A conversation between Thomas Friedman, Pulitzer-prize winning author of The World is Flat and Dov Seidman, author of HOW: Why HOW We Do Anything Means Everything…in Business (and in Life)

National Press Club
June 18, 2007

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Tom Friedman: Thanks to the Press Club for having us here. Dov, it’s good to see you but this evening is all about me. So…

Dov Seidman: I can help with that.

Tom Friedman: Because whenever Dov and I are together, it’s always about me. It’s what column idea is Dov going to give me next because Dov and I never, ever get together without him stimulating a column idea or, in the case of The World is Flat, a couple of good chapter sections. So I’m not here because Dov quoted me or because I quoted him, I’m here because I quoted him in my book because he’s been a great teacher of mine and a really innovative thinker.

I’ve been looking forward to this evening. I’ve got my notebook and if I don’t get at least one or two columns out of this, you owe me big time. So, let’s go right at it Dov. The book is called HOW. And right off, in the first chapter, you make a very bold statement. You say “It’s not about what you do. That was when the world was round. It’s about how you do it.” What happened, why that shift from what to how?

Dov Seidman: I’m going to answer the question but let me just take a moment to say I, too, am thrilled to be here, and since I have the last word, I’m going to say I learn more from you.

Tom Friedman: No problem.

Dov Seidman: So, you know, you write about entering the 21st century. But to enter the 21st century, we exited the just-do-it century, where teachers and bosses told us just get it done. How doesn’t matter. You couldn’t look into how people got things done. It was just do it, just get it done, don’t break the law. There were no boundaries – what we can and can’t do. Just get it done. And that’s as much instruction as many employees at big companies got: just get it done. And it was about speed, efficiency, productivity, out-performing, out-producing the competition. What we made, what we do, what service we provide was the key to getting ahead.

Tom Friedman: Jerry Maguire.
Dov Seidman: Well, in the movie, Jerry Maguire got fired after he wrote that memo. But he had it right. The things we think and do not say. But he said what should have been said and what people are now hearing.

Now, those things still matter today but today they keep us in the game. Years ago we would win the game by building a better, faster, cheaper mouse trap. But today the stuff – the “whats” we make – are reverse-engineered not in six months but overnight. They’re copied and we get an advantage, but it’s short-lived.

But how we do what we do is so vast and so varied, how the rich tapestry of how human beings behave and conduct themselves and connect and collaborate in this flat world is so ripe with variation. And when there’s great variation, there’s opportunity for differentiation.

But let me just illustrate what I mean by how. Any of us today can go to a mall, and buy a new cell phone, a new gadget, a new plasma TV screen. And you walk into a retail outlet and you know you can get that product at the same price across the street and in the next mall or online. And the sales clerk says to you, “Over there, aisle 42, help yourself.” I don’t think that’s going to cut it. Or what if that person is instructed by their boss any time someone gets within 10 feet of you to smile and take a walk? Anybody can take a walk. How is about what happens during the walk? Is there a connection? Is it an authentic open conversation?

Can you say, “You know, here’s why you shouldn’t get the most expensive one. Here’s what’s good about the product you asked for but here’s what it’s missing.” And if I make my purchasing decision based on that connection, then that person out-behaved the competition; they didn’t just out-perform them because the product is the same there or anyplace else.

That’s what I mean by how. This unique opportunity to differentiate, to build lasting success by how we do what we do or how we behave, out-behave the competition.

Tom Friedman: Let me ask how we got to that world, though? More examples of companies you’ve encountered who got it. You met with the CEO and he said, “Oh, I get that,” and then made a change that people here could really understand what you’re talking about. Give me a couple of concrete examples.

Dov Seidman: Before I talk about companies, I need to say that all companies are communities and teams. They’re people. Many of them are incorporated in Delaware, and we don’t go to Delaware. I mean companies are people. The companies that get it are the ones who are fostering atmospheres, cultures where people feel safe and secure, and they trust that they can reach out and innovate in how they do things and not just in what they do.

I talk in the book about GE Durham. They make engines with 10,000 parts. These engines keep Air Force One in the air, and we fly our kids to see their grandparents on Thanksgiving on these things. There’s only one directive at this plant in North Carolina in Durham: what date the engine needs to be sent off by.

The organization is flat. There’s one boss and his job is to get people talking. Every decision is made by engineers, and they shipped 400 engines last year. Zero material defects; 15 percent of them had at most one cosmetic defect.

They out-performed the competition by how they work together. A complete trust-based system, no commissary, no rules, no Post-it on the wall that says “Don’t put your feet on the table and don’t write on the chair.” So people can then write on the tables and put their feet on the chairs. It’s “we trust each other to focus on that mission.” So that’s one example.

One more. The University of Michigan Health System. They were getting sued in the last few years for malpractice. And before the world was flat, people hunkered down. They admitted nothing. They fought these things. And that was their strategy.
And then they said let’s get back in touch with that patient-doctor relationship. It’s sacred. Let’s lean into it and go on offense, and why don’t we apologize in a real way?

Lawsuits and payouts went down by 50 percent because they connected with their patients through an apology. And their patients understood that their doctors aren’t just human doings, they’re human beings. Real people. We’re fallible and if you act like one and apologize and take responsibility, I’ll stick with you. They got it. And I can go on but there’s more to cover.

Tom Friedman: Did Barack Obama just get a good how right when he apologized today for his campaign leaking a derogatory memo about Hillary Clinton? Is that a good how example?

Dov Seidman: Yes. First he said I made, we made, a mistake. Not I, we made a mistake. And then he emphasized how we communicate on this campaign is key, and we got it wrong this time. And we’ll endeavor not to do it again.

Tom Friedman: What happened in the world that made this shift to how so prominent? What is it that made us? Behind how is really a whole set of technologies which make us all so transparent, which make our hows – when we get them right and wrong – so much clearer to ourselves and to others. What happened?

Dov Seidman: Well, simply put, we’ve been connected. We live in a hyper-connected world. In fact, we’ve been connected up faster than we as human beings have found frameworks and languages to understand each other. We are asked to collaborate with people, and some of them think that a cow is a sacred object and other people think it’s lunch later on today. And we don’t speak common languages and yet we are part of global supply chains.

Now in a connected world, those who make powerful connections are the ones getting ahead. Those who can relate to others who can extend, who can build trust in the relationship with suppliers and colleagues while making powerful connections is about how we relate and collaborate with others. That’s about how we do what we do, not about what we do. So simply put, in a connected world, those who make connections win. Making connections is all about how we do what we do.

Tom Friedman: But there’s something prior to that. There’s a level of transparency now. Where did that, where does that fit into all of this?

Dov Seidman: Well we’re transparent because we’re connected. Now we used to think that information is key because we can control it. Companies fall in love with Joe Camel, the Marlboro man, Ronald McDonald. We don’t need to tell you about hydrogen peroxide; blondes have more fun. That’s why you should dye your hair. Today, what’s in those chemicals? Because we can look through. And this is a message for our kids. So we think we can control the message, but information today is like a toddler. It goes everywhere, it gets into everything it can’t be controlled. And the point to keep in mind is we all crafted that perfect resume. We could control our life story.

Tom Friedman: Let’s stop there. Let’s just stop for one second because I want to set up that point because when I got out of college, when you got out of college, applied for my first job, I write up a resume. I got to write my own resume, got to tell my own story. It was all true. But I got to write it, emphasized certain things, de-emphasized others. How about today? Somebody comes to apply to you for a job, what’s new today?

Dov Seidman: You can write your resume but it’ll be pushed aside. People will blow right past it because before I read your resume because it was the most efficient thing I could do. How else could I find out information about you?

Today, I can more efficiently Google you, go onto My Space and see what you write about yourself, what your friends say about you. Forget about saying that’s a semester that the dog ate my homework. If you were out partying, another friend is saying didn’t we have fun that semester. So your resume is being written about you.

So how do we turn these conditions to our advantage? We have to understand that if our resume is being written about us, we don’t get to tell our story, it’s being told. Our story today is how we live our lives. That’s our resume, how we live our lives; how we make decisions; how we say what we mean; how we mean what we say; how we follow through; when we don’t, how we apologize; how we treat others.

Tom Friedman: Because in a world where everyone has a cell phone with a camera, everyone’s a paparazzi. In a world where everyone has a blog, everyone’s a reporter. And in a world where everyone has access to You Tube, everyone’s a filmmaker. Now when everyone’s a paparazzi, a reporter and a filmmaker, everyone else is a public figure, leaving digital footprints everywhere. That’s really what you’re saying. Therefore, your hows are going to be etched in stone from a very early age.

Dov Seidman: I talk about persistence of memory. In many ways, what’s old is new again. But what’s old matters more today than it ever did. Many years ago, people found themselves in small towns. They understood the currency of their reputation. Anything they did stayed within the town forever. If a few town elders died off, maybe they took some secrets with them but, for the most part, we understood that the most previous possession we have is our reputation.

Tom Friedman: What happened in Peoria stayed in Peoria.

Dov Seidman: Then the world became disconnected. We could re-invest ourselves. Doctors can move; quack doctors can move to the next town. And we stopped earning our reputation because we focused on what we did, efficiency, bottom line, speed, etc. In a connected world, we’re back to that small town and this time nothing gets erased. It actually stays forever. So in many ways, what’s old is new but doubly so.

Tom Friedman: So George W. Bush could never have been elected President had he gone through Yale the last four years because there would be so many cell phone pictures of him in different people’s face books. You can’t be young and crazy any more and expect to be elected President. You’re leaving footprints everywhere. What advice do you have then for young people?

Dov Seidman: The first thing I’d say is forget about managing your reputation. You’re in a baseball game of life. You’re up at the plate early on, and every pitch counts and you gotta connect. And you have to accumulate a lifetime batting average. You’re up at the plate.

And you have to earn your reputation, one interaction, one communication, one treatment of a friend and a colleague at a time. And if you do that, you’re going to have a currency that will arrive before you do and allow you to get ahead.

People will not keep you at arm’s length. They’ll invite you on to teams. They’ll collaborate with you. They’ll share credit with you, and I would tell young people with deference, because remember young people are connected better than we are.

They understand this world better than we do. The one thing they get is how to connect. They are more amazing, and they connect in more fascinating ways that we don’t think of. But the one thing that we do need to remind them, even though they have a leg up on us in terms of how to innovate in their connections, we have to tell them what matters and how this, how they do it is what’s going to make the difference. And I think that’s the advice I would lean into with young people.

Tom Friedman: I feel that in my own life, how much more transparent…

Dov Seidman: If you cut someone off in line that will be on You Tube not what you write about. If you’re in the store and you cut someone off, that Tom Friedman guy cut me off in the store.

Tom Friedman: Well I actually had that experience. I was teaching up in Boston at Harvard about 5, 6 years ago, and I was at Logan Airport after class, and I was going to buy a magazine. And I was walking to the magazine stand, and the woman was coming from here, and I thought I got there first. I put down my money and she said, “Excuse me, I was here first.” And she was looking at me Dov, “I know who you are.”
Had that happened today, I’d say ma’am could I buy your magazines, could I shine your shoes, could I take you to lunch? So, you know, I think anyone…

Dov Seidman: And people are getting this. There’s one person in the book that gets the secret better than anybody else. The guy sells doughnuts in the streets of Manhattan and we all know that there are all these doughnut stands. And he sells a great fresh doughnut, but so does the guy he’s competing with across the way.

So what did he do? He put a change box, and people put down a dollar, and they ask for a doughnut and they get to take their own change. His business sped up threefold because he didn’t sit there counting change. People had a better experience because they took their doughnut and hit the road. But they felt this feeling that he trusts them. And when he extended trust to them, they repaid the trust by coming back the next day. And his business just propelled itself because of a how. How he connected with his customers. He innovated in how. He said let me show you how I can use change to tell you I trust you.

Tom Friedman: We’re just coming off the U.S. Open. You spoke to the golfer, David Toms. What did you learn from him about how?

Dov Seidman: That how matters when no one is looking. That life – back to baseball and keeping your head in the game every time – Toms understands something that many people don’t know, that in a transparent world, people will see how consistent you are. And his ability to stay and golf is about how you bring yourself to the ball, mentally, spiritually.

He understands that whenever he doesn’t get his hows right, he creates dissonance and friction in his mind. And he felt that he’s trying to do something long term. He wants his reputation to be earned over a lifetime. He wants to do something of significance. And he understood how damaging it is to him to get his hows wrong in that sense. And even when the official said you don’t need to disqualify yourself, he disqualified himself from the British Open a few years back. He chose to do so because he saw his life as part of that string, and I’m mixing metaphors, of at bats.

Tom Friedman: So, what would you tell a high school principal today? Let’s bring how to education. We know what can go wrong. You can leave digital footprints. But how do you build in young people the positive attributes to thrive the way you’ve talked about, before they would get to college or the marketplace?

Dov Seidman: Education became part of the “just do it” world. I think we started to look to schools, high schools and universities to produce economic engines, engines of commerce, people who will show up at companies who have skills because we felt that collaboration was taking diverse skills and just putting them in a room together. And those skills, knowledge, that’s being outsourced. We might have a specialization that’ll give us an edge for just six months.

I would tell educators that we’re back to liberal arts education: how we understand other people, the human condition, how we show compassion, how we extend sympathies to others, how we get along.

I actually think that the liberal arts are going to have a renaissance that instead of producing human doings, we’re going to have to produce human beings who connect and relate to others better.

Tom Friedman: Human doers: no. Human beings: yes.
Dov Seidman: Yes.

Tom Friedman: Why does liberal arts matter in producing human beings as opposed to human doers?

Dov Seidman: Liberal arts education was about character development. And the philosopher Heraclytus said that character is your destiny. And liberal arts understands that people who get the human condition, who through literature understand pain and suffering, who through philosophy understand moral and ethical issues, through political theory understand how societies work. These are the people who can connect and relate to others in a world that we’re so connected.

Tom Friedman: How do you deal with the CEO? You get invited, I know, into a lot of companies, including the New York Times. Let’s do a little play acting here. “Okay Seidman, I’ve got 15 minutes. I’ve heard your rap about LRN. Why do I need to hire your company, read your book to teach me about how? We hit our numbers this quarter.”

Dov Seidman: I think that…
Tom Friedman: What is this stuff?
Dov Seidman: This stuff. Well it’s not stuff, it’s how.
Tom Friedman: Make a sale.

Dov Seidman: Make a sale. Look, what do CEO’s want to do? They preside over stadiums. That’s why I talk about the wave as the most powerful metaphor.

Tom Friedman: What do you mean by that, the wave is … the most powerful metaphor?

Dov Seidman: I open the book with the wave. You know, we’ve all been in stadiums where we do the wave. Anybody feel like doing one? You do a wave. And to me it’s the most powerful metaphor for business. I actually interviewed Crazy George, [instigator of the first wave], and I asked him, “Did you threaten to punch someone if they didn’t stand up the first time you wanted a wave?” Well, the person halfway across the stadium felt safe. “Did you show up with a bunch of $20 bills and says ‘here’s 20, will you get up?’ Did you motivate people with a twenty?” No, he didn’t have enough twenties to go around.
“Were you non-transparent? Did you say please stand up but it’s a secret, I won’t tell you why?” No. “How did you get the wave to go?” He shared his vision.

Everything about the wave you could break down into all the hows you have to get right. Now CEO’s understand that whatever they’re trying to accomplish in this connected world has to be done with and through people. And there are only three ways to get a human being to do something. Three ways. You can coerce, you can motivate or you can inspire.

Now, none of us like to be coerced. “Get this report to me by 4:00.” That’s coercion. The only reason to get it to you by 4:00 is your title is bigger than mine, and you’re intimating that something bad might happen to me if I don’t. Motivation became kind of the name of the game in the 80’s and 90’s. Here are playing by the rules. If you play by the rules and do what we tell you, here’s a bonus, here’s a good salary, a promotion, a little extra in your 401K plan. But we understand that people like pleasure and hate pain so we use carrots and sticks to motivate them. Interestingly, motivation’s very expensive and doesn’t create deep bonds. I’ll keep at this job to the extent I’m motivated.

Tom Friedman: Yeah, you might have brought in Vince Lombardi-like motivational speakers to speak to your workforce.

Dov Seidman: Right. But today it’s about inspiration. And inspiration’s free because it comes from within. So I would tell CEO’s today, “How do you create an environment where people are inspired, that something is called forth and then it’s the best of who they are, that they bring passion?” Because you cannot motivate someone to delight a customer. To follow these rules, to obey a rule is to do exactly what it tells you. You could have 100 percent compliance with everything that motivates someone and delight nobody and exceed no expectations. Yet CEO’s want people to do more and make these powerful connections on behalf of the company. It’s all about inspiration.

Tom Friedman: Okay Seidman. Inspiration. I offer my company. How do I do that? I have to hire you to do that or is that my job?

Dov Seidman: Well it’s your job to inspire but the key is about the wave. You could be drunk on four beers and start a wave. You don’t need to be the CEO in the crowd.

You know, companies are dismantling their centers for innovation because they want the entire company to innovate. They want to create cultures that are innovative.

Now, you could hire our company to give you approaches and methodologies to educate people on how they do whatever it is they do. How they speak to officials of foreign governments. How they write appropriate and respectful and careful emails. But in the end you have to commit to use those things that inspire and don’t just motivate and coerce.

Now, the secret to inspiration is that people act on their beliefs. And beliefs are the only things that people can share. People can’t share carrots. They can’t share coercion. But if you can get people to share in a sense of mission and purpose and beliefs, you can get these waves to happen.

And that’s why we’re seeing a move away – and I write about this from just telling people what they can and can’t do – into getting them to think in terms of what they should and should not do. Here are the values we believe. Because only values can propel and guide us.

When you think of a rule, that is, you go bowling like we do with kids and you put the guardrails up. The rules allow you to not throw the ball in the gutter, but there’s nothing in a rule that can help you hit a strike in life or in business. Values propel and guide us. And CEO’s understand that if they can enlist their people in a set of values that they share, they’re going to start to act in inspired ways.

Tom Friedman: So I want to go back. Which are the best how companies that you’ve seen? Which companies really get it, whether it’s a retail company, a restaurant chain, a hotel, a manufacturer, who really gets it?

Dov Seidman: There are people in every company that I work with that are getting it. I write about Angel Zamora. This happened to me. He works for UPS. Now you write about UPS opening up and collaborating with Toshiba, truly to take over Toshiba’s back end. A lot of trust. Someone got their hows right. Think of the trust that had to have happened there.

But let me tell you something else UPS does. I tried to order some jewelry for my anniversary, and the day before you don’t want to not get an anniversary gift. You met my wife. And it was 12:00 and he showed up without the package, and it was over. And I said Angel, I really need this. And he said it’s not on my cart. That guy went to downtown Los Angeles from the West Side, found it and brought it back. Now he could have said to me, “Look, my shift is over at 12:00. What I do is deliver packages until my shift is over.” Instead, he understood that he’s an agent that keeps promises on behalf of his company.

Tom Friedman: An agent who keeps promises on behalf of his company.
Dov Seidman: Absolutely.
Tom Friedman: That’s an interesting job description.

Dov Seidman: He is a promise keeper. He did extra. He gave me his boss Eric’s cell phone, and they delivered that package.
What is it that allows a Southwest Airlines pilot to take a baby stroller downstairs and help check in a flight? I see pilots in other airlines just sit there and watch one person check in an entire flight, and they turn their planes around in 28 minutes and Southwest does it in almost half the time.

What is it? There’s no rule, no carrot and stick, no extra pay to help check in a flight. But there’s something about the value of giving people a no frills, happy experience but getting them home on time and safely that they’ve bought into. And they’re acting on that.
And there are many companies who are getting this. But what all companies are getting is that they need to devote newfound energy. They are running out of areas to differentiate. In the end, business is about creating value that can’t be copied by the competition.

Tom Friedman: Because everything gets commoditized.

Dov Seidman: Everything gets commoditized. How we do what we do is unique. It’s like one family saying I’d like to be like the Friedman family. Can someone copy your family? How can one culture copy another? Their history? So, how we do what we do is an area so ripe to create lasting differentiated advantage because it can’t be copied.

Mossimo Ferragamo talks about his father making these perfect shoes, and they had the best shoe. And today he will be the first to tell you that up and down Fifth Avenue in New York people sell shoes just as good.

And he talks about the person he admires the most in his company is a young person who works in corporate and on a Saturday on vacation she took a walk down Fifth Avenue and saw that the Ferragamo store was bustling. It was hectic. There were too many people in there, and she walked in and volunteered. And helped people and was there all day on her vacation.

One person didn’t know what he was doing; he was getting gifts for his family. She took out a list, they made a list, and I think that she made a customer for life. You know what Mossimo told me? “What I need to do as CEO of Ferragamo – (and they’re about to go public and you’ll see even more into that business) – is I have to create an atmosphere where that happens day in, day out. If I do that, I win. It’s not just about my father’s craft. That’s where we are today.”

Tom Friedman: Dov, you say something I think at the end of the book about how this only goes one way. We’re only getting to get more transparent, more connected, more wired. Do you see that, and how will that affect how? Could we get a difference of degree that also becomes a difference in kind? Can there be another stage to this?

Dov Seidman: Well, I agree that we are never going to be any less exposed or connected than we are today. There are still too many people who are hunkering down, trying to avoid exposure. The winners are going to lean in, they’re going to go from defense to offense. And they will say there’s an opportunity here to turn this to my advantage.

Tom Friedman: Give me an example of that.

Dov Seidman: Well, the doughnut guy, the Methodist Hospital. People who say what’s wrong with saying you’re sorry? I mean look what happened with the BP CEO, a venerated great career. He only ran into trouble – people really didn’t care what he did outside of work – when he tried to suppress information. When he tried to control his story.

Look at Kellogg’s just today. In 1997 Kellogg’s decided to re-invigorate the company. This was just recently reported, by saying, you know, every kid has to start the day with a great breakfast. And they started talking about Fruit Loops again. Great campaigns. And you know what they did? They, just last week, they came out and said we are only going to advertise to children if the cereal meets nutritional guidelines. And we can no longer say that about Fruit Loops. So 1997 they tried to brand themselves. 2007, we make a promise.

And the CEO of McDonalds talks about the moment of truth, that 30- second drive through the drive-through at McDonalds. Years ago, McDonalds controlled its story. What did it say? Billions of people served. Think greatly of us. Look at how many people we’re serving.

Now, tell me about trans-fats. Tell me about what are you doing about obesity? When you can look into somebody in a connected world people want a connection. And the just-do-it society was very individualistic.

Today, you have to be other regarding. And if companies don’t make themselves about the person they’re serving and making and keeping promises to them. And that’s why I interviewed William Broyles, [who wrote] the movie Castaway. And many of you – have you seen the movie Castaway? Right, remember Tom Hanks? Do you think this movie was about survival for the most part, survival? Remember at the end of the movie he delivered the package? And what did he write on it? This package gave me meaning.

In the book I write about people who lay bricks for a living, and you walk up to them and [they] say, “Can’t you see I’m laying bricks?” And the other person says, “I’m building a cathedral.”

So Tom Hanks is building a cathedral. He understands that FedEx keeps a promise, and he’s there as an instrument to keep them.
When people see themselves in larger terms – I’m building a cathedral – two things happen. One is if this cathedral is so large, there’s room to invite others in. The bricklayer has no room to collaborate with someone. It’s one brick on a time. But when people see their endeavors in larger terms, they create space to invite others in. But also to build the cathedral, you need to think about how you’re going to do it and how you’re going to inspire others. And the greatest companies are the one getting their people to think in larger terms.

Tom Friedman: But that says to me so are the greatest countries. And that’s a question of leadership. I’m not going to ask you who I should vote for. But I will or there’s someone in the front row who has an idea. But I will ask you this. I was actually having this conversation with Tim Shriver from Special Olympics the other day.

Everyone talks about experience. We need someone who’s experienced. Well, one thing we’ve learned from the last administration that experience as Gerald Ford’s chief of staff might not be the most relevant experience. My question really is Tim’s question. Experience, for what? What kind of experience? In a how world, what should we be looking for in the different candidates? What questions should we be asking? What traits should we be looking for that, in an age of how, we would want in our country’s CEO, in our country’s architect?

Dov Seidman: I think you hint at the answer yourself at the end of your last edition. You call for imagination. HOW is about how nations relate to each other, how people, how organizations profit and not – and that’s another way of asking where is imagination and innovation going to come from to problems that are so complex, from health care, whatever people care about. I think one thing we agree on is that these problems have become very large. And we’re going to need imagination. And I say you can’t do imagination. You can only get it.

Tom Friedman: What does that mean?

Dov Seidman: Well, why don’t people innovate? Because they’re scared to innovate to do something new. Someone has to take a risk that their boss won’t think they’re stupid, that they won’t get fired, that if they make a mistake and squander some funds, it was worth trying.

So we ask for innovation and imagination but people do what they did yesterday. Leaders today are going to create atmospheres where there is so much trust, and that’s the one thing that this country can produce better than any country.

I believe that we are designed to manufacture trust. In high trust environments people start to take risk. And when they take risk, they innovate. And when they innovate, they create progress. And the only acronym in this book is TRIP. That Trust leads to Risk taking which leads to Innovation or Imagination which leads to Progress. Which is what we want. We want to make progress on our most vexing and largest problems.

And the leaders that I don’t care for are the ones that think that trust is: can I trust this guy, can we work with that person? They think trust is something out there and we go looking for it. And we check up on people.

The leaders who get it understand that trust is a verb. It’s an action. You trust. And when you trust someone, if I trust you Tom, I’m giving you the power to do right by me or let me down. I’m the one taking a risk. And leaders are the ones who can get the trust cycle going.

So now ask me the 64 trillion dollar question. Well who do we trust? We trust people who have integrity, who get their hows right, who are honest, who are honorable. Because that’s who we are prepared to go with.

Tom Friedman: But does that also then speak, Dov, that we need a leader who’s truly a uniter not a divider, one who builds trust who erases red states and green states and all that nonsense.

Dov Seidman: Back to the wave. You know what’s amazing about the wave? You can show up to root for the other team and you stand up with those guys. Think of that. The wave is not just for season ticket holders. You could buy a ticket for this game, you could show up for the other team. But if you can lay out a vision as to how an unbroken wave of human energy can help your team win or solve this problem or advance the cause, you can pull in people who came to root for the other team. And leaders have to unite.

They have to take advantage of the fact that we’re in a connected world. And a 30-second spot in this election is not going to do it because that’s like the resume. We’re going to blow past that and see who can have a one-to-one authentic two-way conversation with people. Even J.W. Marriott – guy turned 75 years old, right – and the first 74 years of his life he ran around Marriott properties with a pencil and a pad of paper taking notes. Now he’s blogging and on his first blog he said I promise you to get no help from corporate communications and PR. I’m not going to spin and message this. I’m going to open up, even though I’m 75 and have a conversation. That’s a leader of a large organization that gets it. I think politicians are no different.

Tom Friedman: Let me translate this to foreign policy. There are a couple of areas I want to ask about. Is Iraq a low-trust country? Is that the problem? I’m asking you very seriously. As you look at a country like Iraq, Gaza, what’s going on there. Do you see low-trust countries?

Dov Seidman: So, yes and let me tell you why. I actually talk about something called the certainty gap. And I think the key to understanding a flat world is the certainty gap. I mean every human being has an image in his or her mind of a totally predictable certain world. That if I invest my currency here, it’s not going to be stolen. What will happen if I create intellectual property? I’ll be able to safeguard it. And we have this perfect image of certainty. And when things are certain, we pursue our lives. We run forward, we run forward. When the gap is small, you see a lot of risk taking and innovation.

When the certainty gap is big, people get paralyzed and they stand on their feet and they start to act out in ways that are destructive. I think the certainly gap is massive in Iraq. Now, we tended to try to close certainty gaps in the past: rules, regimes and we tell people what they can and can’t do because the nature of law is such as it’s designed to give people certainty.

Now, rules do tend to work. I’ve been living in California. I’m glad that there are some rules about earthquake-proof buildings. But rules are quite limited in terms of inspiring the best in human conduct. And the only way to close the certainty gap is to not legislate how people should behave, but to create trust. And trust fills the certainty gap, and I think that when in environments in countries where there are massive gaps of uncertainty, I typically find those to be low trust environments for nations, etc.

Tom Friedman: If you were doing a world map of countries and cultures, are there cultures where HOW is intuitively and easily absorbed and others where it’s more resistant?

Dov Seidman: I think that we’re at a plateau. I write about Transparency International and Francis Fukuyama. There are a lot of studies about how to trust nations. And that yes, high-trust nations have more innovation because people feel secure.

But I actually think that we became so obsessed in the 80’s and 90’s with efficiency and the bottom line that we hit a plateau, and we use rules for too many things. Most companies – from Sarbanes-Oxley to what happens inside companies – we tend to try to manufacture this certainty that trust is there to give through rules. And I think we’ve become over-regulated and we’re starting to get in the way.

Companies don’t have rules that say don’t forget to breathe. Employees naturally breathe so we don’t legislate breathing. Wherever there’s a rule, something went wrong and somebody in power was upset and said I don’t want this to happen again, and they put a rule.

And next year we’re going to have an election that says that if you need to be 18 to vote, and if I can prove that I’m 18, I get to vote. But there are some 25-year-old immature people voting and some 15-year- old highly mature people with a sense of civic duty not voting. Eighteen is a proxy. It’s a great rule if you want to administer a nationwide election in one day. But it doesn’t get you focused on what we should be focused on: ideas, solutions, civic responsibility. And we became so obsessed with efficiency that I think that countries are going to get back to being about values. And those are going to run ahead faster. Values propel.

Tom Friedman: We’re at the National Press Club. Is the press getting its hows right or wrong in your gross generalization?

Dov Seidman: I hope I was, I wish I was. At this point I was wishing I was out of time. But…
Tom Friedman: It’s always the last question.
Dov Seidman: It’s always the last question. But I…
Tom Friedman: No seriously…

Dov Seidman: To the extent that, just intuitively, to the extent the press thinks that their job is to be a watchdog, we can do anything we want because we’re here to watch you and that’s our role in society, to be a watchdog. I think that they’re embracing the wrong paradigm.

I think the press is there to be about truth, and there to take advantage of how connected the world is to put things out there in an objective, independent, informative, valuable way.

If they’re doing anything other than that, I think that the conditions that they find themselves are going to bring them down. And we’ve seen some of that within the New York Times and others. The measure of life today is consistency. Simply put, it’s consistency. That’s true. This election we’re going to be able to see how consistent every candidate has been or how they explain inconsistency. The press, politics, leaders have to be consistent. Back to that baseball.

Tom Friedman: You have to be consistent or you better be able to explain your…
Dov Seidman: Inconsistencies.
Tom Friedman: …your deviations in a credible way that connects with people.

Dov Seidman: I believe that Joe Biden just did that. Look, in 1987 he had the issue with Neil Kinnock and the Labor Party in England and what did he say recently? “I wasn’t ready to be president in 1987. I wasn’t mature enough. But here’s what I’ve learned. Here’s why that doesn’t fully speak to how honorable I am.”

And he actually recently said “I think I’m honorable enough to be president but it took me another 20 years to become that person.”
I don’t know what’s going to happen but I know that he’s leaning in, and he says today when he’s not sure of an answer, he says “I think I’ve got this right. And if I don’t, forgive me but here’s the point I’m trying to make.” He understands how to turn the conditions to his advantage.

Tom Friedman: Before we go to the question or to the floor though, I have one big question. Will HOW be translated into Chinese?

Dov Seidman: If I sell more books and my publisher thinks there’s a winner there.

Tom Friedman: That is, you know, we hear all about China. Where China’s going to steamroll us. We’re road kill to China. China. Britain owned the 19th century. America owned the 20th century. China will own the 21st century. How are they on how as you look at it?

Dov Seidman: I think that our advantage, if we want to stay ahead, we’re not going to become hungrier than they. I mean hungry as a complimentary term. Their sense of hunger, to make a mark, to drive forward in their lives and in business seems to be, they have a voracious appetite, as do people in India and other countries.

High ground for us is imagination, ideas, innovation. And I think that we can always keep that high ground if we go on TRIPs, if we go Trust, Risk, Innovation to Progress.

But why not turn that to our advantage? If we start with the idea and add value at the back end of the idea: how to bring it to market, how to connect it to consumers, which we’re also great at. They might own a lot of the middle but I would advise us to make sure that we come in the front and come out the back and collaborate and partner in what happens in between.

Tom Friedman: So just on last question. If I’m a candidate for President and I really buy into this that the one way we can always stay ahead is by producing, always being that more innovative country. And that’s not an easy thing to adopt or he can’t have one hour of innovation class in Singapore and think it’s going to bring about innovation, you know.

You want to produce that trust that will produce that risk taking that will stimulate that innovation that will drive progress and profits. As a President, what can the President do legislatively, bully pulpit-wise so that our next President – because we’re coming off a period of real division here in this country, most divisive eight years I certainly remember – so we were still inventing iPods and CAT scans and whatnot, but we want to maximize that. You’re the advisor to the next President. What do you tell them?

Dov Seidman: Tom, every generation feels and announces that its values are the best. What the lens of how allows us to do is if we live and act our values, we know what your values are based on what you’re doing.

So, if you run around the world using the word crusade, I can’t embrace your values. What I’m hoping is that looking at life through the lens of HOW we do what we do, we will take the values that we hold dear, freedom, equality, justice, fairness, our Constitutional values, and put the pressure on us to say if we believe this, we’re going to act this way because…

Tom Friedman: Make sure there’s no gap between.

Dov Seidman: No gap. To believe this is not to do this and it’s to do that. And that how we do what we do tells us. Anybody can pop off and say my values are the best. Countries do that and presidents do that and we do that in different time frames. But if your values are so good, then show them to me through how you do what you do.
[Applause]

Thomas L. Friedman, a world-renowned author and journalist, joined The New York Times in 1981 as a financial reporter specializing in OPEC- and oil-related news and later served as the chief diplomatic, chief White House, and international economics correspondents. A three-time Pulitzer Prize winner, he has traveled hundreds of thousands of miles reporting the Middle East conflict, the end of the cold war, U.S. domestic politics and foreign policy, international economics, and the worldwide impact of the terrorist threat. His foreign affairs column, which appears twice a week in the Times, is syndicated to seven hundred other newspapers worldwide.

Friedman is the author of From Beirut to Jerusalem (FSG, 1989), which won both the National Book Award and the Overseas Press Club Award in 1989 and was on the New York Times bestseller list for nearly twelve months. From Beirut to Jerusalem has been published in more than twenty-seven languages, including Chinese and Japanese, and is now used as a basic textbook on the Middle East in many high schools and universities. Friedman also wrote The Lexus and the Olive Tree (FSG, 1999), one of the best selling business books in 1999, and the winner of the 2000 Overseas Press Club Award for best nonfiction book on foreign policy. It is now available in twenty languages. His last book, Longitudes and Attitudes: Exploring the World After September 11, issued by FSG in 2002, consists of columns Friedman published about September 11 as well as a diary of his private experiences and reflections during his reporting on the post-September world as he traveled from Afghanistan to Israel to Europe to Indonesia to Saudi Arabia. In 2005, The World Is Flat was given the first Financial Times and Goldman Sachs Business Book of the Year Award, and Friedman was named one of America's Best Leaders by U.S. News & World Report.

Friedman graduated summa cum laude from Brandeis University with a degree in Mediterranean studies and received a master's degree in modern Middle East studies from Oxford. He has served as a visiting professor at Harvard University and has been awarded honorary degrees from several U.S. universities. He lives in Bethesda, Maryland, with his wife, Ann, and their two daughters.
Dov Seidman is CEO of LRN and author of HOW: Why HOW We Do Anything Means Everything in Business (and in Life).

Thirteen years ago, Seidman had a vision of a new kind of company that would help businesses get their hows right. With this powerful vision and an over-extended credit card, he founded LRN in the living room of his apartment.

Today, Seidman has grown LRN into a highly successful company of over 200 employees, whose clients include some of the world’s most respected companies – Johnson & Johnson, Pfizer, Trump Entertainment, The New York Times Company, Raytheon, and more than 250 others. Through its legal research group and its ethics and compliance education solutions and applications, LRN helps companies shape their corporate cultures and build strong, principled organizations that win in the marketplace.

In 2004, Seidman testified before the United States Sentencing Commission about the need for companies to focus on fostering ethical cultures instead of simply developing check-the-box, formulaic approaches to complying with the law. Today, companies are judged by this higher standard, and consumers, investors and employees are placing greater expectations on companies to operate legally and ethically – in effect, to get their hows right.

Seidman holds degrees in philosophy from UCLA, politics and economics from Oxford, and law from Harvard Law School. He is recognized for his thought leadership on a wide range of issues, and is frequently invited to speak at leading industry events and to senior management and Boards of Directors. Recent presentations about the importance of being both profitable and principled include the Outstanding Directors Exchange, The Defense Industry Initiative’s Best Practices Forum, National Contract Management Association World Congress, Council of State Governments, and Corporate Board Member Magazine Boardroom Summit. He has also been a keynote speaker at UCLA’s annual commencement.

Seidman’s views on business behavior, success and corporate culture have been quoted in dozens of print and broadcast media, including The New York Times, The Wall Street Journal, Fortune, Forbes, The Financial Times, CNBC, ABC’s Good Morning America and BBC News. Pulitzer Prize-winning journalist Thomas L. Friedman included excerpts from his interviews with Seidman on the importance of trust and protecting and strengthening corporate reputations in his best-selling book, The World is Flat.