Following is the unofficial transcript of a CNBC interview with Bridgewater Associates Founder & Author Ray Dalio and Former Netflix Inc (NASDAQ:NFLX) Chief Talent Officer & Author Patty McCord at CNBC’s @Work Summit, which took place today, Wednesday, October 13th. Video from the interview will be available at https://www.cnbc.com/work/.
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Interview With Bridgewater Associates Founder Ray Dalio Former Netflix Chief Talent Officer Patty McCord
BECKY QUICK: Good morning Ty and hello everybody, it's great to see you. I am really thrilled to be here with both Ray and Patty this morning because these are two people who have spent an awful lot of time thinking about the future of work and many other things. And Ray, I'm going to start with you because you are somebody who has really applied principles to thinking about the workplace, thinking about how people work together and I'm just wondering what you're feeling at this point. We've been through of 19, 20 months now of this pandemic. It has lasted longer than any of us have thought. What are you thinking just in terms of what the future of the workplace will look like?
RAY DALIO: Well, I think the future of the workplace is going to be characterized by probably two things, customization and technology. I think we're now, we've been given a gift to be able to rethink what we're doing and you can see it in the economic statistics of how people are changing jobs and the workplace so I think that customization when each will be different. Like at Bridgewater, we're intentionally thinking about the time together, when do you have to have in personal time and so when we bring people together it's more purposeful for that kind of experience. And then at the same time, what are the freedoms that you can create of where people can live and so on. I think the whole competition in the job market is going to be around those kinds of things and I think that also with technology that that's going to play an important role. We've learned it, look at what we're doing right now and we're going to have a lot more of that so I think that customization for the individual, for the organization to allow greater differences to exist in a better way and then also the technologies that are going to enable that. I think those will be the big forces in the future and I think they're happening now.
QUICK: Very quickly Ray, does that mean customization and technology, does that mean that we're going to be looking at really highly qualified workers? The workers who are most in demand being the ones who get to customize when they come in and when they don't come in and are we going to be looking at, at a lot more Zoom conferences in the future?
DALIO: Yes, I think that in a tight job market for that type of talent, the ability to offer the flexibility that can work that we never considered before will be an important competitive element, and it will be important element in producing efficiencies because we'll think about that. And yeah so I think the technologies will, will enable that. So I think it's going to be a better job, a better environment and where people will get both the personalization and the ability to be more efficient through the technologies.
QUICK: Patty, best practices is sort of a buzzy catchphrase right now and it's one that people use all the time when they say that organizations should be putting best practices in. How do you feel about best practices and how should it apply here?
PATTY MCCORD: Well, it was great hearing Dr. Gupta talk about best practices in health and I think it's really an appropriate term to use in that particular circumstance. I applaud the death of the term best practices and Ray, I also applaud the death of the term consistency because we started to realize that, that our workers are adults and they come to work with very different circumstances and so I couldn't agree more about, about customization and about creating workplaces that work for getting the work done in the way that the employees want to do it. I think it's giving employees a greater strength and a bigger voice in thinking about how they want to work and how they're going to do their best work. And I think it's going to be different for lots of companies. I get all kinds of, every time I talk to somebody I get the question, you know, who's doing it right and my answer is nobody. We're all just making it up and that’s a wonderful thing.
QUICK: We're making it up but if you're a company leader who's trying to figure out the best way to do it, should you be looking at certain places or should you be talking to your employees? How do you figure out which way to go if I mean, there's so many things everybody's trying to do at one time, trying to figure out a new way to evolve the workplace, it may not be high on the priority list.
MCCORD: Well I think you, your second, your second statement was the better one. First you should be talking to employees. I mean we should be writing down every day, every week what's working and what's not working and looking back at the trends over time. We've learned so much. I mean the downside is it's been 19 months. The upside is it's been enough time for us to really experiment with a lot of different ways to work, to start to figure out what's working for people. And then, you know, compare it to the P&L, right, with what parts of the business are working, where people are producing, what's really happening that's, that is efficient and effective and then dive down into how those people are working and what's working for them.
QUICK: Ray, you're somebody who's always been pretty data driven. How do you kind of put data metrics around this and figure out what you can do what works and what doesn't?
DALIO: Well start, I start with the economic data. Look at the employment report let's say the big picture and it conveys what we know. Dropping out of the workforce, people are dropping out of the workforce, changing the nature of their jobs so that you can see that. You're seeing this adaptation. And then, data is information, is fact. You can gather that data just as we were just discussing the understanding what people think and feel and how they're behaving is all available in data. And so I think the combination of data technology and the personalization will be the, the force. There's so many ways I can go into describing how that data is collected. We have a tool called the Dot Collector which collects all of that data. We have personality profiles, we have communication something that in which there's data every day interacting with the clients, with the people who are working there to find out what they're perceiving, what they're doing and all of that there's a plenty of data around and the combining of the data with the speaking to the clients and the technology is a very powerful force.
QUICK: Ray, you mentioned before that the part of this has to be around, around trust, and, and making sure that employers are kind of taking this from a step back and being able to say even if I don't see you in the office I know that you're getting your work done and so maybe that is enough to keep me going. Is that kind of a new thought process when it comes to the corporate world?
DALIO: Yeah. But nowadays, with, with the element of data, you can measure somebody's productivity. You can, you know, you can see if they're hard at it and they're and they're productive. You don't have to have them in the office and it's not like you're going to have eyeballs on them and saying are you working harder. There are so many tools today that make it very clear how productive people are and it gives them greater freedom to be productive in that way. So, I think the data and the technology enables freedom and, and, and choice. There's more information about everything not less information.
QUICK: And Patty, I know that this, this is an area you've thought a lot about too and you can take the data and you can make sure that people are working but there's also a point where it kind of steps over the line. The Wall Street Journal and other places have reported recently just about how invasive some of those data points can be. It's one thing to be measuring the output, it's another thing to be kind of watching their eyeballs and their keystrokes along every second of the day.
MCCORD: Yeah and I don't think we need to do that and it's interesting hearing Ray talk about it because you know all this information has always been there. But we have this sense that if we don't see people working, then they're not working. And so, what I find really interesting right now is that muscle was always there. We could have always done it differently, we could have always been flexible about how people work and we just chose not to because that's the way we've always done it. So I love that we broke, you know every time I talk, I afterwards people come up and they say, you make a lot of sense, you're so logical, we'd like to do it too but we can't because we're not a tech company. We can't because we're regulated. We can't because we're in Europe and now, boom, you know, 72 hours we all did it differently. So let's use that muscle and realize that we've always been able to do that and if we can do this, imagine what else we can do and more importantly, imagine what else we can do when we don't do the things that took up a lot of time that don't really matter. I mean now is a really good time to clean house, right. If we didn't do it for the last 18 months, it probably wasn't important then.
QUICK: Go ahead Ray.
DALIO: The freedom, the enjoyment, the satisfaction. Netflix and Reed, in what Reed’s book, and you go back I've known Reed for a long time and the notion of what personal freedom can allow in terms of creativity and also having the satisfaction of those employees enjoying their job and allowed to be creative is such an important element. So this is freeing and I want to really congratulate and make the point that Patti was saying, they have been able to do that for a long time and, you know, and we at Bridgewater tried to, have tried to do that that is a power when they love their job and they have the freedom and you give them the freedom, you will get the best employees, the best people who are partners in the organization. Reed, Reed’s book.
QUICK: And Patty, to that point though, this is a tough job market.
MCCORD: But you know, here's how I think about it. I think about it as the job market is a series of problems that need to be solved and so what we, what you want to do is make sure that the people that you're hiring and the people that you're working with are people who are passionate and capable of solving those problems. And so if you focus on the problem set and you give people a lot of freedom to get there, and, you know, you have some timeframes and you have boundaries around it, then people will. I mean I think that's the most important thing that we've learned. You started off talking about trust and that's exactly what we've learned, you know, guess what, if you tell somebody they need to get it done by Friday and why they need to get it done by Friday and what it matters to the business and how it matters to the client or the customer, they'll do it.
DALIO: Well, I would.
MCCORD: I, just people are motivated to do great work and I honestly believe that everybody is motivated to do great work if you give them the freedom to do it.
DALIO: And the only point that I would differ slightly is some people are absolutely great that way and stars and you want to make them happy. And some people aren't and that may not be the right environment, but the stars are like that. So, you're, and it's very easy to know which is which. It's very easy to know which is which. So just keep the stars, give them the freedom and you'll know which is which and that's a good policy, but also it's not everybody really.
MCCORD: Know, you know but—
QUICK: That goes back to customization. Oh, go ahead, Patty.
MCCORD: Yeah well I mean, to the point of customization, I think that we can break down these kind of principles, Ray, to every worker. You know, I, I remodeled my bathroom and my tile guy came in and he said I want to introduce you to Fabio. He will be your, he'll be your craftsman on this project. And I realized that Fabio wanted to make the tile as incredible as he could make it. And so, you know, people at different jobs again about customization have different motivations to get them to do work, right. The other thing I was thinking this morning about the revolt of the essential worker, right, if we're so essential, then we probably should be paid fairly and be able to take care of our families and find a place to live and so how about that, right. The revenge of, the revenge of the waiter, right. So, I think we can apply those principles to every job and I think that there are stars in every role and that by and large people, all people want to be proud of doing a good job.
QUICK: Patty, part of what you're talking about is really treating people like adults.
MCCORD: But they are. I mean we have child labor laws but—
QUICK: But unfortunately, we don't always do that. We don't always treat employees like, oh by the way you're an adult, I'm not your teacher. I'm not your babysitter. And by doing that maybe you get more out of people.
MCCORD: But look at this is our chance, right, we've already broken it, right, we've broken so many, you know, norms that. I hate the idea of the new normal. Isn’t that an oxymoron? I mean it's either new or it's normal, right, so let's not do that, right. Let's not go back and, and I think that's the most important learning from, from this whole crisis experiment whatever we've been going through is that workers are grownups. I mean, look at, one of the things I talk a lot about, Reed and I have talked about is, you know, you're a team, not a family and we certainly see it now when we're living in the world of Zoom. You know, the toddler that walks in looking for the pacifier is your family, right, the person you're on a Zoom call with your teammate so that, that ability to look into people's lives and realize these are adults who have responsibilities outside of work and they're not two different people. You know, there's not work dad and on home dad, right. There's work Mom, wait a minute, maybe work mom doesn't get to be work mom because she has to be home mom. So that idea of integrating people's whole lives in how they're productive at work I think is super healthy.
QUICK: I agree. I am not a work wife to anybody either. Hey, Ray, let me, let me ask you this. We're talking about this and this, you already touched on this at the very top. This is definitely a moment where workers are having a lot more say. That's in part because it's such a tight job market right now. Do you see this kind of ebbing and flowing and once the job market goes down as it inevitably will at some point, there's kind of a regression to the mean or not?
DALIO: No, I think that, I think there are timeless and universal truths. For me, the culture that I wanted was meaningful work and meaningful relationships through radical truthfulness and radical transparency and to build that kind of trust for Patty in Netflix, that's been a timeless and universal truths that she's speaking to. And I think that the success of people is not based on how smart they are or even, you know, how hard they work as much as how adaptable they are. And I think that the adaptability will be brought out, is being brought out to create a much, much better work environment so I don't think we're going to come back to the old world where I think that you're, there's just the realization of these opportunities.
MCCORD: Couldn’t agree more.
QUICK: Patty, you said something a little bit ago and I want to go back to this maybe end on this note because I think it's important. You talked about how, you know, employers everywhere should be rethinking the workplace and maybe getting rid of things that didn't work. We haven't done it in 18 or 19 months, maybe we don't need to. What do you think about all hands on deck meetings?
MCCORD: I think it's a really good time to rethink it. I'll tell you that any company that's global has already been thinking about it anyway. So back to how Ray started the conversation, this is a real opportunity for technology to really help us in using all the tools that we have to communicate to people. I mean we're right here on video right now and so I think that video is an incredible tool and that how we communicate to people consistently can easily be done with video, so I think it's a matter of using, you know, all, all of the, all of the ways that we've experimented with and saying, you know, how do we leverage what we've learned to make a better and more informed workforce going forward.
QUICK: And Ray I'll just give you the last word. In terms of that evolution and adaptability, where do you think we'll be 5, 10 years from now?
DALIO: Oh, I think they’re gonna be a lot, a lot of changes in the world over those five to 10 years. But, you know, history has shown that even in the worst of times, the best of times, whatever, human adaptability and technology that comes from it is the greatest powerful force because just as we've seen in terms of coming up with vaccines and the various adaptability that we’ll face all of those challenges and we'll come to a better work but I think it's going to be a radically different kind of work. What, what is employment, how will technology be replacing people, how will that be dealt with, how will the wealth gap be dealt with. There are many, many things that will affect employment and, and the sharing of opportunities and what those opportunities are going to be, there are going to be many, many changes over the next five years.
QUICK: Ray Dalio, Patty McCord, thank you both for making us think very deeply about what's been happening all around us, maybe being a little bit more purposeful in what we're doing with these changes. Really appreciate your time today. Thank you both.