By Michelle Toh October 28, 2021
Source: Harvard Business Review
Photo Source: Unsplash, Few people have more insight than Satya Nadella into how teams collaborate and innovate successfully. HBR editor in chief Adi Ignatius interviewed the Microsoft CEO to discuss what team collaboration will look like going forward, the next generation of workplace technology, the new imperatives of leadership — and whether and when our future workplaces will in fact start to look like the “metaverse” fantasies of science fiction.
This interview is the first in a new video series called “The New World of Work,” which will explore how top-tier executives see the future and how their companies are trying to set themselves up for success.
Transcript ADI IGNATIUS: Satya, thank you very much for joining us. It’s great to see you again. Let’s dive right in. This program is about the new world of work. And there are probably few people who have their finger more on the pulse of what is work and what are the platforms and the approaches that we need to work effectively together than you. I’m really glad you’re here.
So, the concept of work, how we collaborate together, how we innovate, is constantly changing as businesses evolve, as technology changes, as employees have different kind of attitudes and empowerments. Where are we on that journey? What is the near-term future of the workplace look like to you?
SATYA NADELLA: First of all, it is fantastic to be with you again. And you’re absolutely right. We are coming out of this pandemic or living through this pandemic in its various stages. I think there’s real structural change that we are seeing because of what I would describe as two megatrends. One is the trend around hybrid work, which is a result of the changed expectations of everyone around the flexibility that they want to exercise in when, where, and how they work.
And then the second mega trend is what Ryan Roslansky, who is the CEO of LinkedIn, termed, which I like, which is the great reshuffle. Not only are people talking about when, where, and how they work, but also why they work. They really want to recontract, in some sense, the real meaning of work and sort of asking themselves the question of which company do they want to work for and what job function or profession they want to pursue.
So these two, hybrid work and the great reshuffle, are the two major trends that are fundamentally structurally changing I think everything we do.
ADI IGNATIUS: Let me get a sense of how you would define flexibility. Because on the one hand, flexibility sounds great. Let individuals, let teams decide how they want to work together, when, and in what fashion. But then there are sort of larger corporate company concerns about, well we want people to be together. We want to create and sustain a culture. And that maybe means people need to be together, a little less flexibility on that. So how do you how do you balance these imperatives?
SATYA NADELLA: Yeah, I think first of all, I think we should sort of perhaps just get grounded on what are we seeing in the expectations. For example, when we see all of the data, the reality is close to 70% of the people say they want flexibility. At the same time, 70% also want that human connection so that they can collaborate. So therein lies that hybrid paradox.
Interestingly enough, if you look at the other sort of confounding piece of data: 50-odd percent of the people say they want to come into work so that they can have focus time. Fifty-odd percent also want to stay at home so that they can have focus time. So the real thing I would say is right now, it’s probably best not to be overly dogmatic. Because I don’t think we have settled on the new norms.
These norms have to settle so that then we can have real causal relations that settle. And then we can understand what are even the broad contours of productivity flexibility. But in that context, Adi, to your point, we are taking what I would call a much more organic approach right now. What I would say is what we want to practice and what we want to evangelize is empowering every manager and every individual to start coming up with norms that work for that team, given the context of what that team is trying to get done.
For example, if I manage a team of five people, I better know [if] there are people in my team with young children who have not been vaccinated? Because the considerations of those parents will be different. What is the childcare situation? The considerations for people who have the need for childcare will be different. What are the commute times today? The expectation going forward is, I don’t think anybody wants to get back to 2019 commute times because you can be productive remote.
In some sense, we are really saying, let’s just use an organic process to build up through empowerment new norms that work for the company to be productive. Ultimately, we are in business to be able to produce products and services that our customers love. Ultimately that will define the firm in its performance. But I think to also ignore the fact that there is structural change in the way employees produce those products and services and drive productivity, the expectations have changed. So we have to now find that match.
ADI IGNATIUS: What I’m hearing you say is that you probably don’t think we’re ever going back to the way we worked before the pandemic, number one. And number two, that in the old days, there was a temptation to come up with a policy that was consistent and therefore fair. But you’re talking about a much more complex job for managers, for HR, for everyone in the company to be, as you say, flexible, adapting, not any kind of one-rule-fits-all approach to talent.
SATYA NADELLA: Yeah, I mean, first of all, I also would say this, Adi, which is the economy is a very diverse economy. We are talking about even during the height of the pandemic, all the healthcare workers were coming into the workplace. All the retail workers, all the critical manufacturing workers. So, to some degree, I want to make sure I stay grounded in my comments that the world and the economy and the society today is much more diverse in terms of its workplace expectations, habits, needs. Because we do need our healthcare professionals in the hospitals that we visit and what have you.
So that said, I do think that there is real structural change with the new tools. Take space: so somebody had described this to me, which I love a lot, which is physical space is probably what, since the industrial era, we’ve discovered as the best productivity tool.
There’s no substitute. For 200-plus years we have tuned the workplace, whether it’s a manufacturing line, whether it’s a retail outlet or whether it is knowledge workers coming into an office campus, we have tuned space to drive productivity by bringing people together, having a common sense of purpose, mission, connection, and what have you.
I won’t trade that off. But can we use space, such that it maps to the expectations of our employees and the task at hand.
For example, we are redesigning some of our campus spaces. We will still have our campus. We love our campus. Except the way managers and teams will use our campus will change. They may want to bring everyone together for a design session. Or we want to bring everybody for a crunch-time mode in-building, say, some software product. We want to have orientation. We have a whole bunch of new employees. And when we do that, I think we’re going to use space as even a more malleable resource, using some of the digital technologies we have.
I think a combination of space and this remote digital fabric that we have established through the pandemic will come together to give us the tools for flexibility.
ADI IGNATIUS: Now, as all of this thinking is happening, it seems to me employees in the last few years and especially now probably are more empowered than they have been. I mean we talk about the “Great Resignation.” And that’s partly employees feeling like they have opportunities. They have choices. They’re making some choices that are forcing us all to respond as managers. How do you think about the talent equation these days? What does it take to attract and retain talent, given everything you’re saying about the evolution of the workplace, the evolution of the concept of work.
SATYA NADELLA: Somebody had at one point said to me: Nobody quits companies. They quit managers. I felt like that was one of the best epiphanies I had, at least growing up even at Microsoft. That is such an important statement.
Because after all, it’s the people that I work with that keep me going at a given place. And it’s when that equation doesn’t work I look elsewhere or reevaluate. So to me, we have to really deeply look at what is the lived experience and culture for anyone and that connection between the company’s mission and the individual’s mission and philosophy.
I always say, if everybody at Microsoft who works at Microsoft reframed it and said, “I don’t work for Microsoft. Microsoft works for me,” just for a moment, just as a thought experiment, does that equation compose? Am I able to fulfill whether my career aspirations, my approach to having impact in the world? Somehow if Microsoft is acting as a platform for that, then it’s very different. I feel connected with the mission.
So to me, we are very focused on two points. One is helping managers really recruit and retain talent through a framework we call “Model Coach Care.” Everyday practice of great management is super important. That’s on the manager side.
Then on the employee side, we are doing everything we can to help employees feel that connection to the company’s mission and their coworkers– and coworkers both in terms of strong ties and weak ties. Because one of the fantastic things about having, let’s say, a campus like the Microsoft campus in Redmond, Washington, was you come to campus. You work with your immediate team. Those are strong ties.
You also run into people who are interesting, that you meet and form long-term relationships with, which are weak ties. Unfortunately, in this pandemic what we’ve noticed is two data points, which is strong ties have actually gotten stronger. The weak ties have gotten weaker. But our job, through a variety of software tools, is to make those weak ties even stronger. It’s because it’s those human connections that get people to stay in a place. Without that, without the connection to your manager, without the connection to other employees, I don’t think it would work.
ADI IGNATIUS: Talk more about the weak ties. Because I think many of us believe those weak tie connections can actually be very important for triggering innovation, a sense of culture, collaboration, all that. Talk a little bit more about how you use technology to identify and improve those connections.
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