Why She Took the Hardest CEO Job in America | PG&E's Patti Poppe

We were losing a coworker about every 90 to 100 days on the job.

No, I was confident. Don't go silent on people. You have to tell them what you're doing and you have to tell them the truth.

Yeah, on the second fatality and then the third and the fourth. Like what in the world?

Thank you, Connor. So good to be with you.

Me, too.

Well, I think I loved learning new things. I thought TV news broadcasters were, you know, cool and fantastic and they were always right where the action was happening. So, I thought that would be fun, but my father thought that was a terrible idea. And he said, 'You're never going to make any money.' I don't know if he didn't think I was cute enough or what the deal was, but he was sure I would not be successful in that. And I was good at math and science, so why waste that good math science talent? Go be an engineer instead.

I often wish. I think that would be so interesting. I watch them with great admiration and I think, okay, maybe, you know, there's still time, Connor. Who knows?

That's right. Very good.

Live on location from Oakland. That's right. Yeah.

Yeah. Wow. When you say it like that, I question my own judgment. But yeah.

You know, I think a couple things. One, I did have a wonderful experience in Michigan. I mean it was my dad's company where he retired, where I became CEO, a storybook. He lived two doors down. My sister lived next door. You know, like I mean he had been an engineer there and then here his daughter becomes the CEO. We did a commercial. Like it was great. But what I knew was that wonderful feeling because you're right as described. It was a wonderful feeling being at that company at that time. Our people were amazing. Our customers really respected us and I knew what it felt like and I felt so drawn and sad really for the people of PG&E in particular and the customers that we serve that they weren't having that experience and I knew that a utility could be a force for good. I knew that an energy hometown energy company could feel like a hometown energy company and why not PG&E and I just turnarounds are my jam for sure and so steady as she goes probably wasn't my endgame and coming out to PG&E to come and do my part to make it right and make it safe and give people the joy of making a difference that was pretty compelling.

Yeah, that was definitely an option to stay and live, you know, a nice long be one of those, you know, 20-year CEOs at a company that did good all the time. And yet, I felt like I had one more in me. My husband and I would kind of contemplate that and we figured we would know when it came to us. When this call came, it just felt like it needed exactly what I had to offer. And in fact, my husband saw the we saw the job description from the board of directors and I handed it to my husband. I remember I printed it off and I said, 'Well, why don't you read this?' Because I had read it and I knew what it said. And he read it and he looked at me and he said, 'Oh, geez, did they write this for you? Like, is this a custom job description?' And I said, 'I don't think so. I think it's actually what is needed.' And he said, 'Well, you know, I guess we're moving to California.'

Yeah. Which I was surprised. I thought for sure he'd say, 'Uh, no.' But he didn't. He said, 'You know what? I feel like this has got your name all over it. Let's go.' And so I do feel prepared for a time such as this. Like all of the work I had done throughout my career definitely has prepared me to know what to do. I used to wonder how do CEOs know what to do like that's a big you know they have these big jobs and I would look from afar when I was just middle management or whatever and wonder how do they know and I actually knew what to do and I felt pretty settled about that. I could see what needed to be done.

There definitely are times when I think I hope I have what it takes to like take it to the finish line, you know, but we make progress every day and that's what fuels my tank being with my people, watching them work, watching how much they love to serve. And when I say my people, I mean the whole darn team at PG&E. Nobody goes to the utility to find fame and fortune. These are not like people seeking the great, you know, gold rush. These are people who serve their neighbors.

Yeah, I think I learned it early in my career. I had one of the well multiple repeat experiences and I suppose that is what really creates the muscle memory. But the muscle memory I had developed through my career was one being part of a transformation from the junior level when I was an entry level engineer at General Motors. I worked for this amazing plant manager and our plant in Detroit was just doing terrible. It was just a disaster. And he came in in a matter of about two years. Took us from like worst to first. And I saw how much fun that was for us as participants in that turnaround. And I saw the fundamentals of what he did. I thought, 'Oh boy, leaders can have a real impact on the lives of the people that they lead.' And so that was an early lesson that then I replicated myself at different levels of responsibility. And so I have muscle memory about that.

Well, I think part of it depends what's the state of the team that you're inheriting. Like if it's a successful team, it would be a different playbook. A successful team you're trying to take to the next level. It's a different playbook than a team who's on their knees. And so I would say for the PG&E experience, it was definitely a team on our knees. You know, we were definitely at a low point. And so at that time, and one of the things that was particularly challenging at PG&E, the leadership team was gone. And so when I was hired as CEO, the entire executive team was vacant. But for the general counsel, thank God, we had to hire a whole new leadership team, which actually was a blessing. And we had amazing people who signed up for the challenge, who like me had had long successful careers, who understood what a great utility looked like, knew what leadership was really required, up for the last challenge. So they came. So hiring the right team is obviously a key part of the success.

I agree. I definitely had to recruit but the people who I recruited actually didn't need recruiting. They wanted to be part of something special. They wanted to be part of this turnaround. The whole industry was watching PG&E. We have a big industry that the benefit is we learn from each other a lot. We're not in competition for customers. We're in competition for capital, but we're not in competition for customers. So, we really know who's who and what's what. And so I could call on a handful of really known and experienced leaders and I just said, 'Hey, you know, you got one more in you just like I do. Let's go out there. Let's do our part for the industry. Let's do our part for the company, for our potential co-workers. Let's go do something really good for our world.'

Yeah. And people really got that. The people who were compelled, some people were like, 'Oh, this would be a great stepping stone.' I would just be like, 'Thanks. Bye.' Click. Like I don't need stepping stone people. I need people who are here to serve.

I need boulder people like the people and people who want to do this for the sake of it not for the sake of what other thing they could do. Like people who are all in for PG&E so we got a great management team who came and then I found some great leaders within the company who have stayed. They're just terrific leaders. And so we formed a great team. So number one, form a great team, but then two for PG&E, we needed a game plan and we knew that really having an operating system and I would say this was fundamental to PG&E and would be fundamental other places. We use a lean operating system that has a handful of specific what we call plays that we could teach everyone to get everyone playing out of the same playbook. Any just think of sports, it's a good analogy. You know, you have a football team, they have a playbook and that playbook is taught to every player and every player understands what their role is. And if a new player comes, they don't say, 'Oh, okay, you can bring your old team's playbook, just play out of that.' No, no, we needed a way. And I would say that was one of the challenges at PG&E. There were a lot of different ways. It's a big company.

Yeah, we have 29,000 coworkers, but we also have 15,000 daily contractors. So I think of it like we have about 40,000 people who are working for customers on behalf of PG&E every day. And those 40,000 people all had their own way. And so getting language that people can understand and defining our purpose. What are we trying to achieve right out of the gate was essential and then communicate, communicate, communicate. So if I think back to the early days, we did a good job establishing our purpose, which was delivering for hometowns, serving our planet, leading with love. That's what we're going to do here. Now, we can have a whole conversation about that. People kind of wondered about that.

Yes. But that was like we just anchored on that and nothing that has not changed. It's been five years. Our purpose is our purpose. It's evergreen. We're working every day to deliver for our hometowns, serve our planet, and lead with love, lead with a heart, show up not as a big corporation, but as human to human and people to people and people for people. And that was very powerful to anchor everyone. And then these basic plays that we could teach everybody from our lean playbook. And then one last ingredient which was something we call breakthrough thinking. That's we learned that from a company called GAP International. Breakthrough thinking is a really powerful way to unleash people's ideas, help them to be free to say the unsayable, to think the unthinkable and to cause a future that is different than the past and not be anchored in only what they've seen but in their biggest dreams make those dreams come true.

Yeah, there are some environmental things that a team can create a breakthrough environment that include things like affinity, purpose, ownership, interdependence, risk and freedom. Those attributes of a breakthrough team create an environment and we measure those. We measure those at our levels of leadership through our directors. We know which teams have high affinity. We know which teams have low affinity. We can see the performance correlation between those teams that have a high breakthrough quotient and those that don't. And it's all about creating a space where people can be their best through leaders. And so that's that combined with our basic like very practical lean operating plays is I think been a really powerful combination to change fundamentally change the culture at PG&E.

I had used those plays or those components of that playbook elsewhere but never with such determination. I would say when I compare and contrast my first CEO job to my second CEO job. My first CEO job, I inherited a very successful team from an incredible predecessor who had had their own turnaround and I was a beneficiary of all the hard work that he had done and I had watched him do his thing and I had been leading operations. So certainly I played a part but to become the CEO of a successful team in fact the board was very clear with me just don't screw it up Patty like that's your job which is only so challenging. Thank you so much. Don't change anything like I'm an agent. But I had my own imprint so we did we changed a little bit but it was a different construct like that was a successful team that I had been a part of that I just continued what we had. At this team I had to bring a mandate, it was a crisis. We did not have time to take a vote and, you know, continue doing what we're doing. We had to like have a way and with limited information, I needed to set direction. And so that playbook was very impactful, you know, starting with that purpose and then our lean plays and the breakthrough thinking. That combination just created some momentum, some consistency, some messaging, like just a way to communicate with each other. Here's what we're trying to achieve and slowly but surely get buy in from across the company. And we were pretty adamant that leaders needed to play the playbook. And if they could not or would not or had their own playbook from their previous team, it wasn't going to work. You got this is we have a way and sure there's probably 20 other ways but this is our way so this is it or you got to go somewhere else and we really have created some serious momentum and the performance is truly remarkable what the team how much the team has changed. One of my I'd say best proof points it's about safety. Safety is everything. A lot of the board was very clear with me at PG&E that this job is about restoring safety to your co-workers and your communities. And when I arrived on the scene, we were losing a coworker about every 90 to 100 days on the job. It was shocking.

Someone would die every 90 to 100 days serving the people of California. And that was not normal.

Industry. No, not normal. I had at my previous company, it had been six years since our last fatality and it was 90 to 100 days. I was observing this like stop the bus what is happening and so our safety grassroots effort which has been extraordinary I'm happy to report we just went 946 days, a 25-year record in co-worker safety and what's important about that is that I don't I can't actually do it for them. Co-workers have to do that like that's the you, first of all, you can't fake those numbers. There's no fudging. You either did or did not have a fatality on the job. That's a very clear-cut data point. And they have to choose. My co-workers have to choose to do it right. They have to choose to do it safely. They have to choose to put the controls in place. They have to choose every single day. They have to choose every single job. And whether that job means just driving to the office, whether that job means going out on a pole in the scariest of conditions, whether that means digging a trench, whether that means operating a power plant or taking a call at a contact center, every job has hazards, some more than others. And those controls are a choice. That's a symptom of culture.

Yeah. On the second fatality and then a third and the fourth like what in the world? We couldn't go fast enough. I'd also say on the community safety and public safety, the Dixie fire that happened six months into my tenure as CEO was pretty shocking. It ended up being the second largest wildfire in terms of land mass in the state's history six months into my tenure. That was a little scary like

Yeah. Literally. And what are we how can we go faster? And it actually led to a very significant breakthrough in our technology that we deploy on our grid. Like all things, you know, out of catastrophe can come inspiration and our team got really inspired around enhanced power line safety settings. It has been a fundamental shift in the safety posture of our system for our communities. And so that the you know, a lot of good is born out of you know the catastrophes, but we're hoping to have less catastrophes. So we're working really hard every day that lives are definitely on the line, Connor. Every day the lives of my co-workers and the lives of the communities. What we do is real deal, real business. It's not, you know, people think, 'Oh, you're profit motivated. Are you out of your mind?' I could go to a lot of industries and have a profit motive. I don't go to the utility because I'm profit motivated. I go to the utility because we bring heat in the cold and light in the dark under the most extreme conditions. And here in California, given the extreme weather, particularly wildfire risk, but also atmospheric rivers and massive snow dumps in the Sierra and the earthquakes and I found out we have volcanoes. Good lord, we have volcanoes here.

We do. We do. Shasta, you know, like look out. We have to be prepared.