This podcast is sponsored by Moments, which allows companies to reward employees who do extraordinary work with trips around the world. At the end of this podcast, you'll get a feeling for what it's like when you get a Moments box. Welcome to Big Questions. This is Cal Fussman. In all my years of interviewing, I can't remember a subject coming in prepared like the guy you're going to see today. He came to pass on wisdom to you, but apparently, to teach me a little about himself. And he did it with the aid of AI, which, as you may know, I've been focusing on, in order to answer the question: how can we get the best out of AI while avoiding the worst?
My guest is Sébastien Page. He is the co-head of global investments and the chief investment officer at T. Rowe Price, which is an investment company that was founded in 1937 and now handles well more than a trillion dollars. A good portion of it is dedicated to giving people a comfortable retirement. And that got me to thinking: how can you be certain about the future when people are wondering about the present? But, as it turns out, for many, many years, the founder of T. Rowe Price is well known for the maxim, "Change is the investor's only certainty."
When you hear about one of the moves Sébastien has made in an important recurring company meeting, you'll get a good glimpse of how he's approaching change in the age of AI. You're also going to be swimming in a fountain of wisdom from his book, The Psychology of Leadership, published a couple years back. This is a great hour, and I hope you'll enjoy it as much as I did.
So, let's get straight to Sébastien Page. I'm so happy to be talking to you, and the virtue of our first conversation gave me an immense amount of thoughts. And it all seems to come down to this quote from Thomas Rowe Price. I think it's an exact quote, but AI has told me that he stood by it: "Change is the investor's only certainty." Does that ring a bell?
It does. And you know, I think it's funny when people talk about change, Cal, because it always sounds relevant in the moment. Take any consultant report. If you're not inspired, you're a consultant, you're writing something, you're going to go, "We live in an era of unprecedented change." It sounds smart. Everybody agrees with it, right? You can write that at any point in time in history. So, that's what T. Rowe Price meant. But also, I do feel with AI that there's something going on that, in my lifetime — and by the way, I'm 49. I grew up without the internet, and then we had the internet — is at least as big as that, if not bigger. I'm wondering, when T. Rowe Price started this company, this is back in like 1937. Did I get that right?
Yeah. We're on the cusp of World War II. It must have been a time where there were jitters and no idea what was going to happen. Is this something that is just hitting every generation in a different way, and we just have to embrace ours?
100%. And to oversimplify, there are two types of leaders. You know, I wrote an entire book on leadership, The Psychology of Leadership, so I'm going to oversimplify. But there are those that anticipate and even create change, and there are those that will react to change, sometimes too late. You want to be in the former category. And that applies to investment management for sure, but it applies to every kind of leadership situation. You know what I did preparing for this, Cal? I read about you. I read about all the interviews you did with so many famous people. I felt quite humbled. I told you that when we were off the air. And the other thing I did to illustrate the kind of change we're going through with AI is, you know, we want to talk about leadership. I looked at — I went into a very powerful version of one of the frontier models, ChatGPT. And I said, "Go to my email, my Outlook." We have the Outlook connected. And I said, "Give me five things I do well as a leader based on my conversation with people, and give me five things I should be doing better." And you know what I did after that? So, this was very illuminating, and it quoted certain emails and said, "You need to do this or that better." You know, one of the things was, "You give direction, but they're not very clear. You don't specify the outcome you want and who's going to own it." Hey, that's super helpful. And it gave me some emails that I could look at to understand why it said that. But you know what I also did? I also asked about you. I went to AI, and I said — I am going to put you on the spot, Cal — I said, "Look at everything that's public about Cal and tell me five things he does well on leadership, but mostly on communication, and five things he could do better."
And you know, it was fascinating. I won't walk people through it if you want to hear more, but the read is very positive, of course, because you have such a warm approach to communication. But it said, "My read is that Cal is a relationship-first, story-driven communicator who leads through curiosity, attention, and persuasion. His public work shows particular strength at drawing people out." So, watch out, Sam, you know, you're going on Cal. He's going to draw you out. He's going to make sure you're authentic in your answers. And first-hand accounts of his mentoring — because there's a lot that's been published about people who have been mentored by you — suggest considerable patience combined with high standards.
You know, I don't think I could have written that better myself. Although, when you get to the downs,
I'd probably say the same thing. Well, there is one thing about taking the scenic route. So, you clearly are a wonderful storyteller. And by the way, I don't want to turn the table for the entire interview, but clearly you're a wonderful storyteller. But it picked up on taking the scenic route — be selective about when you want to tell a long story. Apparently, there's an interview you had where you had to compress an hour-plus presentation into 17 minutes. I don't know if that rings a bell.
Do you know what? It's so interesting you said that. The guy who asked me to do that, his name is Roman Sandler, and he is the CEO of a company that basically brings all the marketers of America and the world together. And I just got an email from him this morning. And so, what happened is, I don't know if you've ever been in these situations. I had given a talk on a cruise ship to a bunch of entrepreneurs, and it was for an hour and 15 minutes. And it went over great. And Roman was in the audience, and he said, "I'd like you to come speak at my organization." And I said, "Great." And he said, "Good, we're going to meet about it." So, we sit down to meet, and he said, "I loved everything you did, except for one thing. I need you to get it down to 17 minutes."
That's hard. That is hard.
It was one of the hardest things I've ever had to do. And you know something? And maybe ChatGPT is correct, especially in these times. It was one of the most important things I've ever done, because it showed me the power of compression. And maybe I still got to work on that, but I'll tell you, when somebody starts telling me a good story, I always do take the scenic route. You hardly ever see me on the highway. So, thank you for that. That's the first time that's ever been done.
I think storytelling is incredibly powerful. And there are books written about how you can use storytelling to be more persuasive, to command the audience's attention. I've worked on this mainly over the last two or three years with the publication of my book, where there's a story or two every chapter, but also in my public presentations. And I've realized, of course, the upside is that you capture people's attention. But there's also another under-appreciated benefit: it's easier to present. It's easier for the presenter. Now, you have to prepare. You don't want to just wing it. But if you're following a story, you feel like you have less to remember, and you relax a little bit, and it just makes it easier for the presenter as well, which I think is fascinating. I'm going to give you just one more.
Oh, oh, I know you want it. Well, it relates to storytelling. And then again, here we're illustrating how AI can be used for self-awareness, right? I can tell you what came up in the analysis of my emails. Yours is more public transcripts of your discussions. I'm going to give it to you because it's very similar to what has surfaced in my own feedback of ChatGPT's analysis of my email, which is to be more concrete in how I give directions, who's responsible, what's the outcome. Often times I'll send a one-line email saying, "John will handle this." You know, well, it should be, "John will handle this by May 30th, coordinating with, you know, Lisa," and so on. So, and yours is kind of related: pare the metaphor, because you're clearly strong with metaphors, with a diagnosis, a vision and an example. And I think where it came from, where AI was scrubbing the internet about you, Cal, was someone said about you, "Cal speaks in code." Banayan, I don't know if that rings a bell. And recalling feedback such as, "This draft is underwater, bring it to the surface." So, we both could presumably — we don't have to agree with all feedback. We take some that we like, some that we don't like. But both of us might be giving directions and feedback in ways that aren't precise enough. Does that resonate?
What's very interesting about that — the example that you cited was a young guy. He was, I guess, about 18. He had just dropped out of USC to do a book about trying to understand success. He wanted to go out in the world and interview people who he thought were the most successful people, and then come back and translate it to his generation. Think about it, he's only 18. And if you tell somebody — I'll give you a comment that came to me from a writer named Harry Crews, who presented a short story to somebody he thought was a great writer when he was young. And he was looking for commentary — basically, he was looking for affirmation.
He was looking for a mentor, and the mentor looked at him and said, "I've got two words of advice for you." And he said, "What is it?" And the guy said, "Burn it."
And so — exactly. I didn't want to ever do that to a young person who is trying to write.
Because — and there's something good to it. It did set a standard, and it did tell you that if you're going to do this, just be prepared for all the obstacles.
At the same time, somebody's 18, they got a lust for adventure, they drop out of school because they feel like there's this book that they want to write that they can't find in the library. Maybe I do use metaphors that make it a little easier to go down the hatch.
Yeah, and that's a good thing. You don't want to destroy their dream. This is another thing about leadership. You're speaking from a position of tremendous authority and credibility. So, whatever you say has much more impact than just a peer or random person or troll on the internet. Thank God the trolls on the internet, we can ignore them because they're pretty brutal. I do live national TV, they cut clips, they put it on YouTube, and people comment about my hair, and it's like, "I can't listen to this guy, the hair's too distracting." And I'm like, "What's wrong with my hair?"
But there's a difference. You know, Larry King used to get his hair done every day. Do you take care of your hair that well?
I mean, I get a haircut, you know, once a month or once every couple months. I do put product on it because I pull it back, so it's not like I don't... I keep it fairly short. I don't think it's crazy hair. People are mostly listening to our discussion right now, so they have to look me up.
Well, it'll be on YouTube, so everybody can look for the... It looks pretty good to me, and from somebody who's bald, well, it looks absolutely great.
Well, you don't have that problem. But circling back, you giving a young writer feedback and using metaphors and being purposefully vague, right? Because you don't want to crush — you don't want to say "burn it", I think, at that point in their experiment. And that's different. Like, and for a leader who's senior in an organization, I've had to learn this: every word you say, every frown can ruin someone's week.
You know? And that's a big responsibility. And people climb up the organization to get promotion, and they don't realize — they think, "Oh, I'm still very buddies with these people," or, you know, "I'm in a rush, I'll just tell them, oh, this sucks." But really what you mean is like, you've done a tremendous amount of work, 90% of it is really good, we just need to fix that. But you're too busy, and you just go like, "Fix that." This happened to me this morning. Someone sent me a 10-page report, and I was looking for something specific. It's clearly a thoughtful analysis, and a tremendous amount of work went into it. A team of people. They crunched a bunch of numbers. They talked to a lot of people. This has been months in the making. But I'm looking for something specific, and I don't see it. So my first draft of my email was, "Where is this? Where is this thing?"
And then before I hit send, because I've learned — before I hit send, I went back to the beginning of the sentence and I wrote, "This is clearly a very thoughtful and comprehensive analysis." And then I wrote, "Where is the thing I'm looking for?" And because, like in my position, in your position, talking to a young writer, you don't even realize it. You don't intend to crush their spirit, to destroy their week, but very easily you can.
And I learned that actually the opposite way, at a point where I was teaching this young guy. He didn't know what he was doing, but he was trying. And at one point, I called him champ. And his whole face lit up. And it's just what you're saying. Look, you've written a whole book about leadership. And you could see what a single word can do to somebody who was not even doing good work at the time.
But it lifted... You know what? Here's an example for you. I wonder what you think about this when it comes to leadership. So, Serena Williams had a coach.
This was early on in her career when she was basically playing at the back of the court. And yeah, obviously she has a lot of strengths and is winning. And her coach says to her, "You know, Serena, I don't understand. Why aren't you going up to the net? Because when you go up to the net, you win like 80% of the points." She said, "Really?" And he said, "Yeah." Now, it wasn't the case at all. It was much lower. But she started to come up to the net. And then, lo and behold, she did start winning 80% of the points. Obviously, it's okay, it worked. But how do you feel about that?
Cal, I love that you bring up the example from sports, because a big part of The Psychology of Leadership, my book, is about sports psychology and how it can apply to business leadership. There's a huge difference between how athletes welcome feedback and how business people welcome feedback. Athletes love it. Business people hate it. I can't really explain why, but that's just the fact. I interviewed an Olympian two weeks ago. She had four Olympics, one gold medal, twice world champion in aerial skiing, where, you know, you jump and you do multiple flips. And she goes, "Okay, when I was" — and she's retired — "when I was an Olympian, my coach would give me feedback every minute of every day, tell me things to fix mostly, and I loved it because I was really competitive." But then she goes, "Now I work in private equity. I don't get feedback for six months. And that doesn't work." And she says, like, "I don't get it. I want to win here, too. Help me win, coach."
So, bringing this sports mindset to the feedback process in business, and especially in money management, but I think in any kind of business, is super important. And I know, Cal, you wanted to talk about AI. I think AI's underappreciated. There are good things, bad things about AI. But one of the things AI can do really well is help you become more self-aware, because what it does is it captures a consensus. That's how the models are built. It predicts the next word and then the next word after that. It has something called attention and transformer. There's a lot of very esoteric technology, but what it does is it's basically the best at extracting consensus from a conversation, from feedback, from my email, from all your public writings where we started. So I think if you're uncomfortable with feedback, you can actually go to AI and give it — in my example, your email or other sources — and work with AI. And now it's very much lower stake. There's much less of the emotion of getting the feedback from a human.
And another thing I explained in the book about neuro leadership. This is a narrow field. Dr. David Rock is the founder of neuro leadership. He figured out a way to reduce the stress associated with feedback giving or receiving by 50%. And he measured stress response. He had people have dialogues, and they were hooked up to monitors. 50% reduction with one small tweak, which was when the receiver asked for the feedback, then the stress went down for the receiver and the giver, because if you go and ask for it, you take control of it.
So merge that with AI when you have full control, and you can ask AI, and then just as a leader, model the principle that you should go around and ask for feedback. If I give a talk, after the talk I'll go to my colleague who was in the room, and I'll say — not really like "what did I mess up," because that's a bit stressful to ask most of the time — I'll just ask, "What should I do different next time? What should I tweak for the next one?" And now you can have your talk transcript, put it in AI and ask AI, "How would you make that talk better?" It's awesome that way.
Yeah, that's Michael Jordan and Kobe Bryant right there.
Yeah. The athletes are phenomenal at embracing feedback.
You know what? As I was listening to this, I was just thinking about tone of voice. We think the words are important in creating a message, but just our carriage, the way we look, the way our voice sounds, can mean so much more than the words.
There are good things and bad things about removing tone of voice. The bad side is that through email, sometimes you interpret an email in a negative way if you're in a negative frame of mind, and it's better to pick up the phone and actually give your reassuring tone of voice. But at the same time, if the manager's nervous giving feedback, or aggressive, or having a bad day, then it's better to have it in writing first so you can read it and digest it. But also it's depersonalized with AI. But Cal, let's push a little bit on this tone of voice thing. My view is that AI is phenomenal at bringing consensus to the table. I had a meeting recently where we had a voice agent in the room.
All right, and you know what? I'm going to ask you to take the scenic route here, okay? Because we talked a little about this earlier, and this fascinated me from the start. So, in order to do that, I'm just going to back it up a little.
Because you pointed out something earlier in the conversation that struck me as something that many people might be scared to do, which is to allow an AI agent to go through their emails. Right. And it's kind of akin to allowing your AI agent to have your credit card, which is a feeling that many of us may know, like the first time we typed our credit card info into Amazon when we didn't really know...
Amazon at that point was just getting started, and what's going to happen? Are there going to be a lot of charges? But you had the courage to allow that agent to just go through all of your emails. Was there any trepidation when you made that decision?
Well, two things. In my personal life, I have a Yahoo email address. By the way, when you say that, you betray your age, Cal. I'm 49. If you're like in your mid-50s, it might even be Hotmail or AOL back then. Yahoo's pretty old school. And you know, I wouldn't hesitate to — these emails have been hacked, you know, already. They're not public, like people can't read your email, but they're in databases, and the security is probably not perfect around it. But I don't have anything in there that... I don't think a person who knows me could go and hack my email, but I don't think that it's fully private from the perspective of the servers and so on. So, I would be okay in my personal email. On the corporate side, I just did that with my corporate email. Now, we're a big company, we have top-notch cybersecurity, we ring-fence the data from the AI, and the data is not used for training. So, I have the confidence that our cybersecurity team has already put fences around whatever we're doing with the tools. There's a certain amount of risk acceptance here, but pretty top-notch cybersecurity team here. But, these things are moving fast, and you got to be mindful of it. But, I think what it comes down to is... and before I get to the voice agent story. Cal, if I go to you, like you're in your office or something, and I knock on the door, and you don't expect me, and I go, "Cal, can I give you some feedback?" How does that feel?
That's right, because if you would have knocked on the door and said, "Cal, I couldn't contain myself. I just listened to your podcast, and I had to tell you," that's very different from "I need to give you some feedback."
It sounds like a premise, a prelude to a pretty tough discussion. My adrenaline, my stress response, if someone does that to me, is very, very high, and it's the lack of control. If you take control of the feedback, use AI or just ask for it, and also build a mindset that, again, to what we said earlier, you take some, you leave some. You take the feedback that's helpful, some that you disagree with, it's okay. Research shows — I talk about this in the book, The Psychology of Leadership — that a very high percentage, as much as 40% of the feedback you receive, reflects the giver's attitudes rather than your own performance.
So, you should take some and leave some.
Well, the reason that I've brought it up is just to note that, in my view, it was a courageous thing to do to allow the AI to just go racing through all those emails and give you the conclusion that you were looking for, but it obviously...
Do you mean courageous in terms of taking the cyber risk, or courageous in terms of, you know, being prepared to read stuff that I don't want to hear?
It's being prepared to face uncertainty.
Because you have confidence in yourself.
And that's the way I saw it. And then, I'm going to allow the scenic route to move forward here. And you know, we call it like the memory palace. It goes back to ancient Greece, where you can, as you're telling a story, imagine that each part of the story is a room in a palace that you're going around. So, you would start with the opening, which I put that door in place when I asked you that question about the courage that I thought was necessary to allow AI into your personal email. But, as you're going to tell the story, you're going to move around room to room in this palace, and we're going to see the evolution of what happened when you took your courage, took that next step, and you brought AI into a pretty important meeting with a select few people who have very high standards.
So, go ahead. The stage is yours. Tell the story.
Okay, coach. Thank you. This is a committee where we make investment decisions, and these are some of the top investors at the firm, and they have strong views. They're highly intelligent, highly driven, motivated, and it can be hard to build consensus. We decided to train an AI as a voice agent that will participate in the meeting as a live participant, keeping track of the conversation, and intervening when it maybe wants to, but for now, when we call on it. And let's call the AI Oliver. Okay, Oliver. So, that's a new member of the committee. Oliver's been trained on the minutes, the transcripts from our prior meetings, has been trained on our proprietary research. It's been trained on whatever's available on the web about investment conditions at that moment. So, it has a vast amount of knowledge, some of it proprietary, some of it public. And again, it compiles the conversation as it goes.
First time I bring the AI into the meeting, it's a disaster. Oliver interrupts. That's kind of a big problem. I start asking Oliver a question, and Oliver starts responding before I'm done, and people are rolling their eyes: "Are we wasting time? This is just a prop. We got big decisions to make." And I ask for the committee's patience. Next meeting.
Well, well, well, well, well, well. Let's linger in that room — the storytelling palace. So, how are you feeling in that moment? Because you've basically set the whole tone by bringing Oliver in. And now you've got some very accomplished people looking at you and saying, "Come on."
How, as a leader, do you respond to this? Because you also know AI is going to be better the next time than it was the last. And so you don't want to just have somebody give it the back of their hand and say, "Forget this. Let's get down to what we really need to do here," and knock it off the table forever. So, how did you prepare everybody and Oliver to move forward?
First of all, I'm embarrassed. But then I cut my losses. I shut Oliver off. I apologize. I say, "This is an experiment. It's going to get better. Stick with me. We'll bring it back the next meeting." And I have people in this room.
Ultimately, they understand failure and trial and error, and they gave me grace. So I get the confidence to keep going despite the temporary embarrassment. And then I have something else to manage, which is I got to go back to the tech team that's developing Oliver and give them feedback. But I need to take a deep breath first and give them feedback. Yeah.
Interesting point. Because now you have to basically train Oliver.
Yes. Not to interrupt, not to talk too fast either.
