the feedback we get, that fills your heart with — oh my god, business could be a powerful force for good in the world if we simply had leaders who cared about the people. These are not bad people. It's a bad system that is totally based upon monetary gains. And we use people. We use people to achieve those gains and we discard them at will when we need to.

Our capitalism system is broken. Our education system does not teach you the responsibility of caring for those people. I thought if I paid you a fair salary with benefits and you joined our company and shared your gifts, that was the exchange. And when I didn't need you anymore, you know, that's just the way life is. And it's a transactional relationship, not a stewardship relationship. Though, as you've heard me say, business could be the most powerful force for good in the world if we had leaders who genuinely knew how to care for the people they had the privilege of leading.

And I see the future as being such that not only can we continue this — not growth but transformation and improving the world, but improving the psyche of the individuals who show up for work. Because in my background, I mentioned to you before we started, I spent a quarter century measuring employee engagement. I know 60% of the workforce absolutely hates what they do. They just dislike it. They dread going to work. They're either disengaged or actively disengaged, strongly disengaged. And that is a huge opportunity. And it's not just in the US, which would affect 100 million people of the 160 million people who are working. It's all around the world.

Your statistics are very much in line with what I hear in my speeches around the world. Because as we began this journey, we got public information, so I've been sharing this. We live in a country where 88% of people in this country feel they work for an organization that does not care about them. 88%.

When you look at people through the lens that I — again, the way I was trained in business, what I experienced in business — I saw people as functions for my success. I needed engineers, accountants, manufacturing team members, sales team members. I needed them for my success. I was a nice guy. We had a nice company. But the day my lens flipped and said, these people aren't functions.

They're somebody's precious child that's been placed in my care for 40 hours a week, and the way I treat them will profoundly affect their health and the way they go home and treat their spouse and their kids. Okay? And we said, how are we going to take our leaders around the world and give them the skills to care? Not the skills to use people to produce results, but the skills to care for people while we're creating results. And so we created our university. So it is a system.

So you're right. The Industrial Revolution, which Raj Sisodia, my co-author, wrote a great deal about in Conscious Capitalism, is credited with improving healthcare, standard of living. Communities were built around factories. That's right. And our universities became skills factories because these great entrepreneurs of the Industrial Revolution said, I need salespeople, I need engineers, I need accountants. As organizations develop, I need these skills and I'll pay them well.

So we thought this is going to create happiness, right? People are going to make money. They're going to live healthier lives. They're going to educate their kids better. They're going to live in nicer homes. And guess where we are today? We have the most prosperous economy in the world. And we have the highest level of depression, anxiety, and suicide we ever had.

Why? We have unprecedented prosperity. Because money does not create happiness. Okay? No way. It may give you a healthcare system to deal with your issues, but it doesn't create a sense of meaning and purpose. And Tom Friedman said it beautifully in an article in the New York Times a couple years ago. More than a poverty of money, we have a poverty of dignity. When people feel used rather than cared for, there's a sense of humiliation.

And when they feel humiliated, you'll see anger and unrest like you've never seen before. What are we seeing in this prosperous society? Anger and unrest.

And we think it's a cell phone or it's drugs. But if my stat — and again, Raj told me, my co-author, that there's a 20% increase in heart attacks on Monday morning at 5:00 a.m. when people have to go back to work. 65% of people would give up a salary increase if they could fire their boss. 65%. Okay.

One of the things — and this is a revelation in my education. It never occurred to me the way I would run Barry-Wehmiller would affect the people who worked at Barry's personal life. But when we tried to transform managers and leaders and started teaching human skills, 95% of the feedback is how it affected their marriage and their relationship with their kids. It never occurred to me — your personal life is your — I don't have anything to do with the quality of your marriage. The greatest feedback in this journey of the last 22 years as we try to create a caring organization is the impact on their marriage, their health, and their children.

And I'm going to take it a little further because I thought about this the last ten years. We sold my company in 2016 and since then I've thought a lot about what we had done in terms of helping people engage their employees. And it was really to try to benefit the organization, right? Benefit the bottom line, retain employees, help them perform at a higher level. That's what we talked about. But I think we missed this whole other section, which is when an employee goes home engaged knowing that they've done great work, they're a better husband, they're a better wife, mother, sister, community member.

I think if I told you — so and again this is not an American issue. We deal all — and I have these global calls with team members on Zoom, you know, I have 20, 30, 40, 50 people on a call and I ask them what is the experience. We had a gentleman from Lucca, Italy the other day talk about what it has meant to his marriage, what it has meant to his relationship with his son. It was — I mean he almost cried.

I'll give another example. We — I was having a listening session up in northern Wisconsin, our big plant, with relatively new team members. And everybody introduced themselves. In the back, a young lady who looked like she's 30 said, Mr. Chapman, I've been here six months. I work in the accounting department. And she said, and I just took your empathetic listening class at our university, the three-day class. And she said, I realized I'm not a good mother to my children. I mean, can you imagine how my heart felt? And the way she said it was so beautiful.

And so I would say to you that in this 22-year journey, the stories I've heard of the impact on people's personal lives, their relationship with their parents, their kids — the healing power that business could be in the world. Where we have people for 40 hours a week and we send them home. If we said our goal is to send our team members home knowing that who they are and what they do matters, so they can be better stewards, they can be healthier and better parents, better family members, community members. So business could be — it is not. It could.

It's just the opposite. Right now we have economic prosperity. We have no human prosperity. We thought if people make money they'll be happy. That's what we thought. They buy cars, they buy homes, but it is horrible what's going on. And these mass destructions, these mass layoffs they're doing right now. I mean, I heard this one company, large public company, that when they decided they needed to do a mass layoff, they basically deactivated people's badges. So when you walk up to the building, that is degrading. I mean, can you imagine treating people like that?