Thirty Minute Mentors Podcast Transcript: Former Best Buy CEO Hubert Joly

I recently interviewed Hubert Joly on my podcast, Thirty Minute Mentors. Here is a transcript of our interview:

Adam: Our guest today is a former Fortune 100 CEO, who was the leader of America's largest consumer electronics retailer. Hubert Joly spent seven years as the CEO of Best Buy, where he led the company's turnaround and is the author of the new book, The Heart of Business. 

Hubert: Adam, thank you for having me. I look forward to our conversation.

Adam: Long before your days of leading one of America's best-known companies. You were growing up in France. Can you take listeners back to your early days? What were the key lessons and experiences that shaped the trajectory of your success?

Hubert: Yeah, there were several milestones, one of them was when I was 16, I was working in a supermarket putting price tags on vegetable cans. And this was a very dull, uninspiring experience, I needed to make some money to buy a bicycle. You know what it is? I just say that we always remember the experience of a frontliner. And when it would be a leader, my responsibility would be to create something more inspiring than when I had seen another milestone. So move forward a few years, quite a few years, I was at McKinsey and Company. And one of my clients once told me it was the early 90’s, where the purpose of a corporation is not to make money. The outcome is not the goal. Instead, in business, you have three imperatives, which I think will all lead to this in which you have people in productivity to have the right people properly equipped and trained. You have a business imperative, but you need to have customers who are happy. And then of course you have to face it. But it's excellent. Some people have at least two exits of business that lead to accidents of finance and sin. Always manage your business like this very practical implication when you do your monthly business review. Start with people in the organization. Then good customers and business are strange with fires. And another master was a couple of friends who are monks asked me to write an article about the philosophy and theology of work. Why do we work? Is work a punishment, is it a curse, because somebody, some dude sinned in paradise? Or is work is part of our quest for meaning as individuals. And that stayed with me because I think our individual quest for meaning needs to be a foundation for the kind of leader we want to be. So these were three milestones along the way.

Adam: The importance of the human element in the workplace, the importance of finding meaning and work are core themes of your book, which we're going to talk about throughout the course of this conversation. But before we do, I wanted to ask you, what were the most important skills that you developed that allowed you to rise within your career? And what skills do you encourage anyone listening to this conversation to develop?

Hubert: Well, it's interesting…I was so involved in this when I was growing up. As a leader, I thought that the most important thing was to be smart and I relied on my problem-solving capabilities. I got some good neurons from my parents, naturally being smart and hardworking was the key that my role as a leader was to solve problems. Over time, I came to a conclusion though this is wrong. My job as a leader is not to tell what, you know, other people want to do. It's much more to create an environment where others can be successful. And the mistake I made at him for many years, was to have my head cut off from the rest of my body. The longest journey I had to make was the 18 inches over my head to make it to my heart in attendance during the last two years with COVID. We've all learned this, right? We need to lead the way we said. We need to lead with other family paths, not just our head, but also our heart, our soul, our guts, our ears and our eyes. And that's a big transformation. So today I pay much more attention when I recruit somebody. Tell me about who you are, what kind of leader are you? What is your soul? What drives you? How do you want to be remembered? As opposed to just how smart you are and you know, your technical skill. So we need the whole package, but much more balanced than initially with that.

Adam: I appreciate your not only willingness, but eagerness to acknowledge that you made a mistake and you evolved as a leader. Can you talk about some of the failures that you've encountered in your journey as a leader, and what advice you have on how others can navigate and best manage failure?

Hubert: Yeah, so use a couple of points, one. So it was a bit more than 20 years ago, I was in Los Angeles, I was leading a video games company, and Vivendi's parents had acquired Universal. And I volunteered to be put in charge of the post merger management and extracting synergies between the two companies. And I thought I was driven by you know, I have experience in that and I thought it could be helpful. I also felt it would bring me closer to the top. So I am always driven by ambition, ego, power, friends, and logging. And that was a big mistake. And today, fortunately, I was punished because the job was actually meaningless. There was no synergy. So that was meaningless. But the lesson I learned was, I have to be attentive to what drives me if it's power, fame, glory, money, timeouts. Today, I'm much more attentive to if what I'm going to do, meaningful, impactful, and enjoyable. And shortly thereafter, you could say, professionally had been successful. I've been a partner at McKinsey and Company and was on the executive team that was the player that made the event universal, but Animesh felt emptiness. There was no joy, there was no meaning. So call this my midlife crisis. And this is what led me to slow down, step back, and spend the time to search for what is my calling in life? What is my true purpose? And then the last thing I would say, so project to 2009, and to see counseling companies in Minnesota, Minneapolis, my head of HR, at the time asked me, would you like to work with a coach? And I said, oh, did I do something wrong? The idea of the coach as being a remedial thing is another no and thinking of Marshall Goldsmith who is like the father of all executive coaches, and he helps successful leaders get better. And I think that, before that, I've struggled with feedback, and struggled with the idea of getting better, you know, because I was a perfectionist. And so Marshall really helped me. I needed help, right? In his book, what got you here won't get you there. He lists 20 quirks of successful people. I got 13 out of the 20. But he helped me discover the idea of feed forward, how can we decide what areas I want to get better based on the feedback from my team? And then the idea of asking for help. Because if I want to get better at these three things, maybe I can ask my, you know, team members to help me with these various areas.

Adam: Where I think that feedback is a topic that, unfortunately, is not talked about enough, but it's so essential to success, up and down an organization. And I wanted to ask you if you could share with listeners, what your best tips are? On the topic of feedback, how can anyone best give feedback and best receive feedback?

Hubert: So three months after I joined Best Buy, the executive team at Best Buy, things were going well, we were getting momentum, but I told my team, look, let's agree that this turnaround is going to be hard. The reason why we know it's gonna be hard is that everybody thinks we're gonna die. That's how you know. And so that means that every one of us is going to need to be the best leaders we can be. That includes me. So I have a coach. He's going to come in and ask you for feedback. So we would appreciate it if you could spend 30 minutes with them. Marshall gathered feedback from the executives. He sent me two documents, the first document with all the good stuff, say read this first. Okay, take the time. And then a second document with the other stuff. In any case, you don't need to do anything about it, there's no law that says that you need to address any of this. Think about what you want to get better at. Pick one or two or three effects. And so I did, I picked one, three things. And shortly thereafter, I get my team together and say, thank you so much for all the input you provide to mash. Alright, so by the way, when you get feedback from somebody, say thanks, say thank you, and smile. And by the way, shut up, don't be defensive. So I said, these are the three things that I've decided to work on. I'm going to follow up with each one of you, and ask you for advice on how I can get better at these three things in three or four months. So it's the ability and it's the first time I did this, and it was excruciating pain, let's be clear. But it's the ability to stand and say, these are the things I want to get better at. And be able to say my name if you need any help. So if you're writing to somebody these days, you can ask them, what are you working on? They'll tell you and then ask you if you have any advice for me.

Adam: And it really comes down to humility, which is a core principle of effective leadership. And to that end, what do you believe are the key characteristics of an effective leader and what can anyone do to become a better leader?

Hubert: So I think we have to recognize the model certainly I grew up with, which is the model of the leader as the superhero, knows everything, he tells other people what to do, is not working. You know, nobody wants to follow a leader like this. I think the kind of leadership that's needed today, they talk about it in The Heart of Business, right, we talked about the five B's of purposeful leaders. First thing is to be clear about who you are and what your purpose in life is. And be curious, by the way about the purpose of people around you, in how all of this can be connected to the work and the purpose of the company. So purpose is the first thing. The second thing is about being clear about your role. It's not to be the smartest person in the room, it is to create an environment for others to be successful, it's a completely different mindset. The third one is being clear about who you serve as a leader. I told the officers at Best Buy, look, if you're here to serve yourself, or are your own boss, or me as the CEO of the company, it's okay, I don't have a problem with that, except you cannot work here. We're going to promote you to being our Best Buy customer and we take great care of you as the Best Buy customer. On the other hand, if you're here to serve the frontliners people in the organization, then we've got the fourth word is about values. And the fifth one is about your documents about authenticity, vulnerability, being able to say I'm not perfect, and you help. And it's about humility, you said it's about empathy. And this is interesting because these are words, five years ago, empathy and business leaders, we were not talking about the same phrase. But following the crisis we've been in, you know, humanity has become so much easier because, Adam, did you have the manual on how to deal with COVID? Or on how to deal with going back to the office? Of course you didn’t. Nobody did. And so as a leader, we have to be able, it's so easy to say, I don't know. So let's sit down together. And let's figure it out together. And so that's a completely different approach to leadership. It's a much more purposeful and human and humble approach to leadership.

Adam: Hubert, I love everything you said. I love each and every one of your core principles. They align with what I talk about when it comes to leadership. I give a talk on the seven characteristics of resonant leadership and so much of it is in alignment with what you just shared; being self-aware, being empathetic, having a core moral compass. And I want to talk to you about a topic that you spoke a little bit about in answering the question on leadership, but you wrote a lot in the Heart of Business and that's on the topic of motivation. What are your best tips for leaders on how to motivate those around them, and what advice do you have for anyone listening on how to motivate themselves on the days that they might not necessarily feel all that motivated>

Hubert: Yeah, so there, we have to go back to the old model of top-down leadership. And there was this belief that you would tell people what to do, you would put incentives in place that people would align with the direction, we could do a survey of this podcast, and ask people who likes to be told what to do? I'm going to bet that people are listening, probably aren’t raising their hand saying I like to be told what to do. The other thing we've learned is that if you use carrots and sticks, right, you get donkeys. And that's not a great way to get to form a team. So one of the things we've learned is that motivation is not extrinsic, it's intrinsic. What do I mean by this? It comes from within, it starts within. And in many ways, during COVID, you know, if you could go outside, you had to go inside, and reflect on what was important to you, and how you would want to be remembered. So for me, in particular, in this context of the great resignation, we need a great re-recruitment effort, which means empathetic listening of people around us, you know, what's important to you? What drives you? What are your struggles? What are your dreams as a store manager in Boston? Even as one of the associates in the store, what is your dream? What is your dream is very down in the break room. My job is to help you achieve your dream. And so I think leadership is in part about connecting dreams, connecting the dream of the employees with their work. And then connecting the work with the purpose of the company. And that's a completely different way to lead. The other ingredients of what I call unleashing human magic has to do with creating an environment where there's genuine human connections, where you can be yourself and you can be seen and respected and accepted with all of your quirks, not that we're going to tolerate bad behaviors, but that, you know, we accept the fact that you are a beautiful, quirky, and messy human being. And we're going to work together to create a better future. Autonomy is important. Growth is important. So that's what I call the ingredients of human magic. But the key idea there is that it's leadership from the inside out. It's about connecting drinks

Adam: I love it. What did you look for in the people who you hired within your organization? And what are the keys to building a winning organizational culture?

Hubert: So the two questions are related. One; so under the attributes of the characteristics, so there again it evolved in the old days, and we put most of the emphasis on experience and expertise, are we the best e-commerce person I can get, the best supply chambers, the best marketing person, you name it. Over time, I learned that this is interesting but not fascinating. At least as important is who this person is. I remember when I was being interviewed for the CEO job at Calcium Company, so the job before Best Buy. Marilyn Calcium Nelson the daughter of the founder of the company, it was about replacing her as the CEO. One of the questions she asked me is, is he there? Tell me about your soul. You asked this question, right? And yet it is so relevant. And you know, everybody loves The Godfather so when this show is about concealed carry or tells the consumer to tell Michael actually liked him, it was on the business, nothing personal, I think he's wrong. Business is very personal. So who is this person? I think the most important decision we made coming from a cultural standpoint is who do we put in positions of power, right? Because as leaders, there's very few things we do ourselves. So being clear about the leadership expectations, the leadership profile, what is the kind of leaders we want, what you and I were talking about? That's absolutely essential. So when I recruit or promote, I tend to spend the most time on that. And on the topic of changing culture, I think, you know, starting to use, making sure you have the right leaders. And the other thing is, sometimes people say it takes a lot of time to change your culture. Sometimes it's actually easier than people think because I learned one day that the way you change behaviors and behavior has to do with culture, the way you change behaviors, is by changing behavior. So if you're a leader, and everybody listening is a leader, if you say that, you know, you want to build a customer-centric culture, but do spend time with customers and listening to customers and basing the decision on the basis of what's going to be good for customers. If you say, people are important, well spend time listening to the frontlines. And I'm particularly impressed, for example, by how Satya Nadella changed the culture at Microsoft. Now, when he became CEO in 2014, it didn't take him 10 years to change the culture and create the kind of environment that unleashed the amazing growth of Microsoft in the following years where he'd studied with role modeling. While modeling is a very important aspect of leadership, role modeling is an empathetic leadership approach, with a growth mindset it just actually shows what it looks like in doing it. So these are some thoughts on that complex topic. But sometimes we make them too complicated.

Adam: And you are incredibly successful in executing on your vision on how to build a winning team, how to build a winning organizational culture. You took over as CEO of Best Buy when the company was deeply struggling, and you made a number of contrarian decisions that helped drive the turnaround of Best Buy. You invested in the organization at a time when the conventional wisdom was to lean out and to cut costs. You collaborated with the company that was perhaps your biggest competitor, Amazon. How did you develop such a winning strategy and what advice do you have for leaders on how to drive successful turnarounds?

Hubert: Oh, so the advisor- so this is back in 2012, right? At the time everybody thought that Best Buy was gonna die. They've been a great company, but you know, there was zero buy recommendation on the stock before I took the job. I was taking time to do due diligence. And I found that the world actually needed Best Buy for customers as some of our purchases were actually important to be able to touch, feel and see the products and ask questions. Best Buy was also important for the vendors, right? Because it is the place to showcase the fruit of their billions of dollars of R&D investment. But what I felt is that all the problems the company had were self-inflicted. Right? The prices were too high, and the online shopping experience was bad. You know, the speed of shipping was bad. The experience in the store had deteriorated. The good news with self-inflicted problems is that you can solve them, right? You don't really need to call Jeff Bezos and say, stop bothering us. Right? It was all internal. So the approach was, you know, the advice I was getting was to close doors, fire a lot of people, but all of our stores were profitable. So what would be the point of closing them? And getting headcount is like, if people are the problem, now people are going to be the source of the solution. So the strategy we applied was very much a human-centric approach. So the opposite, studied while listening to the frontline. Adam, they had all of the answers. I spent my first week on the job working in the store in St. Cloud, Minnesota. I asked the employees what's working, what's not working, what would you need? My job was simple as these three questions, take note and do as I was told. The other aspect was to build the right team, right? As we've just discussed, then from a business standpoint, treat headcount reduction as a last resort. First bite is to grow the top line. It’s so amazing what our languages can do as we used to curse and we did a cast out by $2 billion over the following nine years. Start with non-salary expenses, which are all of the elements of the cost structure that have nothing to do with people- which at most companies is actually the vast majority of the cost structure. And you treat headcount reduction as a last resort. And the last thing I would say, creating the plan used to be a perfectionist to recover from, we even have time and it was not necessary to create a perfect plan. We created a good enough plan, but the key was to co-create it because nobody likes to be told what to do. So we worked together to create a plan that people could support, then we got going, because the key in a turnaround in either transformation is to create energy, that's a big role that leaders have is to create energy. And as a leader, you need to decide how you're going to show up every morning and see whether you're somebody who drains the energy from the room or creates energy. How do you create energy, again, by co-creating the plant, by thinking in terms of possibilities, by getting going and having early wins and celebrating them? If something is not working, say it out loud, be transparent. Oh, Adam, this one that we tried didn't work out as intended, right? So let's re-work it. People know so you might as well say it and be transparent and humble, and then keep going. We paid attention to our say ratio, the biggest management team was saying a lot but doing nothing. So we flipped it, we said less than we did more. And that builds confidence amongst the employees amongst the shareholders. And it builds momentum.

Adam: So many great gems in there. And I'm just going to highlight a few among the many; lead by example, let your actions speak for themselves. You brought up again the importance of listening. Great leaders are great listeners. Great leaders are not afraid to admit that they make mistakes. In fact, they're eager to admit that they make mistakes because it demonstrates that they're real, it demonstrates their vulnerability, it demonstrates that they're actually in touch with what they don't do well and that they're open to improving. They're open to growing, they're open to learning. So I think that those are such great lessons for listeners. Something else that you mentioned, the importance of bringing a high level of energy to the table every day. As the leader, you set the tone. And to that end, what was your daily routine while you're leading Best Buy? What did you do to optimize your performance and to effectively manage all the competing priorities on your time and on your focus?

Hubert: Yeah, it's such a timely question because if we bring it to today, the world we live in is very challenging. Right? We live in this uncertain environment where we think we're going to be back in the office by October and the Delta variant comes in. So there's so much uncertainty and demands that you know, the range of things we need to deal with as fast we expand. So it raises the question of resiliency. And remember, Adam, when we used to fly on airplanes a long time ago, the steward would ask us, if the oxygen mask comes down, put it on yourself first before you help others. So the topic of taking care of yourself is fundamental. So you know, for some of us, it's going to be physical exercise. And for me, it's really important that exercise it's also keeping time for yourself. Some of the best things for me was a walk around the lake in Minot in Minnesota, that's many lakes or elevation for my house, walking around the lake and being able to see, you know, not be disturbed and reflect, meditation, breathing. Very important. I also learn from my coach who will tell you it is very important to practice regularly. If you can, you do it every day, but maybe it's every week. Think about the key values that are important to you, your key things you're trying to accomplish. Reflect on the past day or the past week and ask yourself, not was it perfect or did they do a good job, but did I do my best now to take care of employees on the frontline or do my best to communicate a clear strategy to the shareholders. And if I didn't do my best that day, then be kind to yourself. There's always tomorrow. Because if you're going to be kind with others, you need to start with being kind to yourself. Now, that doesn't mean that you're going to tolerate mediocrity. But instead of, you know, hitting yourself on the hand, try being kind to yourself and meditate on what can I do tomorrow. So think about the next day, in that spirit of, can I do my best? What can I do to do my best?

Adam: One of the earlier guests on this podcast was Tony Horton, the creator of P90X, which is a workout that has helped me get through the pandemic. And one of Tony's go-to lines is, do your best and forget the rest. And it's applicable when you're working out. It's applicable when you're thinking about just about anything in leadership and in life.

Hubert: Yeah, and we pile on that. It's also the thought that you're not the product of circumstances, but you're the product of your decisions. And as a leader, as a leader, you need to be a thermostat, not a thermometer. Things happen. Right? That it's all about how am I going to show what kind of a leader am I going to be? You know, in terms of dealing with that leadership moment.

Adam: What can anyone listening do to become more successful personally and professionally?

Hubert: It starts with defining success. It starts with defining who you want to be. So at HBS where I teach now, you know, we have a new program for new CEOs, we ask them to write down and deliver their retirement speech. My wife, who's an executive coach, goes one step further, she asked her clients to write down their eulogy. What do you want people to say on that day when you're not gonna be here to listen to? Because I think if you're governed by, you know, a true north, a true purpose in life, then that's the foundation for success. However you define it, against the idea that leadership starts from within its leadership from the inside out.

Adam: Hubert, thank you for all the advice and thank you for being a part of Thirty Minute Mentors.

Hubert: Adam, thank you so much.


Adam Mendler is the CEO of The Veloz Group, where he co-founded and oversees ventures across a wide variety of industries. Adam is also the creator and host of the business and leadership podcast Thirty Minute Mentors, where he goes one on one with America's most successful people - Fortune 500 CEOs, founders of household name companies, Hall of Fame and Olympic gold medal winning athletes, political and military leaders - for intimate half-hour conversations each week. Adam has written extensively on leadership, management, entrepreneurship, marketing and sales, having authored over 70 articles published in major media outlets including Forbes, Inc. and HuffPost, and has conducted more than 500 one on one interviews with America’s top leaders through his collective media projects. A top leadership speaker, Adam draws upon his insights building and leading businesses and interviewing hundreds of America's top leaders as a top keynote speaker to businesses, universities and non-profit organizations.

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