Strategy with Seth Godin: Hard Talk and Painful Truths

Michael Krigsman: Welcome to episode 858 of CXOTalk. I'm Michael Krigsman, and we are speaking with one of the world's most respected marketing strategists.

Seth Godin has written 21 bestsellers that have been translated into 38 languages. He writes one of the most popular daily blogs on the planet, and he has given five TED Talks. His new book is called This Is Strategy.

Seth Godin, welcome to CXOTalk.

Seth Godin: Thanks for having me, Michael. It's a pleasure.

Michael Krigsman: Seth, why do we need another strategy book? There's a million strategy books in the world.

Seth Godin: I don't want to start off by disagreeing with you, but there are almost no strategy books in the world. There are a lot of tactics books in the world, and tactics aren't strategies.

Tactics are the tasks we do to further our strategy. As Roger Martin has said, "Strategic planning is an oxymoron," because it implies that we can plan our way to a guaranteed future.

Businesses, particularly C-suite people, really like a plan because they have authority, they follow the plan, they get the prize. But strategy doesn't work that way. Strategy's a philosophy.

And I spend a lot of time, I don't do any coaching or consulting, but I spend a lot of time helping people I care about, nonprofits and leaders, and they think they have a marketing problem. They don't have a marketing problem. They have a strategy problem.

Michael Krigsman: So, can you break that down for us to distinguish between the marketing problem that folks think that they have and the underlying strategy problem that you've identified?

Seth Godin: For my entire life, marketing and advertising were the same thing: Get the word out, buy ads, make enough money to buy more ads, over and over and over again. So that's the Generals, right? General Motors, General Electric, General Foods. These people were in the business of interrupting folks, making money, and doing it again.

The internet changed that and undermined what people thought of as marketing. Marketing then became, "How do we tell a story that resonates and gets the word out?"

And yet people are still fixated on getting the word out.

When we see a brand, an organization, a leader with an elegant strategy, it looks like it's so easy for them, that the wind is at their back, that the systems propel them forward.

And you know, so if someone said, "Name an elite school of higher learning in the United States," you might say Harvard or Yale. But not because they spent a lot of money promoting themselves, but because they have a multi-generational strategy.

And so what we're seeking, if we want to change people, and what's the point of marketing if you're not trying to make a change happen, is an understanding of the systems that are around us and how to dance with them.

And, you know, for the tech people on this call, Moore's Law is fuel for many, many strategies, right? That Moore's Law says, "Computers are going to keep getting cheaper," and the corollary of that is bandwidth is going to keep getting better.

So we can now ride that for a very long time if we're in the right place. That's different than saying, "We've got to figure out how to get a whole bunch of people to buy tickets for that concert next week." That's a get-out-the-word problem, not a strategy problem.

Michael Krigsman: But I'm still confused because people have problems, business challenges that they're trying to solve, that they're trying to address. They look at the dynamics directly affecting that problem. They look behind the dynamics to think, "Okay, here are the 12 other aspects."

They put it all together, and they say, "Here's what we need to do." How is that different from what you just described?

Seth Godin: Something had to happen before that.

Michael Krigsman: Well, that's always the case.

Seth Godin: Right. But you took for granted that your strategy was to serve a certain kind of customer in a certain kind of way over a certain period of time to solve a certain problem for them.

You skipped over the empathy part. You skipped over the understanding of time as it unfolds. You skipped over the shift in systems caused by tech and other things. And you went straight to, "I got to do this, and I got to do this, and I got to do this, and then I'll get that outcome."

And if the world wasn't changing, that might be a good way to approach it.

But when the world is changing, what you discover, you know, so when I was at Yahoo, the unstated strategy of Yahoo, which would have made them so much better if they had said it out loud, was, "The internet is a wild and woolly place, really under construction, mostly mediocre. So we're going to be the place you come to and don't leave."

So, the home page of Yahoo had 183 links on it.

There was Yahoo this and Yahoo that and Yahoo the other thing. The goal of Yahoo was come and stay.

So, in 1999, Yahoo had the chance to buy Google for $10 million. Make sure you get that word right, $10 million, and they did not. And the reason was because Google's strategy is, "Please come here and leave." And they even bragged about how many microseconds you were on their site before you left.

That everything they did during their best years was, "Please come here and leave."

Yahoo innately, intuitively understood that that strategy was the opposite of their strategy.

What they should have done in that moment is learned that the world had changed and they should change their strategy. But they wouldn't have done that. They would have destroyed Google, and it would have been the end.

Google will thrive for a very long time with that simple strategy: "Please come here and leave."

And yet, most people who worked at Google couldn't have told you that that was their strategy. Most people at Google were busy building things, but they didn't really understand the strategy of—they were just doing their job.

And then when my friend Megan bought YouTube, that was the beginning of Google changing their strategy and saying, "We have enough money and enough hard drives, we want to build a place people are going to stay."

But that's missing from almost every conversation I have, including at super famous companies and with billionaires in the room. They can't tell you what their strategy is either.

And so the purpose of the book is—you know, my book has no page numbers in it. It just has 295 or so riffs because I want someone to walk into the meeting and say, "We're talking about 187 today. What are we doing about 187?"

And I made this deck with 5.2 million combinations in it so that you can tactically say, "We're not even talking about this, but our startup competitors sure are. So let's get out of the task and tactic business and build an elegant strategy instead."

Michael Krigsman: I just want to remind everybody that right now there's a tweet chat taking place, of course, on Twitter X, and you can ask Seth Godin pretty much whatever you want. So pop your questions—

Seth Godin: But he might not answer you.

Michael Krigsman: He might not answer you, but you can ask.

So pop your questions on Twitter using the hashtag #CXOTalk. If you're watching on LinkedIn, just put your question into the LinkedIn chat.

So all of this begs the question, what should we do about this? How do we address this very basic set of issues, Seth, that you're raising?

Seth Godin: It's not that hard. It's just scary and challenging. I need—the book has 400 or 500 questions in it, and the questions are things like, "Who is this for? And what is the change you seek to make?"

And almost everybody avoids that, right? Who is Starbucks for? Who is Microsoft for? Who is the local community center for?

What is the change we seek to make? If we're not here to make a change, why are we wasting our time in this?

Right? Then we can start leaning into, "What are the systems, the invisible systems at work?"

So yesterday I spent an hour coaching a local high school student on where she's thinking of going to college.

And I said, "Where do you think you're going to college?" And she read this list. I could have written the list before I talked to her, right? It's a list that includes things like Bowdoin and Swarthmore, expensive, exclusive private schools. Yeah, why?

"Why are those schools on your list?" "Because that's what I'm supposed to do."

She's making a quarter-of-a-million-dollar decision that's going to change her family's life and her life without understanding why she's even choosing.

And it's not just for 17-year-olds that they have this problem.

So when you tell me that you're doing a brand extension, and you're going to launch this thing, and I say, "Well, who's it for? And what's it for?" you should be very specific.

And then we can talk about, "Well, what are the invisible systems?" In the case of this young woman, the college-industrial complex is a 400-year-old invisible system that affects so many elements of the lives of upper-middle-class privileged people, and it's invisible.

If I asked you, Michael, "How much should a wedding cost?" it's an interesting question, right? Because a wedding actually only has to cost $44 in paperwork. So how much does a wedding cost?

And the correct answer is exactly what my friend spent, but a little more because the wedding-industrial complex is an invisible system.

If we understood the invisible system, we wouldn't have a freakout when we find out that we have to buy flowers. Like we know what the flowers at the wedding are for.

The flowers at the wedding are not to make things look pretty. They are because we are engaged in working with a system, and we've never named it or identified it. But once you see the system, you can dance with it.

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We have a question from Twitter, from Arslan Khan, who asks about this, maybe about this invisible system, and he says this, "Who is responsible for strategy in an enterprise? Everyone? No one? The Chief Strategy Officer is just a highly paid tactical project manager?"

Seth Godin: Certain things need to be done by committee. Strategy almost never benefits from that.

A mission statement, by the time the committee is done with it, is this thing that any company could have the same mission statement. Strategy is a point of view.

Someone needs to bring in a fully formed strategy and then see what happens in opposition to that.

And if you look at a company like Starbucks, the strategy of Starbucks before Howard Schultz got there, there were only two Starbucks. They didn't sell espresso or any cup of coffee. They sold beans and leaves, and their strategy was amorphous.

Howard showed up and had a very, very clear strategy, and he grew that into a multi-billion dollar enterprise. And then when he left, the new people who took over, no one had the guts to announce what their strategy was, and they became a wandering generality instead.

So yes, in most organizations, the Chief Strategy Officer has been bullied and cowed into being the Chief Tactics Officer. And I understand the dynamics that lead to that.

But when you have an elegant strategy and the wind is at your back, things go better.

Who's responsible? Well, the magic of having a very clear strategy is then you can give authority and power and leverage to everyone in the organization who cares to execute tactics that help the strategy.

So you know, there's a great chain of luxury hotels. One of the things—their whole motto is "Ladies and gentlemen serving ladies and gentlemen," and that informs their strategy, which is, "There are plenty of dark, quiet rooms that are cheaper than ours. But when you come to this place, it will change the way you think about who you are and where you are in the world." Notice there are no tactics in that sentence.

They say to the hardest-working and lowest-paid people in the organization, the folks who clean your room, "Here's $250 per guest. Spend it any way you want, whenever you want, to fix any problem any guest encounters. We trust you."

Well, first, it's not that big a piece of trust because you made that much money from one night if the person's staying in it. You're not going to lose that much. But number two, you now empowered your ladies and gentlemen to execute the strategy you just announced you had.

Compare that to the typical place that says, "Service is really critical to what we do," but then uses a stopwatch, monitors all the calls, says, "Due to unusually heavy call volume…" puts people through an AI system all to cost reduce.

Well, you're not acting in congruence with your strategy. So why are you surprised when it stops working?

Michael Krigsman: The strategy is the kind of core guiding principle about what we're doing. Is that a correct way of saying it?

Seth Godin: Easy to say and hard to stick with. It is your philosophy of the market, of time, and the systems around you.

Your—a good strategy finds an insatiable desire and builds the assets for you to be the one to keep filling it.

So a social media company that understands that people have an insatiable desire for status and affiliation figures out every time some way hack shows up to give someone a false proxy, a number, any sort of signal that they're on the right path, people respond to it. So then they do it again and again and again.

So LinkedIn might not have a beautifully structured way to talk about their strategy, but it's very clear that their strategy is tied up in the yearning that people in a late capitalism world have for security and achievement around their career.

And if they can create all these proxies around that, they can suck people like you and I into doing a live call to see if more people will watch us, blah, blah, blah, blah. This is all connected to filling an insatiable desire to weave together possibility and get the word out and advance things.

But plenty of people before LinkedIn said, "Oh, we have all these features." Yeah, but people don't want features. They want to try to fill their insatiable hole.

Michael Krigsman: So you're making a very clear distinction between that philosophy, the strategy, and then the execution or the tactics of getting there.

Seth Godin: Correct. I went to a conference last week, and it wasn't very good. There were some amazing people there. And the people who organized it didn't understand what the conference was for.

So it had the trappings of a conference. It had name badges. It had people meeting in a big room.

But there was nothing about the name badges that made people connect to each other. There was nothing about the big room that made people open up to each other. There was nothing about the feng shui and the aura of what was going on to create an event that a year from now we would be glad we went to.

So you say, "I have the solution. It's a conference." And then you do all the conference things, but if they're not connected to the strategy of, "The reason I did this was to get 50 people I care about to connect at a deeper level," there's a gap. And that gap, I see that gap everywhere I look.

Michael Krigsman: So again, the strategy, the philosophy, by its nature, will be relatively simple, easy to understand, very much in accord with the philosophy that you take when you write your daily blog, which is—they look very straightforward.

And then the execution, the tactics are the mechanisms that we use to put that strategy into practice. And what you're saying is you see very often a disconnect between that underlying philosophy and the execution of how we get there. They don't match up.

Seth Godin: Right. So I'm a teacher, and pedagogy is the science of learning. And one of the understated, critical, ignored rules of teaching is "Don't steal the revelation."

And what that means is if I say, "Da da na na na," and you say, "Da da," you will not forget that interaction.

But if I say the whole thing, and you have to write it down in your notes, you'll forget it in three minutes.

So if I write a good blog post, it's because you filled in the gaps.

And so you can now say to yourself, "You're a co-author to what I created."

What often happens when an organization hires someone who's on this call is they say, "We like what's happening over there. Go figure it out."

And then people go look for all the tactics, the trappings.

You know, having a fancy business card and a good website does not mean you are a successful entrepreneur. It just means you have some of the trappings of that.

And as the world has shifted so dramatically, we've gotten really hung up on checklisting all the trappings and skipping over what were those trappings even for in the first place?

Michael Krigsman: We have a lot of people who watch CXOTalk that are technologists, and they're business leaders in technology companies, consulting companies, but one way or another, it's all centering around technology.

What do you see in the technology world specifically that companies have trouble with, and that business leaders have trouble with?

Seth Godin: Okay. So what's technology? It's not computer chips. It's a lever.

Technology is, as Kevin Kelly has so eloquently described, its own species, evolving in conjunction with our culture to give human beings leverage.

And there are only, I think, two real approaches for organizations embracing technology: either to be a relatively fast follower and to make sure your levers are on par with other people's, to benchmark your way forward, taking as few risks as possible as you do that.

And the other way to do it is to realize that early adopters of successful levers build assets that last a very long time.

In the old days when TV ads and shelf space were key, all Schick had to do was follow Gillette fairly closely, and they would keep their market share.

But when the rules changed completely and somebody like Dollar Shave Club shows up and uses a new technology, which is selling online, it undoes all of the hard work of generations of people at Schick because they thought their only job was to follow the path to a sharper razor, not see that technology is going to change a totally different part of the system.

So if you're a professional, and you're working in tech, you got to be really clear with your bosses which one of those two hats am I wearing today.

And if you're wearing the leadership hat, you can't invite to meetings the people who don't want you to wear the leadership hat. And I have a great story about this.

Netflix defeated Blockbuster. Netflix owned DVD rental. They had done something very hard. They had taken a technological shift in the system and really made it work.

And Reed Hastings and Ted Sarandos looked around, and they said, "All right, we beat Blockbuster. Did we win forever?" And they said, "This system is about to change, and the way it's going to change is streaming. And someone's going to build a streaming company that's going to put us out of business."

So they decided to put themselves out of business.

So they started a task force, and they built streaming. At all of the meetings when they were doing that, no one from the DVD business was allowed to come.

Because if they had invited the people who were responsible for 100% of their profit, those people would have had a very loud voice in that room, and those people would have defended the cash cow that was paying everyone's salary.

The day Netflix became Netflix was the day they didn't invite the DVD people to the meetings.

Michael Krigsman: It's very hard to not invite those folks because they're generating the revenue, and that means they have the greatest influence. So—so in the case—please, go ahead.

Seth Godin: No. I was going to say, "But if it was easy, we wouldn't need you." Right? That we have all these high-paid, respected professionals on the phone precisely because it's hard. If it was easy, everyone would do it.

Michael Krigsman: What you're saying also flies in the face of conventional wisdom and something that many business leaders who are running the largest companies in the world have told me on this show, which is "We need to invite dissenting voices. We need to have team diversity, diversity of thought."

And you're saying, "Keep those folks away."

Seth Godin: Diversity in the woodwinds and the horns is critical or it doesn't sound good.

We need to have diversity at the table, but everyone at the table needs to agree with the strategy.

The people who want to undermine the strategy shouldn't come. That's different. Because what we're saying is we're agreeing that the assertions of this strategy are our future. Now let's figure out together how to put that strategy to work.

But you can't do that when the most powerful people in the room don't agree with the strategy.

Michael Krigsman: And I'm delighted that Arslan Khan comes back with another excellent question.

Seth Godin: Okay, two for two.

Michael Krigsman: Arslan asks really good questions. He's a regular listener. And he says, "Strategy is the holistic North Star. But how can frontline employees even make a suggestion about it when enterprise strategy is done behind closed doors by executives?"

Seth Godin: Frontline employees often want to not be in the room, that we've been indoctrinated from a very, very young age to want to do our job. That's what school pushes us to do, to comply, to follow instructions, that people who sign up for a certain kind of job want to do, often, not always, a certain kind of job.

So if you are not one of those people, if you would like to be part of an organization that is more permeable, I think it's incumbent on you to either earn the right to have a voice at that table, or to go somewhere where you can.

That there is nothing that says that the hundred thousand people who work at Amazon should have a seat at the strategy table. That just can't possibly work, right?

I was lucky—not lucky, I was lucky in so many ways, but I intentionally picked a fast-growing small company after business school. So there were only 30 people in the whole room, and it was changing every day. Why did I do that? I sacrificed 70% of my salary compared to my peers from Stanford Business School to be in that room so that I could sit with the officers of the company and argue about strategy.

But if I had gone to the companies that I could have gone to, I wasn't going to be invited in the room.

And it's not just whether the company is small. It's "How does the company think about, what is the agency that individuals in that company have?"

And there are some places—you know, McDonald's used to give more agency to the franchisees. The Big Mac was invented in Pennsylvania, not in Illinois because the Pennsylvania franchiser, I think it was Pittsburgh, I'm not sure. He had enough agency to invent the Big Mac. That could never happen today.

So if you want to change the strategy of a fast food restaurant, you should start Shake Shack, not go to work at McDonald's.

Michael Krigsman: We have a very interesting comment, question, from Jenny Holden on LinkedIn, and she says, "Okay, the flip side here. What if you're a frontline employee, and you ask leadership what the strategy is, and they can't answer it in two sentences?"

Seth Godin: Jenny, that's the question—it happens to me every single day, and I don't even work there. Right? That's why I wrote a book, that what I am hoping people will do is buy a few copies and have lunch and talk about it. And then invite other people to lunch and talk about it.

And the purpose of a book is to disrupt the time-space continuum and to create ripples. And I'm not in the business of selling books. I am in the business of having conversations.

And, you know, the frontline employee question is fraught for a whole bunch of reasons. But let's presume most people on this call are not frontline employees.

We should be having conversations. "What is the strategy of our local spiritual organization? What is the strategy of people in the climate change movement we're working with?"

There's a lot of places where we don't have a very pointy pyramid with one person in charge of a hundred thousand. Lots of places where we, the people who are talking right now, can weave together a possibility, and it begins by talking about strategy.

Michael Krigsman: I'm glad you guys are asking questions. You guys are such an intelligent audience, and your questions are awesome.

So Greg Walter said, "Strategic guidance is a product of process. AI eats and optimizes process. When will the line between human and silicon dissolve when it comes to strategy definition and execution?" I think he's talking about that relationship between people and large language models and so forth.

Seth Godin: My short pithy answer is you're either working for AI, or AI is working for you.

And in the book, at the beginning and the end, I strongly suggest people enlist Claude, which is a much better LLM than ChatGPT for a bunch of reasons in my experience, to say, "Here's my strategy statement. Pick holes in it."

To say, "Here's our company's current business plan. What strategy do you think we're talking about?"

"Compare this to the 20 prompts in Seth's section and tell us what we're missing," that AI turns out to be great at this, that these are really powerful prompts.

If you give AI what you're thinking about, and you give it the right prompts, it will spur you to think more deeply about those things.

When will AI develop agency and curate useful ideas out of the blue?

I think really soon.

I'm not yet ready to say that it's going to be in charge. I think that every technological innovation of my lifetime and the two lifetimes before that has created more jobs than it destroyed by a lot, and the pattern seems to be repeating itself here. But I might be wrong.

Michael Krigsman: But the workplace will change as a result of AI. So any thoughts on that?

Seth Godin: The word mediocre just means average. And LLMs specialize in doing mediocre work.

If you're a mediocre radiologist, which means you're an average radiologist, I've got an AI that can read an x-ray faster and cheaper than you, probably more accurately.

And that goes for ad copywriters. It goes for, even recently, talk therapists. If you're just mediocre at it, average at it, middle of the road, you're in trouble.

And so we're going to see this hollowing—and we've been seeing a whole bunch of hollowing in the middle anyway. We're going to see another hollowing in the middle where the people who choose to work for AI are going to be less and less respected and have less and less agency, and the people who are putting AI to work for them will have more and more.

And so organizations are going to shift dramatically. Like my organization only has one person in it.

If my organization had only had one person in it 20 years ago, we would have accomplished almost nothing.

The leverage that the internet and AI gives us is astonishing. And if you're going to be—if you've got 20 or 40 or 50 officers who are making six figures, you got a lot of explaining to do because many of those people just go to meetings for a living, and your competition isn't going to have those people.

Michael Krigsman: We have a question on Twitter from Chris Peterson. And Chris says—it's a great question. He says, "It's impossible for all rank and file folks at a big organization to have a seat at the strategy table. But how do we ensure that they all feel connected and are able to connect the dots from their roles to that broader company strategy?"

Seth Godin: I got into a spirited conversation last week about people dumping on the youngest generation and how they "didn't want to work very hard."

And it began with someone saying, "How do I get the most out of my people?"

And that was the problem right there because generation after generation, bosses have been saying, "How do I get the most out of my people?" And they've been strip-mining folks for their passion and their effort.

So why are we surprised that people aren't committed?

The real question is, "How do I help my people get to where they're going?"

Because if I help my people get to where they're going, and hire people who are going where I want to go, everything gets better.

And so what we're seeking is enrollment. Enrollment is "the bus is going to Tulsa." If you get on the bus and start complaining because it's not going to Cleveland, a good bus driver will ask you to get off the bus because this bus is going to Tulsa.

So the key thing that organizations with passionate employees must do is announce where they're going and not say, "Your job is to do your job." "Your job is to help us get over there," and point to where you're going.

And the late Tony Hsieh did a brilliant job of doing that in the first couple of years of Zappos. If you went to work at Zappos, training was expensive, it was hard to find the right people, and after three weeks, if you were good, they brought you into a conference room, and they said, "Here's $3,000, you can have it if you quit today."

They would say this to their best potential employees. And people say, "Why would you do that? Why would you pay your best employees to leave?"

And Tony said, "Because if they're willing to leave for $3,000, they're not enrolled in the journey."

Michael Krigsman: It's a very luxurious mindset. And not all organizations have the luxury of having the time, the resources, to think about that kind of long-term vision or to have that long-term vision. Now, I can understand that you would say, "Well, if they had that right strategy and the long-term vision, they would have the resources." But as leaders, we have to play the ball where it lies. And so how do we go from the muddled, confused, poor execution machine that we are today into becoming the simple and straightforward execution beast that you're describing?

Seth Godin: You just said it. The question is maybe the organizations that feel that way, feel that way because feeling that way got them to be in the place where they had no choice. That you find someone on a cold day shivering, having—and they've taken down one wall of their house to burn it for heat. And they're like, "I have no choice. I have to burn down the other walls of my house because it's cold in here." "Yeah, because you burned down one of the walls already."

And if we're talking about a future where mediocre isn't going to command a premium, and you're running a company that has raced to the bottom, all I can say to you is, "Yeah, you won. You raced to the bottom." And your competitors have raced to the top.

So Kmart closed its last store a week ago. Blockbuster closed. I mean, we can go down a long list of organizations that raced to the bottom.

The opportunity is to take a deep breath, find a place where you have enough leverage to begin something of actual value, and rebuild from that. But tearing down more walls to build more fires, I think everyone here is smart enough to realize that's not going to get you where you want to go.

If I was at Procter & Gamble, I would worry a lot because the engine of the last 80 years, TV advertising, is now officially gone. The engine of mass market is mostly gone. And whining about the fact that you're going uphill isn't going to help you because it's not going to get better.

You need to take a deep breath and say, "What assets do we have? And which people are enrolled in the journey of putting them to work to get us back to the kind of company we want to be?"

Michael Krigsman: On that topic, you describe in your book a concept called the smallest viable audience. Can you talk about that?

Seth Godin: For internal folks, it's also metaphorically important. We want to believe that our good ideas are for everyone. We want to believe that critics are a problem to be mollified. We want to believe that bigger is the point.

And the math is very simple, that's never true. That I've had 22 bestsellers in a row, but my market share of audience in the United States is less than 1%. Fewer than 1% of the people in this country have ever bought any of my books. So basically, I have 0% market share. It's plenty.

That the number of people who buy something from Patagonia every day, a multi-billion dollar enterprise, is tiny.

So the goal is not, "How do I reach everyone and make everyone happy?" It's "How do I reach someone? How do I do work that people would miss if we weren't here?"

And this is part of the DVD Netflix story, which is, the goal isn't for your policy to please everyone in the company. Your goal is to find policies that the people who are at this company a year ago—a year from now will be glad you implemented today.

To find people who want to enroll in the journey you need to go on, and to shun the non-believers. The non-believers may very well be well-meaning, but they don't get the joke, or they don't want to go where you're going.

If everyone's a non-believer, then your problem is that you came up with the wrong answer. But if you can get traction, if you can engage with the people who get the joke, just go with them and then do it again tomorrow.

Michael Krigsman: So in other words, if you can gain product-market fit to a small group, and that group is passionate, then you're onto something.

Seth Godin: Yes. And they will tell their friends. If you build the network effect into what you are doing, and the next thing you know, you will have rewired the way the culture works. And you can't name a brand where that didn't happen.

Right? This experiment you're doing, 800 episodes later, your first week, you only had a hundred people listening to it. That's enough if those hundred people bring a hundred more people next week.

Michael Krigsman: Yeah, I wish we had a hundred people that first time. I don't know how many it was, but it wasn't a hundred.

Seth Godin: I was counting your cousin Morty.

Michael Krigsman: Oh yeah. Well, if you count my cousins and brothers-in-law and sisters-in-law, what have you, then definitely.

So we have another question from LinkedIn, and this is from Wilson Suarez, who says, "Building on your advice regarding Netflix's strategic reinvention, where success involves engaging those who may not align with the current strategy and who hold power to resist change"—and by the way, we call that the anti-innovation antibodies—"and so the question is, how can we motivate or support business leaders who feel isolated? And what message can we as outside observers convey to encourage these business leaders to move forward under these circumstances of uncertainty and economic challenges?"

Seth Godin: I think there's two kinds of innovation we're talking about here. There's the innovation where, in a short period of time, a small number of people will engage, and we will know we were on the right track. And then there is the innovation that requires a large number of people, a long period of time, and a lot of money before we find out if we're on track.

So, the people at ChatGPT who are at OpenAI, they had to spend hundreds and hundreds of millions of dollars before there was any customer traction.

I think that's a very rare sort of innovation.

What I like is science fair innovation, where you get three pieces of 11x17 card stock, tag card, or whatever that's called, and some Sharpies. And you describe your assertions and your structure and your smallest viable audience and the systems at work. And then you can stress test your idea.

And the criticism of that idea will tell us a lot about whether you're onto something or not. So let's talk about what happened when Alexander Graham Bell, who did not invent the telephone, but he did invent the telephone network, when he walked into Western Union's offices. Western Union had the chance to buy AT&T and the whole ball of wax.

And they didn't, and instead they made better telegrams.

So you can imagine that meeting. Well, Bell's thesis, his—his strategy is "human beings have an insatiable desire to be connected, and businesses will pay money to be connected faster and at higher bandwidth." That's his thesis.

So now the argument is "Is a telephone a faster and higher bandwidth way to connect with someone than a telegram?" "Yes, it is," even then it was. There were arguments about how much a business would pay. There were arguments about how long it would take. It took over a decade for a million people to have a telephone.

And Mark Twain actually installed Alexander Graham Bell's first personal home phone.

All these really cool things are happening slowly. So you could argue about the tactics of this. But the strategy, the strategy was clear.

So the support that Bell would have needed isn't necessarily the support of how does he make his strategy better? It's the—when you're hitting the speed bumps of adoption, when you're trying to work your way through the tactics, "Is there a smart person who can help you think that through?"

Michael Krigsman: As you're talking, it strikes me that the strategies, the philosophies that you're describing, in every case, align very closely to core human beliefs and human needs, to people, the need, the desire for connection in the case of the telegraph, for example. Is that an accurate statement, my perception?

Seth Godin: You know, we talked about the four pillars. The one we've talked about the least is empathy. Empathy implies kindness, but I'm not here to talk about kindness. It mostly is the humility of realizing other people have power.

And that other people aren't us. I'm not you. I don't see what you see. I don't want what you want. I don't need what you need, and that's okay.

So I don't have to be a cancer survivor to be an oncologist. I don't have to be a three-year-old to be a toy designer. I just have to have empathy.

And when we bring that to the table, other people will, on their own, choose to take action.

If, on the other hand, we say, "I worked really hard on this. You must use it." We are being selfish. And that's when we get into organizational battles.

So it's the empathy of realizing that other people, when they see it, will say, "That's exactly the solution to the problem I've been nursing." That's when a strategy starts to kick in.

Michael Krigsman: Years ago, I worked very closely, as an outside consultant advisor, with a very large technology company. And the project I was working on became the kind of centerpiece of their marketing. And so around the world, we had people in different departments who wanted to get their hooks into it and take it because they wanted—you know, "Hey, what are you guys doing? This is our thing. We should be doing it."

And my philosophy of that was anybody who had enough interest, that they wanted to—that they saw value in this—I said to them, "Hey, come, what can we learn? You know, let's—what can we do? How can we shape what we are doing to help you?"

And you know what? That project went on for a long time because it had support around the world inside this company.

Seth Godin: A lot of times we can think of strategy and its integration into the organization in terms of protocols and algorithms.

So I was in the room when the TED Conference figured out that they had a challenge, which is the TED videos were working great. They could only fit a few thousand people at the Vancouver location. The list of people who wanted to give a TED Talk was infinite.

And so what people were going to do was start their own local TED, give it a new name, do it on their own. And an idea would become diffuse, which would have been fine.

But instead, TEDx was born. And TEDx is an algorithm, a protocol, for how you put on a TEDx. There's only two or three pages of rules, or at least, then there was. Maybe there's more now. "If you follow these rules, you can have a TEDx."

And the last time I checked, there were two TEDxes a day every day somewhere around the world, maybe more. It became the farm team for ted.com, which led to more videos, which led to this iterative process. But TEDx Allentown or TEDx Bolivia or TEDx whatever isn't under the control of the TEDx central organization.

The same way, Alcoholics Anonymous is a protocol. No one knows where their headquarters are. They never ask anybody, as far as I know, for public fundraising. But everyone knows about Alcoholics Anonymous. It's hardly anonymous. And the protocol is all written down. "If you want to start one, go ahead."

So these strategies become extensible and resilient.

Michael Krigsman: We have a question from Greg Walters again on LinkedIn, who says, "Who do you see as contemporary leaders of science fair science?" Or any companies that you're aware of that are approaching innovation in this way.

Seth Godin: There was definitely a decade at Google where this was happening. Where they tried to build an academic ethos to what they were doing, and they weren't hooked on being a monopolist. Instead, they were saying, "How do we organize the world's information? That's our mega-strategy. What are the minor strategies within that? And then the tactics would arise from that.

From smaller companies, it's fascinating to watch, for example, my book publisher, which only has nine people in it. It's run by the woman, Madeline McIntosh, who used to run all of Penguin, the biggest book publisher in the U.S.

Well, what does a book editor do? A book editor, when acquiring a book, is basically looking for a strategy statement. They don't have time to read every book that's submitted, but they do have time to read the one-page strategy statement that says, "Here's a problem. Here's my philosophy of how I'm going to address it. If I could pull this philosophy off, is it something you want me to help bring to the world?"

Now you end up enlisting hundreds or thousands of people to propose new strategy statements to bring ideas to the world. But it's worth noting that some of the most strategic books, like Stanley Kaplan test prep books or the Cliff Notes that high school students bought for all those years, came from outside the industry because the industry, even that one, gets stuck in its tactics and forgets to think about its strategy.

And the last thing I'll say about it as we wrap this up is, Random House or Simon & Schuster would have told you 40 years ago that what they did for a living was organize the world's information. And it only took two people to start Google, which means Simon & Schuster should have been Google.

But they actually think that what they do for a living is chop down trees and put things into independent bookstores. And the problem they have is technology changed both of those things. So now, if a book is digital, and there is no independent bookstore, they don't know what to do because they didn't have a strategy.

Michael Krigsman: We have another question from LinkedIn, again from Wilson Suarez, who says, "Although social media was created for connection and conversation, do you believe it has lost its focus by lacking empathy, kindness, and humility, becoming instead a hub for misinformation and conflict?"

Seth Godin: I don't think it was invented to do what you said it was invented to do. I think it was invented to make money for its investors.

And I think the problem with the false proxy of, "How do we get as many eyeballs as we can to interrupt as many people as we can?" is that the easiest way to get eyeballs is to create tension and distress and division.

And most of the people who run social media companies are gutless and claim the system leaves them no choice and that they're not responsible. But they are responsible, and they did this on purpose, and they created a new cultural dynamic that is based on stripping people from hope—stripping hope away from people and setting them up to be anxious.

And I think we can name a dozen people who, if they had made slightly different choices, the system would be different. It would be a system where you were rewarded for compassion and connection and optimism and unification, and we would live in a totally different place.

So don't think you don't have a lot of power. You have an enormous amount of power, even if you're not funding or starting a giant social media company because all there is is the grassroots. The grassroots isn't the bottom. It's us. And we have a chance to make things better, but we can't waste any more time.

Michael Krigsman: Well, that was one of the most powerful and elegant, eloquent, and elegant critiques of social media that I have ever heard. And that one will definitely be worth going back to check out later on the replay.

Very quickly, we have another question from Elizabeth Shaw, who says, "Okay, gen AI is average and driving people and organizations to the average. But gen AI has become popular. How will AI and gen AI impact an organization's will and competency to develop good strategy?"

Seth Godin: Most organizations are average. That's math. And most organizations want average people to do average work in a predictable way. Management and leadership are different. Management is using power and authority to get people to do what they did yesterday.

So when Frederick Taylor worked with Henry Ford to invent the assembly line and mass production at the scale they did, Henry Ford, with Frederick Taylor doing some ghostwriting, wrote a four-page article about it in Encyclopedia Britannica in the '20s.

Taylor invented human resources. The phrase means treat people like machines, tune them up, optimize them, get them to fit in.

And so if your organization is optimized with that in mind, why are you surprised that AI is going to fill in all these gaps? Because it's exactly what the organization said it wanted.

Whereas when you run a studio, what happens in a studio is you want diversity of opinion. You want creative conflict coming in from people who are edge cases. But you have to be open to that and reward that.

You can't—you're going to get what you reward. And if you reward people for compliance, that's who's going to get promoted, and then you're going to fill an organization from the top to the bottom with the compliant.

And so I think AI is going to suck an enormous amount of cost out of organizations like that. But ultimately, always, organizations like that go away. Go to your local Sears Roebuck. Oh, I'm sorry, you can't because they're all gone, right? That's what it means to want to be the same.

Michael Krigsman: Fine. I'm a business leader. I'm listening to what you have to say. We absolutely want to have the values and the clarity that you're describing. But that's impossible because we have the public markets, and we have our existing sources of revenue. We can't destroy the company, Seth.

Seth Godin: You're right. Someone else is going to destroy the company for you. Schumpeter's creative destruction is real. Every company is going to go out of business. Yours is probably going to go out of business, too.

And the question is, do you want to be a spectator, or do you want to grab agency and at least give it a shot?

And what I am saying to these organizations is you could at least talk about it, that I have an article in the Harvard Business Review this month, and it quotes a study that CEOs are spending a tiny percentage of their day on strategy because they don't even think it's important. And I'm arguing it's the most important thing.

Michael Krigsman: The relationship between storytelling and strategy. And any quick advice on telling the right kind of stories as well.

Seth Godin: Storytelling, as my friend Bernadette Jiwa says, is the original human technology. Before there was writing, there was storytelling. You need to understand what storytelling is first. It is not the facts. It is not an RFP. It is not a PDF.

Stories are simply a way we get to put on our show inside someone else's head. If you go to an open house to buy a house, and they haven't mowed the lawn in five days, that's a story. If they baked an apple pie that morning before the open house, and you have a Proustian memory of your mom, that's a story.

A story is the nonverbal shorthand we remember when we think about the change you propose.

And most of the people who tell me they have a story don't have a story. They have an elevator pitch. The problem is no one ever bought anything on an elevator. So you don't need an elevator pitch. You need to create the conditions for people to say, "This is what I've always been looking for."

Michael Krigsman: Last question, again from Twitter. "If social media is all about using data for AI to make money, who should develop the guardrails to create some sort of empathy that relates to data and AI?" The guardrail question around AI and social media.

Seth Godin: First of all, Milton Friedman and Ayn Rand sold us a whole bunch of nonsense, and the market cannot solve all problems. The market can't exist without community action. And community action is what happens when people who care come together to make rules. Rules is what enables the market to work. If you don't believe me, go to a country that has no rules and no taxes, and you will see anarchy is not the friend of the market.

So when we see things that aren't working, we have to organize and take community action.

And the second half of this is human beings did not evolve and are not wired to keep a billion people's voices in our heads. That Dunbar's number of 150 is real. You can keep 150 people's desires in your head with empathy.

So we need to find smaller circles, the same way you are, Michael, organizing people into cohorts who can see each other and support each other. Can we be parts of multiple ones? Of course.

But when the whole world shows up in your house and dumps crap on your living room carpet, which is what happens every time you open X and invite it in, you're not helping anybody.

I haven't been on X for however many years it's been called that, and I have no intention of going back because it doesn't make my life better.

Michael Krigsman: All right. And with that, Seth Godin, thank you so much for sharing your expertise and your wisdom with us today. I'm very grateful for your time.

Seth Godin: Thank you for leading. And everyone who's listening, thank you for the ruckus you make. I appreciate you.

Michael Krigsman: Everybody, thank you for watching.

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