Speaker 1:
From the Library of the New York Stock Exchange at the corner of Wall and Broad Streets in New York City, you're inside the ICE House, our podcast from Intercontinental Exchange on markets, leadership, and vision and global business, the dream drivers that have made the NYSE an indispensable institution of global growth for over 225 years. Each week we feature stories of those who hatch plans, create jobs, and harness the engine of capitalism right here, right now at the NYSE and at ICE's exchanges and clearinghouses around the world, and now welcome Inside the ICE House. Here's your host, Josh King, of Intercontinental Exchange.
Josh King:
If we are being honest about it, no matter how fulfilled our lives can be, we all suffer from a touch of FOMO, or the fear of missing out on something great that friends and colleagues got to experience while you have to be someplace else, and guilty as charged couple of weeks ago I was hit with an acute case of FOMO while away from the NYSE for a couple of days. I was busy taking Inside the ICE House on the road to Salt Lake City, Utah, where I recorded a great conversation with Hervé Sedky, the CEO of Emerald Holding, that's NYSE ticker symbol EEX, and a very special guest that you'll need to tune in next week to hear from.
And at the same moment that I was recording in the Snow Show 2023 Podcast booth, there was an event going on simultaneously in the boardroom of the New York Stock Exchange. Now, that kind of thing happens almost every day, but what made this event different was that every single person in the audience was an ICE colleague, which meant that upon my return to New York, dozens of people told me about the inspirational conversation and lessons they took away from our keynote speaker at ICE Data Services 2023 Sales Kickoff.
The first person to let me know that I'd missed out on something great was ICE Data Services Chair and the president of the New York Stocks Change, Lynn Martin, who'd invited and hosted the speaker for a fireside chat, one that ended with a sustained standing ovation for the guest and his message. Fortunately, for me, we'd already scheduled a podcast with the guest, which leads us to our conversation today with VMware Chief Operating Officer Mike Hayes. He's been kind enough to give us up another hour of his time so he can join me Inside the ICE House to share his story with me, you, our loyal listeners. Our conversation with Mike Hayes on his career and the lessons from his bestselling book, Never Enough: A Navy SEAR Commander on Living a Life of Excellence, Agility, and Meaning is coming up right after this.
Speaker 3:
Connecting the opportunity is just part of the hustle.
Speaker 4:
Opportunity is using data to create a competitive advantage.
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It's raising capital to help companies change the world.
Mike Hayes:
It's making complicated financial concepts seem simple.
Speaker 7:
Opportunity is making the dream of home ownership a reality.
Speaker 8:
Writing new rules and redefining the game.
Speaker 9:
And driving the world forward to a greener energy future.
Speaker 10:
Opportunity is setting a goal.
Speaker 11:
And charting a course to get there.
Speaker 3:
Sometimes the only thing standing between you and opportunity is someone who can make the connection
Speaker 12:
At ICE, we connect people to opportunity.
Josh King:
Our guest today, Mike Hayes, is the COO of VMware, that's NYSE ticker symbol VMW, where he's responsible for worldwide business operations and acceleration of the company's software as a service transition. Prior to his current role, Mike was Head of Strategic Operations for Cognizant Technologies and also served as the Chief of Staff to the CEO and COO at Bridgewater Associates.
Mike spent 20 years in service to his country in the United States Navy and is now the author of the bestselling book, Never Enough: A Navy SEAR Commander on Living a Life of Excellence, Agility, and Meaning. His Military decorations include the Bronze Star for valor in combat in Iraq, a Bronze Star for his service in Afghanistan, and the Defense Superior Service Medal from the White House. Mike is on the board of the National Medal of Honor Museum. He's also a lifetime member of the Council on Foreign Relations. Welcome, Mike Hayes, Inside the ICE House.
Mike Hayes:
Josh King, thank you, my friend. Such a pleasure to be here in the ICE House with you. Thanks to you and Lynn Martin and the entire team for not only a great day that you referred to a second ago, but just for having me here today and of course, most importantly, thanks for all the incredible positive impact that you have for this great nation and the globe and the planet. We wouldn't be able to do what we do without such a fine institution as the NYSE.
Josh King:
Well, talking about the globe and the planet, Mike, I wanted to start our conversation talking really about the last couple pages of your book, talking about a different part of the globe and the planet, your trip to Guam with President Obama. It's a place I visited a couple of times on stopovers to the far East with President Clinton. Given that the range of the VC-25A, the Boeing 747-200, known as Air Force One, when the president is board lacks the range to make a nonstop trip between joint base Andrews and the runway in Tokyo or Beijing, at least if the aircraft isn't using its airborne refueling capability, but for you, Mike stepping on the island was more of a homecoming than a refueling stop and the spot in Micronesia in the Western Pacific where America's Day begins. How did your father's Navy career and your parents shape your upbringing?
Mike Hayes:
Josh, I'm a third generation naval officer. My grandfather was at Pearl Harbor on the day of infamy December 7th, '41 and later became a very decorated naval officer himself and my father also a 20 plus year career in the Navy. Neither of these guys said, "Hey Mike, you've got to go join the Navy." What they did was they lived a life of service and giving more to others than self and just left an indelible mark on me growing up, and so I say they tricked me into my own service because they just set the example and then moved out of the way.
Josh King:
I want to zero in on your grandfather's example because I haven't checked Barack Obama's presidential travel records on this one, so I'm not sure if that same trip that you were on with him included a stop back in Hawaii and a visit to Pearl Harbor, which I do know that Obama visited at least once during his two terms, and certainly that's where he grew up and played hoop at Punahou High School. I read the book, he and a couple friends were maybe nursing a hangover on December 7th, a little far from where the attack was and his ship was, and some of them said, "More safe here." But he said, no. He got in his Jeep and almost ran through the entrance to the harbor.
Mike Hayes:
He did, and he had a lifetime of really put the nation before self and put others before self. At no time did my grandfather or father ever say, "Hey, go join the Navy and here's how we'll contribute." All they did was set the example, but for me, just like all of us, I think we know what we get exposed to, and so as we grow up and we have different influences in our lives, we pick our own heroes and inspiration. Then I think there's an unquestionable subconscious to put in times even conscious imprint that makes on us and the opportunity to serve in the SEAL teams and create a real impact for the nation was an opportunity that I couldn't pass up myself, and so when as the oldest of four, getting ready to go to college and receive an ROTC scholarship and maybe leave a little bit of ability for my parents to pay for school for the next three siblings, it was really a no-brainer for me. It wasn't a question of should I serve, it was just a matter of how.
Josh King:
So 25% of you did ROTC. What did the other three siblings, did they fall in the parents' footsteps as well?
Mike Hayes:
None of them served in uniform, but I often get thanked for my service. I love to flip that around on people and say, "Well, thank you for your service. I don't think that the military has the corner market on serving." In the military is just one way that we can as citizens of this great nation and planet can serve each other. Look, everybody's got different abilities and interests and passions, and so the real question is how do we apply those and help pull others up around us, whether it's our street or our local institutions that we support or whatever, however we give back. That's not a question of exactly what we're doing. It's just a matter, are we off the sidelines? Are we helping inspire people to take more ownership in this great nation, take more accountability for the outcomes that we're, are we pulling societies up? Are we making each other better every day? And I think that, again, doesn't have, the military doesn't have the corner market on that. We can all help each other to serve each other more, and that's really one of the underlying key themes of Never Enough.
Josh King:
I think you are by Pete and my count, the Fourth Navy SEAL we've had on the podcast over about 340 episodes, which if you do the math, that pretty much corresponds to the percentage of Navy sailors who've become SEALs. Despite only a couple thousand operators at any one time, I think it was 3,500 on the teams at any one time, their successes and also their setbacks have been pretty well known. Were you aware of the teams and what they did before you ended up attending John Connors's memorial service while you were at Holy Cross?
Mike Hayes:
Not at all. I had no exposure to the Navy SEALs growing up. I didn't know they exist. I don't know if it's the fortune or the misfortune of going to college in an era that didn't have cell phones and didn't have the internet yet, so my knowledge about the SEALs was zero. My first exposure, as you just referred to, was in the chapel, St. Joseph Chapel on the College of the Holy Cross where I attended, and I saw a community come together and really celebrate the life of a man who made the ultimate sacrifice, and seeing that community come together was incredibly special. I didn't realize how special it was. It was the Panama was December of 1989, so I was a freshman. I had no idea even as a freshman that I would even contemplate becoming a SEAL two or three years later.
Josh King:
You credit Father Michael Ford and this week long silent retreat that you took for the decision to actually join up. Tell us about Ford and his influence and that retreat, but also what might have you done if you hadn't come in contact with Father Ford?
Mike Hayes:
Well, great question. God rests Father Ford's soul. He's a great man who baptized my daughter and married my wife and I, and was a huge influence on me at Holy Cross. An incredible man who was in the stands at a hockey game, one random school night or something, and tapped me on the shoulder and said, "Hey, Michael, there's always a." By the way, he's one of the few people that called me Michael. It was Father Ford and my wife and once in a while, my mom, but he said, "Listen, there's always a backlog of people to do these this week-long retreat. I know you only get four weeks of vacation in the winter, but just trust me you've got to go do this." And I just said, "Okay, I'll do it. I'm in." It was one of the best weeks of my life.
Josh, I think what we as professionals, as humans, as family members don't get enough of is quiet time to think and to reflect and to think about who we want to be. I've always told my daughter, don't worry about what you want to be, worry about who you want to be and land those concepts in how you want to treat people, how you want to influence the world, et cetera. For me, that week of no talking in Narragansett, Rhode Island in the very great cold of winter, look, I still went out very privately, no one saw me. I jumped in the ocean water and had some really, went for long runs and just some moments of great deep personal reflection where I said, ultimately, how do I want to have impact for this great nation?
And to your point, I really... If I wouldn't have become a SEAL and wouldn't have worked that out, I probably would've been a pilot. The basic struggle for me was, is it a Man v self or a Man v machine man career path? And I was ultimately much, much more interested in the Man v self problems rather than me just becoming really good or trying to become really good at controlling a piece of machinery.
Josh King:
I read Mike that while you were at Holy Cross, among other things that you were involved in on campus, you were in the Big Brother program, and later I think when you were at the Kennedy School of Government at Harvard, mentored a number of ROTC undergrads, including Dan Crenshaw, who would become the US rep for Texas' second CD. We talked about your family and we talked about Father Ford, but who are some of the other mentors that you had earlier in your academic and military career?
Mike Hayes:
I was a child who moved around a good bit, so I don't have great answers to that questions because I didn't have the opportunity to have really longitudinal relationships through my childhood and my high school years, and so I would say my biggest influences were seeing the military community and seeing my peers. All of us in any given neighborhood, when you're growing up in a military community, you've got people who come in and out of that community with some significant frequency, and so while there are a lot of downsides to moving around and being a military child, the upsides are also phenomenal because you first of all get that high EQ, high perception, high ability to recognize what it's like to see somebody in a new situation and to welcome them and understand how someone, an outsider is feeling and say, "Hey, I know what it's like to move and not have any friends. Come on over here into this circle with me." And really to help settle people down.
And then it's also on the backside of that, as you were, the individual leaving those communities, it is hard to leave, but what you learn are the lessons that you do stay in touch and you do develop more and more friends. Over time, look, lots of us lose touch with our third grade friends and our ninth grade friends and whatnot. What we don't lose touch with are the lessons that we learn on how to positively treat people and how to be great influences in groups of people, so that I think for me was really some of the greater influences were just the situations that I was in.
Josh King:
We spoke with the Navy SEAL Foundation, CEO, Robin King and DJ Hailey, one of its founders just a couple of days after Dan Crenshaw had his famous appearance on SNL with Pete Davidson back in 2018, that was around our 75th episode. You had developed this close and mentorship relationship with Dan. When you saw that, what was your reaction in either, how did you counsel him or how would you counsel us in the way we support our veterans?
Mike Hayes:
First of all, just for context for the listeners, the 17 bajillion listeners that you have Josh because your foundation here has grown so nicely in a sign of how much impact you've had in the world. When I was at Harvard in graduate school, I didn't have any obligations to the Navy, the Navy was paying for two years of fully funded grad school. It was a great privilege, and with that, one of the ways that I gave back was to allow some of the college kids to work out with me while I was in grad school, and a group of 40 or 50, quickly went down to about 10, I handpicked about three of them to go to SEAL training. That wasn't ultimately my decision, but I wrote a very strong letters of recommendation for three people. One of those was Dan Crenshaw, who you were just referring to.
So I think that I'll never forget sitting in my kitchen in Cambridge, Massachusetts after a very long and hard workout, sitting with these three young men and talking about what it means to be a Navy SEAL. It has nothing to do with the glitz or the glamour of Hollywood. It has to do with, again, how you exercise an increased ability to positively influence people and how you use that platform for good. The job of the Navy SEALs is not complicated. It's becoming as good as you possibly can so that you can stop bad people from doing bad things to good people. I'll never forget some of the real foundational conversations that I had with these three at the time, young about to be college graduates.
And so on the Pete Davidson thing that you just referred to with Dan Crenshaw, what I saw was a very level and calm approach that I was to a very pointed criticism that frankly I thought was incredibly off color, and I was just so proud of the way that Dan stayed calm, cool, and collected and took the high road on his answer, but I wasn't surprised. I wasn't surprised. I take no personal credit in that. What I would say is, but I knew Dan, it's funny that you bring him up because we literally talked two nights ago, and I know his head and his heart and how he thinks about things, and so I wasn't surprised, but all of us when the platform gets bigger and we have more people that are listening to us, sometimes we can find it a little bit more challenging to stay true to our roots and our values and I was very proud that Dan acted the way that he did and really set an example for positive discourse in how people can disagree and then come together.
Josh King:
One of the things that you've done in your professional life is to start the 1162 Foundation to support Gold Star Families. For our listeners, what does the name mean, where does it come from, and how is the book helping the foundation's message?
Mike Hayes:
Thanks for asking. The 1162 Foundation is a 501(c)(3) that I started that pays off mortgages for Gold Star Families. Gold Star Families are families of fallen service members. The 1162 is the date that JFK started the SEALs, the special operations, both the SEALs and the Green Berets, so one-one as we know is also a symbolical of renewal. Every January 1st we all come up with the things that we want to do for the new year, and I think that as my organization has now paid off seven mortgages for women whose names that I don't use, you won't find any website, no fanfare. I don't need any pictures or public recognition for anything that we go do. We just quietly help out.
But as we've helped some of these incredibly inspirational women, what has been very rewarding for me personally is to see how they have just been able to get back on their feet and be renewed and then not surprisingly, also give back themselves and go out and talk about what they've experienced and then use their platforms to go positively in influence other people. I think a larger segment of the nation has at least heard of visiting various military hospitals and wounded warriors and whatnot. Almost every hometown at this point unfortunately, has somebody who's been either lost or wounded in one of the wars. What I would say is to a person, these people who have both beared the visible and the invisible wounds of war down deep all they want to do is contribute, continue to have a really positive impact on this great nation, so that's what I would mostly emphasize that we're here to help them do.
Josh King:
One of the tenets that you write about in Never Enough, is that everyone has got to figure out how to push themselves into areas of their own discomfort. I'm sure listeners are familiar with a physical discomfort that is associated with Bud's training and active military service, but you focus a lot on the discomfort of leading as a young officer. Would imposter syndrome be a corporate analog? And what can rising leaders learn from your experiences in Coronado?
Mike Hayes:
When you're in incredibly freezing cold water and just physically just jackhammering, meaning shivering so hard that you could be confused for a jackhammer there are some really great lessons in life. I had the great privilege of having a swim buddy who I'm lifelong friends with who left the SEALs after 12 or 13 years and became an astronaut and later the chief astronaut of the nation and now the CEO of the National Medal of Honor Museum, Chris Cassidy. Chris and I'll never forget a really, really cold day, us being in the ocean and not sure when the instructors were going to let us out, and Chris just started laughing and then all of a sudden a whole class of students who were in a miserable situation had started laughing.
The power, the lesson I would draw from that is really the power of humor or maintaining the big picture. If you never take yourself too seriously and you can laugh at yourself in really hard situations, that's a real gift. I think a lot of us roll in and out of these really big positions with fancy titles, et cetera, it's so important not to let your head get big when you're in these big situations because throughout the course of a 100-year lifetime that all of us will be up, all of us will be down. I think with the measure of a person really is how do you treat people when you're up and how do you keep that positive mentality when you're down because we'll inevitably all be up and down through a course of a life.
So I think that's really the seal teams summed up. There are really positive up days. There are really, really hard down days. Josh I, like every seal of my era have buried about 70 friends. Many of those I've been just as close if not close with my actual blood brother, and so it's, while the SEALs can sound very glitzy and glamoury, man alive, there's some really hard days and the lessons that resonate the most are how to deal with adversity and how to pick yourself up when you have the hard days.
Josh King:
In the antithesis of the glitzy and glamoury aspect of life in special operations, you write early in the book that perfection isn't the goal of the never enough mindset, even for SEALs at the pinnacle of their powers. The pages have examples of missteps by SEALs from spraying mustard on a street vendor to life-altering mistakes that lead to loss of life and some of those friends that you've buried. How do you make sure that the drive to improve doesn't tip over into the overwhelming stress to achieve perfection?
Mike Hayes:
I'm so glad you brought this up. My mom hates the title or hate it, I should say the title of my book. She's like, "Michael, who is in the world, wants to go pay for something that says that you're never enough?" It does bear a little bit of explanation, and I think that an equal, I could have equally named the book Always Enough, and I will lay this down. That is the name of my next book, which isn't completely written yet. The thing is we have to live in two worlds at once. One world is that we celebrate who we are, we know that we've been given a lot. To those who much as has been given, much as expected. We all have so... There's so much to be grateful for.
And then at the same time, how do you live in a world where you're always striving to improve and I'll say be more? And I don't mean that in a go make more money or go get more title or more ticker tape parades falling and so that we're more important and self-aggrandizing. The reason for Never Enough and that mindset is ultimately so that we can have more positive influence on those around us. The better shape that we get in, and I don't just say that physically, but the better mental, physical, and spiritual shape that we are in the better suited we are to help people when they're in their down days, and so for me, I think it's really, really important to do what you basically were referring to, recognizing that we are enough while we strive to be never enough.
Josh King:
You mentioned John Connors and Panama earlier and in your career you served during the Clinton administration in places that many in the American public may have been less aware about US military action like the Balkans, where I visited with President Clinton when he went to Tuzla in Bosnia, but there's also even less awareness about operations in places like Peru. How did those experiences shape how you would lead far larger units when you ultimately found yourself in Afghanistan?
Mike Hayes:
Training is a gift, and so a lot of times we spend an unknown amount of our careers preparing for just a handful of days that we face, and so I came into the SEALs in 1993. I'm 51 years old, so in '93 through '96 and '97 I'm in mostly South America, '97 to pre 9/11 I'm in mostly in Bosnia, Kosovo, those places. Those were not the big shooting wars that Iraq and Afghanistan turned out to be. I think the best way I can sum it up is that when I was in, a quick story Josh, if I may, is in Bosnia, there was a day there where we witnessed an arms transfer between Russian forces and some indigenous forces and we were hiding out unseen. Long story short, there was a reason why we needed to extract and leave our mission.
We ended up getting shot at, nobody knew where we were, but they knew somebody was out there because of for certain reasons that I won't go into, but my communication guy, a guy named Jimmy Graham was able to draw on one thing that he learned from one day in training four years earlier and made some makeshift antenna and measured this thing out, licked it twice, cut it three different ways and I don't know, stuck his, licked his finger, put in the air. I don't know what kind of magic he did, but he got us in touch with a helicopter that basically came in and saved the day. Now, the point isn't about the story itself. The point is if Jimmy Graham doesn't learn that thing that he learned in a 20-minute thing in a classroom three or four years earlier, none of the six of us may have survived that mission.
And so the question is, when you're in those 20-minute training things, how seriously do you take those moments? How much effort and energy do you put into learning and preparing? Because none of us may know when we're going to go need that skill that we learn. A lot of people look at the Damar Hamlin and CPR and how beautifully that beautiful life was basically saved by some heroes on the sideline. How many times has CPR been needed on the football field in the last couple decades? I think it was only one other time if I was known right now. You have a whole group of first responders who are training for that moment, and how seriously do they train? Well, obviously they trained incredibly hard and it paid off. You just never know when the Damar Hamlin moment's going to happen, and just like you don't know when the coast of old moment's going to happen.
Josh King:
As we head into our midway break here. Mike, I wanted to just touch on the role of technology and the digital transformation of the military. Way back, I think on our episode 18, we spoke with the former SEAL and now the President of Forge Markets, Jose Cobos, a former colleague of mine, about the connection between Silicon Valley and the front lines. Is that something you experienced, for example, the military's use for green energy?
Mike Hayes:
First of all, let me say, Jose is a great American. I haven't seen him in a long time, and he's incredible human, incredible reputation. As far as green energy, when we were in Afghanistan, it was not a thing. It was myself, and I had the privilege of being a White House Fellow in 2008, 2009. A White House Fellow alumni named Phil Cullum was a vice admiral who was pushing green energy and pushing the Navy forward. He's a visionary. He's an incredible leader, and so Phil and I, with our White House Fellow connection, we're thinking, "How do we continue to advance where we need to go as a nation?"
And look, people can hear green energy and quickly devolve into some partisan, "Oh, I'm of this party, therefore I think green energy is good or bad." That is not the point at all. The point is green energy, the lighter you can be as a war fighter, the better off you are. The less money you have to spend on energy, the more money you can go spend on other bullets and bombs. There was no question that green energy was and continues to be the future for a bunch of reasons, and so myself and Phil Cullum really worked from two different levels to really move us forward as well as we could. This is back in 2009, '10, '11, '12 timeframe before you heard that much about green energy.
Josh King:
After the break, Mike Hayes, the COO of VMware, that's NYSE ticker symbol VMW, and I are going to discuss his transition from the military into the private sector and how Never Enough is a blueprint that all leaders can follow regardless of what organizations they serve. That's all coming up right after this.
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Josh King:
Welcome back. Before the break, I was talking to Mike Hayes, the COO of VMware, about his career in some of the lessons contained in his book, Never Enough: A Navy SEAR Commander on Living a Life of Excellence, Agility, and Meaning. Oh, Mike, when did you decide it was actually time to set out on your next adventure? And can you talk about the transition of leaving the teams and those people and brothers that you'd given so much to?
Mike Hayes:
Love to. I think the thing that really hit me in the White House that I didn't recognize fully until later was that I had seen a bunch of people who knew national security and public policy and then a whole nother set of people that knew the private sector, but I very rarely saw people with command of both. I had the privilege of running or attending hundreds of meetings in the White House Situation Room at an atypically young age, roughly 35 or so. What I decided at that point was that in order to best serve the nation, I figured a chapter in the private sector, 10, 20 ish years in the private sector would really, in the long scheme of things, help me to better serve the nation. I'm a person who, like I said, had the privilege of running or attending meetings that normally I would not have done for another five or 10, 15 years down the road.
And so after I had command of a SEAL Team Josh, I thought it was a really important inflection point to reflect and say, "How do I want to continue to grow and learn and contribute?" And ultimately decided that a chapter in the private sector would best achieve that. Now that said, I remain even today, 10 years out of the SEALs incredibly close to the community and the military will always be my people and the national security policy decision makers, et cetera is always my people as well. I know what gives me energy and I do love contributing and giving back. I've been fortunate to have very unique situations and learned a ton, and like I said in the first half, in the earlier segment, it's really just about, life is about giving back and making others, pulling others in the nation up.
Josh King:
On that transitional period in your life, and I want to just stay a little bit in the White House because during the Clinton administration, I worked with a lot of White House Fellows each impressive in their own way. You write about this situation known to many moviegoers about Captain Phillips, the Merc Alabama, and dealing with people like Tom Donlan, Dennis McDonough and Mark Lippert. We had one former White House Fellow, the current secretary of the Navy, Carlos Deltoro on this show just before the Army-Navy game. Can you talk about the process that you went through to become a fellow and the role that you took on actually?
Mike Hayes:
Love to. The White House Fellowship is the nation's premier leadership program for the public sector, so I was lucky enough to do a public policy degree at Harvard's Kennedy School. A guy named Professor Porter was a White House Fellow alumni, talked about the program and I was in a classroom with a hundred people while he talked about it and everybody was salivating and drooling about how cool that program sounded, and I just sat there and thought to myself, "Okay, I've got to go return to the SEALs and go do a three-ish year cycle through Iraq, back and forth and do a real tour in the SEAL teams again." But at that moment, I determined that I'm going to be a White House Fellow because I just thought it would be incredible growth. The thing about being a White House Fellow is that you only really get selected if you actually have an incredible amount of humility and desire to do more for others than self like I've talked about thematically through this, our whole conversation.
The process is pretty simple, 10 essays, they're the hardest kinds to write. They're the 150 or 200-word essays where you're trying to chop out a single word to hit the limit, and then after that window's several thousand plus applicants down to a group of about a hundred regional finalists, and then around eight or eight to 10 cities around America, there are regional finals, and then 32 people get selected to go to National Finals where there are three days of interviews. Questions are tough. It's like, "Hey, what influence did your mother have on you? You're in the elevator with the president, what would you say to him? Ready, begin. What was the biggest ethical dilemma you faced where you failed?" Trick questions like that. Just really, really fun conversations with all judges who have incredible name recognition people that every single person you know and your listeners would know, and then out of the 32 National Finalists, 14 fellows are selected. Sometimes it's a little more, sometimes a little less.
And then during the course of the year, you get placed at a department or an agency in the executive branch, and there are three pillars of the White House Fellowship. One pillar is your real job that you get where whatever department or agency you're in. The second pillar is an education program where the 14 White House Fellows get an hour with the president, the vice president, Supreme Court Justices, CEOs, senators, and it's all off the record conversations. Then the third pillar, and what I would actually say is the most exciting is that you get to spend a year with 13 people who are incredibly accomplished and incredibly diverse, and you get to learn from people who don't think like you and it makes you better. Over the course of that year, whatever humility you thought you had at the beginning of the year, you've got a lot more at the end of the year, but you've also got a lot more tools in your toolbox on how to best contribute to your own view on what the nation needs.
Josh King:
In your book, Mike, Never Enough, you write about bridging the politics of the room to get things done, even in areas that your expertise might be little or have no overlap with the topic at hand. Talking about this experience that you got when you're a White House Fellow, is leadership and the ability to rally a group around solving a problem, something that Washington is lacking you found, and how can it be taught?
Mike Hayes:
Actually, I think you're raising the answer to what the biggest strategic problem for America is right now. A lot of people answer that question with China, Iran, North Korea, et cetera, et cetera. The biggest problem right now is our inability to agree disagreeable and make enough progress forward. There's so much... Our nation's forefathers intentionally built a system with friction in the system, but right now, the friction that coefficient has gotten way too high to where it has slowed down productivity.
GDP, gross domestic product is just labor times productivity equals a total economic output of a nation or of the globe. Our productivity factor coming from government right now is way too low and candidly embarrassing relative to the talents that we have in this great nation, and so I think that the ability to fight for what you believe in, but then when that fight is lost, how do you set that aside and go argue and fight for a different day or a different cause? And so I think to say it more simply, our forefathers built this nation, so we bump our way down the road, but we never really depart from the highway.
And so we've had a lot of challenges. January 6th, whatever people's views are on that, et cetera, but in the last handful of years here, we've had way too many challenges to our nation's democracy, but I would say Josh, almost all of them unnecessarily self-induced.
Josh King:
Yeah, and those guardrails have got a lot of workout as the treads on those tires have sent us carrying back and forth, Mike. Business leaders, they tend to often borrow a lot of military jargon to describe the activities they're involved in, maybe more than they should, but it was time to actually walk through the door of Ray Dalio's Bridgewater Associates. How did you begin to apply your military background to that business proposition?
Mike Hayes:
Well, the first thing was recognizing that I went from a world of being in charge of what missions people went on, having my own jets and ground vehicles and thousands of people and to a world where I had no direct reports and I had to go procure my own pencils, and so that, I think the most important thing is, again, it's a lesson in humility and how much gas do you have in the gas tank to go work and to go learn and to lean into things that you don't know. I had no idea about the world of finance and hedge funds or candidly private sector management. What I had was just good foundational leadership experience and principles on how you treat people and how you become an ever improving world-class organization.
And so I was fortunate where I went to an organization that very much values different experiences. I think the nation's best enterprises are ones that can bring in people who are a little bit different, but make bets on people who are a little bit different and then celebrate the differences in the different viewpoints in the diversity, and Bridgewater unquestionably did that in I think a culture of iron sharpens iron was one that attracted me in the SEALs, and I don't think Bridgewater was very different, and so I really greatly valued that. There was, I landed at Bridgewater through a very close dear friend, Dave McCormick who just finished as the CEO maybe about a year ago, now had a run for Senate in Pennsylvania, and I certainly hope to see him run again. Dave's an incredible American and we've had lots of conversations over the years of, again, how do you help people and how do you ultimately create organizations that can metabolize veterans in particular, but people of all different walks of life.
Josh King:
Just sidebar, any thoughts about why Dave couldn't beat Dr. Oz in the primary? He probably could have walked away with the general election.
Mike Hayes:
Well, I think it's a great question, and if there was a really crisp answer I think we'd really recognize that the root cause is that we don't get educated. We 330 million Americans don't get educated enough deeply in who people are and what they stand for. We vote on very superficial information, and so the life sometimes doesn't work out with the right things in the short term, but it always does in the long run. I know there's another seat in Pennsylvania that opens up in the next election, and I personally seriously hope that we see Dave announcing a push for that, but the nation needs great Americans who've had that success at West Point in the military and in the private sector.
Josh King:
So the folks that are in Bridgewater shop, they're under a lot of stress to deliver good returns for the investors and for Ray and has to be a place where people are wondering if they have what it takes, and you write about functioning in some ways as a stress sponge to help others, but how do you also find the right altitude for yourself?
Mike Hayes:
I don't think I have any secret sauce there. I think the most important thing is to ask yourself how much you value working in a meritocracy and how much you're willing to bet on yourself. There are some organizations where people can hide and there are some organizations where you can't, and so it's that point you brought up earlier around comfort with discomfort. The only reason we really don't like being, that we don't like getting uncomfortable in professional and personal situations is ultimately because in my view, Josh, we're a little bit unnecessarily concerned on what our friends or our colleagues will think of us. I like to say, you read this in the book, but you've got success and you've got failure, but you have to determine if something's failure you have to go one more node down that tree and say, did you learn or not learn?
And it's only failure if you failed and didn't learn. If you failed and learned, you just succeeded, especially if you just didn't learn as an individual, but you help your organization learn whatever lessons you've learned and bring that to the whole enterprise, and that's what we value in the SEAL teams, and so after these operations we help people learn lessons. I like to say we teach people how to think, not what to think, because you're never going to be in the exact same situation twice, and so for me, I think bringing that rigor and discipline to a place like Bridgewater was also very much valued.
But it does take work when somebody says, "Hey Mike, I don't know that you're doing that the best way." Do you want to hear that answer and hear what somebody has to say or do you not want to hear it? If you don't want to hear it, you're not going to improve. You might feel better, but that's not going to what makes you better in the long run, and that's how I grew up in the SEAL teams was always hearing the feedback of there's probably a better way to do this operation.
Ultimately, as a SEAL Commander, I just had one job and it wasn't different than Ray Dalio's job. It's how do you define an outcome you're trying to achieve for an organization? How do you come up with a bunch of different strategies to achieve it, but then risk adjust those strategies so you can take the minimal amount of risk or the desired amount of risk to achieve set outcome? And that's really just a decision-making framework and process that applies in both the SEALs and in business.
Josh King:
And you talk about success and failure. Mike, you talk about having comfort with discomfort. I'm curious, you also write about the importance for leaders to share the credit and also share the blame. Typically, leadership training encourages just the magnificent effort of sharing credit. Why is sharing blame important and how can you do this so that the after action decision-making process is reviewed and improved instead of just affecting morale and talking about credit?
Mike Hayes:
Well, Josh, everybody knows if I'm doing something wrong and if I can blame you for it, then it's not going to cost me anything so that's a real skill. No, I'm just kidding of course. I think what is most important here is that a high performing team is either strengthened or weakened really by one concept. It's whether the credit or the blame will be proportionately shared or disproportionately shared. I grew up in a SEAL team environment where you absolutely win or lose as one unit, and that is the biggest thing that separates a high performing business and enterprise from one that is not. To me, I think what really matters is a leader standing forward in trying to take more of the blame if something does go wrong, all that does in the long run is helps strengthen the team.
Ultimately, I think that I like to describe careers in three quick buckets. One is really choosing something to do and getting really good at it, whether it's accounting or medicine or law or whatever, teaching, whatever. Then the second phase is trying to show the world that you're really good at what you chose, and then that third bucket that many people don't make it to is really realizing and knowing that you're so good at what you chose, that you no longer have anything to prove to anybody, and that's when you can stand in front of a room and take more of the blame like you're raising because you're so comfortable that you can say things like, "I don't know, or I made a bad decision, we're going to change course." Or things that people with a higher ego or lower humility may not be able to say, but I think that is really ultimately, fundamentally the biggest differentiator in leadership and high performing organizations.
Josh King:
One of the concepts that you discussed with Lynn Martin in the boardroom talking about getting in front of people was making sure someone oversees what your organization isn't doing. What does that mean and how do you define the bounds of that responsibility?
Mike Hayes:
It's one of my favorite concepts. When I walk into an organization and say, "Who's in charge of what we're not doing?" It never computes. People are like, "What are you talking about?" Well, what I would say from my years in the SEALs mostly here is that I recognize that all of the opportunity and all of the, almost all of the opportunity and almost all of the risk reside in that unknown, unknown quadrant. You can go design an organization where everybody has a job, think about the positive space and the negative space. The positive space is everything that you have tangibly in front of you or your email inbox, your stats, all the work that you've got to do. We get so pulled into that positive space that we very rarely can disengage and think about what are we missing or think about that negative space. The best organizations by design have the ability to get into that negative space, and ultimately that makes an organization stronger.
When I was the commander of a SEAL team, I used to joke around and say, "I designed the organization so that I don't have a job." I would walk into our operations center and I could just sit and observe everybody doing their job and think about that risk that isn't going to hit us. I think I told that day a story, which we probably don't have time for here, but a story about an event that happened where because I wasn't so sucked into the positive space, I was able to step back and think about things that we were missing and ultimately ask questions that no doubt, and I don't say this lightly, but they saved American lives. I'm not patting myself on the back. Any SEAL Commander, any SEAL leader, I should say, would really it would be smart enough to design an organization this way. It just doesn't happen in the private sector as much as it should.
Josh King:
As we wrap up our conversation here, Mike. You joined VMware in 2020, the mission to oversee operations, particularly digital innovations. As we're now in 2023 how are you making sure that the team stays focused on innovating despite what must be an uncertain environment with the impending acquisition by Broadcom?
Mike Hayes:
Great question. First and foremost, it's focusing on the foundation, and so we're going through two business transformations. One very external, which is moving from selling perpetual licenses over to software as a service, and that's incredibly important because we as a business only want to be creating value for our customers. We don't want to sell things that sit on a shelf and don't get used, we don't want anybody to buy something that isn't valuable for them, and so that as the world pivots to this model where you're using what you pay for, then ultimately we create more help and more value for our customers. Now, that's the external transformation. Internal, in order to be able to do that, I've overseen the complete rebuild of our data foundation and ERP upgrade, moving everything onto one, call it system and backbone of our commerce and our infrastructure, and then on top of that, at the application layer, a new custom internal application on which we do all of our commerce. That transformation really is just creating the foundation for one concept, which is business agility.
We can't see around the corner what markets are going to do next, and so how do we have the ability to react to markets? And that's not unlike what I learned in the SEAL teams is you never know what fight or what offense or defense you're going to have to play tomorrow, so just prepare for the plan to change, and if you can do that as the SEALs or as VMware, you will win over the long run. And so while we're excited about moving forward and integrating and strengthening the partnership and growing VMware with Broadcom, at the same time, we have to run the business as a standalone single entity that has a fiduciary responsibility to our shareholders. Until the day that we merge, we're running full speed ahead as an independent business, and all of those concepts, whether we're integrated or not, are all the same as you rightly raised throughout this conversation between the SEALs and the private sector, just tons of similarities.
Josh King:
Talking about the similarities and this long resume that you've got, Mike, between the SEALs and the private sector, it's so unusual going from the United States Navy to the White House to a hedge fund and now technology SaaS firms. You mentioned that you're maybe at work on another book, but where in addition to that do you see your career going next and how do you plan to plan for such nimble change and not knowing exactly what might come next?
Mike Hayes:
Well, I think the, first of all, I'd like to say with the book and when I do go around and do speaking fees, I donate all of that to the 501(c)(3). I've never made a penny off of Never Enough and I think I just want to emphasize that all the book and the speaking fees have paid off seven mortgages for very, very deserving families, and so first and foremost I will continue, whether it's book number two or book number 200 or speaking or lots of other things, I will live every moment of my life here on the planet in service of those who have paid the ultimate sacrificed and many of the families who also bear the visible and invisible wounds of contributing to this great nation, and so that's first and foremost.
And then Josh, your question is really great, and I wish I had a good answer. People are like, "Oh, you're going to run for office or you're going to this." And I honestly don't know. I would just say I'm continuing to build the foundation so that I can continue to contribute more in the future in whatever ways I'm asked to. Whether it's an appointed or elected position back in government in my '60s or as some senior position. In the private sector, who knows? I'll just keep taking it with a short-term and medium-term lens with just like many of us, a very unknown long-term set of goals on what I want to be. I just know I tell my daughter who I want to be and how I want to treat people and how I want to try to positively influence this great nation.
Josh King:
And we will keep you closely on our radar, Mike, because I know you're going to make a lot of contributions in the months and years ahead. Thanks so much for spending a little extra time with us inside the ICE House after your visit here last week.
Mike Hayes:
Amazing. So nice to be here with you, Josh, and thanks to Lynn and John and the entire leadership team of NYSE and ICE. Thanks again for all that you've done for this great nation and planet, as I said,
Josh King:
Thanks. That's our conversation for this week. Our guest was Mike Hayes, the Chief Operating Officer of VMware. That's NYSE, ticker symbol VMW. If you like what you heard, please rate us on iTunes so other folks know where to find us, and if you've got a comment or a question, you'd like one of our experts to tackle on a future show or hear from people like Mike Hayes, email us @icehouseice.com or tweet at us @ICEHousePodcast. Our show is produced by Pete Ash with editing and engineering from Ian Wolf. I'm Josh King, your host, signing off from the Library of the New York Stock Exchange. Thanks for listening. Talk to you next week.
Speaker 1:
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