David Grossman on Leadership, AI & Change | Future of Work Podcast

Welcome 

David Grossman [00:00] — …is that employees — less than 20% — feel seen, feel heard, and feel like they’re reaching their full potential. So when I thought about the book and the research, I thought I was going to write about bad leaders. But actually, it’s the good leaders today that we need to be thinking about and worrying about, irrespective of company size — because they were trained for stable times. They weren’t trained for all of this uncertainty that we’re dealing with today. They weren’t trained to deal with the emotional load that employees are bringing into the workplace today — whether you have 10, 50, 50,000, 150,000. 

Frank Cottle [00:36] — David, wow — you have done so much. A who’s who of people you’ve written for, publications — it seems like you’ve worked with almost everybody in the Fortune 500, plus a major Harris poll on workplace management. Who haven’t you worked with?   

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David Grossman [00:54] — There are a few companies on my wish list, definitely.   

Frank Cottle [01:00] — Okay — well, you were on our wish list, so we’re really grateful to have you with us today. I’m intrigued by the Harris poll — the work you did with Harris, surveying thousands of different companies. It concluded — and I think it’s sort of pointing out the obvious, but then, what to do about it — that AI is really the most frequent and the major organizational change, the change-management issue, we have to deal with in today’s business world. As we look toward the future of work, why do you think this particular change might be harder than changes in the past?   

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AI Is an Identity Question   

David Grossman [01:45] — AI is such an interesting topic today, because people think about it like it’s a workflow change — but the reality is, for employees, it becomes an identity question. They start to wonder big questions: Do I matter? Do I belong? What’s my role? What’s my job? And for anyone at work, those are big questions. Those can be scary questions. So I think that’s one reason.   

The second is: most changes have a beginning, a middle, and an end. It’s a benefits change; it could be a new piece of software being implemented. But AI — it doesn’t seem, it is true — AI is this relentless change. It starts to get implemented, and there’s a new version, and there’s more. It is ongoing. And I think that’s part two of what makes it so challenging and difficult from an employee perspective.   

Frank Cottle [02:46] — Well, it’s funny — you said employee identity, and I started thinking 1970s-esque, people in white robes wandering around saying, “Who am I?” But that really is a huge issue within companies, because a big percentage of people identify with their jobs as who they are as a person, both inside and outside of their job. So I can see the challenge there. Is it speed also — is speed of change the challenge? When we first applied technology to business — my first office had handwritten letters and a telex. I’ve seen the march forward of technology in every iteration, but nothing has moved at the speed we’re seeing AI move. And I don’t think anything has threatened people in the same way that AI does. 

The “AI Cover Story”   

David Grossman [03:54] — Yeah — very true. I think part of the challenge is that organizations have not communicated this well at all. They haven’t talked about what the benefit of AI is for employees; they’ve talked about it for the organization. And I also think some of the tech companies have created a lot of fear that this will replace jobs — and the data out there is pretty much a mixed bag when it comes to AI replacing jobs. The reality is AI is more of a complement to one’s job: it helps with some of the routine tasks to allow employees to do the higher-level, more important kinds of things that only humans can do.   

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But as we’ve seen so interestingly lately, in some of the earnings reports as well as some of the restructuring announcements — we see this AI cover story, as I call it.   

Frank Cottle [04:51] — I think that’s it on a lot of these layoffs. It’s a cover story. “Oops, we goofed — we’ll blame AI.”   

David Grossman [04:58] — Absolutely. Versus a CEO or senior leadership team that takes some accountability and says: look, the market’s changed, we’ve made some decisions, we own some of the changes we’re making. And at times we do need to let people go — we’re going to do it, hopefully, in a hugely respectful way, and then focus on the people who are left. That’s not necessarily what we’re seeing, Frank. But that’s the wish, that is what’s possible, and I think the best companies are doing that.   

“Angels, Not Agents”: Frank’s Playbook   

Frank Cottle [05:27] — Well, you know, we have another company aside from Allwork — about 140 people. About a year ago, we pulled everybody together and said: hey, AI’s happening. We’re going to embrace it. We’re going to put a band of angels on everybody’s shoulder — so not agents, but angels; things that will help you. By the way, we’re not laying anybody off. We think we can improve our productivity by 100% in the next year. We’re rewriting every single job description in the company. We’re providing these tools. And if we reach our production goals, everybody gets a raise. So our team — everybody goes crazy for AI. “What more can I do? How can I do it?”   

David Grossman [06:27] — Bravo to you, Frank. What a perfect way to do it.   

Frank Cottle [06:30] — It was just messaging. And so far we haven’t exactly doubled our productivity, but that company had around 25% growth last year — and we hired two people. That was it, for 25% growth. On all of our metrics for adding positions, we reanalyzed and said: we won’t need to add X people per Y accounts, because we have a big commercial account structure in the service department — we don’t need to add those people. So we didn’t let people off, but we did slow down on our hiring.   

And in the challenges facing the workplace today — and it is a future-of-work issue, let’s look at Gen Z — the slowdown in hiring, I think, is more impactful than this or that big company having a layoff. I’ll point one thing out: we all study different data. If you look at the Bureau of Labor Statistics, which tracks the formation of new entities — LLCs, corporations, et cetera — in the United States, as these layoffs happened, there was a blip in entity formation. A lot of the people who had skills said, “screw it, I’m going to become a consultant or start my own firm.” We see a little peak right around each one of these major layoffs. That’s another interesting element of what’s happening in the world of work.  

The Say-Do Gap   

David Grossman [08:09] — I want to highlight one of the things you said, Frank — you mentioned messaging. What’s so interesting is that what you did is not just about what to say and how to say it; you were also focused on what to do and how to do it. There wasn’t this say-do gap that we often see inside organizations — the words and the actions matched. And that’s when employees know they can trust you: they can believe in what you’re talking about, the future you envision, and how you’re planning to get there. And most importantly — I’m imagining there were conversations where folks talked with employees about their role and how it fits into the future of your organization. That is such a key piece today, when people are asking this question of “Do I matter? Do I belong?” So well done to you. We need more organizations thinking like you do.   

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Does Company Size Change the Problem?   

Frank Cottle [09:06] — I think we have it easy — we’re not a terribly large company. So if I fall into the less-than-500-employee category, am I having the same problems a Fortune 1000 company has, or is it easier for me to adapt and have the right messaging — maybe because my values aren’t simply corporate reports on profitability? Smaller companies have different value structures oftentimes. They want to be profitable, but they also have different values. So if 80% of the employees in the United States — just using the U.S. as an example — are in companies of less than 500 employees, do the layoffs and changes at the larger companies really matter that much, or are they just easier to watch?   

David Grossman [10:13] — Look, I think there are lots of lessons no matter what the size of the organization. It’s clear your ship, Frank, is easier to turn than some of the larger corporate ships. But at the same time, what we know about employees is there are fundamental needs employees have, no matter what organization they’re working for. When we meet those needs, they are more productive, more content — they help us get to where we want to go. So I go back to: can we better understand the needs of our folks, and then deliver on what’s most important to them?   

The Data: 16% Outdated, 30% Exceptional, 54% “Good”   

David Grossman [10:50] — The Harris research we did with employees — asking folks, tell us the good, bad, and ugly when it comes to leadership — I think absolutely applies across the board. Here’s what employees told us: about 16% of leaders are outdated — not surprisingly, they’re playing from an old playbook. On the other end of the spectrum, 30% are exceptional leaders, the best of the best. What’s super interesting is that about 54% fall in the middle — employees said they’re good.   

You may think good is good enough. But when we dug deeper — when we asked employees what it feels like to work for a good leader, across organizations of multiple sizes — three big blind spots came forward. Employees — less than 20% — feel seen, feel heard, and feel like they’re reaching their full potential.  

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So when I thought about the book and the research, I thought I was going to write about bad leaders. But actually, it’s the good leaders today, Frank, that we need to be thinking about and worrying about, irrespective of company size — because they were trained for stable times. They weren’t trained for all of this uncertainty we’re dealing with today. They weren’t trained to deal with the emotional load employees are bringing into the workplace — whether you have 10, 50, 50,000, 150,000.   

Frank Cottle [12:18] — I completely agree with that. When we look at people we’re dealing with across the table — negotiating with, building something with — we always ask ourselves: has this person been through more than one side of one economic cycle? If they haven’t, we know they’ll have a very specific and limited perspective. Unless they’ve done this in business through a couple of economic cycles, each caused by different types of events, they won’t have the clarity of thought for how they shape the future — they just have limited experience. And I think when you get into middle management — those people who are good but not exceptional — a lot of them might have that limitation.   

David Grossman [13:22] — They absolutely do, and that’s what the research shows. With the bad leaders today — HR knows about them, or senior leadership knows about them; they’re getting coaching, [or they’re even on] a performance plan. But are we thinking about how to best support those good leaders, to help them close those three blind spots? Irrespective of where they’ve come from, the skills we’re talking about today — these human skills — are absolutely teachable, coachable, learnable. Therein lies a key opportunity for leaders at any level of the organization to grow skills around some of these human qualities that are so critical.   

Should Leaders Just Figure It Out?   

Frank Cottle [14:05] — I wonder. If we look back through history at some of the most important leaders in any category — look back a couple thousand years, even — what was their learning process beyond their own experience, their own intellect, their own ability to figure stuff out? I don’t know that the coaching structures, or even the educational institutional structures, were there. They just figured it out. And I wonder if today we’re spending too much time trying to train leaders based on somebody else’s theory, as opposed to helping that person think — figure it out for themselves. I don’t know if I’m off on that. I’m kind of a crazy entrepreneurial guy, and a bit of a lone wolf in the way I do things — always have been. When I was going to college, I really didn’t care, because all college did was teach you how to get a job at IBM. I consequently got kicked out of at least one school I went to. So I wonder if we’re too much in that mode today.   

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David Grossman [15:39] — You know, I struggle with that, Frank — because what’s our choice here? To let people figure it out on their own, or to understand that smart people have been here before? There are lots of learnings now. We know more than we knew in the past — about how to lead, what the pitfalls are, how to have some of these different kinds of conversations and be more sensitive to where employees are today, how they’re feeling, the load they’re bringing into the workplace. These are all new things we didn’t see when command and control was the way to do it. So I feel like we do need some strategies — this is a muscle we need to help leaders build. Because we’re seeing the results, and the data shows leaders aren’t really meeting some of these key critical needs around feeling seen, feeling heard, and helping people reach their potential — and that clearly gets in the way of results.   

The Six Differentiators — Starting With Gratitude   

Frank Cottle [16:39] — Well, you’ve identified six differentiators that separate exceptional leaders — not just good, but exceptional. And I agree with you: good doesn’t win the Super Bowl. Good doesn’t win the Olympics. It’s always exceptional. It’s the same in business — good doesn’t get the CEO’s position, you hope; at least don’t invest in that company if it does. You want exceptional people. So what are these differentiators?   

David Grossman [17:10] — From the research we identified six differentiators. The first — the most important one when it comes to exceptional leadership — is gratitude. And what’s so interesting about the concept of gratitude: most often, good leaders recognize the work. Exceptional leaders recognize the work and the worker. So it’s not just enough to say “great” — it’s helpful to say: “Thank you for that presentation. I know you reworked your schedule and some personal commitments to make it work this week. Thank you.” That’s very different — and super powerful.  

Frank Cottle [18:04] — I agree with you wholeheartedly. It’s recognition well earned when it’s given — and recognition is remembered.   

David Grossman [18:08] — Absolutely. But here’s the thing for leaders: you need to know and understand every employee’s story, so you can connect your appreciation and gratitude to something that’s meaningful for them, instead of something generic. I was in New York a couple of weeks ago — I love Broadway shows. One thing I know about Broadway shows is that early on, there’s a point where the hero steps forward and sings what is often called an “I Want” song. It tells you basically everything you need to know about that person: their wishes, their dreams, their values, what’s getting in their way. Every employee has that same “I Want” song. And the question for us as leaders — big company, medium, small — is: do we know our employees’ story and what’s important to them, so we can connect our appreciation and gratitude to what matters to them? That’s what exceptional leaders do today.   

Frank Cottle [19:06] — I would certainly agree with that. We have a little saying we use about customers — and it’s the same with employees or team members, I think: you don’t know the customer well enough unless you know the name of their dog. That saying’s been around a long time, but we really try to practice it with each other.   

The other thing about leadership: it can be an intern who’s been with you two weeks. Leadership isn’t how long you’ve been with a company or how much life experience you have. There’s a certain innate characteristic that surfaces — and identifying those people and building them up, as opposed to keeping them level, is a huge value to a company.   

David Grossman [19:54] — You bet. Look — everybody’s a leader, no matter where they sit, whether they have people reporting to them or not.  

Frank Cottle [20:09] — They have to lead themselves, right?   

Fine China vs. Cast Iron: Gratitude as Reverse Gossip   

David Grossman [20:10] — That’s right. You bet. One other thing about gratitude, while we’re talking about it as part of leadership: let’s remember there’s a benefit to both the person sharing gratitude and the person receiving it. I think that’s part of why it’s so powerful — there are benefits for both involved.   

And what’s so interesting is that sometimes gratitude is treated like fine china. I don’t know if anyone has fine china anymore — my mom did, and she’d pull it out only for special occasions, right? A holiday, so the fine china came out. It’s the same with gratitude: we treat it like fine china, instead of treating it like a cast iron pan — because the reality of a cast iron pan is it gets better the more you use it.   

One last thought on gratitude: I have heard it called reverse gossip, and I love that idea. Can we take any energy we’d otherwise use to talk about other things, and share some appreciation with someone multiple times a day? It will make our lives — it’ll make the workplace — definitely better.   

Frank Cottle [21:22] — Do you think it can get diluted, though, if it’s overdone — to where it becomes less meaningful?   

David Grossman [21:29] — Yeah — if it’s generic, if it’s not personalized, if you’re just going through the motions. But that’s true about any kind of communication: if you can’t do it in a genuine way, you shouldn’t be doing it. People read through that super easily. And I should distinguish, too, Frank: when we’re doing new things, trying to build new habits, it may be a little clunky and feel perfunctory the first few times — but then it should get much easier. Being genuine is absolutely critical.   

Frank Cottle [22:03] — I think authenticity, being genuine — if you aren’t, you should do something else. Everybody says “fake it until you make it” — if you’ve got to fake it until you make it, you probably ought to do something else. You should understand what you’re doing and why you’re doing it, and I think that’s part of communications.   

I think consistency is also a foundation for communications — and consistency in a corporate world is built on your values. Not a mission statement on a poster on the wall — the things that really are important to the company and to the people in it. And that’s hard to define, especially as you grow larger and larger. Do you think that’s part of the challenge with AI, or do you think the challenges with AI are more just classic change management — do it right?   

AI Is Classic Change Management   

David Grossman [23:23] — Oh, I think it’s classic change management — no question about it. Companies are looking at this like a technology change, and it’s a people change. We aren’t thinking about: how do we create readiness? How do we answer the key questions employees have? Leaders in many cases are thinking about rollout and deployment and all those things — and employees are thinking: how is this going to change my job? Will I have a job? What will the opportunities be? Is how they’re talking about AI really going to play out for me, or not? So I think it’s classic change management that we need to do better at — and we can. We know better.   

Frank Cottle [23:51] — Do you think certain executives think this is just an HR problem, as opposed to a true leadership change-management problem — basically shuffling it into a departmental issue, as opposed to an overall cultural and directional one?   

David Grossman [24:20] — Yeah, absolutely. Look — companies are all going to get AI. What’s going to differentiate is the leadership application involved in using AI effectively and productively inside the organization. It’s that leadership piece that’s going to be the differentiator.   

And it’s interesting, Frank — I’ve always been fascinated by what makes a great leader great, especially at this time. I’ve been thinking about the relationship between all this uncertainty and leadership and the employee experience. Going back to the data for a minute: uncertainty times outdated leadership gives us a not-great employee experience. But if we look at good leadership times uncertainty — we get anxiety, we get complacency, we get drift. And the point I’m trying to make is: what’s the variable? The uncertainty isn’t going to change. It’s leadership. It’s what we do, it’s how we lead, that’s going to make the employee experience better and different — and change the trajectory of our results, our team’s results, and our organization’s results.  

What Is an Outdated Leader?  

Frank Cottle [25:39] — You talk about outdated leadership — I don’t know what that is, by the way. Considering I’ve got a white beard, I might be an outdated leader. But the best leaders might be guys with white beards too, so you don’t know. Is it people who just aren’t keeping up with the technology, so they don’t know how to lead the change management appropriately? Or people who are complacent about the way they lead? In the case of AI’s applications — as a leader, if you don’t know as much as your students, so to speak, the people you’re trying to lead; if you haven’t studied it yourself — it’s hard to understand the applications and the benefits, and to lead from the front, as opposed to leading from outside-to-the-left somewhere.   

David Grossman [26:36] — So — white beard or not — my sense is, Frank, you are not an outdated leader. Because when I think about an outdated leader, I think about command and control. I think about leaders who say: here’s the hill, here’s where we’re going, go do this. Many outdated leaders today are also micromanagers. None of that helps employees today as they think about how they fit in, their growth, and the overall business results. Plus, the example you shared at the beginning of our conversation — my sense is that absolutely falls into what is exceptional leadership today.   

Frank Cottle [27:16] — I’ll stick with that compliment, I think.  

David Grossman [27:19] — I hope so. It was absolutely intended as a compliment. Savor it.  

Taking the Hill: Trust and Authority  

Frank Cottle [27:26] — Well, I will. But leadership is always a challenge internally — you’re always asking, is this the best person for the job, as you look at that command-and-control structure? Because command and control is always there; it doesn’t go away — it’s just used differently. Instead of micromanaging it: take the hill. Here’s your rifle, here’s your ammunition, here are the four guys, here’s the truck. Your objective is to have the hill by 4 p.m. What do you need? Two ways of taking the hill, overall. In leadership — if I’m telling someone to take the proverbial hill (maybe not the best analogy in the world, by the way) — if I don’t know how to take the hill myself, am I going to be able to really help them?   

David Grossman [28:33] — Yeah. You know, there are lots of times we as leaders are asking our people to do things we’ve never done — but we’re relying on qualities that help us provide the vision, provide the outcomes, provide some of the [watch-outs], some guidance to help them get there.   

Frank Cottle [28:55] — So if I can interrupt: what you’re saying is, as a leader, you have to have genuine trust in the people you’re giving responsibility to — and ensure you also give them the authority to execute that responsibility. Because if you don’t, you’re not demonstrating trust.   

David Grossman [29:16] — Absolutely. You bet.   

Nine of the Top Ten Qualities Are Heart-Focused   

David Grossman [29:20] — The other thing we know today — and this came from the research — is we looked at the top 10 qualities of exceptional leaders. Nine out of the top 10 are heart-focused qualities. The tenth, interestingly, the head-focused quality, is around overall transparency. I share this because this is a list of skills that in many cases are new for many leaders — as they think about empathy, listening, inspiration, creating a culture of “we’re all in this together.” This is the new set of qualities that I think are super important for modern leadership today. And the challenge and opportunity is: how do we help leaders gain and learn these brand-new, super-important skills to motivate people today?   

Frank Cottle [30:14] — How do we?   

David Grossman [30:18] — I think it’s by training and development. It’s by senior leaders role-modeling — gratitude, for example, or listening, or creating a culture. It’s by creating coaching inside organizations to help people gain and learn these new skills. As I said earlier: many leaders today were trained for stable times. They weren’t trained to be thinking about emotional intelligence, or vulnerability, or some of these other core elements that are super important to motivate employees today.   

Five Generations, One Culture   

Frank Cottle [30:57] — In our company, and in most companies today, there are literally five generations of people — five business generations — each with different layers of what you call emotional intelligence, broadly different layers of values and life experiences. You want all those people to work as a single unit, under a single culture, for a singular goal. How do you do that?   

David Grossman [31:37] — I think as a leader we need to figure out the superpowers our people have, and see if we can put them in positions and on tasks to use those superpowers, whatever they may be. And one of the critical unlocks today is all about growth and development: where there are gaps — or leaders of different generations who may not have some of these skills — how do we help them continue to gain them? What’s cool about that is it fills one of the blind spots we talked about earlier: employees under good leaders are thinking, “I’m not reaching my full potential.” So how do we help them continue to grow and reach their full potential? Because that’s super meaningful.   

Frank Cottle [32:24] — I’m going to pick on this a second further. If one of those generations — top, bottom, middle, doesn’t matter — has very different values personally than the other generations, how do you make them want to accomplish the same things?   

David Grossman [32:49] — I think it comes down to understanding and appreciating where we in the workplace are similar to others, and where we are different — and that one of the values of the organization is that we appreciate that people are different, that they think differently, that we need people to think differently. I don’t know how you get innovation in a company without getting people to think differently. So as leaders: how do we embrace whatever our people bring that is good and helpful and valuable, and put them in positions to use that on behalf of customers and other stakeholders too?   

The One Thing to Do This Week   

Frank Cottle [33:33] — I’ll go with that — I agree with you on the innovation element. As we get toward our time here: so many leaders know they need change. They need to start somewhere, or they’ve already made a false start and need a correction. What’s the one concrete thing they should do this week — or first — to make sure that whatever they launch has the highest probability of success?   

David Grossman [34:18] — I think they need to set a vision for what the change end-state is, why you’re going there, and what it’s going to mean for every individual employee — not just for the company or the team, but for individuals. And hopefully, in many cases: so many changes are good development opportunities, growth opportunities, a stretch assignment, learning a new skill. That’s what we see with AI — there hopefully are lots of opportunities to help people grow. Because there are certain skills that only humans have, that AI is never going to have and will never replicate. We will always need humans to think about and use their human skills — their leading-with-heart kinds of skills.   

Frank Cottle [35:13] — I thoroughly agree, and the takeaway I would have is: make it relate to the individual. I work to give my family what it needs, and the company is a vehicle I’ve chosen to do so. I think most of us, when it boils down, come to that position — and if we don’t, our family will deteriorate, and we’ll have a pretty lonely life at the company.   

David Grossman [35:35] — Well said. And I would just add — for anyone who wants to be more authentic and bring their evolved self to work: the reality of authenticity today is that one of its core elements is that it’s about other people — and your ego often gets in the way. I think that’s what you were starting to talk about, Frank. Real leadership, authentic leadership, is all about someone else: helping them reach their potential and do great things. And also speaking your truths in ways other people can hear them.   

Frank Cottle [36:10] — I agree with that. I’m sort of an old hippie surfer sailor guy, and to me, it’s all about love. Not saying “oh, I love what I do” — really? Do you love the people you do it with? How are you expressing that? Genuinely trying to hold that — and that goes to your value of gratitude as part of the value system for the company.   

David Grossman [36:39] — You bet. Wasn’t there a song — “All You Need Is Love,” Frank? Was that how it went?   

Frank Cottle [36:53] — Well, I started before that, but that’s okay. David, I’ve really appreciated the opportunity to chat and get to know you a little bit, and I look forward to hopefully chatting again and learning more. Your book, The Heart Work of Modern Leadership, is hugely valuable. I usually don’t pitch things, but the concepts you’re espousing and the research you’ve done are hugely valuable — and to me, its biggest value is that it represents a change in the perspective people should have on change management, as opposed to the mechanics. So I thank you for that.   

David Grossman [37:26] — Thank you, Frank. I’ve really, really enjoyed the conversation.   

Frank Cottle [37:29] — Take care.   

David Grossman [37:31] — You as well. Thanks.