It’s Not WHAT You Know, It’s WHO You Know!

Episode #138 It’s Not WHAT You Know, It’s WHO You Know!

A few weeks ago, I had a lively after dinner discussion with my youngest sister, Kate. I was telling her about the plan that Emma and I have to source some high profile endorsements for the book, when she said, “Oh well, Marty, you know what they say? It’s not what you know, it’s who you know.”

I actually fired up a bit at this because the expression is normally used in a pejorative manner, not that Kate intended it that way. It implies that learning and knowledge are inherently more noble and worthwhile than building relationships. Or perhaps, a person’s success is down to favouritism or nepotism. Or that anyone who leverages their connections is at best, taking a shortcut, and at worst, doing something vaguely distasteful.

I have a huge amount of love and respect for Kate and you’d be pleased to know that only half a bottle of red later, we realised that we were actually in violent agreement. But if we weren’t, that would have been okay too.

The discussion was interesting enough that I wanted to explore the key points further here. Instead of just rattling off a few points for what types of behaviours sit behind successful people, I want to give you a deeper perspective on the subject. You might actually want to take notes so that you can really let the concept sink in. Trust me, it’ll be worth it!

Let’s start with a look at how the expression applies and why it can be dangerous to hold this as part of your belief system. Then, I’ll outline the 10 factors that matter to your success as a leader and more broadly in your career, including both what you know and who you know.

WHY THE ‘IT’S NOT WHAT YOU KNOW, IT’S WHO YOU KNOW’ MENTALITY IS A DANGEROUS BELIEF TO HOLD

The expression is an over-simplification and it’s designed to make a point. However, it cuts to the heart of success principles, and if we’re not careful how we think about these things, it can reinforce victim mentality and drive a fundamental misunderstanding of how the world works.

So when is the expression warranted? In my head, there are two clear circumstances where, who you know, trumps what you know.

#1. When a person is a purely political actor

I’ve seen lots of this in large organisations and it’s characterised by things like managing upwards in a highly disingenuous way.

Think:

• “Yes” men and women

• White anting or undermining the people around you

• Taking credit for other people’s work

• Blaming others for failures

• Building up every achievement, no matter how insignificant or minor, to make it seem more significant than it actually is.

Once people like this have their boss spellbound, they seem to move effortlessly through an organisation, in the absence of performance and results. That’s certainly a case of it’s not what you know, it’s who you know.

#2. Blatant nepotism

The other circumstance that the expression is probably warranted in is the case of blatant nepotism. When a person is promoted, rewarded, or granted concessions based purely on their relationship with the decision-maker, this is a classic case.

Traditionally, it refers to relatives, but it’s commonly expanded to also cover friends. In this case, the meritocracy is weakened and the team or organisation becomes something quite different.

I’ve seen this often enough to be aware of it. The only real way to guard against this is to insist on hiring and promotion processes, having independent parties involved, who aren’t the hiring manager. Obviously in smaller organisations, this is impossible. The likelihood that founder-led businesses will fall prey to nepotism is also pretty obvious. If you’re in that situation, you need to ask yourself – what type of business do I want? If you’re bringing in family and friends to your business, it’s likely that the other employees will feel disgruntled and de-motivated.

In one client company I worked in recently, they even had an expression for the people who are in their positions purely because of perceived nepotism. They were called ‘koalas’ because koalas are of course a protected species. In that case, once again, it’s not what you know, it’s clearly who you know.

Apart from those two obvious cases, I want to talk briefly about why the expression can be so dangerous when it’s used as a crutch to lean on, for people who believe that it’s true.

It’s easy to look at someone who’s successful in any area of life and say “They have something I don’t”. When we say this, our mental frame is quite often, “It’s easier for them, or maybe they found a shortcut that isn’t open to me, or if I had the same advantages, I’d be where they are. But I don’t. So I can’t”. Or even, “I know more than they do or I work hard or I’m better qualified, but they’re successful because they have the relationships that I don’t have”.

As soon as we start to make those excuses, we let ourselves off the hook. We give ourselves an excuse to explain why we can’t be successful as another person, when in reality, there’s absolutely no reason why we can’t. It pushes us into victim mentality. It cements our external locks of control, so in other words, “I can’t change things or I can’t be as successful as someone else because they have a privileged asset that I don’t have access to”.

As an aside, I’m not sure that I’ve used that expression before, but a privileged asset is something that you or your organisation possesses that no one else does.

For example, CS Energy owns a privileged asset. It’s the Kogan Creek Power Station and mine. Why is it a privileged asset? Because it’s the newest and most efficient coal-fired power station in the national electricity market, and it’s positioned right next to a mine that is extremely cheap to extract coal from. It has a cost advantage over virtually every other black coal power station in the country. When demand for coal reduces, virtually every other power station is going to close before Kogan Creek will.

There are also other asset classes that are privileged by their very nature. Monopoly assets, such as airports, shipping terminals, water infrastructure, need to be strongly regulated to curb the power of the owners. Otherwise they would indulge in all sorts of bad behaviour. I digress, but you get the picture about a privileged asset.

Once you fall into a victim mentality and once you believe that there’s a magical ingredient that you don’t have access to, your whole frame and demeanour changes. You feel as though life is unfair, and despite all your hard work, ingenuity, and knowledge, there’s something beyond your control, stopping you. This feeds a perspective and builds a mindset that is dangerously limiting.

SO IF IT’S NOT WHO YOU KNOW, WHAT IS IT?

There’s a wide array of ingredients that contribute to the recipe for success. They’re pretty consistent, no matter what area of life you apply them to.

I’m going to look at 10 ingredients that I’ve observed over my time, but there are many more you could include. Now, please don’t misunderstand my intention here. I need to relate these stories, using examples from my own experience as I do with most stuff on this podcast. I’m not saying, “Look at me and how I’ve managed to turn these things into a success”. I just want to give you the key to the things I’ve learned to be true, through bitter experience, so that it helps you to focus your energies in the right area.

Collectively, these 10 things form an ‘ecosystem’ for success. An environment where results are more likely to flourish than if that ecosystem wasn’t in place. If you want to grow plants, the ecosystem is important. The condition of the soil, the availability of air, sunlight and water, perhaps even whether you play a Mozart violin sonata to them each night. Plants in a poor ecosystem don’t survive, but in a favourable ecosystem, they grow and thrive. Here’s some components you might want to build into your success ecosystem.

10 factors that matter to your success as a leader

#1. It’s where you start

I hesitate to open the door to the privilege debate here, but where you start definitely makes a difference. Views and beliefs are formed early in life, and there’s no doubt, they’re extremely hard to change as time goes on. Those of you who managed to do so will understand just how hard. But where and how you grow up, your family of origin, and the opportunities you have as a child, have a really strong influence on where you start your adult life, when you have to make your own decisions and fend for yourself.

A great example of this is the people I went to school with. I was at one of Sydney’s top private schools for boys. Trust me, there was a lot of money at this school. My brother and I were there by virtue of a shared scholarship that we were granted as a result of his excellence as a child athlete and scholar, by the way, not mine. What I’ve seen over the years though, is surprising. Many classmates have been extremely successful, as one would imagine.

In my observation, it’s not because their parents had money. It’s because they had access to the best education. It’s because they grew up in a household where they watched their parents work hard and take calculated risks. It’s because they had an ‘expectation’ of standing out from the crowd. It’s because they were taught to rely on themselves and to make their own way, not wait for someone else to give them something. There’s absolutely no doubt in my mind that being brought up with that attitude, behaviour and belief system is a massive advantage.

Then, of course, as you become an adult the choices you make obviously contribute to where you end up and our early career choices are really impactful. There’s a very different path laid out in front of you if you choose to become a doctor, then there is if you choose to become a social worker. I’m not saying for a minute that one of those choices is better than the other, and it always depends on who you are and what drives you. All I’m saying is that making that decision casts a path for you that has limitations and parameters and opportunity, and you have to work out what path you want.

Let’s face it, where you start makes a difference to how your ecosystem is built. However, it’s really important to understand that regardless of where you start, it doesn’t have to be a barrier to success. There are many more ingredients that make this cake rise to perfection.

#2. It’s the values you hold

This is an ingredient that is surprisingly underrated. Every senior leader will rattle off a list of virtuous values that they hold dear. In case you hadn’t noticed the list always includes integrity. However, in difficult times, or when the pressure is on, everyone around that leader gets to see if those values are held deeply, or if they hold conveniently.

I’m sad to say that the majority of leaders I’ve worked with over the years will always tend to follow the path of least resistance. If the pressure’s on they’ll put their stated values aside in an instant to avoid something that has a high degree of risk, difficulty, or discomfort.

If you have very strong values that you don’t deviate from, even when the temptation to do so is incredibly seductive, that will make you so much stronger. Whether anyone else notices or not, doesn’t matter because you will know, and that’s what matters. This will increase your personal strength more than you can possibly imagine.

#3. It’s the work you put in

To be successful in any endeavour, working hard, is a given. I almost chose to leave it out as it’s such a basic ingredient. Just like you can’t have a pizza without the base, you can’t have success without hard work.

I’ve heard a lot of people say, “It’s better to work smarter rather than harder”.  I believe that’s absolutely true, but here’s the thing… working smarter simply frees up your capacity so that your hard work is more effective and that you’re focused on the right things. As I look back over my executive career, I’ve worked pretty hard. But because I’ve also worked smart, I’ve kept the workload under control and manageable. On average over the last 15 to 20 years of my corporate career, I dedicated about 55 hours a week to my job, on average. Now there were weeks when I worked over 80 hours and there were weeks where I worked less than 40 hours.

The reason I was able to do big jobs, and still perform at my absolute peak, was that I did the right things. I led the people around me to draw out their best and I didn’t micromanage them. I focused on the highest value objectives and learnt to let go of the rats and mice stuff; the things that were only in the margins.

To do this, I had to learn to say no, in 63 languages. These days, I’m hearing a bunch of younger people saying, “I don’t ever want to work that hard. I want flexibility and lifestyle, and I’m not prepared to sacrifice that for my career”. Well, okay, kids, your choice. Just don’t scratch your head too hard when you see other people out stripping you in your career. Hard work is the entry level chip to join the success game.

#4. It’s being willing to do more than the next guy

This is closely related to work ethic, but I want to make a fine distinction here. It’s not just how hard you choose to work, but also your attitude to that work.

A great example comes to mind for me. A chief executive I have a huge amount of respect for, is Jeff Dimery. He’s the Chief Executive of Alinta Energy here in Australia. I got to work pretty closely with Jeff when CS Energy and Alinta put together a joint venture. I found Jeff to have pretty much a complete checklist of the things that we’re talking about here, and he’s incredibly successful in business.

The thing that stuck in my head about Jeff, is something that an ex-colleague of his from a previous company told me about him. When he and Jeff were peers, reporting to the CEO of a major business, he said that Jeff was the best executive he’d ever seen. He would always do more than the next guy. Now apparently at one point, the company was behind its earnings guidance and had to find a way to cut costs. After going through initial rounds, they got close, but they still had a significant gap. In the group executive meeting where this was all resolved, as soon as that gap was discussed, Jeff put his hand up and said, “I’ve got this. I’ll make up the shortfall in my group”. And it was a big shortfall. One thing that’s completely within your control is doing more than the next guy, and it’s about your attitude.

#5. It’s the tenacity you have

This is an easy one. I’ve met an incredible number of successful people who above all else are just relentless in pursuit of their goals. They don’t take no for an answer. They have an attitude that any setback is simply another problem to solve or challenge to overcome. Perseverance, resilience, and passion, all seem to co-exist in the people who are most successful in any area of their lives.

#6. It’s the teams you build

If you look at anyone who’s really successful, they’ve had the ability to get great people around them. My corporate success was due in the main part to one skill; my ability to build a team of great people and lead them to drive value for the team and organisation I worked for.

I’ve learned over the years that you live or die on the quality and strength of your team. Just because I’m not in the large corporate context anymore, it doesn’t matter. Em, and I still live by this principle in Your CEO Mentor. For example, we are not naive about what it takes to launch a book in the US market. There’s around 1 million books published a year, and this doesn’t even count the old chestnuts like Good to Great, and The Seven Habits of Highly Effective People and The Leadership Pipeline that we’d be competing against for attention and space.

So we’re investing heavily in building the right team. There’s my mentor, Dr. Nick Morgan, who’s been advising me since the book was just a germ of an idea. As we get closer to the publishing date, we’re investing in putting together the best marketing and public relations team that you would possibly hope to work with. And we’re backing ourselves. We’re investing. It doesn’t matter how good the book is if no one knows it exists. When the book reaches our expectations for exposure and impact, trust me, it won’t be because of luck!

#7. It’s the reputation you carve out

From your first day in your career you begin to build a reputation. What do you think your reputation is now amongst the people who matter? How consistent is that reputation with what you would like it to be? Every interaction you have builds your reputation.

Are you reliable? Are you a hard worker? Are you prepared to do difficult things when they need to be done? Do you put self-interest aside to the greatest extent possible? Do you give a shit about others or just about yourself? Your reputation will either enhance or damage your career progression, so start acting like you really believe that’s true. Every meeting is a job interview. Every decision is an opportunity to improve your performance and the performance of your team. Every one-on-one interaction with one of your people, either increases trust and respect or diminishes it.

#8. It’s the risks you take

A few times in my career I’ve made moves that required me to leave the comfortable, low risk, safe harbour that I was in. When I left Aurizon to take on the CEO role at CS Energy, I had to walk away from big financial incentives to do something that would position me better for the future. But it was a high risk move and at the time, I had a number of peers who were close to me say, “Gee, mate, I wish I could do what you’re doing. I’m not happy here, but I’m really well paid, and I know I can’t get this money anywhere else at the moment, so I have to stay”. Okay. your choice.

When I left CS Energy, to start up Your CEO Mentor with Emma, I had more than one CEO come to me and say words to the effect of, “Marty, I’m incredibly impressed by your decision. You’re leaving a safe, secure, highly paid CEO job to pursue your passion. What a gutsy move”.

And yeah, I could have settled into CS Energy for another five years, but then I wouldn’t be doing what I’m doing now. Often, people who aren’t prepared to take the risk, will sit back judging people who have taken the risk, and find a measure of success from that.

#9. It’s your attitude to learning

Now, this is the what you know piece. Instead of describing it as knowledge, I think it’s more about learning. I found a big difference over the years between those people who rely on knowledge and those who rely on continuous learning.

The principle that knowledge is power can be extremely detrimental to an organisational culture and it directly feeds into performance. But continuous learning is incredibly valuable. Making mistakes and learning from them. Always having a keen interest to know more. Seeking out alternative views to give you a more balanced perspective. Listening to other people’s viewpoints. Being a student of life and business and people. That’s the, what you know part of the expression that’s brought us here today, and it’s a really important part of the success ecosystem.

#10. It’s your ability to interact and build relationships

I want to finish on the who you know bit because it is important. Relationships are unbelievably important to your success, but they swing in all directions, not just with powerful allies.

You need great relationships with your team members based on trust and respect. You also need the people above to support you and believe in you. But here’s the thing, when I started my senior executive career in the year 2000, I had no connections at all. I had just moved to a new city. Once I landed my first C-level role in a significant company, I built those connections through my performance, attitude and behaviour. I focused on the other parts of the ecosystem; hard work, doing more than the next guy, being true to my values, taking calculated risks, and being a sponge for information and self-improvement. From that, I built a bunch of supporters in senior positions who hired me again and recommended me to others.

So yes, who you know is important, but that doesn’t just materialise out of nothing. Once you reach certain levels, you also get to meet and mix with some very important people. If I hadn’t worked my way up to become a senior executive in a major organisation, I never would have had the opportunity to sit down next to Michael Dell for a casual lunch. I never would’ve met world champion athletes like Sebastian Coe or Benita Willis or James Tompkins. I would never have been able to meet the CEOs of some of the world’s largest companies. And I would never have sat around a table consulting with the Prime Minister of Australia on changes to the country’s energy policy framework

I want to rewrite this expression, “It’s not what you know, it’s who you know”. You get to where you are because you build an ecosystem that supports your success. And when it comes to those relationships, you don’t get to where you are because of your connections, you get your connections, because of where you are.