garry ridge: freedom at work at wd-40
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*This transcript has been edited for ease of reading.
Traci: Hi everyone, great to be with you!
Today we’re exploring freedom at work within publicly-traded companies.
My guest today is Garry Ridge, CEO of the WD-40 Company, the publicly-traded maker of the WD-40 lubricant, you know that can we all have back in our garages?
Since Garry became CEO 21 years ago, sales at WD-40 have quadrupled. Their market cap has increased from $250 million to over $2 billion dollars, and their annual compounded growth rate of total of shareholder return is 13%.
Most importantly, WD-40 is a WorldBlu certified Freedom-Centered Workplace™. They’ve sustained this prestigious certification every year since 2011. Wow!
Garry, dear friend, it’s great to have you with us, thank you for joining us!
Garry: G'day Traci, it's just wonderful to be with you!
Traci: Now Garry, about a year ago, you all opened up a brand new beautiful corporate headquarters right outside of San Diego.
Last fall when I was there, we were walking around, and you were giving a tour to the leaders that we working with, who participated in one of our WorldBlu Academy courses.
And on that tour, even though we have known each other a long time, and worked together for a long time, I had a real aha! moment listening to you talk about why WD-40 calls itself a tribe instead of a team.
So tell our listeners about why WD-40 is a tribe, and not a team.
Garry: Well, everybody wants to belong to something and maybe one of the biggest human desires is to belong.
I know that you and I have both left either an organization or an event or a company or even a relationship because we didn't feel like we belonged.
If you think about Maslow’s hierarchy to self-actualization, the first two rungs of it are survival and security, and most organizations provide that, Traci.
But when it gets to belonging they go naive. Really, it's that belonging that is so important.
Sebastian Junger said in his book, “The earliest and most basic definition of community, of tribe, would be the group of people you both help feed and help defend.” And tribes are enduring over time.
So, when we were thinking about what we wanted to be, what we wanted to belong to, the tribe was very important.
Not only that, but there are attributes we studied of tribal behaviors over thousands of years, particularly with the Australian Aborigines and the Fiji Islanders. And when we looked at those attributes, it was amazing how they had so much business relevance.
The first one is, the number one responsibility of a tribal leader is to be a learner and a teacher.
Traci: I love that, I love that! When you were explaining tribe versus team, I just had such an aha! moment that we have to call ourselves a tribe. So
at WorldBlu now, we call ourselves a “tribe” now instead of a team. And it’s such a different mindset, a different way of showing up, and a different expectation with how we are there for each other and how we’re supporting each other as a tribe versus a team.
Now, WD-40, before you became CEO, wasn't always this way, was it?
What was it like when you first became CEO there at WD-40?
Garry: Well, as I’ve shared often there is no such thing as always or never, and back then, 21 years ago, WD-40 was a great company. It had a culture that was appropriate to its needs at that time.
However, we saw that our opportunity was to grow globally, and to grow globally there were a few things that were obvious.
Firstly, I got really comfortable with the three most important words I have ever learned in my life, ‘I don't know’ and I realized I was “consciously incompetent.”
So how are we going to grow this organization? And the only way we are going to grow it is to grow a culture of freedom, of values, of inclusion. That was that step we took.
I was fortunate enough back then to go back to school. I went to the University of San Diego and I did a Master’s degree in Leadership. That's where I met my now dear friend, Ken Blanchard, and others. They reinforced in me beliefs that I had about what an organization should be.
One of those beliefs really came from a very special book called, All I Really Need to Know I Learned in Kindergarten. If you take the principles of that book, and you apply them in business, they are very similar to the principles that you stand for, and the great work of WorldBlu, then you create a culture that has true meaning and can do remarkable things.
Traci: I love that! These kinds of cultures are still few and far between as you and I both know.
We talk a lot on this show and at WorldBlu that the number one killer of work place cultures is fear.
When you boil down all the problems, strip back the layers, what is usually at the root of so many of our workplace challenges is fear.
You co-authored a book with your dear friend, Ken Blanchard called, Helping People Win at Work: A Business Philosophy Called, “Don't Mark My Paper, Help Me Get an ‘A.’” I love that title, and I can't recommend the book highly enough, definitely check it out.
So when you wrote this book, Helping People Win at Work: “Don't Mark My Paper, Help Me Get an ‘A,’” what was the fear that you saw happening in workplaces around you and at WD-40 that your book was trying to address?
Garry: Well, just touch on fear for a minute, fear is not just in business, fear is in life.
I think it is the most paralyzing thing we have in business and in life. It really does try to confuse us around what we can do.
When we wrote the book, I was in a class of Ken's and he was talking about when he was professor and he used to give out the final paper for his class at the beginning of the class.
He used to get in a lot of trouble from the academic folks at the university saying, “What are you doing, Blanchard giving out the final paper!?”
And he said, “Not only am I going to give out the final paper, now they know what an “A” looks like, I am going to teach them the answers along the way.
And I went, “Oh duh!”
What are we doing in organizations? We are very bad at being very clear about what we expect of each other. The normal review system was more like, I am going to “get you” time.
People therefore didn't know what good work looked like. And we as leaders never spend enough time helping them do good work!
So the whole objective was, how do we share a process that would be very clear about what I expect of you, what you expect of me, and, at the time, put the responsibility of the development of that person with the coach, and make sure that they gave the time they needed to help the person step into the best person they could be every day.
Traci: I think that's so true, because so often in our workplace cultures they’re punitive, right? It's, “how can I step on you? How can I push you down?,” rather than help you get that ‘A’ and lift you up!
Research shows one of the biggest fears in the workplace is fear of failure. I remember you telling me this story and I would love for you to share with our listeners, how you took a really unique approach – when you first came into WD-40 as CEO – you took a really unique approach to addressing fear of failure in the workplace.
Tell us about that.
Garry: Sure, I don't remember I’ve ever seen a lot of people running around the corridor of anything yelling out, “I failed, I'm a failure, I failed, I'm a failure!”
There are a couple of things that happen when people don't really face what hasn't worked well front-on.
Number one, they don't learn from it and number two, they hide it. The reason they do that is because they are afraid that someone is going to make them feel less-than instead of more-than.
When I got the opportunity to lead WD-40, we're a great company, but the knowledge was in silos, and the power was, the more I knew and the less I share, the more power I have. And I said, “How do we turn these silos of knowledge into fields of learning?”
What became clear to me was this fear of failure, “I always have to be the winner,” was so obvious.
I said okay, let's turn this around, let's say instead of making mistakes we are going to have “learning moments.”
So we said, we don't mistakes at WD-40, we either win or we learn. What we want to encourage is a learning moment.
The definition of that for us is, the positive or negative outcome of any situation that needs to be openly and freely shared for the benefit all.
So that was the whole foundation.
Funnily enough, the number one responsibility of a tribal leader is learning and teaching.
Now, just let me touch on why it’s so important.
If you and I were to get into a time capsule right now and go back thousands of years to the center of Australia, my home country, and we were sitting out in Uluru, at what was once was called Ayres Rock and we were kind of looking behind the rock and watching a group of Australian Aborigines in a gathering, what would be happening?
The tribal leader would be teaching the young tribe members how to throw a boomerang.
Because if they couldn't throw a boomerang they wouldn't survive.
Because the boomerang was the tool of the day for hunting.
So how simple is it that if he were to throw that boomerang and not do it well, would he be a failure? No, he would say, “Look, here is your learning moment, you didn't hold it correctly, let me show you how to do it.”
By having the learning moment, number one, we act as we should as being the learner and the teacher.
Number two, as a tribal leader we are there to help the person be the best boomerang thrower they can be.
So what are we doing at WD-40?
We are teaching people to throw boomerangs everyday!
Traci: As I work with leaders all over the world, and coach people, here at WorldBlu, the thing I see people getting tripped on all the time are those inner gremlins in their heads that are constantly beating them up over failure, feeling like they’ve failed in some way, day in and day out. And it is such a powerful re-frame to say, “No it's not failure, it is a learning moment.”
That's something we have also taken on from WD-40 at WorldBlu, to the point we sort of share it easily every day. I try to say, “I had a learning moment on this” – and I try to model it as CEO myself – “I’ve had a learning moment on that!”
Everyone on the team, it makes me so happy when I hear them come forward and go, “Hey, I had a learning moment!” because it is so powerful to re-frame it and go, “Really? What did you learn? Help me understand. Thank you for sharing!”
I just love, love, love that practice that you brought into WD-40, and what an instant impact I'm sure it had on the culture, really helping to dissipate one of those biggest fears which is fear of failure.
Garry: Can you image if I was in a situation and I was your coach and you were one of my tribe members and I wanted to engage with you about an observable learning moment.
The conversation in the old days would go like this: “Hey Traci, I need to talk to about something, I really think you could have been better at it.”
And as I'm starting to talk you go,”Ugh, I am going into my shell, I’m going to get punished.”
Or, I go, “Hey Traci, there is an observable learning moment here that I would like to flesh out with you, to see if there is anything we can both learn from it.”
Then we are putting the emphasis of the learning on both of us.
I am not coming to you laying blame on you, I am saying, “I think there is an observable learning moment we could flesh out here, that we could both benefit from, and I will tell you what, I think once we have worked out what it really is, we can set it out amongst the tribe and they can all benefit from it. Wouldn't that be great!?”
What a difference, eh?
Traci: Such a different feeling and energy and vibe completely!
As you know, what we teach at WorldBlu, is that the opposite of fear and these fear-based cultures is freedom. And of course, we are not saying freedom like anarchy or laissez-faire or a free-for-all, but it's freedom with accountability in the workplace.
I mentioned earlier how WD-40 has been a WorldBlu Certified Freedom-Centered Workplace™ for years now. So Garry, why is freedom, rather than fear and control, so important to running a global, publicly-traded company?
Garry: When people feel free, and they are acting within values, you don't get what I call friction in an organization, you get flow.
Because what happens is, freedom reduces confusion, it enhances clarity, it gives confidence, and therefore people get into flow, and when you're in flow, you're really delivering.
So to me, it's, why not!? I mean, even if you think about it, if you take the opposite of freedom being locked up in a jail cell, when you get locked up in the mindset of a jail cell because there is no freedom in an organization, you don't have very far to move, and you can't really achieve anything because you’re locked into that space where nothing can happen.
That's why freedom is so important.
Traci: I love that! I love that, that, “freedom gives flow, not friction.” I think that is so true!
Now, I know you told me you have a special friend named “Al.” I want you to introduce to us Al, and I want to ask you this question as a way of introducing us to Al ,which is this – Do you feel it's a leader's – whether it’s a CEO, top manager, division head, whatever it may be – do you feel it is a leader's moral responsibility to build a more freedom-centered rather than fear-based workplace?
Garry: Our job as leaders is that we have no right to get in the way of people doing wonderful things.
Our job is to make sure we create an environment where our tribe members wake up each day inspired to do the work they do, feel safe while they are there, and return home at the end of the day fulfilled by the work they do, feeling they have learned something new and contributed to something bigger than themselves.
If they go home happy, there is a chance that their family will be happy.
If their family is happy there is a chance their community is happy.
If their community is happy there is a chance their country is happy.
And God don't we need a happy world right now!?
So it is just an absolute sin that Al. . . Now, you said he is my friend, okay, let me just clarify that!
Traci: Let's clarify that.
Garry: I know Al, in fact it’s amazing how many Al's there are out there!
I wrote an article a few months ago that I called, “The accidental soul sucking CEO.” That's who Al is!
Al behaves and creates a culture that sucks the soul out of people within organizations. That's why we have got such terrible employee engagement.
What an embarrassment it is, if you stood up as a CEO and said, “I am very happy, I would like to tell you that 65% of the people who come to work every day are disengaged or actively disengaged and it is because of my leadership,” – that’s Al, and there too many Als out there. Too many Als!
Traci: There are.
Garry: The reason why WD-40 has been as financially successful as it is, is we have a 93% employee engagement.
Now, if we had the normal 35% employee engagement, we believe we would need twice as many employees as we’ve got now to get the same outcome.
And if we had twice as many employees, we wouldn't have the financial results that we have had over the past 20 years.
It's as simple as that, so simple!
Traci: As you know, Garry – but what might be new to some of our listeners – is that the Freedom at Work system that we teach at WorldBlu has three parts to it:
It’s about a mindset, an organizational design, and a leadership style that helps companies operate from a place of freedom rather than fear.
Now, you talked about Al, the soul-sucking CEO, and I am just wondering, how did you get this mindset, Garry? How did you get this more freedom-centered mindset, this freedom-centered approach to wanting to run WD-40 this way? What inspired you not to be an “Al?”
Garry: I think the basis was that I really came to grips with the fact that I was not going to do it alone.
We think we are pretty smart, Traci, but way back in 384 BC, Aristotle said, “Pleasure in the job puts perfection in the work.”
When I thought about that statement, “Pleasure in the job puts perfection the work,” I thought, “How can we build a culture where people actually enjoy what they're doing?”
It wasn't just holding Kumbaya singing lessons on a Friday afternoon. It was people wanting to do meaningful work, and they want to be respected.
We have four pillars that we stand on:
- Care – if you work at WD-40 Company, we care about you. Caring is not just caring about you as a person, but we care enough to have a robust business model, a good strategic plan, hold people accountable, and do all the things that make a business viable, so it can be enduring over time.
- We are going to be candid with you: no lying, no faking, no hiding. Most people don’t lie, a lot of people fake and hide. Again, it's because they are fearful.
- The other pillar is accountability. We are going to hold you accountable, but more importantly, we are going to be accountable to each other, this is not a one-way street.
- And then responsibility, we are going to be responsible for our actions and the things that we do. So putting that all together I thought, “I have got to try this because that feels better.” Honestly, it does feel better.
We have been able to look back now over 20 years and say, this has been successful.
I will tell you, I did not know it would be successful. I believed the principles were worth trying and we stuck at it, and it did work.
But I could not get up on a stage and say, “I want to tell you the grand plan for 20 years from now.” I could tell you what the foundation was, and the foundation was the same as it is now.
But, as Simon Sinek and I have talked about often, it's simple, it's not easy, and time is not your friend.
More importantly, you have got to make sure that your empathy eats your ego, instead of your ego eating your empathy.
Traci: Isn't that so true? That mindset difference that you brought to WD-40 set you off on a completely different trajectory, which is so powerful.
And the ripple effect you were alluding to earlier, the ripple-effect in your tribe members’ lives, in their homes, and in the world is huge.
You know that we have a course where we teach something I developed called, The Power Question® and The Power Question Practice® and you’ve been trained in this.
For our listeners who might not know, The Power Question is: What Would You Do If You Weren’t Afraid?®
We have a five-step practice also that we teach people, to enable them to recognize fear and shift their mindset from fear to freedom literally in an instant.
I know you use this question all the time at WD-40.
What do you find, Garry, is the thing people that most people are afraid of in the workplace?
Garry: Decisions around people.
When it comes to the time that you know you’ve done everything you need to do, and you have to make a choice, it's really hard to make that choice when it impacts somebody.
That's the balance between being tough-minded and tender-hearted. The genius of that is being in the middle.
When we ask the question, okay we need to take this action and we say, so, “What would we do if we weren’t afraid?” the answer is so clear what we would we do if we weren’t afraid.
So, okay now that we have identified that, what will we do?
What it helps us do is move from that fear of what we need to do, to helping the person move onto something bigger, brighter, and better for them.
Because if someone is not happy in an organization, they’re not happy, it's not just you that is not happy. We should set them free and enable them to go and find something that is really going to make them happy.
So, it's a very powerful question when it comes to thinking about those tough, tough decisions. The Power Question is the most valuable the tougher the decision is.
Traci: It is so true! The Power Question is something I use in my life every day, both in my personal life and running WorldBlu and working with all my colleagues. It’s amazing how when the decision to be make is tougher that the tool is extra helpful.
The research tells us that when we are in a state of fear, the peripheries of our brains shut down and we get tunnel vision. So we are not able to make the best decision possible when we are in a state of fear.
And so just to have this tool that can shift us in a moment to a freedom-centered thought -- Bam! Instantly better decisions, and I think decisions that are more aligned with long term goals versus just the short-term quick fix.
Garry: I don't know if you shared this with me or I dreamt it up myself, but I use it as a little bit of a comparison.
A deer standing in the middle of the road staring at headlights coming to them is absolutely in a state of paralyzed fear. You would think that the deer would move before the car hit them, but they don't. Because they are in total paralyzed fear.
Traci: Starting with mindset, mindset is where we must start building a world-class, freedom-centered culture.
Then it's about the organizational design.
Here at WorldBlu, as you know, Garry, we believe the organizational design system that creates the optimal conditions for success for everyone, while also impacting the bottom-line, is organizational democracy.
We talk about the ten principles that make up a democratic system, and one of those principles is accountability.
We have been talking today about how you can't have freedom without accountability.
Freedom has to have a backbone to it, so you have to have accountability.
At WD-40 you all have many ways of practicing accountability, but there is one practice I particularly love, so I was hoping you would tell our listeners a little bit about it.
Garry: Yes, I think you are referring to the “Maniac Pledge?”
Garry: Okay, so many, many years ago, we realized one of the things that was really getting in the way of accountability was openness and actually again, freedom, Traci.
So you know how we like to put words around things at WD-40, we like to put things in a fun way but in a visual way so that it doesn't become paralyzing because it's a policy like, “You must talk to each other” etc., that doesn't work.
So we pinned up the “maniac pledge?” May I share it?
Traci: Absolutely, we would love to have you share it.
Garry: So this is the pledge we take:
“I am responsible for taking action, asking questions, getting answers and making decisions. I won't wait for someone to tell me. If I need to know, I am responsible for asking. I have no right to be offended that I didn't get this sooner. If I am doing something others should know about, I am responsible for telling them.”
That's the pledge we take, so it takes away the finger pointing, the quacking, “I didn't know,” quack, quack, quack, “He didn't tell me,” quack, quack, quack.
So this takes all that away.
It has lived in our organization for many years. People exercise it. I have people walk into my office and say, “Maniac Pledge!” and I say, “Okay, what’s up?”
The they say, “Well I need to know this, if knew this it would help me in my role.” And I say, “Okay I will share with you what I can.”
Traci: I love it, and what I hear is that by having that accountability, and it's not just you as CEO being accountable, it's every single member of the tribe being accountable, that again takes away fear.
It takes away the fear so everyone has the freedom to be in a position to step up and be at their best.
To me that's what's so powerful about Freedom at Work and organizational democracy; it expects and demands the best of us! This is not for quacking ducks, you know? This is for people who really want to stand up and grow, and be at their best each and every day.
Garry: Yeah, giddy up!
Traci: Giddy up! Exactly.
This leads me into the last element of the Freedom at Work system – we talked about mindset, we talked about organizational design. The last element is leadership, or what we call Freedom-Centered Leadership™.
We define Freedom-Centered Leadership as a person who practices three core attributes.
The first attribute is Power – they know how to be in their power in the right way. Not power over others, but being in their power in a way that empowers others.
The second attribute is Love, which we correlate to self-worth and having high self-worth as an individual leader.
The last attribute is Ubuntu, and this is a word I learned many years ago in South Africa. It's about how can I be at my best so you can be at your best, and how you can you be at your best so I can be at my best.
Garry, I just want to focus on one of these attributes – Power. I want to ask you, what does it mean to you to be in your power as a Freedom-Centered Leader leading WD-40?
Garry: I think it means comfort with vulnerability, which really gives me a feeling of being in power.
Because when I am prepared to be vulnerable, the power transfers to a whole broader base.
When I talk about leadership, I love Simon Sinek’s quote, “Leadership is not about being in charge. Leadership is about taking care of the people in your charge.”
To do that you have to be human and vulnerable.
Traci: Absolutely. And I do actually want to talk about self-worth then, because you can't be vulnerable and authentic if you are not to some degree secure in who you are, right? And this is high self-worth.
One of the things we've learned at WorldBlu is that for leaders who want to build a freedom-centered workplace culture, that individual really needs to feel comfortable in who they are.
We talk about a 1-10 scale and that individual should at least be at 8 or higher in their sense of self-worth.
That's what I hear in you and what I know about you. You are secure in who you are, and that allows you to be vulnerable and be authentic, and be honest, and be in your power.
One of the conversations that you and I had that really made an impression on me, is this one area that can be so challenging.
I can imagine our listeners listening today and thinking, “I love this idea of Freedom at Work and building a freedom-centered culture, but I have shareholders, I have investors, and they are going to think this is total ‘woo-woo,” it is not “real” leadership, or the “real” way of running a company and they are never going to go for it.
Now WD-40 is a publicly-traded company and you have investors. When you first started down this path, were they with you? How did that go?
Garry: Well, 21 years ago they were even more focused on what are you going to do for me in the next 90 days.
I kept saying to them, “Please do not expect us to be this 90-day company.”
In fact, one of our largest shareholders who still are one of our largest and have been for about 15 years, is a company that is a socially-responsible investor.
They actually invested in us because they really did get their head around what we were trying to do.
I said to them once, “I am sorry, I am not smart enough to be able to lead a company in 90-day intervals.”
They said, “Thank God, Garry, you’re not dumb enough to try!”
Today, it's quite a different world. In fact, just last week I was out doing investor calls with our Director of Investor Relations and the shareholders that we have now, they get what we are.
One of the larger ones, I said to them, “Why don't you sell us?” They said, “It's so hard to find companies like you all these days.”
And Larry Fink from Black Rock in his letter a few months ago – and I referenced it in my article about the soul-sucking CEOs – they are starting to pay attention to the fact that an engaged workforce is going to deliver.
As I said, if we didn't have a 93% engagement rate, they wouldn't be talking to us because we would be a financial disaster!
So, I think it is a conversation you’ve got to have the courage to have.
And I have said to some people, “Please don't buy our stock because you and I will never get on, and that's okay. There are other places you may want to go.”
Traci: I am so glad to hear that some of these investors and VC firms are starting to see more and more of the direct-line correlation between culture and the bottom-line.
We started this conversation talking about how in the last 21 years, WD-40 has gone from $250 million to over $2 billion in market cap.
Something that we have done with our research at WorldBlu, and had third-party verified, is we looked at what is the quantifiable bottom-line impact of operating a company using Freedom at Work.
We took WorldBlu certified Freedom-Centered Workplaces™, of which WD-40 is one, and compared them to the S&P 500 over a three-year time horizon.
And what we found was that on average, WorldBlu certified Freedom-Centered Workplaces, meaning companies that practice Freedom at Work, had SEVEN times the revenue growth compared to the S&P 500. Not double, not triple, but seven times the revenue growth!
And that number could have been a lot higher, but we threw out the outliers.
And that's what you have all proved as well.
I love that you have got these investors who have come along with you on this, but also that you have had the moral courage to stand in your power and say, “This is how we are going to roll.”
I am sure that wasn't always easy at times, but I’m glad they have gotten behind you and seen the impact.
So, Garry, for leaders who are listening to this, how does a leader know when they are ready, when they are seriously ready, to build a Freedom-Centered culture?
Garry: When they believe Aristotle. “Pleasure in the work puts perfection in the job.”
When they have decided that empathy is more important than ego.
When they have decided they don't want to be an “Al.”
When they have decided they need to involve their people.
And when they have decided they truly want to enjoy life, because life is a gift, don't send it back unwrapped.
We have no right to get in the way of people being great.
As I have been through my 31 years here, 21 years as the leader of the tribe, I can look back and say, I am proud that I had the opportunity to help this tribe be what it is today, around a blue and yellow can with a red top.
Traci: That's your legacy – you have made the world a better place by building this tribe that is rippling out to impact the world. How do you feel about that?
Garry: Well thank you, but I planted the tree. It's grown and it’s all of the tribe members who are making that work. Without them, I would be nothing, and without all of us, it would be nothing.
So, we planted the tree and there is a lot of shade under that tree now. I do feel good, I mean, I am convinced that purpose-driven, passionate people guided by values, creates an amazing outcomes. When someone else’s happiness is your happiness, that's love.
Traci: Garry Ridge, CEO of WD-40, thank you so much for building a world class, Freedom-Centered company that we can all be inspired by.
Thanks so much for being with me today.
Garry: My pleasure, always.