Malcolm Gladwell: Big Companies Must Foster Dissent

In this video clip originally recorded in February 2014, Motley Fool CEO Tom Gardner interviews author Malcolm Gladwell during the Motley Fool member event, FoolFest. Gladwell shares some insights from his book, David and Goliath: Underdogs, Misfits, and the Art of Battling Giants, including his observations about company culture and how it can serve as a predictor for both how the company works and where it's going.

Malcolm Gladwell: Well, many things. But one of the things I've been thinking a lot about recently is that I think that one of the things that when companies become large, one of the things they need to do is to use their size and strength to become more tolerant of dissent, confusion, arguments, to back off in a certain sense.

I always remember this. I used to work for many years at The Washington Post in its heyday when actually it was Goliath and there was a reporter there named Michael Isikoff. Still around, one of the single greatest investigative reporters of my generation. I mean a legend. I like Michael, a deeply obnoxious guy. [LAUGHTER] But the point was he was a great investigative reporter because he's obnoxious, he's a pit bull, doesn't take no for an answer. I remember that at a certain point that editors at The Washington Post got fed up with him and got rid of him. That is absurd. The whole point of being The Washington Post and having tons and tons of resources and a vast newsroom is that you ought to be able to find room for that kind of character. With that, requires more work from management, dealing with someone who's difficult and who yells at you when you mess with their stories and who goes off on quixotic things and disappears for a while. It's more headaches. Makes your life more complicated. But you have to understand that is the price you pay for remaining on the cutting edge is you have to deal with that.

Now it's easier if you're a small company to deal with that because everything's chaotic and you realize we got no choice. We have to be this way. When you're large you fall into the trap of thinking, "I can make everything run smoothly now. I can have layers of comfortable management. We can all do things by the book," as opposed to saying, "No, you have to continue to find ways to shake it up, to have a disputatious culture." I love it when I write for Grantland sometimes, the ESPN. Grandland is in LA and ESPN of course in Bristol, Connecticut. Nothing makes me happier when I read in some blog about how the guys in LA are denouncing the guys in Bristol. [LAUGHTER] I just think that's why ESPN remains interesting and vital and important because they argue and they argue in public and they don't care. They're fine with having a public image as a company that is in a state of semi turmoil.

Tom Gardner: A Goliath that's open to descent.

Gladwell: Is I think a Goliath that can stave off the worst parts of bigness.

Gardner: And a Goliath that has a smooth tempo, total convention, marches in a line, everyone has a job description, EVP of this. Everyone's got a role. You would prefer to bet on the seemingly weaker, smaller, chaotic, disruptive niche dominating appointed in their marketplace.

Gladwell: I've become more and more convinced, particularly from writing this book but also just from my experience in this. The company culture is the hardest thing to quantify, but the most important predictor of where a company is headed. Spending a lot of time in a large room of people from an organization gives you, I think really valuable insights into how that company works, and how it innovates and how it views it compe. If you have that feeling that people have turned down the volume in their brain then you know that there's trouble.