Story:
A Tale of Two Captains: Making the Case for the Universal Applicability of Leaders Everywhere

The beauty of these two tales is the subtle unspoken similarities.  Charlie and David came from two separate worlds and yet created similar environments... Environments where people become leaders, in a world where following is the norm.    

Chapter 1: On Board the Santa Fe

In the depths of the Pacific Ocean off the coast of Hawaii, one of the most modern submarines was moving silently. The USS Santa Fe, an improved Los Angeles class submarine was designed and operated as a stealthy deterrent to would-be aggressors. Armed with missiles and torpedoes, Santa Fe’s mission was to find and sink enemy ships. In peacetime, she would gather information that would later be useful. There was nothing that distinguished this particular day from any other particular day, nothing that presaged the leadership revolution to come.

The crew of the Santa Fe was troubled. People were doing what they were told, initiative was non-existent and fear of making mistakes paralyzed most decision makers into inaction. They had lost sight of the connection between their day-to-day actions and their mission to protect the Constitution. Plagued with poor morale and operational problems, almost every sailor who could was leaving the navy. Having only reenlisted three sailors from a crew of 135 the previous year, retention was at the bottom of the fleet. Officers were resigning their commissions and the previous captain had quit.

A hasty diversion from his previously assigned submarine had placed Commander David Marquet captain of Santa Fe just two weeks prior.  Now Santa Fe was at sea for the first time with its new captain. Because the Santa Fe was a newer and different submarine than the submarine he was originally assigned to command, most of the equipment in the control room looked foreign to the new skipper. Still, David fell into the mode he was trained for: giving orders. Well anyway, isn’t that what captains of submarines do?

“Conn, maneuvering, reactor scram!” The engineer had inserted the reactor shutdown deliberately, testing his department's ability to find and repair a simulated fault. 

In the control room, the Officer of the Deck, the ship’s senior department head, was doing all the right things. He had shifted propulsion from the main engines to an auxiliary electric motor, the EPM, to turn the propeller. The EPM can only power the ship at low speed and draws power from the battery.

At this point, David nudged the Officer of the Deck and suggested an increase in speed from “ahead 1/3” to “ahead 2/3.” This would drain the battery faster and create a greater sense of urgency for the trouble-shooters. After all, this was the worst performing submarine in the fleet and the crew needed some toughening up.

“Ahead 2/3.” The Officer of the Deck gave the command.

Nothing happened.

The helmsman who should have executed the order was squirming in his chair. No one said anything and several awkward seconds passed. When asked the helmsman reported, “There is no ahead 2/3 on the EPM!”

The captain had made a mistake. Unlike every other submarine he’d been on, there was only a 1/3 speed on the EPM on the Santa Fe, this newest class. This was the equivalent of asking someone to shift into 6th gear on a car that only has 5 speeds.

But what about the most senior department head? Well, he also knew there was no 2/3 speed setting for the EPM. When asked why he ordered it, he replied, “Because you told me to.”

That was the moment of truth. As the Captain, David embodied the traditional leader and had perfected the ability to get people to “do stuff.” This was the point of everything taught about leadership after all; exploit the people to further the mission of the organization. But a modern nuclear submarine is much too complicated and activity takes place in too many places to be controlled by one person. What Santa Fe had was too much compliance, too much doing, and not enough thinking.

The officers gathered in the wardroom and set to turn this around. From then on the captain stopped issuing orders. The officers, for their part, stopped asking permission and began stating intentions with “I intend to…” Although a simple turn of language, this created ownership in the mind of the officer, and they all started the path toward thinking like the captain.

It turns out that “tell me what to do” thinking was pervasive and often disguised. The check lists of tasks department heads maintained for their division officers are “tell me what to do.” Briefings conducted prior to events such as loading torpedoes was “tell me what to do.”

The Ladder of Control is a way to think about this. At the bottom is “tell me what to do.” Somewhere in the middle is “request permission to…” and just above that is “I intend to…” Listen to your people interacting with each other and with you. Identify where they are on the ladder and move them up, one rung at a time. It all starts at the bottom by asking them what they think.

The general rule is this: if you want people to think, give intent, not instructions.

The crew came up with a host of mechanisms to allow subordinates to exercise control and many of them focused on language. Another example was “think out loud.”

The submarine was entering Pearl Harbor, driving on the surface. The officer of the deck who gives the actual maneuvering orders felt the navigation team had indicated it was time to turn to the next course leg a few seconds early and so withheld the order. Standing silently, with the microphone in his hand, the officer knew he was about to order the turn…but the captain didn’t.

It was at this point that David intervened with “aren’t you going to turn?” The officer of the deck was deflated. He had lost initiative and the confidence of his boss.

The antidote was to think out loud. Officers practiced stating their thinking out loud. In this case, “I think the navigation team has marked the turn early and I intend to turn in 5 seconds.” Other areas where these naval officers needed to learn how to talk included diverse opinion, dissenting opinion, ambiguity, uncertainty, and gut feelings.

Chapter 2: Getting into Next Jump

Today, Next Jump teaches other companies how to attract and retain talent.  A few years ago, the company took its turnover from 40% to 1%, and became one of the most challenging organizations to get into. In 2012: Next Jump only accepted 35 new hires out of almost 18,000 applicants (a 0.2% acceptance rate).  Compared to Harvard’s acceptance rate in 2012 of 5.9, Next Jump managed to be tougher to get into than the top school in the country. 

For Next Jump, getting to this point took years of analysis; it took years of building the right environment, an environment that produces leaders who consistently make the right judgment call under pressure.

Where It All Began

Currently, the whole Next Jump family is a part of the hiring process – from receptionist to senior management.  Everyone not only wants to have a stake in who becomes part of the family – they also know it is crucial to actively be part of the decision process; else, the company would be destined to fail.

But it didn’t begin that way.  Prior to 2007, all of Next Jump’s hires came into the company via a traditional route: a phone screen, a few rounds of interviews, perhaps an efficiency test, followed by a potential offer.  During that time, the majority of the company consisted of business people versus engineers.  For an Internet company, this didn’t seem to work. A member of Next Jump’s board told Charlie that “…to become a top Internet company where engineers would want to be, you have to start recruiting from colleges, just like Google and Facebook.”  

Beginning of 2007, Next Jump decided to follow this advice and went to college campuses, recruiting top engineers.  But with one catch.  Although, they were told by many advisors that it would be impossible to recruit engineers to the East Coast (that most engineers had their sights set on Silicon Valley), Next Jump decided to headquarter in New York City, where they spent years improving their recruiting and hiring processes. 

To start, Next Jump decided to try their very first Super Saturday, fall of 2007.  Super Saturday is an event typically held by investment banks, where job candidates from a variety of schools come into the bank to interview with employees.  Next Jump took the traditional Super Saturday and made it their own by creating a 10-hour company-wide event, bringing in top talent from top schools, all previously screened prior to walking through the door. 

The candidate is put through rigorous skills testing, rounds of interviews, team building presentations, and has multiple opportunities to meet with employees of Next Jump at meals and intermittent snacks.  Candidates have many meaningful conversations with employees, a chance to hear varying stories and take in different perspectives.  This offers a fuller picture of what’s to come should the candidate be hired, versus a pre-packaged story by the company’s marketing team.  There is a 2:1 ratio of employee to candidate – meaning, with about 60+ candidates, almost the entire company comes together to screen who they want as fellow employees.  A typical organizational chart and schedule will usually include close to the entire company.

Next Jump employees stay late into the night deliberating over candidates, for whom they want to make an offer.  Similar to a long car ride, it’s either love or hate after spending the entire day together, and the feeling is usually mutual. The company sends offers to those they love the following Monday. 

Transferring the Reins of Captainship

In 2007, the Super Saturday process started with Charlie heading the entire event, which was not sustainable as the process grew.  Moving forward, every Super Saturday, it was one person’s job as the event coordinator, along with a full team of leads, to spend the day looking for ways to improve.

At that time, Charlie recognized that after being a lead of Super Saturday, he learned many lessons he could eventually share with someone else in his shoes – someone who could take those lessons and learn new lessons, too.  At that point, he realized: helping others could only come after being in a leadership role.  He said: we need more leaders to feel the pain, to teach others, and pass down knowledge. This prevented the same mistakes being repeated and offered a chance to pass lessons learned from one Super Saturday to the next.   

For the next Super Saturday, also that same year, Charlie’s Senior Vice President, Greg Kunkel, captained the day.  Charlie (in the coaching role) was now able to step back and observe how Greg operated.  He was able to provide Greg with some mistakes he had made, and Greg was able to run the event even better than Charlie had the previous time, since he learned lessons from Charlie he couldn’t have otherwise received.  

From this coaching-captain framework, a new process was born that would eventually bleed into all areas of the company when it came to developing leaders and distributing power across the company.  Eventually, those in a coaching role realize that to make something better – be it products or events – relinquishing control was the way to not only get better results, but also teach others in the process.   

The “FLO,” Leadership Framework

From Super Saturday spurred a new leadership framework that helped leaders step back, get less tactical, and facilitate new leaders to grow, take risks and take ownership.  Next Jump called this model THE FLO (FOLLOW-LEADER-ORGANIZATION) MODEL. Multiple iterations and multiple captains of Super Saturday had the day down to a science.  The day became more than just a recruiting event: Super Saturday became a platform to develop leaders in the company.  Super Saturday became the first practice ground of the FLO MODEL. 

*The primary focus of the coach is to help build a better leader and captain   

This organizational framework helps distribute power such that “orders” cannot come from the top-down, but instead, lessons learned from previous leaders are applied from the bottom up, and cycle.  For example, in the case of Super Saturday, employees clamor for the honor to lead an enormous company-wide effort and learn leadership at scale, all while being coached and mentored by his or her predecessor, and while having “Multiple Hands” to help take ownership and make executive calls before, during and after the event.  

Charlie doesn’t interview applicants of Next Jump anymore.  He used to... But found that a group decision is more powerful when structured correctly.  The classic notion is that founders are the best at selecting talent. However, Next Jump came up with a better, more scalable and sustainable solution.  The rigorous decision about who “gets in the door” is in the hands of his employees.  Consistently, employees are making the right judgment call time and again. 

For example, driven people don’t necessarily come with a desire to help others.  The smartest candidates don’t necessarily have the most humble attitude.  The combination of smart, driven, humble and a true desire to give back to the world and help others is hard to come by.  In a few interviews, can one truly determine how a new hire will be if hired? 

Quickly, Next Jump learned that it would take an army of people to recruit, attract and retain talent. Throughout the day, Next Jumpers make it a point to rate candidates at lunch or in the hallways, if they held the doors, or if they were kind to the coat-check employee – as these little signs would be indicative of a later successful individual at the company. Below is a sheet that every Next Jumper receives that has the thumbs up and thumbs down score next to a candidate's name, even before the candidates walk through the door for Super Saturday.

In the end, Executive Leaders are not making the final decisions, as every interaction with a candidate counts, whether via interview, at lunch, or just walking in the hall and seeing if the candidate will hold a door open.  Any employee can rate a potential candidate.  Is the candidate humble?  Did they work well in their team exercise?  Throughout the day, there is a dynamic “scoreboard” in what Next Jump calls, “The War-Room,” where employees can see a real-time shift in a candidate’s performance and as multiple checkpoints come through, employees can see the new data pop out based on employee candidate feedback.

Below is an example of the data-driven results, run by employees:

The day is so much more than recruiting – the company relies on all Next Jumpers to make informed decisions.

Chapter 3: A Snapshot on board the Santa Fe

“Fire, Fire, Fire!”

A fire on a submarine was one of the most life-threatening accidents there were. Not only would thick black smoke force the crew to wear emergency air breathing (EAB) devices; the visibility would be reduced to near zero. Unchecked, the fire would grow in size, and the contained atmosphere in the boat would result in heat and pressure increases that would make human existence impossible.

The key time was 2 minutes. Studies showed we needed a fire hose applying water to the fire within 2 minutes.

As was the prerogative of the captain, David was observing this exercise just forward of the crew’s mess when the fire alarm rang. The closest fire hose on Santa Fe was in the passageway just forward of the crew’s mess, about 50 feet from the fire’s location. It should have been easy. The entire engineering department, forty people, was conducting training in the crew’s mess.

The fire was detected and the alarm was sounded. What happened next?

Well, the engineers scattered, running right by the hose and leaving it hanging on the bulkhead. The crew members assigned to that particular hose couldn’t even get to the hose because there were so many people in the way. Why didn’t the crew just take the hose, lay it out, pressurize it, and end the whole thing in 60 seconds?

Because they hadn’t been trained that way. They had been trained to follow the procedure to put out the fire which assigned men to specific roles. They were marked down if they didn’t show up for their assignments (hose man, ax man, thermal image operator and so on) so this became the objective, not putting the fire out. Further, response was directed from Damage Control Central by officers who issue specific instructions to the crew based upon reports they received.

On board Santa Fe all that changed.

First, the objective changed from following the established set of best practices to putting the fire out. They stationed observers to measure the time that it took to put the fire out. This was determined to be the one single overriding metric that mattered. It was scientifically based. It was made clear to the crew that this was the objective, and it didn’t matter who was on the hose. The sailors responded brilliantly, and Santa Fe significantly improved their response time. Now when the alarm sounded, the closest men self-organized to achieve the goal. Santa Fe would later receive awards for their damage control responses.

It might strike you as odd that given a choice people choose to follow a procedure rather than take the steps necessary to accomplish the goal of the procedure yet this happens all the time. We live in a world where more and more rules, regulations, and ordnances are enacted to get people to behave in certain ways. Compliance with the rules becomes the unstated objective even when the rules are clumsy, are written for general cases, and don’t incorporate the latest thinking or technology. No one gets fired for following the rules.

Second, on board Santa Fe, they changed from issuing instructions to providing information. The officers who manned damage control central controlled the ship’s response to casualties. In the old way, DC central would issue orders such as “Senior Chief Worshek, report with the thermal imager to the engine room.” This changed to “A thermal imager is needed in the engine room.” It was information. DC central would not specify who or how. The crew figured it out. The man with the thermal imager would head to the auxiliary room and, as he passed a phone talker, report, “Senior Chief Worshek with the thermal imager proceeding to the auxiliary room.”

This “decentralized” approach to DC central ended up being much more resilient and effective. Now, if Senior Chief Worshek were ready and available, he would pick up the thermal imager and go toward the fire. However, if he weren’t available, another crew member would step into his place.

This places a greater training burden on the organization, though. Previously only Senior Chief Worshek and a backup would be trained on the use of the thermal imager. Now, everyone of the crew needed to know how to operate it.

Chapter 4: What it's Like to Be an Employee of Next Jump

Ever wonder what it would be like if your employer recognized and rewarded you for being a good person?  That is what the employees of Next Jump get to experience every day.  As employees enter and leave the building, they see the following sign:

The sign is a constant reminder that the company seeks a higher purpose, which is “To use business as a platform to build people of higher character.”  For example, employees are recognized not for being the best salesperson, but instead, for helping another employee with a project or for helping others in their community.  Living in this kind of work environment not only teaches employees a better way to interact with each other (including how they interface with clients, friends and family), but also how to better oneself, so as to help others more effectively.  The belief is that one can only help another to the limits that one can help his or herself, which led to the development of the Next Jump Formula: BETTER ME + BETTER YOU = BETTER US.

Better Me

There are two important parts of the Better ME philosophy – physical and mental. 

Physical begins with good health to ensure enough energy to grow and learn when stressed and mentally depleted. Energy (comprised of sleep, nutrition and exercise) is the foundation for growth. With a strong physical foundation, employees are better equipped to handle pressures.  The company believes that if one continually upgrades his or her physical self, he or she can tackle mental challenges.   When the cup doesn’t “runneth over” it’s impossible to help others (or want to) when physically depleted.  This is why Next Jump invested in a full-fledged wellness program, with a fitness center, fitness competition, and a nutritious 24-7 Food Service Program.

The second part of Better ME is around mental growth.  Everyone wants to succeed, however people are caught in a form of repeated errors, poor decisions, and poor judgment calls. So the question Next Jumpers ask each other is: “what is your backhand?”  The “backhand” is the weak side – it is the imbalanced character trait that emerges at the point of stress. Next Jump recognized that thematic errors are rooted in this imbalance of character muscles.

By working toward “character balance,” Next Jumpers minimize the repetition of thematic errors.  Next Jump discovered that most people err on the side of a specific category: confidence or humility.  When too swayed to the confidence side, one is arrogant.  When too far on the humble side, one is insecure. Working to correct the imbalance through training and practice under stress is critical. This is where practicing the backhand comes into play, for which there are BETTER ME programs available.  As character becomes more balanced, a person can make better judgment calls and become a more competent leader. 

Practicing the backhand is only possible in a safe practice ground where people can experiment, take risks, invest in loss and consequently grow through failing.  Having a “No Fire Policy” at the company, implemented a year ago, impacted the ability for employees to take more risks, feel what it is like to fail, and know that their manager is truly trying to help them succeed.  The place to practice “failing forward” is through what Next Jump calls culture initiatives, or “above the water line (per David Marquet)” a practice ground, because if an employee “blows a hole in the ship,” it won’t sink.

Better You

The Better YOU part of the equation is around purpose. Who YOU helped, what YOU gave back.  Next Jump gives in an area of their strengths.  So for example, giving back to charity isn’t something they do with money (although that is certainly an option present in the company).  Giving back with expertise is how the company felt they could help others most and have leaders begin to emerge.  They started with “Code For A Cause (CFAC),” giving away expertise, something better than money.   As with other cultural initiatives, a Captain, Coach, Right Hand and Left Hand allows for team leadership at all levels.  

Other Better YOU programs that also have the FLO model incorporated are: Vendor Appreciation Day for holiday gifts, contributing an optional 10% of their salaries to the forgotten population during Hurricane Sandy, as well as becoming one of the largest contributors to DonorsChoose.org and visiting some of the schools they impacted.  These were all ideas that came out of the team FLO model, and wouldn’t have been possible with just one person making the calls.

Most recently, Next Jump offered office space to a non-profit, Summer Search, becoming the first for-profit corporation to “adopt-a-nonprofit.”  Employees are learning from the Summer Search team how to be more empathetic and give back. 

Better Us is not as tangible as Better ME and Better YOU – Better US is the vision that Next Jumpers strive to attain, constantly out of reach.

Better Me Program: Fitness Competition

A good example that shows leadership from the ground up is the internal Fitness Competition.  The competition was started in 2008 to get better participation in the on-site free gym for employees.  The whole company was and currently still is divided into five teams that change every year, both in players and in its captains.  In the very start of the competition, the executive leadership team led the company as the five captains.  But participation did not climb. It was only when the company peer-nominated captains that an organic sense of leadership started to surface and teams felt a sense of pride that was unsurpassed.  In 2010, the first team hit their first-ever “100% conversion” where every member worked out on the team at least 2x per week.

Motivated by their team, members can check on anyone’s “fit-rank” at any time to see exactly how far they’ve come.  This is a big motivator as fitness is not just about letting oneself down, but also others. In a sense, fitness at Next Jump is both helping oneself and others.

 

Better You Program: Bigger Hearts

“It’s like a hot potato. Except I take it seriously.  When the phone rings, I literally jump over the desks just so I can get to the phone before anyone else.  I love talking to customers, even angry ones.  I learn a lot from them about how to make the site easier to use.  When the call’s over, I’ll say, ‘If you have any follow-up questions, my name is Paul English; I’m the co-founder of the company.’  I’ll give out my personal cell-phone number. Only one out of 20 people might actually call, but they’re blown away when I do that.” – Paul English of Kayak, featured in INC Magazine.

The above quotation is the way Next Jump feels about customer service, which they call: Customer Success (CS).  The “Bigger Hearts” program began when one of the company’s software engineers recognized a customer service issue and instead of forwarding the problem onward, he took the time to understand the situation and solve it himself.  This extreme love and care spawned the Bigger Hearts movement.  Now, the whole company partakes in “Bigger Hearts,” to help build muscles of empathy, listen intently, and serve customers at the highest level.  But it did not start that way…

CS was historically led by the top down, where executive leaders would help a small CS team insulate and solve symptoms of problems as they occurred.  Engineers continued to build -- sometimes not knowing what issues they were solving.  How could we get engineers involved in user iddues and help them truly understand what was at stake? 

Because those who work at Next Jump are immersed by a culture of helping others, it was no surprise when Kim saw CS as an opportunity to build better empathy in all his employees -- and give employees another chance to step up and lead.  CS became the ultimate platform to help employees grow their "empathy muscle" and become better people.

One of Next Jump's top engineers, Lokeya, never helped a customer before – she never needed to.  After solving a few tickets through the Bigger Hearts program, Lokeya shared a story with the executive leadership about how Bigger Hearts helped her with travel product ownership and in making the actual product better. 

“We are trying to find patterns of issue which are occurring in travel and trace the root cause of the issues/bugs and fix them at the source,” said Lokeya.  Here is her story about how Bigger Hearts ended up helping her team trace a major bug in the system, but more importantly, how she took ownership of the product:

“We saw an issue from a user who booked a flight and on the day of her travel she went to the airport and she figured out that she actually didn’t have a booking. She was going to a wedding and she was going to do the hair styles for all the bridesmaids and so she was freaking out and she had to book another flight, pay for it, and travel.

“She wrote a very angry email to the travel team.  Without reporting the issue up, Xuelan and Mike immediately begun to look into the issue and discovered out a bug that had been making bookings for one particular org in QA environment. The bug had been there for a year or so but the travel offer was suppressed for that org till this May when the suppression was removed and users started booking.

As soon as the bug was fixed we also noticed 6 users who had flights booked from same org and proactively reached out to them to help them rebook. If we had not to obsess over this issue this bug would still be out there for months and users would be facing very bad experiences of not having bookings.

Bigger Hearts helped bring in the ownership of the product to next level and the bugs like these can get addressed quickly.”

The difficulty in finding bugs should not be overlooked.  If it were not for the team’s understanding that in this particular organization, they should not give up, they should think for themselves and continue to push until the issues are rectified, these bugs would still be floating in the system. 

As of today, Bigger Hearts is companywide, and each employee can see their "Empathy Rank," on a transparent leaderboard.  Everyone owns the product and the results.

Motherhood at Next Jump

It is disruptive to think of business as a way to help people become better people.  But as shown, that is exactly what Next Jump aims to do.  When Meghan became pregnant with her second child, it became a chance for Next Jump to practice both Better ME + Better YOU.  Next Jump could help Meghan take the time she needed as a mother (Better YOU), plus help others on her team learn aspects of her job that only she could do, helping them become better leaders (Better ME). 

To make motherhood work for the business and at home, Meghan and Charlie realized that they needed more leaders, employees who could think for themselves, make the right judgment call, and take ownership of revenue and culture initiatives. “We needed more people to own more things so we wouldn’t have to do it all,” says Meghan. “A sustainable system where everyone contributes to the bottom line and to our culture.”

A year later…the shift in leadership seemed to be working for the business and for Meghan as a working mom, plus Charlie as a working dad BECAUSE OF the investments in leadership that were made throughout the years. A greater discussion of challenges are listed below.