In Conversation… with Barry Schwartz

Speaker A: People who run the show sacrifice profits, I think, so that they can maintain control. The thing about energizing your workforce so that they have, uh, some control and autonomy in what they do is that it makes them less predictable. And you want to be able to manage them. And the best way to manage them is to make the tasks they do routine, even if it costs the company on the bottom line.

Speaker B: Hello, and welcome to our Future of Work Hub in Conversation podcast. I'm Lucy, a partner in Lewis Silkin's employment team. And whether you're a regular listener or you're joining us for the first time, I'm delighted to have you with us as we explore the trends and challenges shaping the world of work. And today, I'm joined by Barry Schwartz. Um, he's an emeritus professor of psychology at Swarthmore College and a visiting professor at the Haas School of Business at Berkeley. Now, Barry is a celebrated author, and, um, for the past 50 years, he's been exploring the fascinating space where, um, psychology, behavioral economics, and business all come together. His work has been really very influential in, um, shaping our understanding of choice and motivation and the meaning of work. And it's so great to have you, Barry. I'm really looking forward to our conversation.

Speaker A: Well, I'm looking forward to it, too. Thank you for inviting me.

Speaker B: I thought, um, a place to start might be sort of going really far out and looking at the bigger picture. Um, bit. Because one theme that's come through all the conversations that I've had on this podcast has been that despite all the challenges and all the disruptions that we're experiencing at the moment, people are absolutely key to business success. And you have spent so long, so much of your, um, career, studying what truly motivates people at work. So I thought we could start by you talking to us a bit about that, what it is you think individuals really want from their work if they're going to thrive.

Speaker A: Certainly, um, uh, this turns out to be a complicated question, because the society people live in, I think, has a big impact on what people want from their work. And I'll explain that to you. People, uh, want to get paid. They want to make a living, they want to be able to support their families and so on. Let's just understand that that's a significant part of it. But people want more than that. They want to feel like they have some control over what they do, that they can be thoughtful about what they do, that they can take initiative, and at the end of the day, that they've done something worthwhile. All of these things matter. Uh, people also typically like to work collaboratively. And so feeling like, uh, you're part of a team enhances the experience of work. So people want work that's meaningful at the same time that they want work that will enable them to, ah, pay their rent and keep their houses. Um, and the reason I said that what people want depends on the social context is that there have been periods in history, uh, since the Industrial revolution where in which most of these things that people want have not been available. You know, if you work in a factory, everything that I've just described is absent. In fact, the whole point of creating assembly line factory systems is to make it so that people are just another cog in the machine. You want people to be interchangeable parts in the same way that everything else is. So you make the task simple, easy to learn. You have people repeat the same thing over and over again. What they contribute to the final product is, is trivially small. And if they are out sick, they can easily be replaced. And if they quit, they can easily be replaced. And um, and all of that structure was based on a kind of false belief that the only thing people care about is getting paid. So as long as people are getting paid, you can, you're going to have them do anything. And um, so there have been times, I think, when the aspirations to have work that's meaningful, uh, that are part of m. Many modern societies were just absent. People had given up any hope that uh, they would get their meaning in other aspects of their lives.

Speaker B: It's so interesting this, because we've taught actually before on this podcast about this feeling that we're stuck in this industrial age structure and yet the world of work has moved on so far beyond that. Do you think there are reasons why business has been so reticent to, or so slow perhaps to recognize that the structure is really unhelpful for the ways that people want to work.

Speaker A: Now this is a great mystery because the research that I'm aware of that has been done has shown quite consistently across many different industries that the more people can get meaning and satisfaction out of their work, the better their work is. Uh, in other words, by not in creating a workplace where people can have some control and autonomy and make decisions and use their, their, their minds, you are, you are affecting your bottom line negatively. And so you would think that even uh, a, uh, leader of a company that didn't care about the welfare of employees at all would create workplaces that people felt, you know, excited about just because it was profit. Maximizing and yet that has not happened. I don't want to say it never happens but the uh, people who worry about that are outliers and for the most part people sacrifice. People who run the show sacrifice profits I think, so that they can maintain control. The thing about energizing your workforce so that they have uh, some control and autonomy in what they do is that it makes them less predictable and you want to be able to manage them and the best way to manage them is to make the tasks they do routine and even if it costs the company on the bottom line. So it's puzzling.

Speaker B: It's so interesting this because I think in the UK we are starting to see a small number of more forward looking organizations try to take that um, more holistic view of the proposition that they're offering. Um, employees, you know, increasingly they recognize that people value flexibility, they value wellbeing, they value purpose and meaning and work, just as you say. And that was reflected in a recent report we did about the work as well. We looked at um, how organizations are navigating this really rapid period of change, um, increased uncertainty and we found those probably small number, but we found those forward looking employers are trying to build those things into their workforce strategies. They're trying to look at those things in terms of how roles design that they are recognizing that we've got to move out of this pattern of short term reactivity. You've got to build longer term adaptability, you've got to build um, resilience. And obviously that aligns with quite a lot of what you're saying. But I think the thing, and uh, maybe this is part of the mystery, but I think the thing that is really helpful for our listeners is possibly two questions. The first is but how can organisations do that? How can organisations actually make sure that what they're offering genuinely reflects what people want? And then the second part of the question is, is something that I wonder if sometimes holds people back, like how are those priorities going to evolve? You know, is there a concern that, well, what people might want today may be different tomorrow? And how do you, how do you predict that? What's the kind of crystal ball looking at how you ensure that what you've got is flexible?

Speaker A: Well, you know, I don't know, I don't have a crystal ball that I'll tell you. Uh, one way to find out. This may seem ridiculous to say, but one way to find out what your employees want is to ask them. Now they'll, they'll answer your questions about what they want. Um, but I think frequently what happens is that when you get employee feedback, most of the really important stuff is not on the table. You know, I gave some talks to companies that uh, are, that try to promote wellness among corporate employees. And I discovered that their efforts to promote wellness never involved what the employees were doing at work. It was always about what they were doing when they weren't working. Were they eating well, were they getting exercise, did they have adequate health insurance? But it was, it was sacrosanct. What happened at the workplace was sacrosanct and they weren't allowed to look in at what was happening at the workplace in order to promote well being among the employees. So I think even when you ask employees what they want, there are many questions you might ask that will not be asked because they are the prerogative of the people who run the organization. So you have to ask what people want in an open and open hearted way and you have to listen to what they tell you. And if people change what they want over time, the organization needs to be flexible enough to go with the change. And that's not to say that whatever people employees want, they get by no means, but it's at least a conversation between the, um, people who run the organization and the people they employ about what kinds of changes are feasible. It's the same sort of thing that companies do all the time when they're developing products. You know, what do customers want? Well, you know what customers want now, but what are they going to want a year from now? You don't know. So you, you know, you put your heads together and you do as much research as you can and you come up with a good guess about what people are going to want a year from now. And that kind of uncertainty is standard operating procedure in businesses. So you have to be willing to accept a certain amount of uncertainty in asking what your employees want. But let me, let me, since you are, you've talked a few times about how, uh, unpredictable this moment is. Let me say that I think that people care about meaning and purpose and all of that stuff. When their employment is relatively assured and as soon as the economy creates significant unemployment and significant uncertainty about the future of your job, then I suspect that all of the things we've been talking about get understood to be luxuries. And people want to make sure they have a job that will pay them a salary so that they can continue to support themselves and their family. And as you know, the 8,000 pound gorilla at the moment obviously is AI. What effect is it going to have, um, how long will that effect last? Who will it affect, et cetera, et cetera? There are optimists. You know, economists say every new technology ends up, uh, increasing job opportunities in the long run. But as the famous British economist John Maynard Keynes said, in the long run, everyone is dead. So the question is, what happens in the shorter run? And it's small consolation that 25 years from now there will be all kinds of jobs that we couldn't even imagine. If you spend those 25 years scraping by with no, uh, confidence that the job you have today will still be there tomorrow. So I think that we're, you know, the. The conversation we're having and that your report, which was terrific, I read it, focused, uh, on. Is a kind of luxury that we may not have two or three years from now, uh, which would, of course be terrible.

Speaker B: Now, there were two things you said I want to come back to. One is wellbeing, one is autonomy. But because of that. So fascinating. One of the, um, interesting insights, I think, and it goes to this question about uncertainty, has been the impact of the pandemic, because it felt there was potentially a moment where flexibility had to be embraced in a slightly greater way. Perhaps it is the economic uncertainty or the sustained economic uncertainty, but it feels like there's a bit of a retreat from that. You know, it's obviously best, um, best illustrated through the kind of idea of return to office, control and command. Come in, come back. Um, what do you think explains that sort of retreat from what felt like perhaps we were at a moment that was really going to embrace this flexibility?

Speaker A: No, no. And it's really disappointing that there has been this retrenchment of, um. There are people who claim that the reason for it is that their workforce was less productive. I'm dubious about that evidence. Um, I'm sure that there are instances where that's true, but I think the early evidence was that productivity went up once people had figured out how they could manage taking care of their kids while also, you know, doing their jobs. You know, it was a shock to the system for everybody. So I think, you know, that there were no real productivity losses, but what there probably were were losses in the kind of ideas that arise when people are, uh, working together. We all have biases. We all see the world in a certain way, but as long as we don't all have the same biases. When you're together in a room talking about how to solve a particular problem, you'll get ideas from other people. And so it's a Potentially very fruitful kind of interaction. And, uh, my guess is that Zoom did not adequately, uh, replace the kind of, um, incidental interaction that occurred in the course of a normal workday. We could have developed, um, tools for making it work better if we were committed to making this a relatively regular part of work. You know, the techno, it got a lot better in the course of the time that we were relying on it, and it could have gotten better still. But I think really at the end of the day, it has much more to do with command and control than it does with efficiency. Um, and it's really too bad because I think that it's a show of respect to the workforce that you trust them to do the job, even if you're not looking over their shoulders as they do it.

Speaker B: Yeah. And this command and control idea, it takes us this question of autonomy, because you've talked about that, you've talked about it in your work, but you've also talked about it today. And, um, earlier in the year I spoke to professor, um, Alan Felstead on this podcast and he said something that really struck me. So he is responsible for a survey in the UK and on, um, skills and employment in the 2024 version of that in the UK. One of the most striking findings was a really materially sharp decline in employees feeling that they had ability to make decisions about their day to day tasks. That idea that you've talked about, um, of autonomy, can you say a little bit about why that is so important? And then to the people that are listening, do you have any practical tips about what employers can do to sort of loosen the reins in a way that, um, enables people to have that sense of autonomy, Autonomy that they're so obviously craving?

Speaker A: Well, you know, you don't want people to have a sense of autonomy quite. What you want is for them to have real autonomy. You know, there are a lot of ways you can try to fool employees into thinking that they have autonomy. So what matters is that they feel like they have autonomy because they do. And I think this is a very hard nut to crack because the more autonomy the employees have, the less control the managers have. And, you know, the model that we have, uh, inherited from the past is one where command and control is the, uh, ideal aspiration. Uh, except at the very highest levels of an organization, you want to be able to tell people what to do and count on your authority to get them to do it. So, uh, I would have thought that people would learn, people who manage organizations would learn about more clearly about the benefits of giving people autonomy when the circumstances around Covid forced them to give people more autonomy. But, um, maybe they did, but it wasn't enough to compensate for the loss of control. You know, I mean, the people who run organizations want autonomy too, but what they want is autonomy to tell the people they manage what to do and expect that those, the people will listen to them. Um, there's an enormous amount of wisdom that comes from spending your days on the floor. You see what the problems are in production, and you probably even develop some insights about how those problems could be mitigated. Uh, and if you thought that the organization would listen to you, you'd probably see even more. You know, to a, to a certain degree you go to work with blinders on because you don't think anyone is interested in your opinion. And that's, that's, that's, that's just casting aside enormous potential resources that the organization could be using. Um, and now I have, I've spent my whole life as an academic and I should emphasize that I have virtually no experience with real life organizations. You know, as people like to say about universities, it's a bunch of smart people spending all their time thinking about trivial things. Um, I don't, I don't think I do, but you know, everybody else in the academy does. So, so I understand that, um, I'm sort of envisioning work in an ideal world where there is an atmosphere of mutual respect and mutual trust. That's not the world we live in. And so it takes a big step from people at the top of organizations to be willing to trust the people they manage, to show some loyalty to the people they manage, and to hope for the same kind of trust and loyalty in return. And I think we have largely given up on those aspects of character. And instead we rely on rigid rules and, uh, you know, smart incentives to replace trust and loyalty. With a colleague, I wrote a whole book about this called Practical Wisdom that argued that, that the, um, incentives and rules will not get you the kind of performance from people that you'll get if you trust them and allow them to use their judgment. But that's what we've, that's what we've come to rely on. Instead of having a workforce developing a workforce we trust.

Speaker B: Yeah, I think that it's, it's so interesting because, you know, we see increasingly, don't we, that there's actually a real world cost to this. I mean, certainly in the uk, the instances of sick leave, time away from work for mental health related conditions, you know, I think really strategic HR people understand that we have to move, um, well, being from the sort of fringes, this idea that wellbeing is about provision of benefits, gym subsidies, you know, healthcare. We have to put wellbeing into, into job design. We have to start to thinking of it, of it as being intrinsic to the work roles that people do. But as you say, those things are often much more difficult to achieve in practice than they are theoretically. You know, strategic HR people recognize the theory, they just struggle with the operational delivery.

Speaker A: That's right. Even when that's the thing. This is not an easy thing to produce. You know, even if you have real authority to, to help create such an environment in the workplace, you have to get it right. Because if you give people too much responsibility and too much autonomy, then you create a kind of stress that can lead to burnout. You want to be able to say at the end of the workday, at least sometimes my work for today is done and I'm not going to bring it home with me and I'm not going to be thinking about it when I'm playing with my kids. Tomorrow is another day. So the more autonomy and responsibility you give to the worker, the harder it is for the worker to turn it off. So there can be too much of a good thing. And that means that even with complete permission to create the ideal workplace, it is not easy to get it right and it is not easy to keep it right because you're trying to find the sweet spot between too much command and control and too much delegation of responsibility. And it's very hard to find that and it's very hard to maintain it. So, yes, this is difficult even among the best intentioned people and organizations.

Speaker B: Now, Barry, I think you probably should have a crystal ball because the last question I was going to ask you is really related to exactly what you've just said because you've famously written about the paradox of choice. I find it fascinating because like everybody, you know, it's so recognizable in our own lives. You know, we, our workplaces are sort of overwhelming by tools and technologies and, you know, pathways and opportunities in some ways, which should be a good and exciting thing. Um, but as you say, challenges come with that. So I wanted to ask you, whilst I had you, whether you had any advice on how we reduce that overwhelm that, you know, we all recognize in our, uh, in our working lives.

Speaker A: Well, I think, uh, you know, I, as you, as you, as you mentioned, I wrote this book some years ago called the Paradox of Choice, which is about how, although we all agree that freedom of choice is essential to well being and it's a really good thing. There can be too much of a good thing. And I think that that fact, that choice makes life better and better and better and then it starts to make life worse when it becomes overwhelming. And I think this is true of many of the things we in life. There's a sweet spot and you have to find it. With respect to choice, uh, I've given this a lot of thought and a way to find it is first of all, uh, to embrace the idea that good enough is almost always good enough. That you don't need the best. And all of a sudden you can ignore thousands of options out there because you found one that's good enough and you don't care what else is out there. Uh, and I think that can be applied to almost any aspect of life. Um, good enough is mostly good enough. Uh, you can also delegate a lot of the choices you face to other people. When your cell phone plan is due to expire or your cell phone battery is dying and you need a new phone, you could spend two weeks doing research, or you could ask your friend who recently got a phone how she likes it. If she says she likes it, you just buy it. Is it, is it the best phone? Who knows? Who cares? It's a good enough phone. So you can offload some decisions to other people who you trust. Ah, and you bear. And, and sometimes people will call you for your advice about something. So you can imagine a community of people, each of who was an expert about one thing. And when you need that thing, you call that person and just do what that person tells you. So I think there are, there are steps that can be taken, um, to mitigate the problem of overwhelming options. I don't know what steps can be taken to mitigate the problem of finding the sweet spot between too much control from on high and not enough control. Except that if you create a system where there is feedback between the people at the top and the people they supervise, you can adjust. You know, it's just like resetting your thermostat. If people are too cold, you turn up the heat. If people are too hot, you turn down the heat. So you're, if you're getting feedback and you're trusting the feedback and taking it seriously, you can use input from the people who you are trying to create the sweet spot for to keep your organization more or less hovering in that zone. And there will be surprises. So I don't want to make any of this seem simple. But I do want to emphasize that there's an incredible resource that we're not taking advantage of, which is the half of everybody's waking life that they spend working without using the tool, all of the tools and talents that they have. You know, it may not be reflected on the bottom line of the company, but it is certainly reflected on the bottom line as you're on your deathbed asking yourself whether you've lived a good life and it's a huge waste of resources.

Speaker B: It's fantastic. Really fantastic. Very impactful advice. And actually, it's a lovely way to, um, wrap up the podcast. But before we wrap up, and I've given you a bit of a heads up about this in advance, I wanted to put to you the question that I, um, ask all our guests on the podcast this year. If you had one piece of advice, um, that you would give leaders that want to build their organizations for future resilience in this phase of constant change, what would that one piece of advice be?

Speaker A: Try trust as your default assumption. Trust of the people you work with.

Speaker B: That's brilliant, Barry. Thank you so much. It's been so, so lovely to talk to you. Really fascinating. I know that, um, I've learned a lot, so thank you. And if people listening would like to hear, um, more conversations like this, you can sign up to our website. Um, you can subscribe, subscribe on your usual channels. And I look forward to your company again soon. But until next time, goodbye.