[Guitar Music]
[Pause]
>>Hey thank you for letting me do this.This is uh, actually,
this is a lot of fun for me. I have to say with all
sincerity, this is by far the most difficult presentation I
have ever done, period.That is very very true statement. It
took me a lot of time to put this together, because... One,
because of the audience, I'll talk about this audience in a
little bit when we go forward,and the other because we have
a lot of "add hawk" things in life that happen, and I go "
ok, I gotta talk about this experience", and as I was trying
to build the thing, I go "Well, actually I don't even know
what I learned from that experience", so I don't even know
how to communicate it to you. But, I think it'll be
informative, I hope it'll be informative.
Um, a little bit of background about me, so we can kind of
color what we're doing. I have a very odd background to be
here. Um i went to Penn State, undergrad. And then I went, i
was in the Air force Reserve Officer Training Corps, at Penn
State. And then I went straight to pilot training Williams
Air force base in Arizona. I graduated their after a year,
then I became a T-37 instructor pilot at Williams until the
base closed in 1992.
This is a T-37, it's a twin engine, its actually retired
now, but its a fully aerobatic spin-type aircraft. High
performance, but very very very slow. Um but I flew this for
a couple years, and then uh the base closed and I went off
to fly the E3A Wax Frisbee, around the world. I did a lot
of-although is says Tank Air force base, I was deployed,
this is during peacetime, I was deployed 300 days out of the
year. Um I was particularly in Saudi Arabia, Turkey,
watching the northern and southern No-Fly zones of Iraq,
before the second Iraq war. And then also doing a lot of
counter-drug stuff out of Panama, so we'd go and do counter-
drug surveillance, looking for low-flying aircraft over the
Caribbean. So I did that for four years, and then I went
back to T-37, this is actually my last flight in the air
force...That is, yes, Penn State cheerleader Barbie...
[Laughs from audience]
Um, I was a T-37 instructor, at the instructor school, I was
also an Evaluator Pilot, I'll talk about that experience in
a few minutes, and I was a spin demonstration pilot. And
then I got out and went to get a PhD at Penn State. And then
at the time, Penn State had a fantastic PhD program in
Accounting, one of the better ones, we were placing people
in MIT, Harvard, we placed somebody at Northwestern, and
[inaudible], and of course I landed here. Um I do research
and insider training: Exec comp, financial reporting
standards, and international accounting, and I teach the
International accounting Advanced course here...I should say
I taught,because I am leaving the school, this year. talk
about that if you want, later, but I'm not gonna bring that
through here.
Um..I have two daughters and a son a brand new baby, he's
eight months old, um and they love to draw pictures for you,
and today's no exception...
[Laughs from audience]
um, So that's Ryan, Taylor,and Megan-
Why was I selected to provide this lecture? I actually have
no idea.
>>
[inaudible comment from audience]
[Laughs from audience]
Ok, well I'll tell you what I think...Is it because of this?
I'm closer to dead than you. In fact, you shouldn't have
friended me Kathy. In fact, I'm right here at this scary
part where I'm halfway dead. So I have more to talk about
than you do. And you guys are still partying and
[inaudible], and I'm changing diapers.
Um, I also owe the academic committee a lot of money, and
they are extracting rent from me. So there are 25 take your
professor to lunch's, and 15 dollar gift cards, so 375 bucks
I owe you guys. So this is part of that compensation.
Um, why did I agree to do this talk? Well I think it's
extremely important to stop and reflect on where you've been
before you step out and go further, and this is an
opportunity for me to do that. I also think this is
extremely important for me, I actually believe that you can
be more successful if you internalize other people's
experiences. For some reason teenagers have a very difficult
time doing that, and they have to learn on their own through
their own pain. But sometimes I actually watch what people
do, and maybe you can learn from my personal experience. I
also think it's important for me to implicitly honor some of
the people who had a material impact in my life. I would not
be here for-without the help of several people. I'm not
going to talk a lot about them unfortunately, but
this is implicitly honoring them, and also I'm tryna get
more free lunch.
[Laughs]
I am free some next week...
Ok so here's what we're going to cover. It was very
difficult for me to kind of collapse this so, I'm gonna go
through: An experiential lesson about whistle blowing; Some
perspective for the ambitious, because I'm extremely
ambitious, and I know that you are, and I'm actually
struggling with an issue that I'll discuss with you, and I
suspect many of you will have the same issue going forward.
Some thought's about vulnerability, relationships, because
many of you are at an age where you are considering or you
are entering long-term relationships. And i have some
serious, fundamental philosophies about that. And then some
pretty cool closing thoughts.
[Laughs]
So it's kind of ambitious, but here we go!
Um, this is the whistle blowing; this is a serious thing.
And I know you don't understand what this thing is, so let
me explain this. We don't need a lot of this, but I was
flying as an Evaluator pilot in the T-37, we had a brand new
Lieutenant Colonel, I'm a captain, he's a Lieutenant
Colonel, he's a fighter pilot, so he outranks me by a lot;
he's coming into our squad in leadership,and he's, again he'
s a fighter pilot so I kinda defer wow, this guy's flown
alot, and he's got a lot of experience. He's also gonna be
part of our squadron cadre, so this fraternity in out
squadron, so we kind of take care of each other. So we're
flying this mission and he does a bunch of stupid things in
the area, and I'm not allowed to talk to him throughout the
entire flight. So I'm just sitting there as a passenger. And
we're flying in and we're doing a typical instrument
approach into Kelly air force base in San Antonio. And what
this means-this is an approach to the runway to the north--
this is an approach to the runway to the north here--this
here. This here, this 1,040, is called the minimum decent
altitude...Any pilots in here?...Nobody? Ok- It's a minimum
decent altitude, which for this particular approach, you are
NOT AT ALL even one foot supposed to go below that altitude,
unless you're in a position visually to hit the glide path,
and you can go in for the landing. So you have to see the
runway, you have to be on glide path before you can descend
below that altitude. So we're flying along, we are not in
the position to get to the glide path, and he drops 200 ft
below that altitude, which is a check ride bust for any
human being in the air force , period. It's a clear bust;
it's over. And part of the reason why, is because 840 ft
puts me 27 ft below this obstacle right here, this a set of
towers, and it's actually 200 ft below those other towers.
And so I go altitude, and he raises, um he climbs finally up
back to altitude, then we get back on the groud and I go '
What do I do with this guy, he's gonna be one of my leaders
in this squadron, he outranks me by a lot, he's a fighter
pilot, and we're a fraternity, how do I handle this?' And
it's really embarrassing to go through this, and I said, "Ok
sir, here's the deal, you screwed up, I should bust you,"
and he goes," Oh I'm so sorry, it won't happen again", and
he goes on and on and on and on...I didn't bust him, it was
a clear cut bust, so he's in a position where he has no
thrust to make the runway, he doesn't have time to restart
the engine, they eject, they get injured, but not severely,
and the airplane crashes. It's a brand new aircraft, they
haven't even transitioned people on it. The airplane's
toast, so the taxpayers all threw their money away on that.
And it was completely unavoidable-it was completely
avoidable, rather, completely avoidable. And the funny thing
is, I sit back and i heard about this, and I go, "you know,
I could have pulled him out, and I should have pulled him
out, because there were so many instances during this
flight, when I was his evaluator, when I could have said,
This is crap, you're done until we get you through the
flight evaluation process.And that's the process that they
go through if you bust check-rides. And he needed to be
evaluated. In fact, I don't think his head was in the game.
But I deferred to the fact that he was in a higher ranking
position, he was an important person to the squadron, and I'
felt kind of compelled to do it. And so you map this into
your do diligence meetings;I mean, it doesn't take a lot to
kind of map this into where you guys are going. There are a
lot of decisions that are going to be made, where you're
going to be in an opportunity where you smell it out, and
you sniff it out, and you kinda know it doesn't smell right,
you gotta make the call. You have to make the call because
the implications could be severe. Particularly now, you see
all kinds of fall
[] in the economic markets, where people didn't blow the
whistle, and didn't make the call,and people are getting
hurt as a result. I'm actually very thankful--I don't know
what's happening to this guy, or what's happened to him, I
have to believe he retired, but I'm very thankful nobody go
killed here, cause, very easily, I mean, this is on an
approach which when they ejected, they were on approach to
final, when there's all kinds of buildings underneath these
approach patterns. So nobody go killed out of that. so that'
s my whistle blowing story, um hopefully that resonatesfor
you.
This thing is something-we're going to transition to
something I actually feel very strongly about. Um, and this
is in perspective for the ambitious. Let's start with the
set of all human beings, and then let's jump over and say,
hey we're fortunate to now be in the set of all human
beings, domiciled in an economically managed country. Or we
could say we're wealthy.And let's say hey, we're better than
that, we're in the set of all college graduates. So I feel
very fortunate to be in the set of all college graduates. I
went further
Dustin you here?--Dustin's not here? Awwww...
[Laughs]
Anyway, Dustin an I are apart of the set of all air force
officers, because he went the the air force Academy. And
that's a pretty elite set. If you think about the
unconditional probability of going to college and getting an
air force commission, is a very very small set of people.
It's a very elite group, and it actually is an fraternity,
implicit fraternity. So we're proud to be a part of that
set. But you know what, I actually got to a better set than
he did, cause I was an air force pilot.
[Laughs]
And I say that jokingly, buy it's actually serious, because
that's how people think in the air force . I'm sorry, that's
how the pilot's think in the air force .
[Laughs]
That's not how everybody thinks in the air force , but I
will tell you that the pilot's think they're the better set.
So I'm part of the set of the air force pilots, but I'm not
a fighter pilot, and I wanna be a fighter pilot, and I'm not
a fighter pilot. And you know what funny is, all of my
fighter pilot friends are pissed because they're not weapon
school graduates. And all the weapon school graduates are
pissed because they're not on the fast-track for promotion.
Let's map it into another one. This one I'm living today.
Set of all human beings, set of all literate human beings,
set of all college graduates, set of all Phd's. How many
people in the world have Phd's? Very few. Almost nobody
relatively speaking. How many of them are elite school
professors? Do you have any idea what the probability is of
somebody being able to stand here in front of you? Have any
idea of how low the probability is when you take a look at
it, right? But that's not good enough, because I want to be
[inaudible]
[Laughs]
I want to be
[inaudible]. And I'm living with this right now, because
that's an uncertain outcome. If you continue to select into
more successful peer groups, sooner or later you will become
the left tail of your reference distribution.
[Laughs]
You're at Stanford University, there are Nobel Laureates
here, they are smarter than you, you're already in the left-
tail. Probably.
[Laughs]
Especially if you're Matt Armstrong--Um..
[Laughs]
Is he here? He's not here...Ok I can pick on Matt then. Ok
I'm going to pick on Matt.
This I think is very critical. Okay, cause we're ambitious,
we wanna continue, but the problem is, it is important-you
should be ambitious-I'm ambitious, I will always be
ambitious, the problem here is that ambition is addictive.
I'll admit it, I'm addicted to ambition. An ambitious person
might consider this to be a failure. And this could be
wealth; I see it in my community; I live in Woodside. I'm
not a millionaire, I'd like to be a millionaire. And I can
tell you definitively, without naming any names, I know
millionaires that are not happy they're just millionaires. I
know them. I can name them if you want but I won't.
[Laughs]
This could be intellectual distribution;this is the left-
tail dilenma. This can be considered a failure, and almost
everyone of you at some point will face this; I am living
it. In my mind it seems important to find perspective,
because if you end up sitting at the right of the next lower
group. So if you remember the next lower group is somewhere
over here, and if you're over at the right. If you're in
here, you're at the left. One experience I've had is if you
make to the elite group, you're not respected well in that
elite group. You're probably the lowest ranking person in
that elite group, so you're not so clear it's good to be in
that elite group. But if you don't, you might actually have
a better fit, and be more productive, over just to the left
of that group. Or, it might be a good time to look for
somethingdifferent. So that's the take away, this is what I'
m wrestling with. But I think it's very critical, because I
think you are all ambitious, and I guarantee you that many
of you in this room will hit this, if you have not yet
already. The thing is you guys are still early enough in
your careers' that you may not have gotten that far because
you're still kinda working the ambition ladder. But you're
gonna hit this.
This is something I think is kinda cool, because this
reminds me of me and you. Um when I went through pilot
training, the very first thing we did was discuss stuff
before we ever flew an airplane. And they said...Ok, you
guys fit a certain pilot personality profile, and I actually
borrowed this from some research that's out there, about
what a typical pilot, particularly military pilot is, in
kind of a personality. And I think these kind of map in to
you folks. Emotionally stable, low anxiety, low
impulsiveness, except for Matt Armstrong.
[Laughs]
Um conscientious, competent, high
[inaudible], high achieving, and what I find particularly
interesting, is this low sense of vulnerability. Because we'
re control animals; we're like 'Hey I'm in control, I've got
it all covered. I know how to assess risks, and I don't feel
particularly vulnerable.'But we're all vulnerable, and I'll
illustrate how I was vulnerable.
February8, 1991, I was flying with Captain John Black. I was
a T-38 student pilot in the supersonic jet. It was about the
11th month of the 12-month pilot training program, and we're
flying at March air force base, which is now closed, it's
actually air-reserved base. This is the runway layout. This
is runway 3-2, which means we're heading 320 on a compass or
heading-taking off. so we're heading 320 off this runway,
we're heading up that direction. Um it's at night, on a
night navigation mission, and because of the winds are
coming from the right, they're coming from the east, I drift
a little bit when I take off-that's natural , it's called
crabbing. So that you can maintain you're course, you crab
into the wind as you take off. So my compass says 330 when I
get a call from towers saying turn to 150, turn to a heading
in 150. Pilots know that they always turn the shortest
direction unless they are told otherwise. And so I look down
and I go, 'Well hell, it's only 180 degrees, it doesn't
matter what direction I go in, I'm gonna turn right'. So I
started a climbing right turn, three seconds later I get a
call, "Confirm you're in a left turn to 150". I go,"
Negative, I'm in a right turn to 150." At that point John
Black goes into full after
[inaudible] and raises the nose almost straight vertical,
and he starts a left bank turn, and we almost took out that
tower. I was about 20 ft from that tower.
February5,1992 I was an Instructor Pilot with Mike Wood, who
was flying my airplane. And this is a now Lieutenant
Colonel, I won't name who is, one of my better students
actually. Anyway, he was flying lead solo. So, this guy is
flying lead solo, and Mike Woods' flying my airplane, I'm
sitting on the right-hand seat. And we're flying a two-ship,
I show you how close these
are in a minute. We're actually 3 feet apart, 3ft wing-tip
clearance, at 250 miles and hour, 3 ft apart. And he orders
a pitch-out, which means we're going to do this maneuver. I'
ll show you a video of this in a second. We're gonna do a
maneuver, He's gonna turn first, and we're gonna wait a few
seconds and turn behind him and do some trail maneuvering.
This is one of the most absolutely generic maneuvers you
could possibly have. so this is how close we typically fly.
We're going to see two examples of a pitch-out. The first is
to the left. So this is a left pith-out, where the lead goes
first, and the wingman goes afterwards, and then you'll see
it to the right in a second. Actually the guy, the wingman
went too fast, he was supposed to wait longer.
[Laughs]
So this guy turns into me. I don't know what the hell he was
thinking, he clearly wasn't, because he turns into me. So we
were already 3 feet apart and he turns into me. And these
are very aggressive turns. so, I'm not even flying my
airplane, I immediately jam the stick
[inaudible] forward,as fast as I can, we go up, negative g'
s, We hit our heads into the ceiling, and he flys over us by
about 4 inches.
The last vulnerability one, some of you might have seen
this,
this is Cat Michleoso, he was a friend of mine. We were
flying a low-level mission. This is in San Antonio. There
was alot of smoke in the air so we had low visibility
because of all these Mexican wild fires. And um, so we're
flying a low-level mission, he yells,"Bird!", I look up,
there's a big black thing in my face. And this was a big 14
pound Turkey vulture that missed my head, went over the top,
and impacted the tail of the airplane.
So what's my point here? Um...Even when you think you're in
full control, you're incredibly vulnerable in environmental
forces.This should seem obvious, and particularly for this
group, you of all people, given the experiences you've had
with your cohorts since you've been here should recognize
just how vulnerable you are as human beings. We're extremely
vulnerable as human beings, even when you think you've got
your shit together.
You're vulnerability increases with success. The more
successful you are, the more vulnerable you become because
you get complacent. I saw it in the air force over and over
again-I lived it. I was extremely complacent when I was
finishing up my flying tour, because I was bored, and I'd
done it before. When you get successful you get complacent,
you also have increased tolerance for risk. And you also get
rent-seeking threats, particularly if your success is
financial. Your vulnerability increases, and what's funny
is, your sense of vulnerability typically goes down. So I
think it's important to continually recognize and embrace
your vulnerability; I have a term for it called "healthy
paranoia". And I think it allows you to stay vigilant to
ward off threats, and help you stay grounded as a human
being. In fact, i think the more you recognize that you're
vulnerable, the more you can actually interact with kids,
and with your family. That doesn't mean be completely
paranoid, but it means recognize that you're human. And the
sad part is, often it takes some sort of tragedy to somebody
else, to bring us back to this.
Relationships.
[Laughs]
I know a lot about relationships. You guys are entering into
long-term relationships now, because you're at that age
where you start thinking about relationships in a more long-
term basis. One of the things I don't think you're
considering is that your career is also a relationship. I'll
talk about that in a minute.
But I can't say this strongly enough. The number one most
important thing you need for a relationship is fundamental
compatibility. I can't say that enough. If you don't have
fundamental compatibility, it's not happing, it's not
working long-term, it will not happen. In order to get
there, you have to, have to, have to, know what it is you
must be able to do, and what it is you absolutely will not
tolerate. And I'll use "The Bachelor" as the perfect example
to illustrate this.
[Laughs]
Who watches The Bachelor?
Yay! I know I'm
[inaudible]
[Laughs]
So "The Bachelorette" starts Monday...And I'm open to a
Skype chat room if anybody's interested...
[Laughs]
Monday, 9 o'clock.
[Laughs]
Uh, let's take a look at "The Bachelor" history...This
chart, thankfully to
[inaudible].com, I've never been there before, but the
[inaudible].com had this chart, and it shows you all the
relationships that they've had, although they're missing a
couple on the end here. But they show you the success
factors of all the relationships they've put together . And
actually, they claim that these two are still together, but
in fact, they're not. Because Mary actually hit Byron, and
actually had to go to jail for that.
[Laughs]
Um So they don't work. why don't they work? well, because
they're not fundamentally compatible. How do I know they're
not fundamentally compatible? You can see it; you can taste
it; you can watch it. They don'tunderstand each other,
number one. Number two, the type of people that have to go
on national reality television to find somebody, fail to
know what it is they're about...I think. That's my opinion.
So what happen with Brad? What happened with Brad? Somebody,
come on, what happened with Brad? What happened on Brad's
season?
>>
[Comment from audience]
>> Say that again
He turned them both down.Thank you.
[Laughs]
Very nicely done, thank you very much.
[Laughs]
I think that's critical, that's
[inaudible]. The media went ape over that.The media went, "
Aw he's an idiot, he should've picked one, and how could he
possibly do that!" I go, this guy's a hero because he
recognized that he absolutely will now give up what he
believes in to hang out with somebody that's incompatible.
And I actually find the guy to be a hero. In fact, I think
he's probably--besides there's one that's still together,
they have babies and something like that, but besides them-
so there's one success story that I'm aware of. But besides
them, I think this is the role model here. Make sure you
know what you want before you get into a long-term
relationship, and you have to be fundamentally compatible
for relationships, including you're career. You're career is
a relationship; you spend more time there then you do at
home. Many of you seek transition when the challenge fades.
I, actually I put all of you, that's why you're here. Many
of you have a strong sense of social responsibility.
Most of you, actually, all of you like to call the shots.
And all of you have a very low tolerance for inefficiency to
[inaudible].
[Laughs]
Trust me, I've taught you before.
[Laughs]
Here's what I think you'll miss most. Here's what I know
you'll miss most.Here's what I will miss most. Ready to cry?
Daily interaction with the most impeccably selected
collection of the brightest, most genuine, most energetic,
most interesting people in the world. You will never, ever,
ever, get an opportunity, except at reunion, to be around
people of this cohort, of this caliber, again your entire
life. These people are fantastic, they're fascinating, they'
re very interesting. Why do I go to lunch with you? Because
it's interesting. I actuallyy get asked by the faculty, Why
are you going to lunch with students?
Because they're interesting.
[Laughs]
More interesting than you are...
[Laughs]
No...I didn't say that. When you hang around Dave Larker
long enough...
[Laughs and applause]
I love Dave, sorry...Sorry Dave.
[Laughs]
You know I, I, don't--I'm not joking here. I actually think
this is true. You will miss this dearly, and you should.
Because you're gonna be around smart people, because you
select into being around smart people. But you'll never get
the daily interaction with this kind of group ever again.
And you will miss this, and I hope you miss this.
I've been asking this question for--to about a hundred air
force academy applicants. I was an air force academy liaison
officer, and I would interview high school students for the
air force Academy. The first question I would ask them is, "
Who was infulential in your life?" And everyone of them
could answer that question. Then we'd follow up with this
type of a question: "Who would say that you were actually
one of the most important people in their lives? And they
all stumbled and stopped. They could not answer this
question. Granted, they were younger than you, and I know
some of you have been able to answer this. this was a chance
for you to hopefully be able to self-reflect. But what I
think is important about this is,um...that...I need you, I'm
asking you to please expand this list. I don't care what's
on the list. I don't care how deep it is. I don't care if it
even exists. But I hope that you go home and start tomorrow
to expand this list. And here's why. I can't give you a more
sincere compliment than this: You guys are the role models
for my children. It took me 6 years to come to that
realization. But when I think about the types of human
beings in this world, that I actually want my kids to grow
up to be, except for Matt Armstrong...
[Laughs]
Sorry, Matt...I love you too.
But no, seriously though, you're not gonna get a better set-
you're really not gonna get a better set. And the fact that
you're actually in this room and at this institution,
indicates that somebody took an active role in mentoring you
as you got here. And it's time for you to kind of pay that
back.
I'm gonna close off by saying this. Look, it's very hard to
try to come up with an idea of how to distill 42 years of
life into something that's meaningful for a group of people
who are already at Stanford Business School. And I actually
appreciate the opportunity because it allowed me a great
chance to think a lot about stuff that I've done. It's been
a pleasure and an honor to do this, and I appreciate the
time.
[Applause]
