Episode 4: Ken Chenault on two-way mentorship, creating opportunity & corporate responsibility

The big question: Is there a way for social and financial due diligence to co-exist?

Guild CEO Rachel Romer and best-selling author Adam Grant bring this important question to Ken Chenault — current Chairman and Managing Director at General Catalyst and former CEO and Chairman of American Express. 

In this episode, we explore how companies can — and should — respond to the opportunity divide, including ways to:

• Facilitate career mobility with coaching and mentorship for all employees
• Practice skills-based hiring and development to remove biased barriers to entry - especially for leadership roles
• Define a company's role and responsibilities in relation to social impact

Listen now and subscribe below to get the latest on Opportunity Divide episodes.

“...The era of move fast and break things is over... There’s a responsibility to understand the implications of what we do.

...In my view, if you want to build an enduring company - very rationally - you have to say, I actually want a healthy society, so what can I do to help build a healthy society?” 

Ken Chenault, General Catalyst Chairman & Managing Director

Meet the guests

Ken Chenault

General Catalyst Chairman & Managing Director

Kenneth I. Chenault is the Chairman and a Managing Director of the venture capital firm, General Catalyst. Prior to joining General Catalyst, Ken was Chairman and Chief Executive Officer of American Express Company, a position he held from 2001 to 2018. Under his leadership, American Express built one of the world’s largest customer loyalty programs – Membership Rewards – and earned global recognition as a leader in customer service.

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Rachel Romer

Guild CEO

Rachel Romer is Guild’s CEO — a Public Benefit Corporation that provides employees of America’s largest companies access to education, skilling, and career mobility through their employers without paying for tuition or career services on their own.

LinkedIn

Adam Grant

NYT Best-Selling Author of Think Again

Adam Grant is an organizational psychologist and bestselling author who explores the science of motivation, generosity, original thinking, and rethinking. ​He is the #1 New York Times bestselling author of 5 books that have sold millions of copies and been translated into 45 languages: Think Again, Give and Take, Originals, Option B, and Power Moves.

LinkedIn

Podcast transcript: Ken Chenault, Rachel Romer, and Adam Grant

Rachel Romer [00:00:00]:

Can corporations impact social change to support closing the opportunity divide for talent? And in what ways does mentorship and coaching play a role?

Ken Chenault [00:00:09]:

The reality is getting companies to really focus on meritocracy. Meritocracy is saying we want to get the best people, but we're going to afford them the opportunity to better themselves and we're going to move to a.

Rachel Romer [00:00:28]:

Skills first approach America's workforce. We lead them, we need them, we rely on them. But can they rely on us? I'm Rachel Roemer, CEO of Guild, and this is Opportunity Divide. Ken Chenault is the chairman and managing director of General Catalyst, a venture capital firm. He was the Chairman and Chief Executive Officer of American Express for 17 years. That's four times the average term for a CEO. And Ken's also been named the gold standard for corporate leadership by none other than Warren Buffett. Through his work with Guild and others in his portfolio companies, Ken provides advice and insights on responsible innovation and is translating those ideas into action. He's the founder of 110, a coalition focused on upskilling hiring and advancing 1 million black Americans over the next ten years. And he's also a founding donor to the Art for Justice Fund, along with his role as chair of the Advisory Council for the Smithsonians National Museum of African American History and Culture. We talk about skills based hiring, and one of those skills that can feel ambiguous is leadership. The reality is being a great leader isn't something a degree gives you. It takes experience. I challenge Ken and Adam to share how we as leaders can give more people the chance to lead without the prerequisites of having gone to a great school or being born into a connected family.

Ken Chenault [00:02:01]:

I think one of the reasons why we have this divisiveness in the country is what is absolutely true is the American worker, and particularly the American worker who does not have a four-year college degree, feels that they're trapped and they don't have a place to go. So one of the things, and I would actually credit my involvement with Guild and some other investments that we've made of really focusing me on the incredible opportunities with retraining reskilling, giving people the education tools to move forward. 65% of the jobs where the pay is 80,000 and above or more require a four year college degree. And the reality is, in many cases, it's not relevant. And skills opens up an opportunity. And one of the exciting things about 110 that I think given the political divisiveness in our country and the racial discord can be really powerful is as we started off 110 with a focus on finding a million jobs for black Americans. And one of the things we said was that we wanted a ten year commitment from companies, both financially and a jobs commitment for ten years. But when we looked at some of the causes, the reality is that four-year college degree became an incredible obstacle for many black Americans. But as we got involved more in educating ourselves about skills first, we found that's obviously going to benefit all Americans. And so the reality is getting companies to really focus on meritocracy, which meritocracy is not having an artificial requirement. Meritocracy is saying we want to get the best people, but we're going to afford them the opportunity to better themselves and we're going to move to a skills first approach. And I will tell you, I think skills-first could be one of the most transforming developments in providing opportunity for people than almost any other initiative that I can think of. You talk about the hope that comes from that because it's real. I think it's just incredibly powerful.

Rachel Romer [00:04:54]:

My belief is skills are what matter, and degrees or any other alternative that comes, whether it's a certificate or an apprenticeship, they're the container by which we currently use to send a signal about what skills you might have. And the reason for that is it's really hard to measure skills. So we've built all these signals to try and tell people what their skills are and we're trying to disrupt both the signal right now, right, get, move away from degree as the proxy, but we got to invent new signals and we've got to figure out how to measure skills. Adam, what does the research say on how we're going to get better at measuring skills? And I'd particularly love your view on soft skills, which is where the liberal arts degree and some of that intangibleness that people love. We just haven't figured out how to create signal and measurement around that.

Adam Grant [00:05:44]:

Yeah, I think it's a huge problem and it's one that we're not spending nearly enough time or frankly, resources on. And I think the place that I would start is to say, I wholeheartedly agree with you that credentials are a terrible proxy for competencies. That the softer the skill is, the more critical it becomes over time and yet the harder it is to measure. For me, what is the most important soft skill of all is the motivation and ability to learn ultimately, how skilled you are in any domain is going to hinge on whether you want to grow and then you have the capacity to absorb new knowledge and to try out new behaviors and habits. And so one of the things that's surprised me quite a bit in working with organizations over the last few years is that there are not more workplaces saying, you know what, we're going to treat this interview as a tryout and we're going to test your motivation and ability to learn. You've got a week, here's a skill we want you to master, or here's a domain of knowledge that we want you to google and then come to us and demonstrate what you've discovered in the past week. That to me is a better test of your ability to grow because we don't know how much of your existing skill came from motivation, came from ability, came from luck and opportunity. And I want to try to tease those things apart by giving you a chance to grow in the moment. That would probably be my starting point. What do you think?

Ken Chenault [00:07:05]:

I think it gets to what people need to be successful. I think we'd have to think about the levels of competencies that we're looking for. And there's some where the signal of some type of certificate may be helpful when we're talking about significant volumes. But I think it's a real start that we could build upon in a powerful way. And what I also like about it, Adam, is it gets to the engagement that I need to have is why do you want to work here? And part of it is you're taking a chance on me, giving me the opportunity. But I need to come with an attitude of I'm going to show you why I'm the right person.

Rachel Romer [00:08:05]:

It correlates with the data our companies are seeing. So I had this amazing conversation with the Chipotle HR team.

There are folks in their learning programs, any learning program –English as a second language, people management, a college degree, technical cert, you name it. The folks who are learning at their company are being promoted at 2.3 x higher rates in some groups and upwards of seven X in other groups than the peers who have the same job title and aren't learning. And we had HR and L&D leaders in the room and what they said was this could be correlation or causation. And both are great. Here's why. If it's correlation, the learning program and the fact that the person is raising their hand to learn is simply they came to us that way, but it's helping us select our most curious, our most learner mindset employees. And if it's causal, if the learning they're doing on the job is the reason, they're then being able to step up and they couldn't have been promoted without the learning, that's great, too. And that's the impact of the skills acquisition. And so they said whether this is a signal of learning or learning as an input driving the outcome, both of those are positive selection indicators in our business. And so it just is so tied.

Adam Grant [00:09:22]:

That's fascinating. Normally when we think about a learning program not having causal effects, we would say selection bias is a huge problem, we want to control it out. And I think what you're saying is, no, actually it's a filter. Because if the kinds of people who are going to get promoted are drawn to these programs, these programs are doing part of their job for us. I think this is relevant in the hiring process too. Right? So I was thinking as we're talking, where have I seen organizations try to prioritize not just the skills you bring to the table today, but your potential to learn tomorrow. And one of the better examples I've seen was a company that was hiring technical manual writers, and they said, okay, yeah, there's obviously a stem aspect of that skill set. But communication is ultimately essential to the job because it doesn't matter that you know how to put together, let's say, a computer or a lawn mower, for that matter. What ultimately counts is whether you can explain how to do that to somebody who's just bought it and has no idea what they're doing. And so they said you know what? We're going to test people on this. We're going to give them a relatively simple product. We'll put a TV in front of them. We'll give them a couple of hours to take it apart and put it back together and then ask them to write a manual for how to assemble it. And you can immediately see who the clear communicators were. You can immediately see who had really taken the customer's perspective and who hadn't. And that strikes me as something we could do long before people get into a learning and development program in the hopes of getting promoted. Right? Why not do that as part of our interview process?

Ken Chenault [00:10:54]:

No I like that a lot.

Rachel Romer [00:10:56]:

Ken, question for you. You've been a Fortune 500 leader and so you can sit with your classic capitalistic mindset that some might attribute there but you were a provocative one and one of my favorite things you've said is companies exist with permission from society. And you and I have had really thought provoking conversations that have helped me formulate my thoughts on the relationship between capitalism and democracy. And those are esoteric topics. But we're seeing them show up in every company today as people are asking their CEOs and their CHROs, their people team, to make sense of what role corporations should be playing on social activism and on important topics. Can you share your perspective on that conversation within the corporation and for the Chief People Officer?

Ken Chenault [00:11:47]:

So I think what's important to me as you said Rachel is that often in a political environment people talk about entitlement programs and the reality is that corporations benefit from entitlement programs and corporations are just not entitled to be in existence because people view it's the way you support a capitalistic system. The reality is I believe strongly in capitalism. I really do. I think it is incredibly important for a free thinking society. But I also believe, and I start off very fundamentally that I think every person in business, every person doesn't matter what stage of the company should want to have their company endure. Then I think you have to say there are a range of stakeholders in our society and I do think that if you're long term you want a healthy society and so what's the role of companies in contributing to a healthy society? And as you know Rachel one of the areas that I've tried to focus GC on with hamont tunasia is what should be the role for companies that are just starting out. And one of the things is, with all the advances in technology and AI and machine learning, we should focus on understanding what are the first order, second order, third order effects of what we do and a number of things that we do. It's ascertainable to say this could have a dangerous impact, let's try to think that through. And that's why we say the era of move fast and break things is over. And it's over because there's a responsibility to understand the implications of what we do. I think that, in my view, if you want to build an enduring company, very rationally, you have to say, I actually want a healthy society, so what can I do to help build a healthy society? The action should not be guided by your political affiliation. It should be guided by is this fundamental to our society? And there will be a few issues that are fundamental. I think what shouldn't be taken lightly is when companies say that they are really focused on diversity. The reality is when you say all people then therefore should be welcomed and feel valued in the company. That's a lens that you do have to look at different issues through because you can't. I've said to people, it would be a lot easier if we didn't have so much diversity. And I'm saying that obviously I don't believe that. But the reality is because in fact, we are a very diverse society, increasingly diverse, we need to understand the implications of that diversity in creating an environment where all people feel engaged, not just tolerated.

Adam Grant [00:15:44]:

Well, Ken, I completely agree with you and I would just add that, yes, if we didn't have so much diversity, things would be a lot easier and they'd also be a lot worse. I mean, if you go to basic evolutionary biology, there's a reason that we have diversity in our ecosystems because that makes us more resilient, it makes us more adaptable to a changing environment. And I think if we think about diversity in workplaces, what we know is the more innovation you need, the more valuable diversity becomes. And that's not just because of variety of perspectives. That's part of the story. But another piece of it, and this is the brilliant work that Kathy Phillips and her colleagues did, is that when people come into a diverse group, they prepare more carefully, they think more deeply, they explain themselves more thoroughly. And that's all good for group process. I know. And this is not limited just to demographic diversity, right? Let's say I'm a salesperson. If I come into a group of engineers, I know I'm going to have to work harder to translate. And that leads to better thinking and a richer conversation than if I'm talking to a bunch of fellow salespeople. And so I think there's a really strong case to be made there. I think that maybe to tie a couple of threads together from earlier in the conversation, ken, you were stressing the importance of meritocracy. I was blown away by some work by Cassia and Bernard a few years ago which showed that organizations that claim to be meritocracies actually end up being more biased. As a manager, if you're in a meritocratic culture, for example, you are more likely to favor a male candidate over an equally qualified woman because once you assume that your culture is a meritocracy, you don't check your biases anymore. And I think that's scary. And I think the first thing that we all need to do is to acknowledge, you know what, meritocracy is an idea. No organization has reached it yet. And that's something we need to be working to get closer to.

Ken Chenault [00:17:31]:

Adam, what I would say is in the work that you've done and there's a lot of analysis out there. One of the disappointments for me is that companies number of companies are just very unaware or ignorant of the analysis and the data. And in many companies, people are very uncomfortable talking about the importance of diversity. And we're also in an environment where sometimes if you do, you're called woke, which in certain respects has become the red smear like the McCarthy era because no one defines what it is. So I just be interesting, just your thoughts of, given the facts, why you don't think a number of companies are aware of the data or are they dismissive of the data?

Adam Grant [00:18:31]:

Well, Rachel, I'm curious to hear your take because you navigate this in a lot of workplaces. Maybe I'll just kick off on this one by saying I think that we might have overemphasized the business case, and there's some new evidence suggesting that when you make the business case, people don't feel like they have to do it because you can also make a business case for lots of other investments that have positive but uncertain future returns. Right, right. And I think it might be time to shift over a little bit to the moral case. And this is a very strange thing for me to say as a social scientist, but when I say, look, diversity is not only bringing you all these potential benefits, but it is the right thing to do. It is wrong that people were denied opportunities who are equally talented or more talented just because of the color of their skin or just because of the sex that they were born. Right. That's just wrong. You can't then say, well, I'm going to go do the other moral thing. I wonder if we've actually been working too hard on the analysis side.

Rachel Romer [00:19:34]:

Yeah, I agree. Adam and my ad would be I think there's also a zero sum sense. I grew up in college admissions, I worked at Stanford. I thought I was going to work on that side of higher ed and disrupting higher ed from the top down. A year in, I became very disillusioned because what I think we accidentally did in the higher ed movement and I think that spilled over into the corporate space. And you now see the lawsuits following is we made it sound zero sum. If we give this person preference, we are denying somebody else. And that's tied up with the fact that higher ed has been defined by those we exclude. The way you get ranked as a university is by how many people you exclude every year and you can literally manipulate the rankings. There are schools that have generated more applicants. They send out mail to every 17 year old so that they can have a bigger denominator, so that their percentage application rate can go down. Because we define schools by who they exclude, if we define schools and workforces by who we include, you can move from zero sum thinking, which we know scarcity mindset, really hampers innovation and makes companies very unsuccessful, and move to abundance mindset. And the idea that there's enough space at the table, right, we don't have enough workers, right? We simply don't have enough workers right now in America. I think we can shift it. So I love the book The Sum of US and that's what really changed my mind on that.

Ken Chenault [00:21:01]:

I think one of the things that is important, and I'd agree with you, Adam, is I think doing what's morally right is important. And again, I go back to enduring companies. The reality is the companies that really endure are the ones that over time really take the ethical path and they have built trust with customers and clients. Clearly they make mistakes, they have lapses, but there's a moral that they feel that they need to meet. And I think one of the basic requirements of a healthy society and the potential which is so exciting, is to really be welcoming to everybody. I think one of the ways to do that is by demonstrating to people that they don't have to stay in the same position of who they are, what they are. They denied opportunity, they had a personal issue that they in fact can surmount the situation they're in. And I really do believe that the workplace and how people feel about having a job that's meaningful, the return on that investment to society is incredible.

Rachel Romer [00:22:46]:

When we think about a corporation's response to the opportunity divide, we have to look at the micro moments of impact that they can have before bubbling social change up to the surface. One of those ways is through coaching and mentorship. I have the privilege to call Ken a mentor and he's invested in me as a CEO of what was then a 250 person company. Many years ago I was a new mom and I was making mistakes left, right and center while trying to hold it all together. While I know the impact that mentorship has had on me personally. Our research at Guild affirms the impact that coaching and mentorship has in career development for American workers overall. In fact, coaching and mentorship played an incredible role in Ken's development too.

Ken Chenault [00:23:35]:

I'll give one example of how mentorship impacted me. I was a very indifferent student until I was in my sophomore year in high school. So I was someone who tested well, I read a lot, but I just frankly focused on what I enjoy doing. And the principal of the high school called me in one day and he said, ken, you're really frustrating everybody, your teachers, your parents, because you're just not applying yourself. And he actually sketched out and said, you could do incredible things in the world if you would just concentrate and focus, and I really believe in you. It really hit me. And one of the things I learned from that mentorship was, mentorship is a two way street. Because one of the things that he said to me was, I'm investing in you because I think I'm going to get incredible returns and society will get incredible returns. And often people get mentorship confused with, I want to meet this important person, and they look at it as a one way street. And so in my life and in business, what I've always said to people is, don't select mentors based on where they are in the power structure. Select mentors for people who in fact have really good judgment and can make you a better person, but also understand that you got to pay it forward. And so I really look at mentorship as really a partnership. And I always try to think about when I'm mentoring someone or when I was mentored is, how do I make a return on that investment?

Adam Grant [00:25:55]:

You spoke to something that I think is extremely powerful for people to hear early in their career, which is, I have a lot of students, and this has been now, what, a decade and a half of Wharton undergrads and sometimes MBAs too, saying, okay, I'd like to get somebody to mentor me, but I don't have anything to contribute. I think they have a very narrow idea of what a contribution is, and you just reframe that. What I've been telling them all along is your contribution is to make their investment worthwhile, and their reward is your growth. So what do you like to see a mentee do along the way to make you feel that your contribution is making a difference?

Ken Chenault [00:26:34]:

So I think, Adam, you actually touched on one of the important things that I think is important for mentees to recognize is what are you doing in a very tangible way to grow as a person. It's not that someone is immediately going to do great things, but what you will see are changes in people's behavior, which is the leading indicator that they will do great things. And then when those great things happen, you obviously feel incredibly proud, proud of the person, but also proud that you contributed to their development. What I look for in people is self awareness or the willingness to take feedback without being defensive. We're all human, and I understand sometimes the initial reaction is, am I really perceived to be like that? But what to me is most important is the willingness of the person to understand how they are perceived by other people, as well as to understand that there are areas in their leadership behavior that they need to improve. Because I don't think you can be an outstanding leader and be unaware. It just doesn't work. So that to me, is a really basic requirement.

Rachel Romer [00:28:17]:

I'll build on that. I share the self awareness component with Ken, and I think that's a muscle that all of us as leaders need to be building all the time. And it actually gets harder because you get less aware. To your point, Adam, of remembering what journey you've been on. And I think about this at Guild because we do sort of reverse mentoring. And so I think about, who do I want to be mentored? Because people who have been through an experience where they've faced some level of adversity and then have had to reflect on, what did I learn from it, tend to be really good coaches to then help others go through that journey.

Adam Grant [00:28:51]:

It's not something I've given enough thought to. I'm realizing, as we have this discussion, I think too often I've probably looked at somebody's accomplishments as a proxy for their judgment. But sometimes people landed at where they are due to a lot of luck. In other cases, the skill they have is actually not the one that I want to learn. And so I think what I'm thinking about, hearing both of you talk about this is maybe a bit of a test of is this person going to be a good mentor? Is to present them with a dilemma that I've already faced and ask them how they would think it through and then see, okay, is that reasonable advice? How does that track with what I learned from the way that I approach that and then try to I guess what I'm looking for there in good judgment is wisdom. Do they take multiple perspectives? Do they consider more than one value? Do they realize that there's no piece of advice that's right in every situation? And I think that's something I guess I can see more clearly in somebody's reasoning than just knowing the outcomes of their decisions.

Ken Chenault [00:29:47]:

To me, the best mentors provide advice and counsel, but they're willing to let the mentee make the best decision that she or he thinks is the right way to go. And I would say that's hard for some mentors because their view is, if I take the time to give you my advice, you should ultimately do what I say you should do. And that, to me, is not the role of a good mentor.

Adam Grant [00:30:23]:

It speaks to one of my favorite research findings about mentoring, which my colleague Francesca Gino is responsible for. She found that in a lot of cases, mentors have the first instinct to try to help people narrow their options, but mentees are actually more interested in having their options broadened. And so the idea that I'm going to guide you to the right decision as opposed to bringing up blind spots or possibilities you haven't seen, I think is a missed opportunity for a lot of mentors. And I know I've been guilty of that as a mentor, of saying, well, here's how I would approach this decision, and therefore, if you don't do that, you're missing the boat here, when instead my real role is to help them clarify their thought process, right, not point them in one direction.

Rachel Romer [00:31:04]:

It's interesting because listening is a skill, and I think we so often think leadership is innate and you've either got it or you don't. And I am so in the opposite camp, having had to work so hard at learning these skills and sometimes succeeding, and some were innate and some haven't been. Ken, I'd love to hear your thoughts a little bit.

Ken Chenault [00:31:25]:

Absolutely. You know what's interesting? I'll just use a little bit of in my leadership journey. One of the initiatives that my predecessor put in that was really game changing for the culture. And you've got to remember, this was in the early 90s where organizations didn't do a lot of feedback and upward feedback. And one of the things we did was peer feedback and upward feedback, and there were always ten things you did hopefully well and ten things you didn't do well. And I was a hard charger and I thought, I'm really doing well. And I got my feedback, which there were a lot of good things on it, but there was one thing that was really disturbing was the feedback was I was not a good listener. And what they said is, we really like Ken, but if he doesn't think you're saying something that's really intelligent, he just zones out, in fact. And then it went further and said, we feel because we admire other aspects of him, we feel disrespected. And I was I was devastated because I said, look, I'm I think I'm I'm a compassionate person, whatever. But as I really reflected what I did see at the beginning of a conversation, I'd sort of try to diagnose who was really smart, who was giving good ideas, and I would zone out on someone if I didn't think they were really saying something that was really powerful. And so I remember that night just going home and saying to my wife, Kathy, this is just really bad. And so I had to go out to my team and tell them about the feedback, go through what my action plan was, and of course, type A. I said, I'm going to fix. This in weeks and you get the report back in three months. And there wasn't much of a change. And after around a year and a half, people really did see a change. And then five years later, they said, boy, Ken's one of the best listeners I've ever seen. And I would say that it was not just the issue of feedback on that specific issue, but it made me incredibly vulnerable, which was instrumental, and I believe, to me, becoming a better leader and a better mentor.

Rachel Romer [00:34:14]:

This conversation was a reminder that we can find mentors who can support our career in so many different places. But Ken also brought up that mentors have to empower mentees to make their own choices. Mentors only can provide advice, and so our instinct may be to start narrowing people's choices and to guide them in a certain direction. But the best guidance you can give actually broadens people's options. In other words, expand their world of opportunity. We rely on them, but can they rely on us? I'm Rachel Roemer. We'd love if you'd join us to continue these important conversations. To do so, click the link in the show notes next time.

Geoffrey Canada [00:34:58]:

Some kids are worth more to industries. If these kids failed and if we saved them, I have challenged this country to rethink the sort of lack of investment that we're willing to make in some children in some places, while we do these poor investments in other areas.

Rachel Romer [00:35:17]:

You'll hear from Geoffrey Canada, the outstanding founder of the Harlem Children's Zone. We'll discuss how understanding an employee's lived experiences can actually help with recruiting, retention and opportunity creation.

Geoffrey Canada [00:35:30]:

Anyone who's dealing with business that they know, it's a big country and a big world out there, and having diverse sets of experiences will help you navigate that for real.