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The truth is that for all the career planning we all do, for all the attempts we try to find our course in life, I can just say there's no substitute for meaning.
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Meaning actually means something in terms of where you go in life.
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Money can pay bills, status can open doors, but I would just say from my experience in my one journey through life, meaning matters.
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And a lot of people come to me and they say at different times, they're thinking about different jobs, they have these different opportunities, what should they really do?
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And one question, the only question I ever ask people is where's your passion? Where's your heart?
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because in the end, there is no substitution for doing something that means something to you in life.
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May not mean anything to your mother, or your father, or your spouse at times, it may cause lots of consternation as the choice I made and not becoming a lawyer, something that was expected in my family.
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But my first lesson is really meaning matters.
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And what's important to appreciate the untold story I think of this time that history will well document is that our country, joined by the rest of the world, is living through the most profound, the most significant, the most transformative economic revolution in world history.
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That's a lot of words to say, but it really is true.
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I mean think about it, there have only been three economic revolutions in world history.
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The agricultural revolution, it took 3,000 years.
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The industrial revolution, it took 300 years.
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This revolution, and we should be clear, this is the third economic revolution.
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As we transform ourselves from a national to an international economy, from an America, from a manufacturing to a service knowledge, finance, green economy, this revolution will only take 30 years.
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No single generation, you should appreciate this, no single generation of people have ever witnessed so much change in a single lifetime.
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And we're transitioning from employer-managed work lives to self-managed work lives.
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By 2010 or 2011, 25% of all the American workforce will be contingent or free agents.
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They will have no full time employer.
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My son who's 21 is expected to have 9 to 12 jobs by the time he's 35.
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>> Speaker 2: Can you just give us your views on pay for performance?
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It's obviously taken its lumps recently with some of in the banking sector, but that would seem kind of a natural way for employees to share in the gain.
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>> Speaker 1: The problem pay for performance, as you said, has gotten a bad word.
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When you can tank your bank or tank your investment company and walk away with tens of millions of dollars doesn't really sort of give a good name to the theory.
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But I do think, and I just think there's a series of questions, one is pay for performance an individual issue or is it a collective issue?
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There's a lot of issues in schools about whether or not we reward schools or reward teachers.
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Because I think there's lots of issues about evaluation methods of how do you really evaluate people successfully?
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I think we believe sort of more in a collective.
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We're willing to at Kaiser look at the bottom line performance of different units or the bottom line performance of different divisions and think that is a fair way to consider how do we reward performance.
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But there's a million arguments about hustling systems, creating systems, backdating stock options, lots of ways to pay for performance.
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But theoretically, how would you not say that in some way, shape, or form that people who perform well as a team or perform well if you want to individually, shouldn't have some consideration, whether it's by promotion or by pay.
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And I don't think, I mean, I know people like to say that unions protect bad workers.
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People might argue tenure protects bad workers, but I don't thin those are really the factors here.
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I think the truth is that we, the people that work on your campus are actually really proud of what they do.
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I was talking to some of the groundskeepers, they really are proud when the grounds are clean.
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They're really pissed off when you all throw paper on the ground and their area looks dirty or someone had a party and something happens.
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People like to be proud of their work.
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And I think we do need to find ways to reward people's collective or individual performance, however, we do that.
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And particularly, I think the whole question, particularly for profit corporation, of why are the gains only distributed down to a certain level of management?
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I think all of us would love to get some big bonuses when the company did really well.
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And I think that's an opportunity that the country should incentivize.
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>> Speaker 3: Thank you very much for coming here and we all appreciate the opportunity.
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I also had the opportunity to go to your union meeting today at 11 o' clock in Memorial Hall.
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And contrary to your answer in the first question, Stanford University got hit very hard in that meeting, and aid for the hospital organizational issues, but also specifically for the layoffs and specifically for the layoffs here at the GSB.
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And I think in many ways, that shows why many of us here in the business school community are nervous about taking a job in management in a unionized environment.
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And I think that's true across the ideological spectrum actually or political spectrum.
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I was hoping you could talk about how as a manager who wants to do right by your people, has an obligation to do right by your people, but also has an obligation to your bottom line, has an obligation to the long term health of your organization.
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How do you deal with those?
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And kind of specifically, how would Dean Jos, or how would any of us as future leaders if we're in a unionized environment, how do we worry about our people and the long term health of our organizations?
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If when you make a very difficult decision that you don't want to make, the kind of emotions and the lack of labor flexibility that your union was promoting and that you were stoking up at that rally exists and that environment exists as a manager?
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>> Speaker 1: So first of all I'd say I have a unique role in my life because I happen to be a manager too.
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I employ over 1,000 people and just we are completing a layoff of a significant number of people not necessarily for financial reasons, but because we need to reorganize the union so it serves the members purpose, not necessarily the people that work there's purpose. So I start with that.
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Two is I don't think you can sort of judge things sort of, you can judge them, but I don't think it's right to judge things either on management's parts or on our part situation by situation.
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The least best time to make a decision is when you're in the middle of a crisis because we all know your options are far less.
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So I think the first question comes, and that's why I said here I gave Stanford credit is I think we had a very traditional relationship in some of the university here that I think there wasn't a lot of consideration for the people that worked here.
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There wasn't sort of maybe enough flexibility on our part of trying to think about that.
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And so I think we need to build a new long term context because if we keep trying to deal with kind of today's problem, we'll sort of never get to tomorrow's solution.
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So that's one thing and I find it offensive.
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I'll just tell you at Stanford University, when we made a reorganization because our union felt that workers who did the same type of work belonged in the same union, and we had our members vote to say if you're a hospital worker, you're going to be in the hospital workers union, you're a property service worker, you could be a property service worker.
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We really thought that was our business that the university took advantage of that situation to question our representation, and decide to make us go through a long time to reprove, what they knew that the workers wanted to be in our union because they had just voted to be in our union.
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So we find those kind of considerations provocative as opposed to promoting a different climate.
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And so those kinds of things then set a chain motion that takes a long time to rearrange and we're finding the same thing, we go back to the bargaining table now where people are now saying well this is your first contract, let's start all over again.
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So it does take two to tango.
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I would say I appreciate that managers have a dual set of responsibilities.
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Unions have responsibility, advocates managers have responsibility to a whole series of stakeholders, and if you want to be a manager.
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Your life is not going to be easy, whether it's unionized, whether it's stakeholders, whether it's investment bankers, whether it's stock analysts.
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If you think you're going to a place to be a manager where you don't want anybody to ask you questions and you don't want conflict and you want life to be easy, get another job.
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Because if you really want to get to the top, that's your whole life.
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Is that some advocacy group, some institutionalized part of your organization, some local union is going to challenge what you believe.
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And I think part of leadership is accepting that everyone has a different set of responsibilities and then trying to figure out how you manage your way through it.
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And again, I would say, for me, you know, and I try to think about this a lot in my own union, is, how do I live up to my responsibility to my members as managers do to shareholders?
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And then, how do we live up to our responsibility to each other?
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And what advocacy is is that different people see the world in different ways.
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I used to say to the woman who's the secretary treasurer of SEIU, right now you saw Anna Berger, also the highest ranking woman in the history of the labor movement, is the head of the new Change to Win federation.
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Used to be the leader of our staff union.
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And when I was the manager and she was the leader of staff union, and we hated each other.
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I mean, really, we fought viciously with each other.
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Because what we realized after a while though, was the world just looks different from where you sit.
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And once we realize that where you sit, the world looks different, not right or wrong, it allows you to appreciate that we just have to accept that there are certain responsibilities in life that go with jobs.
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And I appreciate, there is not a manager in the world who would like to have no one bother them.
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Lee Scott said recently when he was asked about the Employee Free Choice Act, who's the head of Walmart?
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And just aside about Walmart, which I happen to admire tremendously in terms of its logistical abilities and other things.
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I just don't admire that Lee Scott makes $15,000 an hour and the workers make $10 an hour.
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I don't think that's sharing in the success of a company.
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But having said that, when he talks about the Employee Free Choice Act, he says, I got my hand on the steering wheel and I like it that way. And who wouldn't?
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The point is, that's not life.
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>> Speaker 2: We've heard in the last several months a lot about the collapse of the American auto industry.
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And a lot of blame has been laid at a variety of different peoples and institutions and organizations feet, anywhere from management to consumers to government or to unions.
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I wonder if you could talk a little bit about what you see as union's role in contributing to that collapse, if any, and what union's role is into helping to avoid that collapse, if possible.
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>> Speaker 1: I'd say, the union had at least two or three roles in contributing to the collapse.
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The first is when your employer is making a bad product.
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>> [LAUGH] >> I don't think it serves any purpose to shut your mouth and just, this is a point of when you're walking down a road and you know where it ends, everybody could see, these were companies not responding to the market.
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Shame on us if we're working in a hospital and we don't call out when we see bad patient care.
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There was recently an article in the LA Times about home care workers and home care clients committing fraud.
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And our immediate reaction is not to defend, to say, prosecute the people.
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Because I think it is a responsibility of employees or unions to not smooth over, be the front line of defense, which I think the UAW did too long to the car companies.
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Both leading into the crisis and then at the hearings.
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I mean, the union was really, you didn't see them as an independent voice about calling for change, and I think that is a decision we all make.
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Bankers make, other people make to go along with the herd.
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Sometimes you all pay the price when you go over the cliff.
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And so, I think the unions, all of us have a responsibility to call out when our employers, we think are making bad business decisions and in the long run boomerang back and hit us all.
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Two is that we have a responsibility as unions if we want to allow our employers to be competitive, to take wages out of competition.
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I guess that's an official economic term of some sort.
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So, here's the problem with the UAW.
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When all auto companies were United States based, there were no imports for the sake of our, we had Ford, Chrysler, and GM, union wages were the basic wage of every single auto worker.
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And they did a very good job, they bargained pattern agreements.
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They didn't make Ford pay more than Chrysler, they tried to equalize wages across the spectrum.
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The problem becomes, that's fine when you control 100% of the auto industry.
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But when you control 50% of the auto industry and the other 50% of the workers are now making less wages and less benefits instead of union workers wages bringing everyone up.
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Non union workers wages dragged everyone down.
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And that's exactly what happened.
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We collapsed the wages of the union workers to the non union workers because we didn't take wages out of competition.
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Now, we understand this because we represent janitors everywhere.
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If you know anything about the janitorial industry, which we happen to know a lot about, there is no significant barrier to entry to become a janitorial contractor.
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A mop, a bucket, a bunch of chemicals, you can get a job, and you can hire people significantly for minimum wage.
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And if you're really exploitive, which a lot of people would be in many markets, you hire immigrants and pay them cash under the table, and you get to go to work.
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Now the problem is, in unionized markets, once those non union workers come in, in New York, we make $22.
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30 an hour to be a janitor in a union office building.
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But the good news is every single office building and everywhere in New York City, the janitor makes $22. 30.
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So when everybody goes to the country club and complains about their janitor's wages, no one says, yeah, but I'm paying them $15.
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So I gotta go back and you know, reduce my wages because I'm not competitive anymore.
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So we have an obligation to our employers to level the playing field so the competition's about quality, efficiency, good management, and not about who can pay the less.
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And when we fail like the auto workers did, because they didn't organize the competition, economics 101 is going to say, those wages are going to collapse eventually.
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They cannot be sustained.
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And the auto workers and too many unions don't understand basic economics and competitive realities over employers.
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We cannot be anchors on our employers, we have to at least provide a basic economic foundation for which they then compete on different factors and who can pay the least.
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And I say, the final thing about the autoworkers is that they did not rally, I think, all the assets they had at their disposal.
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There were a lot of suppliers, there were a lot of consumers, there were a lot of retirees, and they did not say what I think they needed to say, that America has failed the auto workers.
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Because America can't be the only nation on earth that puts the price of health care on the cost of its products and then competes with countries around the world that don't.
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It is a stupid economic plan for America.
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And why the Business Roundtable, as long as I'm getting myself in trouble, is still supporting the employer-based health care system. I do not get.
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Because they should be the first ones screaming from the top of their lungs, let's end the employer-based system.
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I can't compete with Canada or Germany or France where the cost of the healthcare is not a part of the product. And yet they do.
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And the auto workers should have said, you have failed us America.
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We created the employer-based system in the absence of your leadership, and now we are paying the price because we promised retirees healthcare, which every American should deserve.
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And because you failed us, we are now there and we want you to pass universal healthcare right now because that's the only way we're going to solve the problem of our VEBAs and and retirees after all.
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>> Speaker 3: Like many of the students here, I want to start my own company.
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I want to invest my blood, sweat, and tears, 100-hour weeks into this company.
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I want to invest basically, my fortunes, my wife, my future kids' fortunes into this company.
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Now, I have I happen to know that SEIU supports card check, the Employee Free Choice Act.
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And that card check law says that if 50% of my workers sign cards in public, that a union is formed.
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Now, I think that I deserve a secret ballot election.
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And I want to know why you think I don't deserve a secret ballot election.
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>> Speaker 2: Well, first of all, we should appreciate what the law does, and then I'll get exactly head on to that question.
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One is, the law just restores what the Wagner Act did.
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This is not a new law, it's an old law.
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And it's actually the law that if you ever manage in most countries around the world, recognition processes are done by signing cards, not having elections.
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So, America is a unique outlier, not necessarily the status quo.
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Two is, there should be an exemption for small business.
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And that's a whole different discussion because I just happen to believe there are situations where unions are not necessarily our major priority and our major focus.
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But the secret ballot election- [INAUDIBLE] >> No, I'm just saying that I think- [INAUDIBLE] >> No, I'm not saying it's bad for small business, I'm just acknowledging that there are many laws in our country where we recognize small businesses have different considerations than big businesses.
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Including the National Labor Relations Act right now, we have exemptions in the National Labor Relations Act based on the amount of dollars you have for commerce.
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So I'm just saying if you're in a small business, you may be exempt to start with.
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And the exemptions probably need to be indexed for what they were in 1950, the last time they were changed.
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But that's no different than the small business administration or any other place where we recognize that small businesses have different considerations.
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And then they're covered by state laws, not federal laws, and then we could talk about that.
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Secret ballot, there is no secret ballot, we should just appreciate this, in elections.
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You don't have a secret ballot when you call your employees into a room and ask them how they're going to vote.
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You don't have a secret ballot when, if they don't tell you the answer, you go out and find everyone who works for them and interrogate them to do that.
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You don't have a secret ballot when you fire the people, which happens in one out of every three organizing drives, who happen to be union supporters, fire them illegally.
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You don't have a secret ballot when the employer is allowed to have captive audience meetings on paid time and the workers have no access.
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We don't really have a secret ballot.
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We have Zimbabwe elections, we have Haiti elections, we have other elections which you can call secret ballot elections.
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They have secret ballot elections in Russia and North Korea, there's just one candidate on the ballot.
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And the inherent amount of power here doesn't make it a secret ballot election.
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Having said that, if there ever was a day where employers wanted to give up their free speech right and have equal speech speech rights, not dominant speech rights, then we can have that discussion.
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The problem is it's like soft money in elections.
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There is this thing called the Supreme Court, they happen to make laws, and employers demand that they have the right to free speech.
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And they are allowed to do in union elections, just to complete, because I know you want to say one more thing.
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They are allowed to do in union elections what you cannot do, appropriately not do, in any other context in terms of sexual harassment.
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There is an understanding that employers, managers, you'll all learn this, if you haven't already, can't do certain things with their subordinates because of the inherent power relationship between an employee and employer.
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I cannot, as harmless as it may say, bring an employee into my office and say, I'd love to have a cup of coffee.
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I'd love to go out for work with you. That crosses a line.
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In union elections you can do anything you want, including predicting, not doing, predicting you might lose your job, you might lose your benefits.
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We might move the plant, and your career will be ruined if you do this.
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If that is an American election, I don't get it.
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>> Speaker 1: It seems like everything you're talking about is illegal by employers to do in influencing a secret ballot election.
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What I'm saying- >> It's not illegal.
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>> In my business, if I do not do any of that, why did I not deserve a secret ballot election?
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>> Speaker 2: I'm saying, if you were just going to allow in a hypothetical situation, a laboratory condition, people to have those kind of conditions, you should.
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But that's a lot of ifs to get to there, and that's not how the world works.