Lesson 03 · The Commercial Excellence Masterclass
Implementing Learning Programs That Drive Growth
Dr. Paul G. Stoltz, Ron Denoo, Kurt Friedmann and Jesse Hopps · Do you know it? Can you do it? Will you do it? Most programs only ever answer the first one.
Reading this as a machine? This lesson as plain markdown.
What this lesson covers
- The spectrum of transformation failure: raise the targets, add a pep rally, and why neither moves behavior on its own.
- Why the standard three-stages-of-change model asks people to accept a dip that nobody has to accept.
- Company A versus company B — the same transformation with the odds flipped before it starts.
- The forgetting curve taken apart: seventy percent gone in a day is a symptom of design, not a law.
- Retention by method — around seventy-five percent by doing, around ninety percent by teaching it.
- Guided discovery: asking the questions rather than delivering the answers, and the ownership that produces.
- The three conditions of self-determination theory — autonomy, competence, relatedness — and what fails when one is missing.
- Why project-based learning sticks, explained from the struggle centre of the brain.
- The disagreement on psychological safety, and Friedmann's rule: build it in, never name it in the room.
- Do you know it, can you do it, will you do it — the test most programs only pass on the first count.
In this lesson
Four people who have attacked the same problem from different directions: Ron Denoo, three decades in chemicals and plastics from project engineer to CEO, running turnarounds and transformation at a company of seventy thousand people; Dr. Paul Stoltz, thirty-eight years measuring and strengthening adversity response; Kurt Friedmann, twenty years leading revenue growth before mentoring fifty thousand students and five hundred startup founders; and Jesse Hopps, who built one of the largest commercial content libraries in the world and then had to work out why nobody used it.
The conversation starts where the failure rate does. Denoo's account of why most transformations fail is a spectrum rather than a single mistake. At one end, raise the targets, change the KPIs, tie the bonus to them, and tell people to work harder. In the middle, do all that and add a three-day pep rally — everybody is excited for a few days and back in their old habits within two weeks. Neither is wrong exactly. Neither does anything on its own, because neither touches how people think and decide.
Stoltz brings a harder number and a sharper objection. Told by a Harvard dean that only about twenty percent of transformation efforts succeed, his response was not to accept the standard change-management story that goes with it — the three stages, the inevitable dip in motivation and productivity, taught as gospel. His question is who says it has to be that way. What that model actually asks of people is to do more with less under more uncertainty for no more reward, and then do it again. Nobody goes home enthusiastic about that.
The alternative he describes is a pause before the push. Tell people why this matters and what is at stake, help them work out why they would want to take it on, then equip them to flourish in that weather — not just in the day job but in their lives — and let the results follow. He frames it as company A versus company B: the same transformation, one running the standard process at low odds, the other having flipped the odds before starting.
On why training does not stick, Friedmann takes the famous statistic apart rather than repeating it. Yes, the Ebbinghaus curve from the 1880s shows roughly seventy percent of new information gone within a day and ninety percent within a week. But that is not the problem; it is a symptom of how the learning was structured. Retention runs to about seventy-five percent when people learn by doing, and about ninety percent when they have to teach it — which is good news for anyone with coaches and team leads in the building.
What replaces the lecture is guided discovery and project-based learning. Guided discovery is questions rather than instructions: ask the right ones and people arrive at the path themselves, which produces ownership that being told never does. Project work supplies the other half. Stoltz explains the mechanism from the brain labs — retention runs through the struggle, and doing something is more multisensory, higher-focus and higher-intensity than receiving it, because the consequences of getting it wrong are real.
Jesse connects that to self-determination theory, and to a school his own children moved into that runs on the same principle: five hundred assignments that ask questions rather than deliver answers, inside a framework of what has to be learned. The three conditions are autonomy, competence and relatedness — people choose, people feel capable, and the work connects to something they value. Miss any one of the three and the program is unlikely to produce motivation that survives it.
The session's most contested exchange is about psychological safety. Jesse cites research linking resilience, adaptability, perceived organizational support and psychological safety to large gains in engagement and innovation, and asks how you build the last two. Stoltz gives what he acknowledges is an unpopular answer — you cannot coddle your way to greatness, and nobody ever gets all the support they need, so equip people to make it happen anyway. Denoo argues culture and top-down alignment make it possible, and that companies should hunt for examples of the new culture and market them internally. Friedmann's contribution is the most practical: build psychological safety into the program and do not talk about it, because naming it in the room is what removes it.
It closes on Friedmann's three-part test, which is the cleanest summary of the whole argument. Do you know it. Can you do it. Will you do it — on an ongoing basis, as a habit, one that adapts as conditions change. Most learning programs answer the first question, some answer the second, and the third is where AQ and GRIT do their work.
Questions this lesson answers
Why do most corporate transformations fail?
Ron Denoo's answer is that they skip the part that decides everything — how people think and decide. He describes a spectrum: at one end, raising targets, changing KPIs and tying bonuses to them; in the middle, all of that plus a multi-day rally that produces a few days of enthusiasm. Neither is harmful on its own. Neither changes behavior, because business decisions come from how people process information, and most programs never touch that.
What percentage of transformation efforts actually succeed?
Stoltz reports being told by a Harvard Business School dean that the figure is about twenty percent — lower than the thirty percent he had expected from the published research, and consistent with the widely cited seventy percent failure rate.
What is wrong with the standard three-stages-of-change model?
Stoltz's objection is that it teaches the dip in motivation and productivity as inevitable. His question is who says it has to be that way. Read plainly, the model asks people to do more with less, absorb uncertainty and stress, receive no more reward, and then repeat it — and then treats their lack of enthusiasm as a change-management problem.
What should a company do instead of announcing a transformation?
Pause before the push. Stoltz's version: say plainly that what is coming matters and will be hard, explain why and what is at stake, help people work out why they would want to take it on, then equip them to flourish under that pressure — in their lives as well as the day job — and let the results follow.
How much of what is taught is forgotten?
Around seventy percent of new information within twenty-four hours and up to ninety percent within a week, without reinforcement — the Ebbinghaus forgetting curve, first described in the 1880s. Friedmann accepts the number and rejects the conclusion usually drawn from it.
Is the forgetting curve the real problem with corporate training?
No. Friedmann's position is that it is a symptom of design. The real issue is that companies do not structure learning so it sticks — no reinforcement, no coaching, no relevance to the person, and no application. The decay rate is what you get when those are missing, not a limit on what people can hold.
What retention rates do different learning methods produce?
Friedmann cites up to seventy-five percent retention when people learn by doing, and up to ninety percent when they have to teach the material themselves. His point for organizations is that this favors coaches and team leads over lecturers.
What actually makes learning stick?
Four things in Friedmann's account. It has to matter to the person and be contextual. It has to be active rather than received. It has to be spaced, with concepts revisited at intervals. And it has to be coached — coaching is what converts an insight from a training session into action.
What is guided discovery?
Teaching through strategic questions rather than instructions. Instead of telling someone what to do, you ask the questions that let them find the path, with guidance and coaching available. It creates ownership of the learning and the problem, and it mirrors how decisions actually get made in the real world.
Why does asking questions work better than giving answers?
Because people resist what is thrown at them and defend what they arrived at. Jesse Hopps calls the opposite belief — that people will never get there unless you tell them — the biggest fallacy in the world, and argues that a well-designed set of questions gets people to breakthroughs that feel novel to them even when the field already knows the answer.
What is project-based learning and why does it work?
Building capability by working a real problem rather than attending a session about it. Stoltz explains the mechanism from brain research: retention runs through the struggle, and doing is multisensory — kinesthetic, cerebral, sometimes emotional. Focus and intensity both rise, because the consequence of getting it wrong is real.
Which companies are known for project-based learning?
General Electric's leadership development programs are the canonical corporate example, where executives worked real problems rather than case studies — often described as experiential learning.
What is self-determination theory, in practical terms?
Three conditions for motivation that comes from inside the person. Autonomy: they chose, within a framework rather than without one. Competence: they feel capable of doing it. Relatedness: they feel valued and supported, and the work connects to something they can apply. Fail on any one and the program tends to produce compliance instead.
Can you have autonomy inside a corporate framework?
Yes, and the framework is what makes it work. Jesse Hopps describes a school his children attend that runs on five hundred assignments made of questions, inside the curriculum the education ministry requires — students plan their own time and route, but the destination is set. The corporate equivalent is letting teams choose the problem and the path within priorities leadership has named.
Why can't people just read the book?
Because without reinforcement, relevance and coaching, it decays — and this applies to any framework, including the ones the panel sells. Friedmann's summary is three words: learn by doing. Stoltz adds Covey's version, which is that the difficulty was never getting people to understand the seven habits, it was getting them to use them the moment they hit a challenge.
What is the first dimension of AQ?
Control — a person's perceived ability to influence what happens next when something goes wrong. Stoltz reports its effects reaching well past work: in nursing home studies it has been predictive of how soon and whether a person dies.
What happens to people's sense of control when a change is announced?
It drops, usually before the work starts. Stoltz's point is that people are already carrying more than they can finish, already missing deadlines they care about, and often suspect the stated reasons serve shareholders and executives more than themselves. Announcing a transformation into that lands on an already low sense of agency.
Does AQ predict sales performance by industry?
Stoltz cites figures across sectors: a two hundred and fifty to three hundred and twenty percent difference in sales volume between higher and lower AQ real estate agents, a hundred and sixty-seven percent difference in telecom, fifty-nine percent in hospitality, and eighty-eight percent in life insurance, with one study at a hundred and sixty percent. These are his figures rather than the Consortium's.
What else does AQ predict?
In Stoltz's account, drawing on more than three thousand five hundred independent studies: attrition, engagement, productivity and performance, plus roughly triple the level of innovation from higher-AQ people. He also reports lower-AQ people taking about triple the sick days and falling ill roughly twice as often, and cites Harvard work associating higher AQ with longer life.
Can AQ be improved, or is it fixed like IQ?
Improved — and Denoo names this as what struck him most. Your IQ is what it is; puzzles do not move it. AQ can be worked on. Stoltz reports average gains of eleven to twenty-three percent through a roughly hundred-day program, sustained in teams re-measured over ten years.
Where is the biggest return — on top performers or the middle of the curve?
The middle, in Stoltz's view. People at the very top are already finding a way. People in the middle or slightly below are also finding a way, but at a cost — and that cost is negotiable. The work shrinks the stress and the toll while raising what they can accomplish.
What did the research say about engagement and innovation?
Jesse cites a study of around thirty thousand people in the workforce finding roughly six times the engagement and six times the innovation where four factors appeared together: resilience, adaptability, perceived organizational support, and psychological safety.
Can a company simply give people psychological safety?
The panel disagrees, and the disagreement is the useful part. Stoltz argues you cannot comfort your way to greatness — nobody ever gets all the support and resources they need, so the durable answer is equipping people to produce results despite the gaps. Denoo argues culture and top-down alignment make it real over time. Friedmann says build it into the program and never name it in the room.
Why shouldn't you talk about psychological safety in a training room?
Because naming it removes it. Friedmann's observation is that the moment you start telling learners a session is psychologically safe, it stops being so — and that raising it with an executive buying the program is a fast route to no sale.
Can psychological safety be switched on by an announcement?
Denoo's answer is no — it is a process rather than a switch, but it can be accelerated. Smart companies look for the places where the new culture is already being lived, and market those examples internally until people believe the change is real.
What does a culture that tolerates risk look like in practice?
Denoo tells the story of a recruiter who spent part of an interview describing a project the company had sunk eight to ten million dollars into, which failed. Asked why he was telling him that, the recruiter said: because nobody got fired. Denoo took the job.
What is the Mindset → Skillset → Toolset model?
Jesse Hopps's holistic growth model. Mindset first — reframing how people perceive challenge so a can-do response shows up in more situations rather than only on good days. Then skillset, built through project work with coaches who have done the job. Then toolset — frameworks and playbooks that frame the right questions rather than supplying the answers. Remove any of the three and little survives.
Why do tools alone fail?
Because a tool does not create the will to use it. Jesse's own account is that his company built one of the largest libraries in the field, sold it to thousands of companies, and heard the same thing back: I wish they would use them more often. The tools were necessary and not sufficient.
What is the three-part test for a learning program?
Do you know it — comprehension. Can you do it — application. Will you do it — habit, sustained over time and adapting as the business changes. Friedmann's point is that most programs stop at the first, some reach the second, and the third is where adversity response determines the outcome.
What should a leader take away from this session?
That a learning program is a behavior problem wearing a content costume. The content is rarely the constraint. What decides the outcome is whether people chose the work, feel capable of it, are coached through applying it to a real problem, and have the adversity response to keep going when it gets hard.
Terms defined in this lesson
- The forgetting curve
- Ebbinghaus's finding from the 1880s that new information decays fast without reinforcement — roughly seventy percent gone within twenty-four hours and ninety percent within a week. Friedmann's position is that this is a statement about how learning was structured rather than a limit on what people can retain.
- Guided discovery
- Teaching through questions rather than instructions. Rather than telling someone what to do, you ask the questions that let them find the path, with coaching alongside. It produces ownership of both the learning and the problem, and it mirrors how decisions actually get made at work.
- Project-based learning
- Building capability by working a real problem rather than attending a session about it. Sometimes called experiential learning; General Electric's leadership programs are the canonical corporate example. It works because application forces focus and intensity that receiving information does not.
- Self-determination theory
- The three conditions under which motivation comes from inside the person: autonomy, meaning they chose; competence, meaning they feel capable; and relatedness, meaning the work connects to something they value and they feel supported in it. Fail any one and a program tends to produce compliance rather than commitment.
- Mindset → Skillset → Toolset
- Jesse Hopps's holistic growth model, and the order it runs in. Mindset first, so people meet a challenge believing they can work it; then skills, built through coached project work over intervals; then tools — frameworks and playbooks that frame the questions rather than supply the answers. Remove any layer and little of it lasts.
- Control (the first dimension of AQ)
- A person's perceived ability to influence what happens next when something goes wrong. Stoltz reports it as the first core dimension of AQ, with effects measured well beyond work — in nursing home studies it has been predictive of how soon and whether a person dies.
- Psychological safety
- An environment where people can take a risk, be wrong, and say the unpopular thing without being punished for it. Named in research alongside resilience, adaptability and perceived organizational support as a condition for engagement and innovation — and, in this session, the subject of genuine disagreement about how much a company can supply.
- Do you know it / can you do it / will you do it
- Friedmann's three-level test for a learning program. Knowing is comprehension. Doing is application. Will you do it is habit — repeated, sustained, and adapting as the business changes. The third level is where most programs fail, and where adversity response does its work.
“They're gonna set their targets higher, change the KPIs, tie the bonus to it, because that should drive new behavior. That doesn't work.”
“Everybody's excited for a few days. And within two weeks afterwards, they're right back into their old habits, producing the same old results.”
“Most people don't really want to change. We think we've got it all figured out and our life is fine. So getting people to change is hard business.”
“For thirty years, armies of change consultants have been saying: there's the endings, there's the new beginnings, and all you have to do to get from here to there is go through the dip. They teach it as if it's gospel. I'm the guy who says — who says it has to be that way?”
“How many people go home at the end of the day and go, hey, guess what — they're turning the screws even tighter?”
“What we're about to do is important, but it's going to be tough. Let's pause for a moment and equip you to flourish in this kind of weather — not just in your day job, but in your life. And the results will take care of themselves.”
“The problem isn't the forgetting curve. It's that companies aren't structuring learning in a way that makes it stick.”
“People retain up to seventy-five percent when learning by doing, and up to ninety percent when they're teaching the information themselves.”
“The key to discovery isn't just finding something. It's asking questions.”
“There's a big fear out there that if you don't tell people what they've got to know, they're never going to get there. I think that's the biggest fallacy in the world.”
“If I give you a lecture about gardening, how much would you learn? But if I took you down to my garden and said, let's muck around and give it a go — which one leads to a better harvest?”
“It's not getting people to understand the seven habits. These are timeless universal truths. It's getting them to do them as soon as they face any kind of challenge or difficulty.”
“The bad news about IQ is that yours is what it is. You can do all the puzzles you want, it doesn't make it go up. But AQ you can change.”
“Psychological safety is important to build into the program. It's important not to talk about it. Start talking to learners about psychological safety and all of a sudden you've got a learning program that's no longer psychologically safe.”
“I'm telling you that because nobody got fired.”
“Do you know it? Can you do it? Will you do it? That's my simple way of talking about the three components that need to be in good learning programs.”
Full transcript
Why most transformations fail
Ron Denoo: I can back up that statistic. I have seen many attempts at corporate transformation, and for sure most of them fail. You can look at corporate transformation on a spectrum. You have some immature approaches where the company says: we need better results, so we are going to set our targets higher, change the KPIs for the management team, tell them to work harder, and tie their bonus to it, because that should drive new behavior. That does not work.
Then you have companies more in the middle of that spectrum who do that, and back it up with a three-day pep rally. Bring all the people together in a big room, get them excited for a few days about some new program or initiative or strategy. Everybody is excited for a few days, and within two weeks they are right back into their old habits, producing the same old results, and nothing has really changed.
Those first few things are not necessarily bad. They just cannot stand alone — they do not drive any change by themselves. The missing piece is that people do not pay enough attention to the people side of the equation, and how to actually change the way people think and act. The business decisions every one of us makes every day come from how we process information, how we think. If the company is not focused on that, they are pretty much doomed to fail.
They try to treat it like a sprint rather than a marathon. You actually need to provide more in-depth support. You need to figure out how to motivate people to want to do something different. It is not natural for people to want to change — most people do not really want to change, we think we have it all figured out and our life is fine. So getting people to change is hard business, and that is why the failure rate is so high.
Who says it has to be that way
Dr. Paul Stoltz: The first time I went into Harvard Business School, they sat me down with the faculty, and the dean asked: based on your global research, what percentage of transformation efforts actually succeed? Like Ron, I had read the material, and I said about thirty percent. He said, actually it is twenty percent. And I thought, it is even more dire than we realized.
For the past thirty years, armies of change consultants and firms have been going around the world saying: we are about to go through transformational change in three stages. There are the endings, which is where we are now. There are the new beginnings, the promised land. And all you have to do to get from here to there is go through the dip — the dip in motivation and productivity and engagement. That is how they teach it, as if it is gospel.
I am the guy who says: who says it has to be that way? Because what they are basically saying is, do more with less, take on massive uncertainty, take on massive stress, get incentivized no better, and get us from here to there. And by the way, if we pull this off, we will make you do it again and again. How many people go home at the end of the day and say, hey, guess what — they are turning the screws even tighter?
The fact of the matter is there are things inside us that make us want to devour change, that make us drive and shape it instead of resisting it. To create that mindset it comes down to our relationship to what we perceive as the challenges and frustrations and difficulties — let us call them adversities — that you are for sure going to encounter getting from here to there. Is anything worth doing easy?
Company A and company B
Dr. Paul Stoltz: Look at the difference. Here is company A and company B. Company A does a standard change process. They pour in resources, they do everything Ron just described, they have been trained at this. They are low probability.
Company B says: let us pause. What we are about to do is important, but it is going to be tough. Let me tell you why we are doing this, why it is so important, and what is at stake. And more importantly, let us unearth what it means to you — why would you want to embark on this? And now, recognizing it is going to be tough, let us pause for a moment and equip you to flourish in this kind of weather, not just in your day job but in your life, because we care about you as a human being. And the results will take care of themselves.
By doing that you begin to unearth what it is really all about. People pinpoint exactly why they want to engage fully. You give them the tools to do it, and now you flip the odds. And when you get to beat the odds once, what are the chances you will do it again?
The forgetting curve, and what it actually tells you
Kurt Friedmann: The statistic comes out of the 1880s — the Ebbinghaus forgetting curve. Do I buy that ninety percent of what is taught is forgotten in a week? Yes and no. The research shows that without reinforcement, without coaching, and without it being important to the person, memory retention drops dramatically after a training event. People forget about seventy percent of new information within twenty-four hours and up to ninety percent within a week.
But is that the real issue? The real issue is not that people forget. It is that companies are not structuring learning in a way that makes it stick. So what actually works? One, it has to be important to the person, and it has to be contextual. Two, there has to be an active learning experience — let me fight a statistic with a statistic. Ninety percent of what is taught is forgotten by that week; people retain up to seventy-five percent when learning by doing, and up to ninety percent when they are teaching the information themselves. That bodes well for leaders and coaches inside companies.
Then space out the reinforcement — revisit the concepts at different intervals, and that boosts long-term retention. And there has to be coaching. Without applying knowledge that has been memorized or learned, people forget. Coaching transforms the insights people find in training into action. So the problem is not the forgetting curve. It is how we design learning and integrate coaching, guided discovery and real-world application, so we do not have to accept that ninety percent.
Guided discovery
Kurt Friedmann: Guided discovery is really all about asking questions. The key to discovery is not just finding something — it is about asking questions. Unlocking insights through strategic questioning is the key. Instead of telling someone what to do, we ask them the right questions, and they discover the right path on their own, with some guidance and coaching. That creates real ownership over the learning and the problem-solving, and it mirrors what is actually going on in decision-making in the real world.
There are frameworks Dr. Paul uses and frameworks we use at Demand Metric, and most of them do not tell people what to do. They have questions embedded inside them, and that gets people to think and apply it to their own real-world situations.
Jesse Hopps: I went to a school interview today for the school we are looking at putting our daughters into. Before we came here to Colombia they were in a Montessori school in Canada, and we really liked it because it was autonomous. They did projects, they loved school, it was clear they were learning a ton. We did not have to tell them to do homework — they had their planner, they had the responsibility to get it done. They were acting like little independent humans.
This school uses a method that came from a couple who came to Colombia from Spain, wanting an alternative approach to education. They have about five hundred assignments, and all these assignments do is ask questions of the students. They have a planner, they plan their time, they figure out when they are going to do their learning. It is guided discovery, because they are asking questions, but in a supportive environment with experts around them — when they are trying to figure something out they can go ask.
So it is not, hey guys, what do you want to learn. It is within the framework of what you have to learn by a certain point in time to graduate. But the way you get to that level of knowledge is through a set of assignments that ask questions. There is a big fear out there that if you do not tell people what they have got to know, they will never get there. I think that is the biggest fallacy in the world. With the right set of questions you can have people go and discover the breakthroughs and insights on their own, where it is not being resisted, because they are arriving at them. That is exactly what we are trying to teach corporations to do with adults.
Self-determination theory
Jesse Hopps: Autonomy is critical. People do not like to be forced to do anything; they need to make choices for themselves. And when you are responsible for your own decisions and you assume the consequences, that is what you learn from. You made a decision, you had a consequence, that did not work out the way I wanted — what do I learn from that? That is the actual process of learning, through making errors. But in a safe environment where it is okay to make errors. You are not going to put your hand up in front of the class and look stupid.
You need three things. Autonomy — people need to choose their own path to some extent, within a context of questions or projects. The second is competence: they have got to feel capable of doing it. My wife does not feel comfortable walking into a gym and doing a workout — without feeling capable, you probably will not be motivated. And the last is relatedness. You have to feel valued and supported, and you have to feel that what you are learning is connected to something you can get value from or apply in the real world. If you fail on any of those three, your learning program is likely to fail at getting the intrinsic motivation you are looking for.
Dr. Paul Stoltz: Spot on. Academics work their entire careers to reveal something that makes us all go, well, obviously. Our perceived ability to influence our environment — self-efficacy, agency, self-determination — according to the research can quite literally be the difference between life and death, not just high and low performance. It affects you biochemically at the deepest level. Imagine a cocktail going on inside your body all the time, influenced by the way you filter your world and your perceived ability to influence it. That cocktail can be toxic and erosive, or galvanizing and fortifying. The difference between the two in the same situation is the way you are filtering your world. We call that your AQ.
The first core dimension of AQ is called Control — your perceived ability to influence whatever happens next when things happen. In nursing home studies, that single factor is predictive of how soon and whether a person dies.
So think about companies. They announce they have decided to go from here to here for these reasons. How bought into those reasons are the people? How many think the reasons sound a little suspect, because it sounds like it serves shareholders and the board and executives more than them? And then, when they are already buried, already have more to do than they can handle, already feel that a large percentage of the tasks put on them do not get completed satisfactorily and on time — how much perceived control do you think most people feel the moment you announce that change? What does that do to their appetite to be all in?
A transformation that worked
Ron Denoo: One of the best corporate transformation examples I ever saw was the first company I worked for out of college — one of the largest privately held companies in the country, around for a hundred and fifty years, still owned by descendants of the founder. Deep culture. The shareholders decided we need to change: we are not growing, we are not dynamic enough, we need to up our game.
What they did was adopt the seven habits of highly effective people, shortly after the book came out in 1989. What was brilliant was that they did not start by announcing the new goals and what the business needs. They started from the other end. They said: we are going to do this for our people. We are going to invest in our people, because we believe that better people who are better equipped and happier will produce better results for our business.
They invested heavily for years. It was not a sprint, it was a marathon — years of asking everybody to read the book, workshops, internal and external coaches to help bring people along, changing the corporate vocabulary. And it worked. When you have a whole organization feeling that my company cares enough to invest in me — and look at the principle, it is the seven habits of highly effective people, not of highly effective companies. It is a people-focused approach, and people could quickly see how it applied to their lives. This will make my life better if I adopt it. So all the motivation in the world was there. Engagement improved, company results improved. That was over thirty years ago, and the same human principles still apply.
Dr. Paul Stoltz: When Covey came out with his work I was at one of his very first sessions, and I asked him: what is the biggest challenge or adversity you face in teaching the seven habits? We ended up becoming fast friends and he wrote the foreword for my book. He said, in his very intense way: it is not getting people to understand the seven habits — these are timeless universal truths. It is getting people to do them as soon as they face any kind of challenge or difficulty.
What AQ predicts, and who benefits most
Dr. Paul Stoltz: We have had more than three thousand five hundred independent studies over the years. Look at sales. We have yet to find an industry where AQ does not both predict and drive it. In real estate the difference between high and low AQ agents is two hundred and fifty to three hundred and twenty percent in sales volume. In telecom it is a hundred and sixty-seven percent. In hospitality, for the people who sell the rooms and banquets, fifty-nine percent. In life insurance the difference was eighty-eight percent, and in one study a hundred and sixty percent — and it also radically predicted who stays and who goes.
It affects attrition measurably, engagement measurably, productivity, performance, innovation. Higher-AQ people generate about triple the level of innovation of lower-AQ people. Lower-AQ people have triple the number of sick days and are sick twice as often. Higher-AQ people have measurably greater quality of life and tend to live longer, based on a Harvard study.
On grit — people who score higher on GRIT 2.0 set bigger goals, and they complete a higher percentage of them. You would think you complete more if they were easier. They set tougher goals and complete a higher percentage of them.
Jesse Hopps: If you are already a high performer, you are already there. What is the benefit for the average good employee in the middle of the bell curve, in terms of their job performance and their quality of life?
Dr. Paul Stoltz: You nailed it. If you are in the top tenth of a percent and you say you are excited to improve more — good for you. But if you are in the middle of that bell curve or slightly below average, what that really means is you have found a way to make it happen, but at what cost? And at an unnecessary cost. That cost is negotiable. We can shrink the stress, shrink the toll, enhance the upside, and make your work so much more energizing and enjoyable, and have you accomplish more along the way.
When we take groups through the experience — a roughly hundred-day journey with a one-day program, sometimes less or a little more — the average improvement is eleven to twenty-three percent in either AQ or GRIT. We have tracked some of these teams more than ten years, and to my amazement, once it goes up we have never seen it go down.
Why projects stick when lectures do not
Jesse Hopps: I have always found the best way to learn something is to be teaching it in two weeks. I will have to figure it out because I am going to be teaching it. So my process is to take on a little project — build a toolkit, come up with a skill model, go teach the course. I have always taken on my own learning through projects.
There is such a thing as problem-based learning and project-based learning. It is the same thing General Electric did with their leadership development programs — experiential learning, real problems. If it is related to something live in our life, a real problem, a real complex situation, now we have a filter: how can I test this, how can I apply it in what I am actually dealing with? That is when it clicks, and it is not just theory.
Dr. Paul Stoltz: You can get as nerdy as you want. I have had the chance to be in the brain labs at Harvard and UCLA, and there is an emerging understanding of what we would call the struggle centre of the brain. What we are seeing is that the stickiness — actually learning something — requires going through that zone. The more multisensory something is, the bigger the difference, and two things matter: focus and intensity.
Think about it. Someone is giving you a lecture — what is your intensity level as a receiver? What is your focus level? But as soon as you have to engage and do what Kurt said, learn by doing, now it is kinesthetic, it is cerebral, it may be emotional, it may be tactile. The intensity goes way up. By definition the focus goes up, because the consequence of getting it wrong is greater. So the retention is dramatically better. If I give you a lecture about gardening, how much would you learn? But if I took you down to my garden and said, let us muck around and give it a go — which one leads to a better harvest?
This is what we do with every tool we teach. We have three tough rules. We ask people — and some are tough audiences — for what can you use it, with whom, and when? If the answers are not authentically pretty much anything, pretty much anyone, and pretty much anytime starting now, we failed. The only way we get there is by having them actually do it. They get up and muck around with it and make their mistakes and get to the point where they say: I am at a six, but if I did this two more times I would be at an eight or nine. That self-evidence is what you create when you learn by doing — and look how it brings us back to self-determination, because now you have the confidence that you can apply it.
The disagreement about psychological safety
Jesse Hopps: I read a study of about thirty thousand people in the workforce. Six times engagement and six times innovation traced back to four factors together: resilience and adaptability — which AQ and grit cover — plus two others. The perception of organizational support to achieve the goals being set. And psychological safety. If we can teach resilience and adaptability through AQ and reinforce it with coaching, how do we build the other two, particularly if people have not felt them before?
Dr. Paul Stoltz: This is maybe going to be an unpopular response. But you cannot comfort your way to greatness. So much has come out in recent psychology where everybody is trying to over-respond and over-protect. It is lovely, it is humanistic, it is compassionate. But go down that path hard and fast and you are in the space of trying to comfort your way to greatness. What are your competitors doing? How about we help equip people to toughen up?
And that is not being a tough sergeant saying, hey, you need to toughen up. That is the problem with grit 1.0 — you need more grit. That can be a massive disservice to certain populations. But if you can equip people to grow stronger and more robust, with greater fortitude and resilience and grit from the inside out, then we have done something different. We know we are highly imperfect. We know you are not going to get all the support and resources you need to make this succeed — guaranteed. What we are going to do is equip you to somehow make it happen despite the limitations, frustrations and injustices, because that is called life. Is that not what all of us have to do?
So it is a combination. Part of your strategy and messaging should be about aligning resources toward the thing you are trying to do, so people have some of what they need. That is smart, good business. But using perceived safety and support as fallback excuses for doing less is another matter.
Ron Denoo: A lot of it has to do with company culture. When I was interviewing in college for my first job, I spent an hour and a half with a corporate recruiter, and he told me about one division that had worked on groundbreaking new technology, invested something like eight or ten million dollars in it, and it failed. I remember looking at him and going: why are you telling me that? He said, I am telling you that because nobody got fired. And I ended up going to work for that company.
People want to be in an environment where they are allowed to take some risk. We talked about the learning journey and how sometimes it is a matter of making mistakes and learning from them. If you do not have an environment that enables that, how do you expect people to learn? Company culture is really important, and that tone comes from the top.
Jesse Hopps: Can a CEO announcement flip that switch — we are investing in learning, we want you to take chances, we will equip you with the tools?
Ron Denoo: I do not think it is a switch. I think it is a process. But smart companies look for examples of where they are living that vision, where they are living that new culture, and they internally market the heck out of those things so everybody sees them. That is what builds organizational confidence, and it can really accelerate the journey. You have to be constantly on watch for the examples you can point to and share, so everybody understands that this is real.
Kurt Friedmann: Psychological safety is important to build into the program. It is important not to talk about it. That goes for the training program itself — you start talking to learners about psychological safety, and all of a sudden you have got a learning program that is no longer psychologically safe. You start talking to an executive who is buying training programs about psychological safety, and you have got a one-way ticket out the door with no sale.
Mindset, skillset, toolset
Jesse Hopps: In my vision of how you solve this, you need three pieces. You need to equip your people with more than a can-do attitude that is temporary and based on the best of days. You need to reframe the whole mindset so they perceive the world and challenge it and have that attitude in more situations more of the time. That is where Dr. Paul's work on mindset and reframing is critical. Without that foundation I do not think you can do anything.
The second piece: how do you equip them with the right set of skills? We know passive learning, just dumping information at them, does not work. So you need project-based learning with experienced coaches who have been there and done it, to coach and mentor people through a real situation they could implement on the job. This is exactly what General Electric did with their executive education — real-world problems, best practices shown, skills developed in context.
The last piece is tools. Frameworks like Dr. Paul's that you can use any time, any place, for anything — mental models and frameworks. Or what we have built at Demand Metric: playbooks and methodologies and templates for thinking through doing things. But as Kurt said, these tools do not do anything for you other than frame up a set of questions to ask yourself, so you do the critical thinking and problem-solving with a little guidance when it comes time to doing the job.
So I call it mindset, skillset, toolset — the holistic growth model. You have got to have all of these working in concert. Without the tools to do the job, without the skills mastered over time with reinforced coaching at intervals, and without the right mindset going into the learning — autonomous, choosing the projects, feeling capable, and related to what matters in their job — I do not think anything is going to stick.
Do you know it, can you do it, will you do it
Kurt Friedmann: There are three things that need to happen in learning, and I am going to make it super basic. One is you have got to know something — do you know the material, do you know what it is you need to do?
The second level happens once I know something: I have to apply it. So, can you do it?
And this really speaks to what Paul is doing with AQ and grit. The key to the whole thing is not whether you know it, and not whether you can do it. It is whether you will do it on an ongoing basis, such that it becomes a habit — and such that the habit can be dynamic and change with the changing business environment, which is really a function of the adversities that business and that individual go through.
Do you know it? Can you do it? Will you do it? That is my simple way of talking about the three components that need to be involved in good learning programs.