Garry Ridge on the stunning business impact of WD40’s Culture First strategy

Damon Klotz: (0:00)

This episode is short and sharp and there’s a learning moment at every turn. So I’m going to do my best to keep this intro the same.

Simon Sinek opened our eyes to the power of having a clear WHY many years ago, but my guest today was CEO for 25 years of one of the very first companies that Simon recognised as putting his golden circle into practice.

Garry Ridge’s leadership style is unique, bold and a balance of his Australian upbring and his time on the road as a travelling salesperson. Many of you have probably not heard of Garry, but his leadership style and infinite mindset saw him become the longest-serving Australian chief of a listed US company. That company is WD-40 - one of the most recognisable household items in the world.

You’ll hear what Garry has to say about his relationship with Simon Sinek in a moment… he even lets us in on the tweaks he’s made to Simon’s own formula for creating a Culture First company.

We recorded this conversation in 2020 and used a small part in my episode with Simon Sinek, but we never released it in full, so today, I thought it was time to honor Garry’s incredible legacy from his time with WD40.

Within a span of less than 20 minutes, you get to hear Garry quote both Nelson Mandela and Aristotle, share the traditions he learned from time spent with First Nations people and Indigenous Fijians that he then brought to his organisation and also gift us the most poignant Australian rugby analogy that, I think, has ever existed.

Garry’s success has seen him teach Culture at both the University of San Diego and the University of Pennsylvania and in this episode he delivers a master class about how he put Culture First in order to deliver a total shareholder return more than twice that of the S&P 500 over his last two decades as CEO.

Damon Klotz (01:00):

Garry, you joined WD 40 in 1987, so you've had an incredible tenure there. Can I ask a little bit about how you started in Australia and then have sort of grown your role and the company to now be the CEO and chairman?

Garry Ridge (00:12):

Yeah, thank you for that. Yeah, I did. I started with WD 40 in 1987. I opened our Australian subsidiary in Sydney. My introduction to WD 40 company was interesting. Prior to being asked to join them, I worked for the distributor of WD 40 in Australia, and that's how I got to know the leadership team here. And in 1987, the licencing agreement for the brand in Australia was coming to an end. And the company at that time were starting to get really serious about going global. Back then, we were probably less than a hundred million dollars in revenue. Probably 90% or more of our business was in the United States, but we at that time knew that there was squeaks all around the world. And Australia was one of the pilots, if you will, about how could this company go global. I was asked to join them in 87.

(01:05):

I opened our subsidiary in 1988. I worked in Australia from 88 through to 94. However, I spent most of my time in Asia, Australia was our base, and we looked at different models of business structures and organisations to help us develop our global business. And they were successful in some cases. And in 94, I was on a call with my then boss here in San Diego, and I posed the question, is there anything else you'd like me to do? I think I could add some more value. And he said, well, have you thought about moving to the United States? And I said, to do what? And he said, to head up our global expansion. I said, that sounds interesting. My dad was an engineer and he worked for the same company for 50 years. And I remember saying to him, Hey dad, I've been given this opportunity, what do you think? And he said, you can't go wrong with that stuff, son. And I think he was right. So I moved here in 1994 and then in 1997 I got the opportunity to lead the tribe. And we've just had a wonderful time from then until now and into the future. We've got a lot of fun things to do.

Damon Klotz (02:17):

It's an incredible story. I have a similar kind of moment in terms of as a fellow Australian moving out to California and to San Francisco. And I was speaking to my dad about what was next for my career. And I wasn't working at Culture Amp yet, but I certainly had this offer to join. And there was a similar moment where someone said, when you get a chance to join a potential rocket ship, don't ask what seat, just jump on. And I think just jumping into the unknown and moving to a foreign country has been such an incredible learning moment for me. And it sounds like it's obviously worked out pretty well for you as well.

Garry Ridge (02:55):

Sure has. And I'm glad you used the word learning moment.

Damon Klotz (02:59):

Moment. Yes. We can definitely talk about that a little bit more. But first, WD 40 is quite a well-known product around the world, but you don't really talk about selling a product, you talk about creating memories. Why are you so particular about that difference? Which I'm sure would be quite unusual for a lot of companies to actually think that way.

Garry Ridge (03:18):

Well, thank you. Yeah. The reason I talk about memories is I truly believe that to build a strong culture, you have to have a purpose that people can actually relate to. And we often say, imagine a place where you go to work every day, you make a contribution to something bigger than yourself, you learn something new, you feel safe, and you're set free by a set of values and you go home happy. And our purpose, which is to, we exist to create positive lasting memories in everything we do. We solve problems, we make things work smoothly, and we create opportunities to us is a bigger purpose or a bigger why than saying we're an oil that stops squeaks. So memories to us are very important in life. They're the things that we treasure the most and we get up every day to create positive lasting memories.

Damon Klotz (04:13):

Which ties in I think beautifully to a lot of the work that Simon Sinek has said and has spent his career trying to make sure that more leaders and companies can think in this way. And when I sat down to speak to Simon, he identified a couple of different companies, which he thought was definitely a culture first company, but also a company with an infinite mindset. And when doing some background research for this interview, I found a video where Simon actually said that WD 40 was one of the first companies that turned him from a crazy idealist into someone with an actual example from a company that shows that this future organisation that we all wish for could actually exist. So how does it feel to actually be one of these companies that has been able to actually have this infinite mindset and to have a quote like that said,

Garry Ridge (05:00):

Well, it's a credit to our tribe. I met Simon nearly 10 years ago, I think, and we happened to be on a panel together about corporate culture. And at that time I really didn't know who he was and obviously he wouldn't know who I am, but we hit it off and we started exchanging thoughts. And I love Simon's work. I just a couple of weeks ago finished reading his latest book, the Infinite Game. I use his Start With Why and Leaders Eat Last Work in the teaching that I do at the University of San Diego and at UPenn where I teach culture. And I just think he made it so simple with his why, how, what. Most companies know what they do, some know how they do it, not many know why they do what they do. And in fact, I stole something from his latest book and adapted it. He says in the infinite game that culture equals values plus behaviour. Well, I adapted it and I said, culture equals values plus behaviour times consistency. And that's really one of the things, if not the thing that's helped us grow our business, both from a employee engagement standpoint, but then because of that on a financial basis is that we've been consistent around the values that we demand, keep people safe and set free and the behaviours that go along with that. And consistency is so important.

Damon Klotz (06:34):

I think that's a really beautiful tweak on that equation because when I think about values, I think of them being the foundations of the culture. And then the behaviour is how you want to bring those values to life. And I regularly say that values should be behaviours not banners. It's very easy to say something and have it up on the wall, but to actually have it as a behaviour is where the rubber hits the road. But with that, there's also consistency, which is how often is this able to show up? Does it only happen at all hands when everyone gets together and then you're like, oh yeah, that's that behaviour, but can it actually play out every day on the factory lines or in a team meeting?

Garry Ridge (07:12):

Absolutely. And one of the things that I really believe in, and I thought about behaviour a lot, and I put behaviour in two buckets. I put it in the behaviour of goals and objectives. So are the behaviours of the tribe members supporting the why of the company? And then the other behaviour is servant leadership. Are we performing the how of the company? Are we being servant leaders? I created this fictitious character called Al the Soul Sucking CEO, and I've written a couple of articles about Al and his behaviours, and it's very easy to identify the ego-driven behaviours that actually create toxic cultures. And Al does that. And so I think its values are very clear. Values are the written reminders of the only acceptable behaviours in an organisation that set people free and keep them safe. And the values need to be hierarchical and they need to be clearly defined.

(08:19):

The behaviours are what do we need to do to support our goals and objectives? And then the behaviours of leadership are we being a servant leader? And if you put all that together consistently over time, our outcome has been our 93.3% employee engagement, which has grown from the ugly numbers that most companies are, which are around the 30%. And incidentally, in doing that, we've taken the market cap of our company from 250 million to $2.6 billion, which is a compounded annual growth rate of total shareholder return of 15% a year. It's all about the people because at the end of the day, even though our Why is about memories, we sell oil in a can.

Damon Klotz (09:05):

I think that's an incredible example of why culture first is not something you think about at the end of the business results is like, oh, and by the way, our employees don't mind working here. It's actually how do we set up a company in a way where we put culture first because that is actually what will lead to business success.

Garry Ridge (09:24):

Well, you know what I think is amazing? When I share with our tribe members, I say one of the biggest advantages we have is companies we compete with 70% of the people who go to work at those companies hate their jobs. So isn't it wonderful to be playing against a team that hate doing what they're doing because they're not going to be able to perform to the optimal level. And that's why it's so important. This is so simple. When I first got on this journey, I worked out a couple of things. Micromanagement wasn't scalable. And I went back to school just after I got the job at WD 40 as CEO, and I went to the University of San Diego and I did a master's degree in leadership. And that's where I met my mentor, Ken Blanchard, the One Minute Manager. He was my professor. And Ken and I eventually became very dear friends. We wrote a book together. I was on his board for 10 years and he's the real guru of servant leadership. And it's simple. And when you think about it, Aristotle said, in 384 BC, pleasure in the job puts perfection in the work. So we are pretty slow learners, aren't we? And it's so simple. It really is simple, but it's hard. Simon Sinek and I agree, this is simple, not easy, and time is not your friend. That's why consistency is so important.

Damon Klotz (10:48):

So in your opinion, what actually makes WD 40 an infinite mindset organisation? I think you've certainly touched on some of the ways that you think this way, but how are you actually playing that long game?

Garry Ridge (11:02):

Well, we have a promise to ourselves. We're going to build an enduring company that we are going to be proud to hand on to others. So we are playing the infinite game, but there is also finite games that you play within the infinite game and you don't build culture in a day. It's not like you get fairy dust and sprinkle it over business and suddenly the culture changes. And you might remember when we were at school years ago, you'd go into a science lab and you'd get a Petri dish and you would put stuff in it and you would grow culture and it took time. But also you had to be very careful what you put in that Petri dish. And you had to be very, very rigorous about taking out anything that was impacting the culture in a negative way. So we believe that culture being about people, we call ourselves a tribe, not a team.

(12:01):

And the reason we call ourselves a tribe is that one of the key benefits of a strong culture is the desire people have to belong. One of the biggest desires we have as human beings is to belong. If you think about Maslow's hierarchy to self actualization, the first two rungs are safety and security. Am I safe? Am I secure? Can I survive? The third one is love or belonging. And organisations don't want to talk about that word love very much, but you can love where you are and you can love the people that go to work. So as a tribe, the number one responsibility we have as leaders is to be learners and teachers, because we want to teach people and have them learn there's values. And I put this whole tribal concept together based on studying the indigenous Australians and the Fijian Islanders. I went and sat with them and asked them, what behaviours did you have that kept you together over hard times in arid conditions?

(12:58):

And when you look at it, it's pretty simple. Treat people with respect and dignity. Care is very important. Do you care for your people? Our definition of care is basically is the wellbeing and development of someone else slightly more important than yours? Candour is no lying, no faking no hiding. Accountability is what do I expect from you and what do you expect from me? And are we going to be brave enough and in a trust position to be able to share that? And then responsibility is I'm going to take responsibility for my actions. And again, it's not rocket science.

Damon Klotz (13:38):

I could talk about this all day with you, but I'm really enjoying the content so far. But I wanted to focus on something that I think it's talked a lot about in the tech industry as well as in Silicon Valley, which I know is a little bit north of where you are today in San Diego, but the idea of the power of failure and why we should fail fast and fail often. And I think you believe in this, but you believe in this in a different way. You actually encourage your employees to call that something different. And so what do you call that at WD 40?

Garry Ridge (14:07):

We call them learning moments. And a learning moment is a positive or negative outcome of any situation that needs to be openly and freely shared to benefit all people. Apart from belonging, one of the other big negatives in our life is the fear of failure. And we decided some time ago, I learned three very important words a long time ago, I don't know. And getting comfortable with those is very important. So we wanted to make sure that people were open and free, living our values and sharing with us the things that do and don't work. If they don't work, what are we going to learn from them? And if they do work, how are we going to amplify them? If people were afraid of being criticised and ridiculed because they made a mistake, that was never going to happen. I worked out a long time ago in every situation, I'm probably wrong and roughly right so it's okay if you were to go to any one of our operations in any of the 14 countries we now operate in around the world - we sell our brand in 176 countries, but we have offices in 14 countries - you'll hear in Chinese, French, Spanish, German, Australian, whatever language they're speaking, you'll hear them talking about learning moments. And learning moments is one of the core attributes of building a strong culture.

Damon Klotz (15:36):

I couldn't agree more. One of my favourite quotes that I've sort of coined around that is, the one thing I know is that I don't know everything. And it's around always knowing that there's parts unknown out there that you need to be open and explore. And having that curious mindset that allows you to actually dive into the unknown and not work on assumptions.

Garry Ridge (15:59):

And I don't know, but you're probably somewhat younger than I am, but I remember back in Australia years ago, there used to be a professor on TV called Professor Julius Sumner Miller. And he used to be in a white coat and he was actually American and I'd come home from school in the sixties and this show would be on. And he used to do crazy things like suck eggs into a bottle and all that sort of stuff. But always after every experiment he'd ask this question, why is it so? And that has stuck with me so much in life to be able to ask, why is that so? Why do I believe that to be true? What's different? So curiosity is amazing. And Nelson Mandela said, education is the most powerful weapon which you can use to change the world. Well just replace the word education with learning and create an org anisation where learning is the key and you will change your organisation. We've proven it. Our tribe has proven it.

Damon Klotz (16:57):

Which ties in well to my next question, which is really around you've got this incredibly large workforce and you've got these great values and behaviours that you're trying to consistently make sure that they show up across WD 40. What role do the managers play at WD 40 in bringing ancora imparo to life?

Garry Ridge (17:18):

Well, firstly, bringing learning or I always am to life is about what is the role of our leaders? And we don't call people managers here, we call them coaches. So you don't report to a manager, you report to a coach and a coach's role, if you think about it being an Aussie, you've never seen the Aussie rugby coach on the podium picking up the prize. The job of a coach is in the locker room and on the sideline. And what is the coach's job to help win the game by making the players the best they possibly can be to help them shine. So our role at WD 40 as coaches is we are not here to mark people's papers. We're here to help 'em get A's. And learning is so much part of that. Everybody here is a learner and a teacher. It's core to our tribal culture.

Damon Klotz (18:15):

I couldn't agree more. I think actually creating that learning culture where it's built into the work and the coaches have that chance to actually bring that to life. It was a nice tie in actually to in episode two of the Culture First podcast. My main guest was a lady named Ambrosia Vertesi, and she actually spoke about her time as a wrestler and how her coach said, I'm with you all the way up until the moment when you're on the mat, but then when you're on the mat, it's up to you.

Garry Ridge (18:42):

Absolutely. And I'm not going to be there when you put on the winning belt because that is something that's yours.

Damon Klotz (18:50):

So you guest lecture about company culture, and you've got some incredible philosophies about this. If there was one thing that you could impart to the listeners of the Culture First podcast about company culture, what would you like to share?

Garry Ridge (19:05):

I think one of the things, the most important things, about building company culture is understanding that leadership is not about you. And when your ego eats your empathy instead of empathy eating your ego, you become Al the sole sucking leader. And with his behaviours or her behaviours, there is no opportunity for you to grow a culture where people go to work every day, they make a contribution to something bigger than themselves, they learn something new and they feel safe and go home happy.

Damon Klotz: (22:00)

Garry’s success at WD40 is an incredible case study of why being intentional about your company culture is how to succeed as a business. As I mentioned at the start of the episode, Garry’s culture first approach resulted in a shareholder return that exceeded that of the S&P500 during his time at the top. So the next time someone tells you that focusing on the culture of the company isn’t going to help the business succeed, send them this episode and over to Garry who will help them change their mind.

If I had to pick one thing that I want you to take away from Garry’s words, it’s this idea that the job of a manager or as they are called at WD40 ‘a coach’ is to guide their team to be the best they possibly can be… to help them shine. If you think about your role this way - as if you’re a coach… Garry reminded us all that coaches aren’t here to mark people's papers. They are here to help them get A's.

I’ve been your host Damon Klotz and the Culture First Podcast is brought to you by the team here at Culture Amp, the world’s leading employee experience platform. Learn more about Culture Amp by heading to www.cultureamp.com

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