E075: From Generosity to Legacy: What Truly Carries Forward

(Transcribed by UniScribe (https://www.uniscribe.co). Upgrade to remove this message.)

Hello, welcome to the Big Strategy Podcast. I'm your host and fellow strategist, Jeff Hyatt. This is your go-to spot for real talk with the masterminds of business strategy. It's about sharing stories, insights, and those little nuggets of wisdom to help you unlock big growth.

Let's turn the key and spring into action. Future-backed thinking is one of the most powerful tools in strategy, but it might also be the most dangerous. Most leaders set a vision based on what they can imagine today, then optimize backward to get there. The challenge is, if you set the end state, built only from your current thinking, you'll execute brilliantly, but perhaps to the wrong destination.

This episode is about the missing ingredient and where it has to come from. Thus, the third and final episode in Tribute to My Father, and this episode is titled Legacy. My dad used to say, I wish I could open your head and pour in what I know, just like cereal. And for a long time, I heard that as a frustration.

As a teacher, when I would work with my students, or as a coach with an executive, and just wish I could transfer my experience directly to them to perhaps save them some of the missteps that I had taken or to learn from the lessons that I had witnessed in other executives. But I didn't really understand what that meant until I sat down to write my dad's eulogy. Sitting down to write someone's eulogy is a huge callback and reflection to a life and the first emotion that I felt was fear of missing something that was important to my dad and this is where my skill of taking everything that he had done everything I had witnessed and not just writing down what I had witnessed through my eyes but practicing empathy backward to what he had hoped I would have understood and how that landed with me.

And so in that moment, I shifted from what did he do, trying to remember every event, every lesson, every conversation we'd had, to what did he build in the people around him? Looking at myself, my sister, his sisters, his wife, professional community, etc. As you draw these concentric circles out, you begin to understand the impact that he had. And frankly, I think his analogy fell a little short.

It's not like pouring cereal into one person's head or cereal as a metaphor for experiences into one person's mind. Because if you think about it, we all need something different from our mentors, our loved ones, etc. And what I realized was that his legacy wasn't a list of accomplishments. It was a set of principles.

that I was now carrying forward, principles of generosity, as we had talked about in earlier episodes, standing on the shoulders of others, and now finally the conversation about legacy itself. The serial line wasn't about knowledge transfer. It was about wisdom transfer, the difference between knowledge, knowing something, and wisdom, understanding it, embodying it, and acting on it. That's the difference.

whether it's in the classroom or in your personal relationships. You can't pour wisdom. It gets lived through actions, through experiences into the next generation. So why does this matter for corporate strategy and your strategy?

Here's the connection. Every strategist, every CEO eventually does some version of future back thinking. You picture the end state and you work backwards. You build the plan.

But the question no one asks is whose wisdom shaped that end state that I am aiming for? And if the answer is only it's my vision as of everything that I know today, you're optimizing towards a target built on an extrapolation of the past and risks amplifying your blind spots. Think about this is the big challenge with AI. When you think about existing forms of computer programming, it's a very algorithmic approach.

You input data, then you have a team or a developer or someone who's intelligent builds the algorithm or the steps to achieve a known outcome. And our knowledge. or our experience in building those steps can predict or determine just how creative, how innovative the outcome is. With AI, we're allowed to picture the outcome, dream the outcome, believe what that outcome could be without even knowing how to achieve it.

Sitting with AI saying, this is my dream. This is what I know today. What am I missing? And let's build a creative, constructive path to this imagined future.

And as humans, it's hard to let go of that process, that urge to build. But we need to shift from that urge to build with knowledge to that urge to dream with wisdom. And this isn't just a personal problem. It's the strategic risk of the AI era.

AI gives leaders something they've never had before at this scale, the ability to move from the current state to the envisioned end state, that dream, the ability to move there faster, to compress timelines, perhaps skip steps and optimize the path. But the unspoken assumption is that the end state we're racing towards is the right one. Even though it's a dream and we think because we've allowed ourselves to dream, that end state is the most optimal outcome. We need to call back to an earlier reframing.

And that is that just as AI makes us more efficient, what is that efficiency in service of or in service to? A pattern that I keep seeing is that we set financial goals. to cut costs, raise revenues, drive profits. And we find the, in the past, we found the tools to make that possible.

Buying new software, buying new equipment, hiring new people. And AI has made that faster because now we can say, I don't need to hire people. I don't need to buy equipment. I can cut these resources and still achieve faster cycles, automated content.

leaner teams, and you hit your number. So the success has been achieved. But what got lost was that thing that actually made them want to start the company in the first place. We saw this in earlier cycles in tech, where the founder gets pushed out when the professional management comes in.

Now the risk becomes is, do we need that founder's creativity? if the professional management teams can simply enlist an AI to achieve that outcome. Conversely, do we need professional management teams if founders can simply create an agentic AI that exists as their professional management team and drives them to these optimized outcomes? But in both cases, I argue what...

got them into business in the first place, one would hope, is the ability or the desire, the passion to make things better. As my mentor Clark always said, no one goes into business looking to make things worse. But we can all point to examples when someone achieves, others are worse off. So I caution you, if you optimize for the number without being mindful of the path it takes to get there, there's a great chance that you don't end up at the optimal endpoint.

And this goes beyond governance and ethics of AI itself. It comes down to the ethics of the people involved. And this is what scares me today is when AI, just as railroad companies took land, displaced people. and exploited labor to achieve an end.

We're doing the same thing with AI today. We're taking water, taking electricity, and exploiting the environment to increase our compute power and our speed so that we can build more robust models that risks ultimately displacing humans, displacing our creativity, our curiosity, and our judgment as we outsource it to the AI. So the principle I want to ground this episode in is future back without past forward is just projection. Let me repeat.

Future back thinking without bringing values forward is just a projection and amplification of the mistakes that came before us. We're ignoring the serial that is so readily available. Future back thinking gives you the direction, but it's that inherited wisdom that gives you the guide rails on what's worth optimizing for in the first place. AI has no clue.

It has no context. It doesn't know. It's a statistical engine. It can't have context.

It can't have values, except the values that you imbue. Otherwise, you risk building a company based on a set of values that the AI has extracted. by scraping the internet. Do you really want to peg your future and the future of your company off of data scavenged online, knowing what exists online?

One without the other, future back without pass forward is how smart leaders execute their way into outcomes that they don't actually want. And I would go further and to say outcomes that maybe they're not proud of. Outcomes that you wouldn't want to share with your kids. And I know a lot of executives today are justifying the outcomes because they say AI is going to take these jobs.

So I need to get as much money, as much wealth, as much power as I can get my arms around today, knowing that there's a future where there will be less opportunities, even for my children, right? The executive's children. And if I don't get my arms around that today, it will be gone. And I will fail my future generations.

I would argue, are those the values that will allow future generations to thrive? Maybe they are. Maybe my future generations are destined to sit around a campfire. But I would argue, compassion, curiosity, creativity, empathy, These basic human to human connections are what has gotten our species to where we are and will get us to where we're going.

Every quarter, every plan, every AI implementation, leaders are doing future back thinking, whether they call it that or not. The discipline isn't to stop doing future back thinking. The discipline is to add the missing input. And if you remember what we talked about before, future back thinking has to be complimented with past forward.

So what are the ways that you can check? What's an audit or a checklist, right? We're MBAs. We love frameworks.

What is our framework? Well, question one, picture the destination, not the next quarter, but that legacy moment. What is your son or daughter or loved one? going to write about you at the end of your life.

What does it actually say? For my dad, we told stories about his working career as a way to laugh. The people who came, some of the people who came were his former colleagues, but they didn't come because of professional accomplishments. They came because of who he was and what he did for them.

So I would argue the destination for him, was how he made other people feel about themselves. Question two, audit the path. Look at what you've optimized for this week. Does the path you're on lead to that destination or somewhere adjacent that just looks similar from far away?

It's very easy. This week of the quarter, I do X. Next week of the quarter, I do Y. Or this quarter looks like the same quarter last year, except for these mild enhancements.

But let's be honest about auditing the path. How has things changed for the people who will eulogize you? I was blessed today. My daughter's school bus had a mechanical trouble.

She was waiting at the bus stop. She was able to call me. I could pick her up and take her to school. What does she remember?

She remembers that dad is safety, dad is comfort, dad always has her back. You may tell your kids that. And maybe your work environment, you can't be there every day. But if you're looking for opportunities to show your kids that you have their back, I guarantee they exist, even if you have to go to work first thing in the morning.

So challenge yourself. Probably your kids who are going to eulogize you. How will they audit the path to the destination? And finally, name the inherited wisdom.

Whose voice is in the room when you set that destination? Is it a mentor? Is it someone, a spiritual leader? Is it your partner?

If the only voice is yours, you're missing the most important input. Legacy isn't what you leave behind. Legacy is what shapes the destination you're walking toward right now. My dad couldn't pour what he knew into my head like literal cereal, but he poured into it how I think.

And now in this episode, hopefully I've passed that on to you. That's how legacy works. It's not a download. It's a direction.

And a direction... not just extrapolating the past linearly to the future to achieve a result, but toward an unexpected future because we are being propelled by a set of values and beliefs that we would want others to eulogize us for. So in closing, pulling everything we've learned together, generosity is about how you operate. Standing on the shoulders of others was about where your wisdom comes from.

And legacy is about where you're heading and whether that path matches the destination. The three principles aren't separate. They're one practice. So try the future back check this week.

Send me what you come up with. I'm holding you accountable. What have you come back? What did you learn?

What did you realize? What's something that is a little bit different? What got clear and what in your path needed adjustment? This three-part series has been very important to me.

I'm very grateful for the feedback that I've gotten from others about their own experiences and just being grateful that I shared this experience. Again, I want to praise my Vistage team for pushing me to complete this, not only start this, but complete this. And going forward, we are going to shift into executing on the news of today, but with a set of values that I hope to be eulogized for someday and if you align with those values this podcast is for you please like follow subscribe and most importantly share with someone you care about if not the podcast share with them what values are important to you and ask them do you see those values in me am i exhibiting them day to day and if i am how might you the listener take those forward This is the Big Strategy Podcast.

Thanks for listening. (Transcribed by UniScribe (https://www.uniscribe.co).

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