The Chief Psychology Officer

Ep64 Building a Thriving Culture with Simon Rogerson CEO Octopus Group

• Dr Amanda Potter CPsychol • Season 3 • Episode 64

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Imagine transforming your organization by fostering trust, promoting cognitive diversity, and championing kindness in the workplace. Join us in this enlightening conversation with Simon Rogerson, the visionary CEO and founder of Octopus Group. Simon dispels misconceptions about his role at Octopus Energy and delves into his journey from a secure job to creating a company that values integrity. Simon shares how he meticulously built a positive organizational culture, ensuring that trust and customer-centric values were at the forefront by personally interviewing the first 500 employees.

Discover the power of cognitive diversity as Simon explains how it can build high-performing teams. Learn the difference between skepticism and cynicism and why including varied perspectives, particularly those from younger employees, is crucial in today’s fast-paced world. Simon provides insights into how promoting ownership and encouraging calculated risks, such as through Octopus Springboard, can drive innovation and success.

Finally, we explore the profound impact of kindness in business. Simon recounts touching stories of employees who went above and beyond, illustrating how genuine acts of kindness can create loyal customers and a vibrant company culture. We also delve into the balance of dedication and self-care, the significance of open communication, and the necessity of honest feedback in building resilient leadership. Listen as Simon uncovers the essence of leadership, decisiveness, and the importance of fostering an environment where trust and transparency lead to long-term business growth.

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Caitlin:

Hello and welcome to this episode of the Chief Psychology Officer with Dr Amanda Potter, Chartered Psychologist and CEO of Zircon. I'm Caitlin Cooper, Senior Consultant and Business Psychologist here at Zircon, and today we have the pleasure of hosting our latest guest on the podcast, Simon Rogerson, CEO and founder of Octopus Energy. Simon, thank you so much for joining us today. Could you please start by introducing yourself?

Simon:

Do you know what I'm actually going? to start with a correction: I'm CEO and founder of Octopus Group and Octopus Energy is one of the companies that sits within the group. But actually that business was set up and it's run by a chap called Greg Jackson. So maybe I'll start there. actually, because I tell somebody I work for Octopus, they automatically assume I work for an energy company because of the scale. Maybe we'll get on to talk about that. But actually the story of Octopus started back in February 2000, when I left the graduate training program at a fund management company called Mercury Asset

Simon:

Management.

Simon:

And I left when I was 25 years old because I thought the financial services industry was broken. I was extremely naive. I didn't realise what was involved in building the business. I left with two colleagues, so we're three of us. We started above a C Costc utter supermarket in Farringdon with two other businesses in an open plan office.

Simon:

One of those companies is still going 24 years later, a company called BigTellycom that rents out plasma screen TVs, and we spent nine months cold calling people using the other pages to get the business off the ground. We needed to raise two and a quarter million pounds and we did, but it was, in hindsight, the best thing we could have done to knock any sense of entitlement out of you. And from there we started building the investments business, which today is about 700 people, about 13 billion pounds of funds under management, and we also have, within the group, Octopus Energy, we have Octopus Money, we ave Seccle, we have a special needs school business called Aurora that has 19 special needs schools. So really we operate in three industries in energy and financial services and in education, and I feel incredibly lucky to do the job that I do do.

Amanda:

And so how did you get started? I mean, you said you picked up the yellow pages and you were ringing, but what was the thing that really created the point where you thought I want to do this and I want to create a new business or a new opportunity?

Simon:

Probably naivety, being very honest, because you just don't know any better when you're 25 years old but actually working in financial services. Back in 2000, financial services was the least trusted industry in the world and you fast forward 24 years it remains the least trusted industry in the world. And that's because of how these companies behave. They are very financial self-sufficient companies. They're selfish, they're self-interested. They've largely outsourced their conscience to the regulator. They've paid collectively around the world $350 billion in fines since the financial crisis for largely behaviours, and that creates massive mistrust on the part of the consumer and money really matters to people Outside.

Simon:

Money is the number one cause of mental health problems in the UK and people need help and they need help navigating what is ordinarily quite complicated. People are largely financially illiterate. I'm not saying that to be horrible, it's just true. It's a very complicated industry and you need to be dealing with someone that you can trust. If I get ill, I go on Google and I diagnose myself. I almost always get it wrong and I get really worried and then I go and see my doctor and my GP and she and she sets my mind straight. I think you need the same thing in financial services and that was the founding belief back in 2000,. That, as you can inject trust back into this industry because of how we behaved and I think you know business has a massive role to play in society, but largely it gets things wrong.

Simon:

You know, think about all the companies that you interact with on a daily basis and you say how many of these companies, if they were people, would I choose to be friends with? The answer is probably not. That's a very broken society and a very broken business model and you know, I'd like Octopus to change that.

Amanda:

The point you've made about debt and money. It's really interesting because it's one that we're increasingly talking about and we talked about on a recent podcast and we just published an article about it and the fact that money and debt is becoming increasingly one of the greatest motivators for people. But, of course, it's a negative motivation, particularly around employment and decisions around employment. But, thinking about the role that you've played within the organizations around culture because the reason we've invited you to talk to us today is I'm very excited about the environment of an organization and the culture we create in an organization and from our conversation, simon, you're very clear about what works in terms of culture and what doesn't work. Would you mind elaborating?

Simon:

I think great business, building a great business it's a difficult thing to do, but at the heart of it, great business is simply about how you make people feel. The only lesson anyone needs to take away is just about how you make people feel, and the people I'm talking about that are your employees and they're your customers. And behavior comes entirely from values. So it comes from the kind of people you hire and the great big things you choose to do in an organization and the tiny little actions of every single person working there. The first 500 people we hired, I interviewed every single person. I probably spent half my time for the first three, four, five years of the company interviewing people, so I got pretty good at working people out because it is about behavior. I'm the group chief executive, but actually I think more than anything I'm kind of group antibody.

Simon:

The culture of the organization was coolest when it was 30 people. Now across the group we have 8,000, 9,000 people working here and my job is to make sure that decline in culture is as shallow as possible. And that comes down to the people you hire, the people you reward, the people you promote. You're either a radiator or you're a drain, and if you're a drain. You cannot and will not work at Octopus. And just recognizing, if you're really good at interviewing people, you probably get seven out of ten people right.

Simon:

So the three you're going to get wrong. You need to do something about that because it's in their interest, it's in my interest, in the company's interest. You know culture comes down to people more than anything else. But again, this is what businesses get so wrong. You choose your friends in life and people have you know, I don't know. A circle of trust is probably six. Can try and name the companies you would be friends with that would fit within that circle. It's almost non-existent, which is so weird because it's just a collection of humans coming together and suddenly you put a corporate wrap around them and no one trusts them anymore. It doesn't make any sense. I think business is fundamentally broken.

Amanda:

And the point you've made there about radiators and drains, given our research and thinking around, cognitive diversity is a really important one, because in some environments we know that I might be an energizer for somebody and other situations with other groups, someone might find me irritating or I could be a drain for them. So it's about the right culture. It doesn't mean that anybody's good or bad. It just means about finding the right fit for you, isn't it? I have an issue with having too much fit because of the lack of homogeneity. So the importance of having really good values and real clarity about what's important with an organisation, yet, at the same time, looking for a diverse workforce who think differently, who are going to challenge each other, who are going to ask you questions, is important too. So what's your view on cognitive diversity and the importance of bringing in a diverse workforce, Simon?

Simon:

So just in reaction to one thing you said, ashley. First, because I agree people will interpret radiators and drains differently. But one point I would make is there's a big difference between scepticism and cynicism. Fine, with sceptics right, we're trying to build businesses all the time and that means we make loads of mistakes and don't always get things right, and that's understandable. But cynicism is not okay because it's wired differently in people. So I would make that point. I think there is a difference there In terms of diversity generally.

Simon:

So diversity for businesses and business leaders is one of these mega buzzwords. So I look at some of the big quoted companies and there's diversity where I must tick certain boxes so half my board must be women and half my must be men, and then I need all kinds of levels of diversity, I think by a mile. The most important form of diversity is diversity of thought, so how people think about things, and that comes from different life experiences and different backgrounds. If I hired a man and a woman who both went to private school and they both were in natural sciences at Cambridge and they both had the same tutors, there's a very high likelihood they will think in a very similar way. So diversity of thought is about different life experiences and what you bring, and that, I think, is what makes our businesses and teams function in a kind of high performance way.

Amanda:

I couldn't agree more, and from our data we've identified that age and longevity is the greatest way of bringing in cognitive diversity, diversity of thought, and that actually because women converge towards a male way of thinking and leading as we get more mature and as we go through our years of experience, in other words, as we get older. Actually, gender diversity is not a really great indicator of cognitive diversity, but age and longevity actually are. So, having people in your team who have been in this business for a long time and then a short time, they're more likely to challenge each other.

Simon:

Oh, I agree with that and I think the one overlaid, I would say, in relation to this. I think the world is changing more quickly today than it has ever changed. So people's relevance to the world and the way it's being shaped and the power the consumer has and the power the employee has in a way they didn't used to have 10, 20, 30 years ago, means that actually the importance of young people who inherently think differently because they've experienced life in a different way and they work differently and they they learn differently, is massively important. And there are a lot of very large organizations where you have I can't remember it's called, it's like the I think it's the highest paid person in the room. That's not good. You need people who are at the forefront speaking to the customer, who think differently, who solve problems differently, and that's very telling.

Amanda:

in large organizations where it's very controlling and it's very hierarchical, it ends up in a right mess because you won't change anything like quickly enough Reasons like that, like the hippo issue, that we love the time to think, nancy Klein approach, which is about making sure everybody has a voice and everyone's listened to and everyone's opinion is appreciated, and very often we'd start with the most junior person in the room so that we don't have the issue of people feeling like they need to compromise their ideas or their thoughts to make sure that they align their ideas and beliefs with others. So, yes, I completely agree. We've talked already. We've jumped straight in with psychology, which I absolutely love, but from a kind of culture and environment perspective. What would you say is the real secret of your success?

Simon:

Oh. So again, I mean fundamentally it's very triad, but it's down to the people we hire and down to the people we retain. If I had two ingredients beyond that, I'd say the people working in the organization are all shareholders in Octopus. To be accountable, you must feel ownership. People must wake up in the morning thinking I'm a part owner in that company. It's accountable not just to your customers but also to one another. So that's very, very important. I think people need to feel part of something and they're financially part of something as well. So the incentive structures we've put in place since the very, very beginning have been a real driver of that and creates an awful lot of wealth for people working at Octopus.

Simon:

And the second thing, I think, is companies get bigger and bigger. Their tolerance for risk just goes down massively. They're stuck in kind of legacy business model. They protect what they have rather than thinking. And again, in a world that's changing really quickly, that becomes dangerous.

Simon:

And probably the best thing we've ever. Well, one of the best things we've ever done was we launched something called Octopus Springboard. And Octopus Springboard is an internal program designed to encourage people working at Octopus to leave and go and set their own company up. So we give them money off the balance sheet typically £40,000, £50,000. And we say go and have a crack, try and build that business and if it doesn't work, you can come back to us and keep your job open.

Simon:

That encourages people to take risk and they are given permission to fail, because failure is a really important part of human development and also business development. And the problem is most people they spend their entire process and education being told that failure is terrible and big red crosses, which is disaster, and process and education being told that failure is terrible and big red crosses, which is disaster. And actually you need to be allowed to fail and not to feel embarrassed. Right, that's the problem that people feel embarrassed in front of their colleagues because they've spent their whole life feeling embarrassed. When someone peers over their shoulder at school and says, oh duh, you got a d or an a, you know there's more than one way to build things. There's more than one way to solve things and actually they're getting over. This fear of failure is massively important and that's probably the best way we've managed to do it.

Amanda:

And do you know what? There are so many people that I've met in my career who look at me relatively to you minor level entrepreneur and talk to me about how did you set up, how did you make the break into building your own business and growing your own business. To be honest, I've absolutely loved every step of the way. It's 24 years now that Zircon has been in existence and we run a really inclusive, great team and great products and so on. But there's so many people that I speak to who never make the step to go from being an HR often HR leaders and building their own business. So the Springboard idea is fantastic. Have you had anyone who has really made a success of that opportunity with octopus springboard?

Simon:

yes, the short answer. Um, the first idea I did is we had six people left to do it now and the lady who left first was karen taylor. She used to work in our recruitment team and part of the hr team at octopus and she left us at the business called parent cloud, which is all about wellness services sold through companies. That business will probably turn over a million pounds this year she left probably four or five years ago.

Simon:

It's genuinely. I absolutely love it. She'll probably get in touch with me about every two or three months and she'll come in and tell me the journey she's going through and every entrepreneur's journey is slightly different, but it's the same challenges and I've been through all of those so and I've messed so many things up helpful and I'm totally with you. I mean it is literally the best gift I've ever been given was to become an entrepreneur and I had no idea. But the way you learn all the time.

Simon:

You know I love my three children to bits, but octopus comes a very close second to how I think about my children, which freaks people out. And in a world where people spend their whole sodding time talking about work life balance, just stop talking about it, resign and go and do a job or get a job that you love doing, and then it won't seem like work. I think the culture we've just got it wrong Right. If you don't enjoy your job and you're working to live, then resign and go do something else and ideally, if you do your own thing, you'll feel a sense of ownership and challenge and everything else.

Amanda:

You can feel that through the interaction with people. We were talking about those organizations, whether they would be your friend or not, and whether we have experienced fantastic service or something that is memorable from an organization. You asked me a question of who have you received a service from that you would want to talk about in a way that would be a delight? I can't think of the language you use.

Simon:

You had to sit there and think about it yeah, it's so difficult to do right, because if you said, if I said to you right, uh, in the last year, tell me some instances when some of your friends have been really kind to you and you'll think about it for probably 10 seconds and you'll come up with a few examples, because that's what humans are wired to do, certainly friends are wired to do. Now, tell me the last time a company was kind to you, right?

Caitlin:

it's almost impossible to answer what is going on in the world right.

Simon:

If you set your own company up, your customers are your lifeblood. That's the reason you can pay yourself a wage. It's a reason we can hire people. It's a reason you exist. It's the reason Octopus will hopefully outlive me, because it creates loyalty in its employees and customers, because of how it behaves right, and a lot of that is down to kindness. Humans love kindness. It's wired into us. Who wouldn't? And yet I can't think of you know it's so think of you. Know so difficult to think of them.

Simon:

I can think of lots and lots of companies which are unkind. I can think of lots of companies where the emotion they create in me is normally frustration or anger. The high street banks I won't name them, the large flag carrying airlines in the UK, right, they're just dreadful, dreadful companies. I'd say that, and almost every single person I talk to will have their own example of just how dreadful they are. Be proud to work at that company. Why do you want to be part of it?

Amanda:

Negative information bias. If you think about that, we are going to hold on to those negative memories. 80% of the information that we store and retain are those negative memories. Because it is like Velcro Caitlin and I we published a podcast, didn't we, on kindness, actually in the role of kindness in senior leadership, and part of that is we did some research on how many values, models and competency models that organizations are building have the word kindness in there, and you can imagine they don't. It's just not prioritized.

Simon:

I struggle with that one a little bit, because there are lots of companies that have the word integrity as one of their values, right? I don't believe them. Most of them do, yeah, do yeah, I mean enron had integrity.

Simon:

I think it's one of its values and it's carved into some rock somewhere, but no one ever did anything about. It, didn't actually mean something. It comes down to actually. What are you going to do? Tell me how you have been kind. I'll give you a story.

Simon:

We had a client call octopus and the client was interested in one of our products and the 25 year old explaining the product to him explained it all blah blah and said would you like me to pop a brochure in the post so you can have a read of it? And he said well, unless you've got it in braille, don't bother because I'm blind. And this 25-year-old this was a Thursday kind of went no, we haven't got it in braille, that's a bit difficult. He went home of his own accord on the Friday. Then on Monday he called this client back and said I'm just going to pop it, the recording and the post. You, if you open it in this order, you'll be able to listen to the brochure. Sorry, I've got a bit of a boring voice.

Simon:

This client called me the following Thursday after he listened to it and said no company's ever done that to me before. There wasn't a rule that said if a client's blind. This is what you should do. He just did it because he thought it was the right thing to do and it's like do the right thing even when no one is watching you. That is the definition of kindness to me, and that won't come from sticking in my values and telling people this is what you're supposed to do. It comes from stories right, it comes from stories that you tell and full of stories like that, because we're trying to change. Trying to change how people interact with us and how they feel about us and the fact they might want to be friends with us, because that builds a kind and nicer business and also a more valuable business. But most companies couldn't do that.

Amanda:

Their stories will be dreadful and I think there's something there around self-compassion and self-care as well. I think the leaders that I've worked with and met the ones that are more likely to show kindness to themselves and to others are the ones that lead with self-compassion and self-care. And so we do a lot and think a lot about the neuroscience and the physiology and the fact that we're chemical human beings and when we're depleted, tired and exhausted and we work in this relentless environment, it's really hard. Well, we know from the research. Actually, it's really hard to show kindness to others when we're stressed, because our natural default is not to go towards the vagus nerve. It's hard to activate the nerve of compassion when we're anxious, when we're stressed, when we're producing cortisol.

Amanda:

So, creating the right environment, therefore, an environment where people are feeling psychologically safe, where they are encouraged to have self-care I know you don't like the work-life balance motto and the fact that people are driving more towards a life-life balance, but I actually think if we can create the right environment, then we will nurture people and encourage people to be kind, naturally, because from a physiological perspective, we are more likely to spot when other people need help and we're more likely to be innovative and creative in the solution. Like your 25 year old, they didn't take just no for an answer. They didn't just put the phone down and go. Oh well, how amazing.

Simon:

I entirely agree with everything you've said. I thought that was spot on. I'm also, as an individual, I'm sometimes not great looking after myself because I love what I do, so I get carried away and I do it and I do it, and sometimes I kind of neglect my own, what's going on with me, so I'm not great at that that. But I listened to that and go yeah, do you know what? You've totally got a point. But company can help from that framework, right.

Simon:

So we don't track any holidays for anyone working here, because you treat them like grownups. If you need to go on holiday, go on holiday, right. You don't need to put it in a spreadsheet or anything like that, you just go do what you need to do. We have a foundational octopus Everyone's encouraged to spend at least two days a year working for charitable causes, because actually charities charities really need expertise and help as well as money. You just create a culture like that that you don't want presenteeism as a disaster. But similarly, if you want to build something really special, there's an awful lot of sacrifice involved in doing that, and so it's getting that balance right between the two and it is a difficult one to tread, and I agree with the points you've made.

Caitlin:

I think it also requires trust as well, what you're saying from that side of things. So what's your perspective on creating that trust?

Simon:

I suppose I think trust comes out of behaviours, especially when things get very difficult. One of the most important things for me is for people to know me me as Simon right? So when we were teeny, weeny in the way, like 20, 30 people in the same room, everyone knew who I was, how I behaved, what I did, because it's really obvious to everyone. They can see it. And as the business gets bigger and bigger and bigger, it's more difficult. So it becomes more corporate and so you know I work in reception. I work in reception so anyone can come and talk to me, because it breaks down a bit of the barrier.

Simon:

I write a Friday update every single week talking about stuff that I think is interesting, not business stuff, not, oh, we've done this.

Simon:

That and the other life stuff that I think is interesting, so they can see a bit of me, what makes me me, because that's a big part of what makes Octopus Octopus, and I think it's trying to build that trust. And especially when we get things wrong and we make mistakes, it's about being able to put your hand up and go. You know what probably shouldn't have done that, but here's what we're going to do about it and here's what we'll do about it thing, even when no one's watching that builds trust.

Simon:

No one assumes you're going to be perfect. Everyone knows you'll make mistakes. We're human, right? It's just how do you react in that moment? What do you do? And always play the very long game which octopus is able to do, where a private company will never be public, so we can play a different game to everyone else. Right, we measure our success over decades, not what's going to happen in the next six months or 12 months. When we build businesses, we build them for the very, very long term, because that's the time horizon you need to to build something that's special so you talked about that.

Amanda:

You're not necessarily the person who always makes the best choices for yourself in terms of working hard, maybe being a little bit relentless. What has been the impact on that for you? Because our data has looked at relentlessness and the impact on psychological safety is looked at relentlessness and the impact on burnout and resilience and imposter moments as well. What happens when you work too hard, personally?

Simon:

Personally, so I'm . . I can't believe I'm talking to you guys about this, but I've self-diagnosed with something I've called permanently disappointed syndrome. So I don't get grumpy, I don't get miserable. I'm not a miserable person. I get moody, but I always think we can do things bigger, better and faster. And I've been like that since I was knee high to a grasshopper and I've been like that since octopus was set up in 2000. So, whatever we achieve, I'm like, yeah, okay, moving on. So I don't celebrate as much as I should do, which is difficult. So this becomes ultimate. For some people it's fine because they're wired like me, but they're not wired like me. It becomes quite draining and quite tiring. It's like, oh, my goodness, look at those amazing stuff we've done. He's already over there, he's already thinking about how. I have an example of that this morning in a meeting and I'm like, oh, is it great for the people? So that bit's, maybe you know.

Simon:

I'm aware of it to the ability so I can talk about it. I don't always get it right. I think the imposter syndrome is an interesting one. I talk to lots of people who are running some of our individual businesses about this. So I think imposter syndrome comes from maybe two angles.

Simon:

I'm fortunate in the fact I haven't suffered from imposter syndrome and I've tried to work out why. And fortunate in the fact I haven't suffered from imposter syndrome and I've tried to work out why. And I think the reason is not in a funny way. I'm very relaxed about my opinion and what I think about things. So I'm not worried about what other people think. And I think lots of imposter syndrome comes from people really worrying about what other people think about them or what they're doing.

Simon:

And I don't have that because I'm in a very fortunate position as the founder of the business. But also don't have that because it's not something that's ever really bothered me, and I'm not saying that in a funny way, I'm just saying I think that's true for me. And the second thing is I'm caught up in the process rather than the end point, Because I love building the business. That's what I think about all the time no-transcript projecting what's going to happen to them when they get here, or they're really worried what people are going to think about them. They do x, y and z. It's challenging, it's difficult.

Caitlin:

So you said the permanently disappointed syndrome you've self-diagnosed that. Is that something that you've met in other people? Would you say in other leaders that you've met Only in entrepreneurs.

Simon:

I think the thing that's really very, very occasionally I meet an entrepreneur or a person who when you first meet them, they just bleed energy all over the table, literally everywhere, and you're like, oh my goodness, there's a force and I haven't met a force like that in a very long time. So Greg Jackson, the guy that set up and runs Octopus Energy, is a freak of an individual. He is the most talented entrepreneur I've ever worked with, by orders and orders of magnitude. He is unbelievably talented and literally you will know that if you met Greg 90 seconds into meeting him, you've already got that impression. And eight years after meeting him I've still got that impression.

Simon:

Part of my job is to make sure that people think really, really big, so they're not limited by normality or what other people have done or what people say is possible, because that just limits and makes us narrower and narrower and smaller and smaller. And part of my job is to open people's eyes up and say, look, the opportunity might be 10 times that size. And how might we do that if the opportunity was 10 times the size?

Simon:

with greg I'm like, oh my goodness, his arms are already as wide as they possibly go and you're like well, I don't need to do anything, he's like he's off he's built an absolute monster, a nice monster, nice friendly monster, but a huge business. Entrepreneurs often have permanently disappointed syndrome because they love what they do, but the entrepreneurs who want to build something remarkable, not the entrepreneurs who are building something to sell it, because they have a different mindset, which I struggle with. Actually, I don't understand why someone will build a company and then sell it.

Amanda:

I love this because if we go back to the old personality theory of type A, I'm sure you've heard of type A and type B, simon, so you're typically type A. I'm sure you've heard of type A and type B, simon, so you're typically type A. My PhD was looking at type A personality and the links with wellbeing and resilience. And permanently disappointed syndrome is perfectly type A because some of the scales are achievements, driving impatient irritability and actually anger. Hostility, because if things don't happen fast enough at the pace entrepreneurs want, then they can get disappointed and I completely get that. I completely understand it. But how do you make sure that you don't let that impact the way in which you lead? If things aren't fast enough, how do you moderate?

Simon:

I'm not great at moderating, because normally when I'm disappointed it's obvious in my face. I've only said oh, you need to have more than one style, and I just don't really have more than one style. I just am who I am. I'm the same, simon that I am at home, at work, whatever. I'm just me. Well, the one bit I don't have is I don't have anger and hostility. So my permanently disappointed syndrome never flows through. No one at Octopus ever shouts. No one angry or becomes hostile.

Simon:

I think there's a horrendous culture to work within. It doesn't mean people can't disagree. It doesn't mean they can't be frustrated, but anger and hostility is not acceptable and you cannot work here. That would not be okay. I want people to come to work bringing their whole selves and to do that you have to feel safe and you have to create that environment. But you have to be up for challenge and you have to listen to that challenge, take it and run with it and think that's a fair thing to do. So for me it's about challenges. My role's changed over the years. Then I create that challenge for people, hopefully in a safe way, and then I encourage them to go and own it and get on with it and that allows them to develop and grow and everything else. I'm here to help them. It's definitely a challenge. I can see some people occasionally just going oh my goodness is what we've achieved not good enough.

Amanda:

Yeah, why are you pushing still? What we're doing is amazing already.

Simon:

Yeah, because it's why we're here.

Amanda:

I think Sarah always says to me that is it B people hire C people and A people hire A plus people?

Simon:

I can't remember the saying, but anyway, yeah, no, I get the point. I get the point. You have to hire people who are way better than you are.

Amanda:

It's really difficult, are much better than Sarah and I. That's the truth. They're brighter, they're faster, they ask really hard questions. They're all incredible. A lot of what we've been talking about is around psychological safety. I know that was one of the conversations we started with Simon when we first met. How do you approach it? Is it a conversation that you have within the business? What does it mean to you within your organisation?

Simon:

I'll give you my interpretation of it. Psychological safety meaning that people can bring themselves to work and they can express their opinion without fear of repercussion.

Amanda:

So admit mistakes, ask tricky questions, challenge all those things yeah.

Simon:

So for me, the way to do that is you have to have a culture of feedback within the organisation, and this is one of the big, big things we've had at Octopus for the last probably 20 years when we got to any kind of scale which is a feedback, and that was originally done in a very noddy way. So every two, three months you would have to go and get feedback three positive points, three developmental points they weren't allowed to be called negatives from three or four people and you had to do that because that feedback builds relationships and it builds trust. Where the problem in organisations, especially ones which operate in a hierarchical fashion, is the little person doesn't have a voice because they're little and not very experienced, and the big person has this enormous voice and everyone must do what they say. That's really silly and the feedback needs to be always done in a way that is designed to make the person better and the business better, and it must never embarrass the individual, so it must never be done in public and that creates a really good culture. But you need to encourage junior people, young people, to give feedback. Feedback sideways, upwards, downwards. It needs to go in every single direction.

Simon:

I remember when we first introduced this in front of the company, where I know we're probably 60, maybe 100 people, something like that. We did what was cheesily called a feedback circle, where we got the five most senior people in the organization to go up on stage in front of everyone and no one knew what anyone was going to say and I had to be the first person in the circle. So I was the first in the circle and the four people around me said really nice things about me and I was typically British and embarrassed, went a little bit red. And then we did some developmental feedback where they said stuff which was not very nice, but they did it in front of everyone so people could understand. That's's designed to make me better in my role and I think if you can get that within the cultural organization, then people feel much more able to be themselves and it's been very positive.

Simon:

For you know it's about. It's about communication. It's the same with almost all relationships. If you don't communicate properly and I don't really know what you're thinking well, then I can't form any kind of relationship with you and I can't trust you. So it's having the really awkward, difficult conversations at the most difficult times and and you know that's always at the heart of what is a good relationship thing, and sometimes they're really uncomfortable and difficult, but you should still have them.

Amanda:

And some people find the positive feedback harder to accept and we almost avoid it than the negative actually. But I read something recently about the emotion of shame. Feeling shameful is one of the most difficult ones and the one we avoid the most, because, wanting the need to avoid the feeling of shame, that's when we go into the protection mode, quite so much. So, in case we feel like we're going to feel embarrassed or feel that awful feeling of shame I can't think of another word for it Embarrassment, yeah, it's like an embarrassment. That's the one that motivates us the most negatively to avoid.

Simon:

This is the same thing, right, and I talk personally. I think men are a lot worse at this than women. But you know, up until I was probably mid-30s, I used to carry this little shield around with me which would hide everything that was really broken about me or bust, and I'd use that shield to make sure no one could see what was going on, because it made me feel vulnerable. Eventually, I got to a stage when I was like, well, probably mid 30s, late 30s, right, I'll just screw this, I can't be bothered, I'll just drop the shield and I'll just tell you this is who I am and waltz and all stuff I'm good at, stuff I'm not good at. And you know what the right people want to help you, and anyone who chooses to use that against you is just a not very nice person and you shouldn't work with them. And it's creating that level of again trust and team environment.

Simon:

Normally, vulnerability is a massive sign of strength, especially from a leader, and the old school management and old school companies do not get that and that is really bad, right. I cannot build a high performance team if you don't have vulnerability, because I need to know what I'm dealing with across the whole team, and that needs to come from me as the example. And you need to be open with people and also get over the fact that all humans are flawed, I mentioned last time. Actually, the best question you can ask someone on a first date is can you tell me exactly in which way you are screwed up, please? Right, because that's the heart. That's the heart of it, but you know, everyone dances around the edges.

Amanda:

How brilliant. I think that's one definitely for the notebook. Then, for those people who are just about to go on a first date In what way are you flawed? I wonder if it's something we should be asking at work, because the reality is we are bringing ourself to work. You're right, we are all fundamentally flawed. I've got some brilliant gaps. We sent an email out inviting everybody to an event that the date had passed last week, so I did not spot on that email that the date was wrong, and so I got so many emails from people saying I really wanted to go, but apparently it's already happened, and so then I had to send out a message saying by the way, I'm sure everybody knows that meticulous is my least preferred strength.

Amanda:

And I'm very sorry. I got lovely, lovely chats back from everyone saying at least you're humble. So you know, that's the truth. I'm not brilliant at everything and in fact I'm pretty terrible at some things, but my team pick up the pieces, thank goodness. So if you were to describe yourself, simon, as a leader, what words would you use to describe yourself?

Simon:

Oh, a bit funny talking about it. I don't really like talking about myself, to be honest, but if I have to, I would say I am courageous, I'm definitely straightforward, and I think I am another word for kind. Actually I'd say I'm fair. That's important because it means that I'll build a business that I'm proud of. Right, no-transcript to remember in their lives. That's cool. That makes me feel good.

Amanda:

So I'd probably say those three things you also said stubborn when last time we spoke. Oh, you know I'm definitely stubborn.

Simon:

Yeah, and I'm definitely stubborn, but I think lots of leaders are stubborn. Great thing is, I may well be wrong, but I'm definitely not confused. And all entrepreneurs, they say I'm going to do this because I think it's the right thing to do, and someone I go no, no, no, it's really not the right thing to do turns out they were right, it was the wrong thing to do. I probably have to do it again and get it wrong a second time before I finally go have to learn myself. You know, all the way, since my mum said oh, don't put your hand in the fire, it's really hot. I wonder how hot it is right I've done it.

Simon:

I did it because I had to find I only did that once, though, you actually did that yeah, I did it. I did.

Amanda:

I've done lots of really silly things, but yeah, that was one I'd love to change tack now, simon, and talk about decision making and decisiveness. So, from the harvard research and from our research, decisiveness at the leadership level, which of course it relates to accountability decisiveness is the number one characteristic, or the most important characteristic, for creating share price in an organisation and for creating high-performing teams. Yet what we see in a number of the organisations we work with is a risk of groupthink, consensus-driven cultures and a need to over-collaborate. What's your view on that?

Simon:

I entirely agree with that. I think it's the wrong thing to do. I think people should not be afraid to make a decision. You can always change the decision it turns out to be wrong.

Simon:

The thing I hate almost more than anything else is businesses or teams which move really slowly. And the reason they move really slowly is because of this group thing the person leading is too nervous to make a decision, or they or they think they want to take everyone with them. So it's like do you know I'm not sure we can do that when let's have another meeting and let's think about it, let's write another 20 page, 20 slide powerpoint deck. No, just do think about the organization. Your organization, right in the early days, or octopus in the early days, doesn't matter right, you're wired to action, because if you're not wired to action, you will go out of business really, really quickly. And if businesses get bigger and bigger and bigger, they're wired to have meetings and take ages making decisions.

Simon:

I'm like, what exactly do you need to have another meeting about? Why can you not just say, look, we're going to do this, if it's wrong, we'll change it, it's fine. It's giving people that confidence and freedom to get on with things. That is one of the most important things in differentiating a great business from an okay business. And you think about really large companies. Their processes are just dreadful. Just go and try and send some money from one of the high street banks somewhere, just to just walk in and try and do it. That's just a perfect example of the way business should not be done. But it is because they're just wrapped in bad tech systems, bad systems, bad bad yeah, right, and you definitely never, ever be friends with any of them.

Amanda:

Well, we've been researching and thinking about the concept of functional stupidity and we talk to our clients a lot about functional stupidity. I was with a client, amazingly, at the American Embassy yesterday and the slide that we were talking through it was a workshop on psych safety and the slide that had the most gravitas and the most impact for them was the functional stupidity side. I won't say what the client was, but it is true and that's from the stupidity paradox book, which is a brilliant book. The point is, so many bright people are encouraged to stop thinking for themselves once they get into those organizations and if we're talking about the big banks, the other thing they're trying to do is be more open to calculated risk. Yet when we've looked at a number of the risk frameworks of those organisations, actually it's still all about the avoidance of risk and the management of risk, rather than encouraging people to take accountability, to make decisions.

Simon:

And these businesses. Just because the world's moving so quickly, businesses are growing and dying way, way quicker than they ever used to, and this is just going to happen to them. It's exactly what happened with electric cars. When they came on the scene. When, you know, musk came along and said here's what I'm going to do. What did those companies do originally? They said, no, electric cars, they're not real. No, no, they're not going to happen. And then they went halfway and they did a hybrid because they didn't want to protect the and again why you wouldn't be friends with them. And eventually they get dragged, kicking and screaming. When change happens to you in your life, it's really painful, true, personally, true corporately. People need to remember that If you affect change and you make change happen way, way easier and this is where people get it's just horribly wrong. You need to run with change.

Amanda:

That's down to cognitive dissonance, isn't it? When change is done to us, we have dissonance and therefore the pain of that change is felt so much greater than if we choose, and actively choose, to make the change ourselves. We don't have the dissonance in the same way, and dissonance is felt like an emotional pain. We produce cortisol, we feel that pain keenly, and so, really, the view is therefore from that point that we need to feel like we're the masters of our own destiny. Surely?

Simon:

Ideally, yeah, but that comes from the best thing parents can give children. They can give them confidence. It's not arrogance, but confidence to believe they can do stuff. What's the best thing? An organisation can give its employees Confidence and that you know when you fall over and you break yourself or something in the business. Unless you keep doing it repeatedly, it's OK. Right, we have messed up hundreds and hundreds and hundreds of things, which is why we have the business we do today, and without messing all those things up, we wouldn't have learned all those lessons. It's totally cool Giving people permission to do that and encouraging them to do that, and then they feel like they are masters of their own destiny, and that's great because that's way more empowering and I'm way more likely to come and give my all for a company that does that than I am for blah mega corporation, whatever they're going to be called Blah.

Amanda:

Well, I wish it wasn't the case, though, that the most painful failures were the best learning lessons. Whenever I've failed the most significantly, and it's been the most awful, sarah, my co-director, will remind me that we have, as a result, improved something incredibly. We've created a new product, we've hired a new person, we've done something brilliant. As a result of that terrible moment, I don't like to fail. I hate losing. I hate failing, but I realize it's necessary.

Simon:

It's how you define success. I'd love Octopus to outlive me and therefore there's no end point. It's just the journey, which sounds super cheesy, but it is just the journey. Right, it's not the end point. I'm not doing this to make you know zillions of pounds or do whatever I'm doing, because I love what I do. So it's the journey that's important and therefore, if you get caught up in the journey, all the other stuff is a bit irrelevant. So any failure? Well, I'm just measuring whether I love coming to work. So I need to surround myself with people I love working with and I need to create an environment which is great for people working here and people who choose to be customers.

Amanda:

So if you were to give one piece of advice for someone who is thinking about setting up their own business and embarking on being an entrepreneur, what would you say?

Simon:

Great business simply about how you make people feel. That is the only thing you need to remember and the only way to think about it is there are so few companies out there that will make you feel really good. Just think of them. You can't. That's it. That's the angle to compete on. Don't compete on outpricing, outsmarting, outmaneuvering out anything else, Outbehave everyone else. It's just behaviours. It's the psychology of people. You'll be loyal to people and companies who treat you really, really well.

Amanda:

Great advice. Thank you so much. That's been incredible. Thank you very much, Caitlin. Do you have any other questions before we finish?

Caitlin:

no questions, really, but thank you so much, simon, especially the stories you were telling. I really love the story, especially of your colleague when going above and beyond for the blind customer. So thank you so much and I think you've definitely highlighted the importance of compassion and empathy, but also trust and bring your authentic self to work and the difference that that can make jobly.

Amanda:

Thank you very much and thank you to all of our listeners simon, thank you very much for and thank you to all of our listeners. Simon, thank you very much for agreeing to be a podcast. I love going to meetings and meeting new potential guests. That was brilliant. Thank you, anne and Philippa for making the introduction, and everyone. If you like our podcast, please hit the follow button, and if you think we're cool to listen to, please share our podcast with one friend, particularly this episode, because it's been brilliant. Thank you very much.

People on this episode

Contributor

Dr Amanda Potter

Host
Contributor

Tim Hepworth

Host
Contributor

Caitlin Cooper

Co-host