The MBA.
To some, it is a goal to aspire to a step
seen as a critical advancement in organizations.
To others, it's a goal already reached and to others.
And it's a long, expensive process filled with
more questions than promises.
Today we're going to talk about the MBA.
Kind of what we're really going to talk about is how to build the foundational
skills taught in those programs without stepping foot in a classroom.
Welcome to another episode of the Remarkable Leadership podcast,
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And with that, I'm going to bring in our guest.
His name is Nathan Krakauer, and I'm going to introduce him to you right now.
You can if you're watching, you can see him.
Nathan Krakauer leads Abilities,
Research and Development Efforts as chief research officer.
He is the co-creator of the 12 week MBA program
and coauthor of a book by the same title, which comes out
as we're saying, This Live comes out tomorrow.
So this is why coming early on the livestreams is to your advantage.
The book comes out tomorrow in February of 2024.
He joined
coauthor Bjorn Millard's first startup company Inspire Learning in 2002
and was the principal author of courses for organizations
such as Harvard Business School and the World Bank.
Nathan has facilitated leadership seminars at major global corporations
and and executive education programs at the
I Am the Business School
London Business School and my Sloan School of Management.
He holds a B.A.
in liberal arts with honors and an M.A.
in philosophy, politics and Economics.
He was born in Falls Church, Virginia, but he now lives in Germany with his wife
and two daughters.
So when I said we were in different parts of the world, I was right.
Nathan, welcome. Glad to have you here, sir.
Thank you. Kevin.
It is a pleasure to have you.
And we're going to talk about this whole MBA thing.
And so we've got Bill with us from Atlanta.
And so if you're here, you can see you can say hello and hope you'll do the same.
All that shows us is that Bill follows instructions.
So so, Nathan, we had this book, the 12 week MBA.
But before we get there,
sort of give us a little more backstory behind the bio that I read
that tells us about your journey.
I often will say to people like, you didn't
wake up when you were eight and decide you want to write books about leadership.
So what sort of gets you to this place in time?
In the short, in short and short version?
Yeah, I definitely would not have said at eight.
I want to write books about leadership.
I might have said I want to write a book,
but it's not about leadership at that point.
Probably more of a fantasy novel, and I probably would not.
It's not too late, Nathan.
It is not too late.
I probably wouldn't have said I wanted to write a book about leadership
even ten years ago, to be honest.
But the path that took me here,
well, I think one thing to explain is why am I sitting in Germany
if I'm I'm an American? I actually wound up
spending most of my
childhood bouncing back and forth between Europe and the United States
because my my dad worked for the US State Department.
And so we were in several different places along the way
in Germany as well, most of it in Germany, but also Helsinki, Finland.
And I did not come back to the States for any longer period of time
until I went to college in Austin, Texas, where I,
you know, did the usual four years of college,
spent a little bit of time in Los Angeles, came back to Austin
to get another degree in mathematics, actually.
And it was on the heels of that that I wanted to start my rock and roll career.
But yeah, rock and roll does not pay the bills early on.
So I had to find a day job.
And that day job wound up being with a company called Inspire Learning
that was just founded by Bjorn Gilbert, my now coauthor.
I have to stop right there because it's
because last night was the Grammys
and we have had a Grammy winning artist on this show.
I'll put that in the show, everybody,
if you know who Maynard James Keenan is, the lead the lead leader of Tool,
among others, also a close friend of Kevin from childhood.
So Maynard has been on the show,
haven't mentioned that a long time.
So sorry about that.
So once you got out of rock and roll,
at least as a livelihood and well into learning.
Yeah, it really it was the day job too, to work at Inspire Learning,
where I was hired to write a course in business statistics, which was being
used as a was going to be used as a pre matriculation requirement at Harvard.
So it was, you know, one of the earlier
attempts at having sophisticated e-learning and,
you know, delivered via web with with, you know, animations and all that stuff.
And I was hired to be the,
you know, the content writer and instructional designer on that.
And I had that opportunity to work very closely with a professor at Harvard
named Jim Jan Hammond, who was a kind of a mentor to both Bjorn and me.
And that sort of brought us together by virtue of that that engagement
that that she had with with us that newly formed company under Bjorn.
And then I proceeded to, you know, work at that company.
Eventually I realized I was having more fun
and it was being more creative
and had a better lifestyle doing what I was doing for the company
rather than rock and roll.
And I realized, you know, I actually don't really
deeply, deeply want to do this rock and roll thing.
I mean, I love music.
It's still, you know, I think that makes me very passionate,
but I could not see myself
doing the touring life even if it were successful.
And it was at that point when I realized, even if I were successful at this,
it would not make me happy that I kind of gave that gave up that dream
and continued to to work along with Bjorn.
We kind of shifted our focus and focused
exclusively on management and
leadership development using
simulations, actually business simulations,
computer based simulations, multiplayer simulations for the purposes
of teaching management and leadership development.
And we birthed a second company out of the first
in 2016 called Ability.
And that's where we are working together now.
And that takes us to where we're headed now, which is,
which is the 12 week MBA.
Interesting that you wrote, you wrote materials for
MBA students in the traditional sense.
You know, I opened I opened the show by saying that basically different
people have different thoughts and feelings about the MBA.
And and so let's talk a little bit about
the problems and promise issues
of the traditional MBA approach.
Before we get to your approach,
I want to talk a little bit from your perspective,
because you've been around this for a very long time.
What are the promises and problems with the traditional MBA degree?
Yeah, so I should clarify, maybe to begin
with, Bjorn actually has an MBA and went to Harvard.
I do not.
And that's not due to any like real rejection of it.
I would sort of say it wasn't really on my radar as something
that I would even consider.
I mean, I didn't even have a chance to not say no to it,
so to speak, mentally, because it didn't cross my mind.
So we come at it.
This is very different perspectives when you know where he actually and
loved his experience at the
at Harvard got a lot of value out of it
and me with sort of complete indifference on the subject.
Now when we talk about the promises and the problems,
the promises, of course, that you are able
through the MBA to learn what it takes to be a manager at an organization
and take over responsibility at a higher level than you could
if you were just entering maybe purely as an individual contributor.
So that
there's the value proposition of the content, as it were.
Then there's the value proposition of
getting the accreditation, which is very important.
Then there's also the, the value proposition of getting into contact
with a, with a peer network of people who are,
you know, in a similar place in life probably have similar interests
and similar desires about where they would want to take their careers.
And, you know, that's actually a great thing
to have a network of people who are kind of like minded and
and prepared also to help each other as they pursue their professional goals
and in some cases also pursue other goals entirely.
Bjorn actually met his wife at Harvard as well.
So he had there you have many, many different successes coming out of
many different successes. So
you make this bold claim of 12 weeks, right?
Like you don't have to it really wouldn't even have to be on someone's radar.
Like you said,
it wasn't really on yours to know that you're not getting an MBA in 12 weeks.
So there's there's something that is unique
about what I mean, there's there's uniqueness in your delivery.
What kind of get to that a little bit later.
But there's a unique sort of thought process about what you guys have created
that is in both the program that you have as well as the book,
and we'll get at both of those again later.
But like what's unique, What have you done
to sort of
distill it to 12 weeks, if you will?
Yeah.
And so I think that is one of the major contributions of the book and the program
that our approach is not to skim lightly and just say,
each and every subject of the traditional MBA is not rocket science
and therefore we can kind of float above it all
and just give you the top three lessons from each right,
that there are things that looks like that and they have merits.
Also, I don't want to say that's a bad, bad way to approach it,
but that was not what we wanted to take for the program or for our book.
What we said is we want to focus on what's the most essential, in fact,
what's timeless and universal, and go deep on that.
So we're not just skimming the surface on that
and how do we, you know,
define what what what is essential.
That also is a bold claim, I will acknowledge.
So first, to understand, like our process for that is that we have
the personal experience of running two companies across 20 years
and we can kind of see, well, what what actually was essential all along
and what didn't change from one company
to the other because they had slightly business model
the different business models,
but meanwhile, what we were also doing then was we were delivering leadership
and management development programs at major corporations.
And so we would see how they internally, the people designated with
with the task of finding what is essential for their leadership management
development programs, what they thought those essential steps were.
And it turns out.
That first voice what a novel idea.
Well, yeah, exactly.
I mean, and it turns out that they don't make everybody
go through a basics of marketing course in these leadership development programs.
They don't make everybody go through a supply chain management
course or, you know, operations course know.
They they focus on a few different areas that they make everybody that they promote
or intend to promote into positions of responsibility, make them go through.
So that gave us sort of the insight that I think that we applied then.
So it's not that we sat back and just thought about it.
It's just, you know, what we observed.
You like to teach.
Right? Exactly.
Yeah.
In fact,
I mean, one of the things, as you'll see, is sort of the financial side
and arguably
I, I wound up loving to teach it.
Okay.
But it was not what I imagined ever in my wildest dreams, not at eight years
old, 18 and much later than that, I would not have said
that's what I want to go around the world teaching.
But that is what I do. And I haven't developed a passion for it.
But because I see, you know, I see what the power is
and how impactful it is for managers to know, or rather
what happens when they don't know how to manage a business from the perspective
of getting getting the numbers right, getting
creating value.
As well as the people.
And those are the two big chunks.
If we take the traditional MBA, we've taken all of the contextual stuff
out, the the, the supply chain, the marketing,
all of those things have your and again, you're not saying they're not important.
You're saying we're getting to a core, which is why they can
these two guys can make a bold claim about 12 weeks because
now these two things are still huge pieces of the book
and the program is based is broken into these two chunks you want to set.
You've hinted at it, but say a little bit more about it.
Yes, numbers in the people.
And I left out the people early because that is an area
that I would have been passionate about much, much earlier.
I had a feeling this we're heading there.
So I up like.
Yeah and
I mean it's exactly right that the other topics
that are covered in a traditional MBA are are absolutely important.
The question is where is the best place to learn them?
And the truth is the best place to learn them is probably on the job.
If you go to an MBA and learn about marketing,
you may you're going to learn great stuff.
There's no doubt about that.
But by the time you actually emerge from your MBA and then and get a
get a job, a a lot of what you've learned
is already going to be passé because that world moves too quickly now.
And B,
you're going to have learned about marketing, maybe from many different case
studies, from many different industries and different companies.
But really what's going to count is what your particular industry,
your particular company looks like at that point. So
you're not going
to actually be able to use necessarily all of what you've learned.
And then what if you actually don't
go into the marketing department, then that that's
all that you learned about marketing is not going to even be applicable to you.
So for that reason, there is this core that you could get to.
Now, again, we don't want to say don't do an MBA.
If you're if you're excited about doing that is wonderful experience.
But if you are in a position where you actually you like the industry
and you're in, you maybe even really like the company you're in,
but you're looking for a way to advance your career
and you don't want to go back to school for two years.
I mean, there's a big expense of that even.
Never mind, never mind, never mind the expense alone.
The two years that you take yourself out of the workforce is another two years
where, guess what?
You're not actually building further expertise at your company,
in your industry, building relationships in the ecosystem of that industry.
And so, yeah, there's a huge opportunity cost for you
and that opportunity costs is also paid by your prospective employer
because part of what they want you for is, you know, you're up to date expertise
and the relationships that you've built over time. So
I told you before we started the show
that the best episodes of the show in my mind anyway,
aren't book reports, right?
And this is a different kind of book than some of the ones that we do here.
And so I thought, well, like, what do I do?
Like, I'm not going to like, I'm not going to have you teach us
value the valuation, the foundations of valuations here
is, first of all, we would lose some of our listeners.
And second of all, like this isn't the right format format or or to do that.
But I am curious with this idea on the numbers side of this,
in your work with folks in in
you know, in live sessions,
is there a
is there a concept that is often misunderstood going in
like is there is there a sort of a red flag you would wave to people to say,
hey, what you think about this may not actually be accurate?
Yes, indeed.
And that is one of the things that I'm very passionate about,
which I think shows in the book.
In fact, a lot of the editorial process was taking
some of Nathan's flights of fancy out about that.
But I think so the core idea is that when you're creating value, it's
not just about creating making a profit.
And I think our naive understanding, my understanding up to age even,
I don't know, 20, 25 or something
would have been, yeah, I mean, what a business does is it makes a profit.
Well, actually a business attempts to create value
for many different stakeholders, but people basically get that.
You buy low, sell high.
You know, your uncle told you that when you graduated from college.
And it's good advice.
But we also know that
businesses like to grow.
I think there's some misconceptions about why businesses are always trying to grow.
And you know, so we accept that, but we don't necessarily question why.
But I think the biggest thing is that value is also created
by making the results of the company more predictable to all of its stakeholders.
And then we focus a lot on the investor viewpoint or perspective on that.
But a company makes a promise to investors saying, we're not going to
just have profitability now, we're going to have profitability
in the future and we're going to be able to pay out something
to you or to whomever you eventually sell your shares of the company to.
And the things that we call dividends. And
investors want to believe in that promise.
Or rather, the more they believe in that promise,
the more valuable the company is to them.
And so strangely enough, it was strange and counterintuitive to me,
but a lot of what a business a business does is try to set,
you know, investor expectations about the future of the company
and try to increase their confidence.
So that really means that sometimes a company will let
profitability take a backseat, even growth take a backseat
to the idea of smoothing the results of the company
in the present so that investors have the perspective
that they will be smooth and continuous and predictable in the future as well.
I love that and I think that one of the things that as I was reading
the book I was thinking about is that even in smaller, organized actions like mine,
that the more people
understand some of these ideas and doesn't mean
they have to be able to create an income statement, That's not my point.
That's not in the book either, by the way, as it turns out.
But but the sum of some of these core ideas.
Another example being the understanding
that industry profitability and cash flow, there's a there's a big one.
As an owner, I promise you
that owners that don't understand that are probably still not owners.
Yeah, but the point is I think that there's there's great value
to understanding some of these core principles,
foundational principles, regardless of where people sit in an organization.
And I think the the most
the healthiest organizations are organizations
where people have some clue about some of that at least.
And there's some transparency about what's going on
in the organization around some of those things.
And the more of that you have, I think the healthier your organization is.
And probably the more likely you have people are going to want to stay.
Which leads us to where I want to go next, because we don't have time
to go into great depth
on the people side of the bucket either as I look at the clock.
But there were some
well, I'm going to start with a core idea.
One of the core chapters in the people side that I think
you will have some interesting things to say in the chapter,
as I recall, is titled Engagement and Motivation.
And so let's just talk about that for a second because kind of
I kind of led there to say if people have some better understanding of the business
and of the whys of the business, which you hinted at in terms of value,
then I think it's easier to create this engagement and motivation stuff.
And I think that engagement and motivation gets a lot of discussion
and often is
we don't serve ourselves best with some of that discussion.
So you want to what would you add or say or make sure
people leave with around this really important topic?
So I want to pick up on one thing you said there that I think is really important,
which is we
could theoretically have written two different books, one about the people
and one about the numbers, and that would have been totally okay
in, you know, in terms of how people write books.
It's almost a risk, I would say,
to try to write one book that includes both of those topics.
But and we thought and
what we thought was really important was to show how these things are
inextricably interwoven, interconnected, and it's sort of
almost pointless to talk about the numbers without talking about the people.
And likewise, it's not very good to talk about the people
without talking about the underlying business realities
that that managers would face when they're making decisions.
And so what you brought up then about
when people know the numbers, they have greater trust.
In fact, that's sort of the underlying message
I think of the numbers part is the numbers part really is also about people.
It's about establishing trust.
You talked about it, about how it is about establishing trust
with the outside world, with investors and so forth and customers as well.
But internally, when people understand the reasons why decisions are made,
then they are much likelier to be engaged and participant.
And even if they do disagree with something, something still,
you know, put their backs into whatever strategy is being
has been decided on.
So I think that this idea of numbers reinforcing
engagement is very important.
Of course, the chapter in itself is also about, well,
what can we do as managers to ignite passion?
And there's an underlying
theme, I would say, especially in those first three or four chapters
of the people side, which is really that,
you know, when you're a new manager,
there are many things that you would love to be able to do and aspire to.
You would probably want to be a superhero manager,
and that might be things like igniting passion and all that.
But realistically, when you first become a manager
and have had not had the experience or the training,
what you really need to focus on is not hindering
people's, it's not sabotaging or.
Be a barrier. Everybody. Yeah.
So, so we talk about motivation and we talk about, you know,
the different kinds of motivators that people have.
And we look at them both in terms of how you might engage in them.
But I think it's always more important to say,
what could you be doing that might sabotage somebody's motivation
and understanding what their motivation is is just as important
for understanding how not to sabotage it as it is for engaging it.
Again, if you're many, you've got many years of experience.
I'm sure that you can, you know, use the levers of motivation to like
bring somebody back from being disengaged and and that's great.
But I feel like that's sort of the that's sort of the master level there is we're.
Trying to ship that's match that's.
Not the that's mastery level. Yeah.
I just make one make one comment about that is in working with
lots of new leaders or leaders of leading new teams
that even if they're more experienced, is that we make it.
All of us have had that leader and we've seen a lot of mistakes
that they make and rarely are they making those mistakes, knowing their mistakes.
And yet and so these being a barrier and inadvertently doing things to demotivate
folks or disengaged folks are things we got to really be aware of.
And I think that's a great thing.
So I'm looking at the clock and
part of me says
Kevin, just go on to the back part of this interview.
But but I want to ask one more thing.
There's there's something that you talk about in the book,
along with remembering the big idea of the book,
which is that we can we can take out a piece
of the core concepts that help us be more effective,
that that are taught in an MBA program and talk about the numbers and the people.
And I think that's a really useful concept.
The other thing I'm
going to remember about this book
is almost an offhanded comment
that you make as a short section
because you put words around something that I teach all of the time,
but you gave it better language and it's this.
And so he's like, is this a book report?
I mean, is this a test? It's not a test.
The idea is alignment versus agreement.
Can you give us five sentences on this?
Because this is a really important idea, and I think you guys captured it
exceptionally well.
thank you.
Well, first, let me say that the insight itself comes from a friend
and colleague of ours, somebody who teaches some of our of our courses.
His name is Jerome Bhargava, and I've had an opportunity to work with him for
a long time now.
And he's just a fabulous person in a fabulous facilitator.
So all kudos on like getting me to think about that in that way.
Go to him.
Now, in terms of what we focus on here, it's
that, you know, businesses make decisions.
They go left or right.
They go for this market or that market.
Teams make decisions as well.
And so whether you're talking
about the whole business or just the team, you're making decisions.
Even if you are nominally the decider as the manager,
you're never making it without, so to speak, involving a group.
You need the group to get information.
You need the group to execute.
So for no other reason than those you need actually for the group
to be participating in the decision making in some way.
Now, if you're
faced with a decision under uncertainty,
then I think you have to acknowledge it's quite possible.
In fact, that's what's implied
with uncertainty, that there's a chance that it will go wrong.
Otherwise it wouldn't be an interesting it wouldn't be a decision at all, really,
if you knew exactly what would happen.
So since there's going to be this space in which
a decision space in which something could go wrong, you're going to have to
you're going to have people who disagree with it.
That's also necessarily the case because different people have different
perspectives on what the outcomes might be, how likely they are and so forth.
And yet you know, if
the people who disagree with the decision don't
pull together and act as one with the team, then
neither option that was in play or none of the options that were to play
could possibly go right if everybody's going on their separate directions.
So what you have to be able to do as a team and as the leader of a team
is somehow gets to alignment
even when there might be disagreement.
And it turns out,
of course, that the way you structure the decision making process
has a huge impact on whether you can get to that alignment or not.
In other words, I might disagree profoundly with Bjorn.
I do all the time.
If he were here, he would he would not very vigorously.
But it's okay that we disagree as long as we
in the leadership team of ability and everybody else move forward as one.
And if we have faith that the decision ultimately is
made in a way that is acceptable to us, that is legitimate, then
we can get behind the decision, even if we're not in agreement with it.
Even if it's not the decision we would have made, One of the things
that I think is so challenging for leaders in the middle, which I'm guessing
is many of you listening,
is how do I lead the change?
That's not what the when I have made
and I think the answer is the difference between alignment and agreement.
And and once we can understand the intention
behind the decision, we can say reasonable people can disagree.
We want we want people to be able to disagree,
but we need to then we need to then align behind the decision.
And it's much easier to do that
when there's a clear understanding of the intention of the why.
And I just loved I just love that.
And I wanted us to go there.
You might have thought, Kevin, there's better things
we could have spent our time on, but hey, it's my show.
So I do have a couple other things I want us to talk about.
Yeah. Before we finish.
And and
I know that you've listened to the show, so you kind of know where I'm headed.
Probably. My question is this.
What do you do, Nathan?
For fun?
Yeah, I think I covered that a little bit because I do still love to play music.
I think I don't know
if the camera shows it, but I've got guitars all around the room that I'm in.
This is a this is my home office.
Which you mentioned rock and roll, but you didn't.
I didn't know if we're talking drums, we are talking
vocals, we're talking piano like keyboards. I didn't know.
So I mean, it's. It's, it's guitar.
And then of course it's I don't practices I don't go
out on tour or have time even to play with bands.
I do a bit of home recording where I do a little of everything
and probably I shouldn't.
But hey, it's my hobby. Nice.
I love that.
And, and the other thing that the only thing
I think you absolutely knew I was going to ask you is this
what are you reading these days or something you've read recently?
Nathan Yeah.
So with this book release, as you said, it's tomorrow.
I've not got around to as much reading as I would like,
but I'm normally a very avid reader and the books that I'm reading now,
it's just taken me a little bit of time is called Owning the Earth,
and it's by a gentleman named Andrew Linklater.
It's a really deep analysis of the history
of private property and private property in the land in particular.
So I have an ongoing interest in the question of why is it exactly
that we can get paid for already having money in the first place?
So why is it that, you know, having built up a surplus of savings,
we can invest it somewhere and get even more money,
even though actually the whole reason that we're
we have the savings is that we already have more than we need to begin with.
I, I know that there's obvious answers to that,
but it's one of those deep questions about how we organize organized society
that I keep coming back to and thinking about.
And I think it's always a good thing to ask those
really deep questions that we take for granted.
Owning the Earth by Andrew Linklater.
And we'll have those.
And that in the show notes as well as in the show notes, will have
more information about Bjorn and Nathan's book, The 12 Week MBA.
Where where do you want to point people?
Where can they learn more about the book, about the program?
We never really got there.
There's a program that is that 12 week
immersive process that this book outlines about
where can they learn more about both the program and the book.
Nathan So if you type in WW dot 12 week
so one to w e k
MBA dot com that will then link you to
ability our company's website
at the right place where you can both
order the book for your you can order the book now as of tomorrow
and learn more about the program.
So you can go to ability.
Abby I'll i t i ecom
or it's probably easier to just remember
well one two week MBA aecom.
I hope you'll do that.
So Nathan, thank you for being here.
It's a pleasure to have you.
Thank you. Kevin Great.
Before we go, everybody, there's a question
I ask you all every week, and I'll ask it again today.
Now, what? What will you do with this?
Maybe you've got some very specific idea from something that
Nathan shared that want to take action on.
I mean, it might be as simple as I want to get a copy of this book, which he and
I would both find very lovely, but it might be something else.
Maybe it gets you to think differently about the idea of an MBA.
Maybe it gets you to think differently
about your work as being about the numbers and the people.
And there's some action that you want to take about that.
Maybe you've got some very specific idea about
alignment versus agreement or you got something
to really consider in the area of an engagement and motivation.
I don't know what that is for you,
but what I know is if you don't ask yourself this question,
this will not will not have been as useful a time as it could have been for you.
And and the reason that we do these is to make them of great value for you.
And the best chance for that to happen is for you to take action.
So, Nathan, thanks again for being here.
It was a pleasure to have you.
I've been looking forward to our conversation and to all of you.
I look forward to having you back with me
next week for another episode of the Remarkable Leadership podcast.
Make sure that you let others know where they can find it.
Subscribe so you don't miss another episode.
Give us some recommendation love.
If you want to do that, you know how to do that
and whatever platform you're in, just come back next week
for another episode of the Remarkable Leadership podcast.
We'll see you then.