John Sculley, Legendary CEO, Apple, Pepsi-Cola Co. – Wharton Leadership Lecture

welcome everyone I'm Ann green Hall deputy director of the Ann and John McNulty Leadership Program also adjunct faculty here in the management department and other under other duties as assigned I am co-host along with Mike Useem and Jeff Klein through the zone of leadership in action on Sirius XM Radio channel 111 and a number of years ago I had the pleasure of interviewing our speaker John Sculley about his book moonshot so I know firsthand that you are absolutely in for a treat and I'd like to introduce and welcome John he makes a wonderful choice for the leadership lecture series a series you know that features CEOs he is a 1963 Wharton MBA graduate and he's the recipient of ten honorary degrees as well as the Ellis Island Medal of Honor and as I know you know he is the legendary CEO of Apple having been recruited from Pepsi to Apple by Steve Jobs with the now famous line do you want to sell sugar water for the rest of your life or do you want to come with me and change the world John Sculley was CEO of Apple for 10 years and during that time he led Apple to become the largest selling hardware PC company in the world and the most profitable computer company in 1992 John Sculley is well equipped to talk tonight on the subject of lessons learned from a disruptive innovator and implications for entrepreneurial capitalism over the last decade he has reinvented himself around the noble cause of reimagining the US healthcare system by law lowering costs that would make the system more sustainable and also by using destructive digital technology that would provide better care to patients with complex chronic diseases as members of the Wharton and Penn community I know that you will be especially appreciative of his talk about lessons learned as an innovative business leader about entrepreneurial capitalism today and about what he calls the quote exponential time Society so please join me in giving a warm welcome to John Sculley well thank you and thank all of you really great to be back at worden let me introduce my my wife and my partner Diane Diane is a computer scientist and data scientist and she and I work together we spend our time working with a small number of entrepreneurs in industries that are using disruptive innovation to change the ground rules of those industries so I would like to give you the the context of why I still do what I do that I'm spending going around the world working with entrepreneurs often speaking at universities and still with an insatiable curiosity I remember I had joined Apple and been there about three months I'm sitting around in the Macintosh engineering lab with Steve Jobs and Bill Gates it's about 10 o'clock at night engineers didn't come in till usually noon and they would still be there you know one or two in the morning just how things were in those days in Silicon Valley and Steve and Bill are talking about what they called their noble cause and I'm listening to this as they say we're going to change the world one person at a time we're going to take an idea that Peter Drucker had back in 1959 where he envisioned the information economy and he described a person in the information economy called the knowledge worker and they said we're going to empower the knowledge worker with tools for the mind and we're gonna change the world one person at a time and that's our noble cause and you have to understand that Steve and Bill rarely ever agreed on very much but they absolutely agreed on this noble cause now I'd come from an industry that was well defined in terms of the boundaries of the industry who were the competitors I was a veteran of the cola wars and I'm sitting here listening to these two entrepreneurs Steve was still when I first met Steve Jobs he was 26 years old and here was Steve and Bill and they're talking about creating an entirely new industry that had never existed before the personal computer industry Steve wanted to build computers with no compromises Bill believed it was all about software and they're talking about this as a noble cause well that's stuck with me over the decades and it's why I went in was introducing me she said you know what is John doing now he's got a noble cause with health care and I'll tell you a little bit about that in a few moments what I want to tell you about right now is what I've learned about people like Steve Jobs and Bill Gates and Andy Grove and others that I worked with who really did change the world and what made them different because they really were different it goes to a foundation of curiosity every one of these individuals that I've met with and worked with over the years just we're insatiably curious about things and Steve Jobs used to say there has to be a better way and he and I would go wandering through the Stanford Hill Steve rarely like to sit behind the desk he was rarely in an office he liked to go out and walk he would walk around the Apple buildings we walk over to Stanford University we'd walk up in the hills above skyline and we spent hours together and you have to picture that Steve Jobs in his 20s was not interested in friends he was obsessed with making what he called a dent in the universe and so I spent more time with Steve Jobs and probably any other person on the planet for four three years we were together seven days a week you know all hours of the days and one of the things Steve loved to do is what he called zooming now I had learned from one of my favorite professors at the MIT Media Lab professor Marvin Minsky Marvin used to say you don't really understand something well unless you understand it more than one way and what Steve Jobs and Bill Gates and Andy Grove and several others had in common was they looked at the same facts that everyone else had available to them but they saw them in a different way and Steve used to : zooming he said you got to zoom out you got to look beyond the boundaries of the industry that people understand and you've got to look at the things beyond that are going to touch the edges of the thing we do understand and you've got to connect the dots and so the time that Steve Jobs and I work together Steve Jobs had dropped out of Reed College he didn't have the money to pay the tuition but he still hung around and audited courses and he loved calligraphy and then he went off to India and he spent some time meditating and then he eventually he and woz started Apple Computer and woz was the technical genius Steve actually wasn't really that technical he was brilliant but he had a designer's mind and designers elegance of how to think about things and woz was the one who actually knew how to build all of this into technology that could be affordable and easy to use so Steve was invited over to Xerox Palo Alto Research Center which is where almost every innovation that Apple had used during the time that I work with Steve Jobs where it came from people in Silicon Valley have never had a problem with borrowing good ideas from somebody else nor should you by the way there's there's nothing wrong with being inspired by you know the brilliance of of other people in the case of Xerox Palo Alto Research Center they were developing engineering workstations for $80,000 one was called the star and another one was called Alto and Steve Jobs started connecting the dots and he said what if you could take calligraphy and if you could take these $80,000 workstations which used the graphical user interface the mouse pointing device Xerox was working with laser printers which at that time we're incredibly expensive and what if you could shrink all that down in terms of cost and make it a consumer product like we have with the Apple - Apple - so he connected the dots and that was when I came into Apple when I met Steve Jobs Apple had recently fired their first CEO Michael Scott the third co-founder of the company Mike Markkula had stepped in temporarily he didn't want the job to be the Acting CEO but Steve really wanted to be the CEO but he was still Steve Jobs 1.0 was not Steve Jobs 2.0 in terms of management experience and so he was considered not only a disruptive brilliant person but he was considered disruptive and so the board said no Steve you can be the chairman of the board you can be the largest shareholder but you can't be the CEO however you know we'll give you the authority to say no to whatever candidate we bring in not knowing that they would go through about 20 different candidates to be the CEO of Apple and Steve turned every one of them down so finally David Rockefeller the Rockefeller family were one of the first investors in Apple said well why don't we try another industry in another part of the country and see if we can find someone who will be acceptable to Steve so when I was introduced to Steve by Jerry Roach who at the time was the most celebrated executive search person Heidrick & Struggles and I had known a little bit about electronics I'd been a ham radio operator since I was 13 I built experimental color television sets but this was all analog electronics this was not digital I didn't know the first thing about computer technology but then neither did Steve you know remember as woz he knew all about the technology so Steve and I spent five months getting to know one another and he would come to the East Coast I was in CEO of Pepsi or I'd go out to Silicon Valley and meet with him and as a result we got to know each other and the thing that really captured Steve's imagination because remember he had insatiable curiosity and he said you got to explain to me how did you take Pepsi when you joined as marketing VP in 1970 Pepsi as I explained to him was outsold ten to one in about half the country by coca-cola coca-cola was the most famous consumer brand in the world at that time by the end of the decade Pepsi had passed coca-cola become the largest selling consumer product in America and he said so how did you guys do that I said well there's no way we could have possibly competed with Coke in terms of advertising dollars the creative was great you know they're great people there was no unhappiness with the product so that's the reality but as we thought about it we said you know perception leads reality if we can own perception then we can change the ground rules of marketing and we came up with a campaign called the Pepsi challenge and the Pepsi challenge said take the Pepsi challenge it was a blind taste test we knew that when you did a taste test between Pepsi and Coke and you put the labels on the packages that Coco is one but we also knew that when you took the labels off and you did what was called the sip test the blind taste test that actually there was a slight margin of preference for Pepsi over coke some people thought it was we had a little bit more sugar maybe was the balance of the essential oils but for whatever reasons you know we would slightly win on average over Coke on a blind taste test so we created this campaign called the Pepsi challenge but it was not about the manufacturer saying our product is better it was the theme line of take the Pepsi challenge let your taste aside so we switched it to the experience and then we went out it was at the time when video cameras were first starting and so we went out with little pen held video cameras and I remember it's my favorite Pepsi challenge commercial we did it in San Antonio where we were outsold twelve to one by coca-cola now nobody in the right mind in San Antonio Texas even what about having a Pepsi Cola it just never was it why would they want to have a Pepsi Cola in San Antonio Texas so we did this little taste test and we would do them in shopping centers and we do them on University campuses state fairs anywhere we could set one up and then we made TV commercials of it I mean this particular one we had three cameras it was a grandmother her little eight year old granddaughter who was leaning over her shoulder watching her grandmother as the grandmother was taking the taste test and then the person administering the taste test so one camera and the grandmother one camera on a little granddaughter one camera on the person administering the taste test to give it context when the commercial was cut and assembled what it showed was the grandmother saying I don't know why I'm doing this I've never had a Pepsi in my life she takes the taste test the camera cuts to the little girl you see her you know just wide-eyed looking over her grandmother's shoulder then there's the reveal to see what the grandmother chose and all of a sudden the little girl says grandma you picked Pepsi and the hula grant and the grandmother says I can't believe it I guess I must really like Pepsi better than coke bang that was our commercial coca-cola was enraged the first thing they did was they went out and they produce a commercial of a chimpanzee taking a taste test and we got our PR people going and we said why are they so concerned okay and the media said you know why are they so concerned this is the coca-cola company then they sued us and so we went out and publicized that as much as we could I used to go market to market when we were introducing the Pepsi challenge because our bottlers were very weak compared to theirs so we'd make them get all new uniforms to well you know clean up their trucks to you know build up the morale of the organization we'd have a sales meeting the night before launching the Pepsi challenge I remember in Phoenix Arizona that coca-cola came to our meeting site and surrounded the meeting hall with like you know Indians going around the the covered wagons and they had coca-cola trucks you know probably 20 of them you know circling around our meeting hall so we called up the television news station said come on out and see what they're doing ultimately Pepsi passed coke and became the largest selling consumer product and that was called we called it experience marketing so I explained this to save jobs and he said you know John that's really cool he said I'm creating this new product and I'm gonna call it Macintosh and it's for non-technical people and I want them to be able to do creative things the problem is everybody in Silicon Valley thinks this is the stupidest idea they've ever heard because they know the computers are for business people and for engineers and scientists so why would anybody want you know a computer for a non-technical person said you've got to come and teach me how to do experience marketing after being at Apple a little over a year the Macintosh was ready to be introduced and we had created a commercial we decided to introduce it at the Super Bowl and we had done it because in 1983 in October 1983 IBM had introduced something called but PC junior and Businessweek put them on the cover the week they introduced it and said the winner is IBM and we hadn't even introduced to a product yet and we were all sitting around saying we got to do something you know we got to do something that will really you know get people's attention and we started to think well what's going to go on in 1984 and we went through various things that could happen in 1984 then we said well George Orwell said that in 1984 that the world would be very different that society would be controlled by information and beasts in the central hands of the government they'll know everything about you actually kind of turned out that way and he said yeah but everyone's gonna do do a parody on 1984 but as we thought about it we said yeah but not in January and so that's why we made this commercial for the Superbowl which I don't know if you've ever saw it you can still go on Google and see Macintosh 1984 but it shows a group of zombie-like figures in pajama suits in sort of sepia green you know color not even a full color rendition to make it kind of creepy and they're marching into this big auditorium much bigger than what we have here and on the screen is talking head and it's kind of info speak you know and the world will be controlled by us and you will do what we say and we'll know everything about you and down the aisle comes this you know beautiful Olympic athletic girl and this time she's in full color you know bright red shorts yeah really good-looking t-shirt and she's swinging a hammer and it's now in slow motion and as she releases it and it goes through the air you watch it going and hitting the screen of a talking head and the screen explodes and then there's a crawl of type and a voiceover says on January 24th Apple will introduce Macintosh and 1984 won't be like 1984 and that was the commercial that stopped the world because we got we spent a million dollars of advertising I almost got fired by the Board of Directors when we showed it to them they said you're not going to run that thing you and they told us to go sell the media time unfortunately we weren't able to do it and we ran the commercial and we got 45 million dollars of free advertising because the television networks just kept running it over and over cuz no one ever seen a commercial like this before and that was experienced marketing so leap forward to today and experience marketing is what we all know because branding today is not the label on the product you know branding today is the experience the relationship between the customer and the brand there's been a power shift in the world thanks to all the things we're all familiar with you know two billion people carrying a supercomputer around in their pocket you know hold a smartphone to the world wide web to social media to all of the things that we take for granted today and this power shift has done one thing and that is that people now customers pay more attention to the opinions of people that never met than they do to the reputations of the most famous brands in the world now think about that and think about it in the context of Facebook and what's going on now with with a Facebook here is Facebook clearly probably the most powerful company in the world not the most valuable company most powerful company Mark Zuckerberg and the Pope both managed communities of virtual communities of about 2 billion people Facebook the Facebook we love is the community where people post their relationships they share things about themselves and their family and Facebook has learned how to turn that into an advertising money machine and it's brilliant the Facebook we're not sure we love is the media company the first one is the platform company the second one is the media company they don't like to be called a media company but the media company has no reporters it has no journalists it has a lot of algorithms and what we've learned whether it's Cambridge analytical or others who may be taking advantage of the Facebook data is that you can manipulate public opinion with a large sector of the world population because a lot of people don't want to see a logic behind news they don't even read news they see news visually and it's all about how they feel one of the most powerful ideas and marketing ever was the concept of the like button because if you track when people say thumbs up I like this it says a lot about how they think about things and so the power of Cambridge analytics was that they understood whether they did it you know ethically legally or not well we'll have to see over time but the reality is that the power of being able to influence people has contributed to populism around the world has contributed to tribalism of different groups than the disintermediation of you know established institutions and when all of these things and that's an incredibly powerful and we don't really understand it and it's not even clear that the Facebook fully understands that yet and so this Facebook event and I was on CNBC last week right after Sheryl Sandberg I was asked to comment on her you know what she and Mark Zuckerberg were going to do in response to this and as brilliant as Sheryl is and she's a great leader and so so as Mark than what they've accomplished they really didn't have good answers in terms of crisis management of what they were going to do and so they've been getting a lot of you know kind of not great publicity since all of that happened but that's all part of experienced marketing you know Amazon created Amazon Prime one of the most brilliant concepts of experience marketing what is the brand the brand could be a private label product that Amazon makes it could be a product that comes from a third party the experienced branding is the discovery of what you're interested in and they can make some predictions of what they think you might like it can be by some apparel online try it on you don't like it you can send it back just as easy as you can you know order it you know it's the time that you can it takes to from the time you order to the time in which you get the product all of those things are part of the experience and so Jeff Bezos has been brilliant understanding experience marketing and that's the world we live in today experience marketing and so the the the face book story is you know a key key chapter in the events of experience marketing the third thing I want to talk about is what I do today and Diane and I are very much involved in our own noble cause which is health care us health care so think about this we have politicians in Washington it doesn't make any difference whether they're Democrats or Republicans and they are debating whether we should repair Obamacare or we should replace Obamacare they're debating the ideology of do we give the state's more authority to make their own discretionary decisions or health insurance or should we give more power to the federal government and centralize the delivery of health insurance the reality is that our current health insurance system is completely unsustainable and it has nothing to do with those issues nothing so even if they figure out what they want to do it doesn't make any difference in the context of how do we make our US health care system sustainable you go back to thinking about what I said at the beginning of this talk that what makes these entrepreneurial genius is different from the rest of us is that they looked at the same facts and they interpret them a different way they have insatiable curiosity they become passionate about what they do and they have the ability to recruit talent to join them to achieve what they want to do and they want to change the world they are different and they do it and you can see them you know a new generation with Elon Musk and Larry Page and Mark Zuckerberg and Sergey Brin and there'll be others after them it's just going to happen some of you may be part of that so in health care there's no way you can make the US healthcare system sustainable without solving the problem of how do we deliver healthcare in a more efficient way to the most expensive patient the chronic care patient 5% of the population represents 50% of the three point two trillion dollar he'll spend now I focus on the pharmaceutical part of that he'll spend because if you look at all of the pharmaceutical expenditures and that includes the therapies and everything that are sort of connected with prescription drugs the expanded ecosystem of specialty drugs of avoidable drug impact medical costs of the whole PBM industry pharmacy benefit management industry add it all up together it's eight hundred and forty billion dollars a year now McKinsey Global Institute is estimated that of that 840 billion that's spent every year that's 350 billion dollars is avoidable drug impacted medical costs and most of that is tied to chronic care patients because you see the most seriously ill chronic care patients have typically eight or nine chronic care diseases these are high comorbidity mean if you have type 2 diabetes you probably have sleep apnea if you have sleep apnea you probably have hypertension and so forth and these people are killing themselves and they're killing our healthcare system too so what we do at RX advanced is we built a modern PBM pharmacy benefit management company a PBM was created 35 years ago to adjudicate the reimbursements between the pharmaceutical companies the health plans the pharmacies and the providers the the clinics hospitals and and the physicians and they're all built on what's called as/400 IBM mainframes thirty-five-year-old technology ironically it's the same technology I saw when I showed up in Silicon Valley you know back in 1982 it's the technology that has green screens command line COBOL programming they're still doing it this is the healthcare industry you know every other industry is changing but not healthcare and healthcare is still running their pharmacy benefit management systems on 35-year old technology and yes they both on other things to be able to add other capabilities but the reality is it's incredibly inexpensive outrageously complex and there's no transparency to it at all and so what's under the spotlight by the government and by others you see a lot of mergers going on now with the CVS Caremark you know merging with Aetna and Express Scripts merging with with Cigna and United Healthcare you know has bought Catalina which is now called optimum rx and so forth so we built Robbie Icahn our founder CEO built the first cloud based platform for a PBM and so the company we started in 2013 this year we'll do a little over ten billion dollars of contracted revenue that's roughly five years we think we can build this company to somewhere between forty to fifty billion dollars in the range of 2023 2024 and then in that time frame now these sound like big numbers but actually we get a very small percentage of profit but even a small percentage of profit on a very large revenue base is a lot of dollars of profit and and it turns out we can grow the company without a lot of expansion growth capital so as you know from I'm sure your case studies here that one of the big questions with startup companies is what got us here won't get us there you know what get us there uz is once you figure out the concept you figure out the problem you solve you've got the right people on the theme you suddenly realize to get us from here to there takes a lot of expansion capital now look look at uber yeah they've raised over ten billion dollars of expansion capital and they still aren't profitable so what's neat about the pharmacy benefit management business is we get paid every week we actually have a float you know so we don't need any expansion capital so our business was basically breakeven last year and the opportunity to go in to an industry that is not used to disruption and to change the ground rules and to connect the dots in a different way to interpret the facts in a different way and I don't take credit for it the credit goes to our CEO founder Ravi Aiko who saw these things and so my role is mentor my role is investor with Diane in his company my role is to open the doors my role is to coach and to help him recruit talent so last year we had 41 employee and 25 other executives full-time employees in in Delhi India by the end of this year we'll have 400 employees by the end of next year we'll have we believe 2,000 employees and we were just with Charlie Baker who's the governor of Massachusetts and he'd previously run Harvard Pilgrim which is one of the largest provider systems in the Boston area and I was explaining to him I thought that I had to he understands health care I said Larry Summers had said to me Charlie that in Boston we should have been Silicon Valley and then when life science happened you know it should have happened in Boston but it happened in San Diego and he said this time we can't lose health care there's this too much going on in terms of talent in health care in the Boston area so they're companies like athenahealth which is incredibly successful and so we said we want to be another role model in Boston and so the thing that Robbie determined and it makes sense to me now that I understand it he said I don't want to hire people from the healthcare industry he said because I have to get them to unlearn before I can get them to learn so he's recruiting people out of universities he doesn't need them to have a lot of experience he said we'll train them and we've been doing that and it works really well so we recruit talented people and part of my job now because I don't run the company yeah I'm the chief marketing officer I'm the chairman I'm a shareholder with Diane but but Robbie runs the company you can't have any confusion about that so what is my job my job is to make sure we maintain the culture as we grow the company that we recruit talented people into the company and that we give them the proper you know train so they can be successful in the honey and to continue to open the doors that's what chief marketing guys do so I give you these examples because there going to be more stories like this in your working lifetime yeah I remember people coming to me back in the 1980s and they say gee how did I miss all this opportunity in Silicon Valley apples already there and Microsoft's already there and Intel's already that I'm just late to the party well the party is just beginning because the world I have worked in has been a world of disruption with one law Moore's law Moore's law is that the number of transistors you can put on a similar-sized wafer scale will double roughly every 18 to 24 months and it's been consistent like that for 46 years well now we have drones we have precision medicine you know we have artificial intelligence we have robots and we have all of these new disruptive technologies and it's all compounding math that's all growing at an exponential rate of change the hardest thing is you don't have to become engineers or technologists if you aren't to be able to participate in this but you've got to get your head out of linear time and get it into exponential time Kodak in 2007 and I'm sure everyone in this audience knows the story the largest digital photo company in the world 26 billion dollar market market cap in 2007 Kodak was doubling down their investment in silver halide which was film processing to compete at a lower price point than Walmart who was their big competitor with a single-use camera in 2007 Steve Jobs was putting a radio chip in the iPod and calling it the iPhone and four years later Kodak filed for bankruptcy and iPhone you know was leading the world into a whole new generation of what technology could do and it's going to happen again because you got all of these exponential growing technologies and the thing to think about is China understands this and they have a different form of capitalism they have state capitalism they don't empower their individuals they empower the state by setting goals and they'll say we're gonna put in you know maglev public transportation by this state we're gonna have all motor vehicles be electric by that date we're gonna be the leaders in the world and artificial intelligence by this state and so forth we have no capability of doing that what we have is this incredible entrepreneurial talent of being able to lead entrepreneurial capitalism but we have to do it carrying the baggage of a political system that can't get anything done them any difference what part of you you're in we just can't get anything done because our government was set up constitutionally to empower people to participate in government even though at the time the founding fathers knew not everyone had the education to be able to make wise decisions so the whole process was separation to power slow down the decision-making have things happen almost in slow motion and that was fine for a couple hundred years but now we live in a world of exponential changing technologies and now we're living with China that's saying hey we can play by a different set of ground rules we can say these things will happen in this way and we don't know the outcome of the story if you haven't read it you should read I think it's Peter Pillsbury's book a Michael Pillsbury's book which was called the hundred year marathon and 100 year marathon and China started in 1949 with Mao Zedong and they this is quite a scholarly work and then many other books like this as to how the Chinese are thinking about things but it's all in the context of exponential time now you may never go to China may never work in China but the reality is that exponential time is going to be just as real no matter where you work and why is it that GE one of the most admired companies in my generation you know is worth a third of its value of what it was worth in the year 2000 you know why is it that IBM that led the world in mainframe computing got completely out maneuvered by a start-up that was begun inside of Amazon called AWS in 2009 and Morgan Stanley recently did an analysis and said that if AWS Amazon Web Services was an independent company they estimated it would be worth three hundred and fifty billion dollars that's two and a half times the market value of IBM so that's the world that you're aiding entering into after you leave Wharton and the exciting thing is if you have the curiosity if you're willing to look at the facts differently as Marvin Minsky says you gotta understands something more than one way the opportunities that you have in your working lifetime you may even be crazy enough to still want to work when you're my age but it's going to be such an amazing lifetime that you have ahead of you and you're coming out of such an amazing experience at Wharton that you are prepared to take on the world well thank you [Applause] this is probably an ignorant question because I don't know anything about health care but what is the problem with PBMs and what is rx advanced doing differently and then more broadly what do you see is the big issues in the US health care that can and need to be fixed because you said it's a different problem than the one that people are trying to solve right now well the big problem in health care is that the rules that we have in health care make it incredibly complex to be able to serve chronically ill people there are so many regulations there is so much bureaucracy and the McKenzie Global Institute estimates that of the three point two trillion dollars is spent on health care 900 billion of that three point two trillion is fraud waste abuse misuse and avoidable expense the biggest part of it ties back to pharmaceuticals the biggest part of the the cost of pharmaceuticals is attached to the cost of care for chronically ill people what PPM's do is they manage the health benefits for pharmaceuticals and unless you can crack that code and can take literally hundreds of billions of dollars not tens of billions hundreds of billions of dollars of cost out of that incredibly inefficient system called pharmacy benefit management there's no way you can make health care sustainable that's the problem that rx advanced addresses it's a modern-day PBM how are they taking the costs out we're doing it with smart process automation so I do a lot of work in machine learning and artificial intelligence and in FinTech and marketing tech as well and one of the things I've learned about machine learning is that it's very task specific and it really only is commercially successful when you can embed it into something else you know just saying that machines are can you know be autonomous and learn from other machines of course that's where the future is but the reality is today practically if you want to do something to make money where machine learning can really work is if you embed it into process automation and you make process automation more efficient so in the case of rx Advance we are able to take several hundred million when we bid on an RFP request for proposal we'll have to demonstrate we can adjudicate several hundred million claims each one different each one different now each individual is going to be different than the next individual and that we can do it all in real time no one else couldn't even come close to that it takes them you know weeks if not months to be able to do something like that we do it instantly and it's not that we had to reinvent the technology we had to learn to adapt the technology to the complexity of healthcare I was wondering how when how do you maintain that insatiable curiosity that you talked about when you have a thousand things on your to-do list and you're sleep-deprived and you have shareholders to please and it's a lot easier just to put your head down and do what you need to do well first of all I don't work for anybody I don't manage any people the hardest part of being a CEO are the people responsibilities the second thing is that I've always been a curious person so as Diane can tell you I'm up at 5 in the morning and I'm on my computer and I'm reading everything I can read and I'm you know email I'm lucky enough that I have a a wide network of relationships and fortunately people I've never met if I you know contact them they usually contact me back and so so so so I just I stay connected I'm in pretty good physical health so I do Pilates every day when I'm home and I go out and run and then I do peloton on the bike and then I do weights and I eat well and I've got a wife who makes sure I do all those things and so I'm just gonna be like the Energizer Bunny I'm just gonna keep going and going and going how would you say that like Steve Jobs and Bill Gates did that too when they were CEOs and had had a lot of people to please well when I know Steve he only did one thing now he wasn't married he didn't have children he was just a hundred percent was focused on work unfortunately Steve died there there are things which you can't control you know he had pancreatic cancer but I don't think Steve ever exercised you know he was very into nutrition I've never seen bill really exercise I'm going horseback riding with him he exercised his brain he's brilliant so people do different routines you have to have a routine I've got the other Mike do you mind if ask one more question thank you so I was wondering I understand the concept of exponential time but I was wondering and you hadn't quite touched upon this whether there's a responsibility on our part or maybe on your part because you're the current leader I'm trying to sure that the benefits of the growth that is going to inch and so over the next maybe thirty years as it over the past thirty years don't doesn't just accrue to a small percent of the population especially in the developing world as it has so far in the u.s. well the reality is that the simplest way to think of exponential time is what used to happen in six years happens in six months and you're absolutely right the the benefits of exponential time the rewards go disproportionately into a small number of people I don't know how to fix that and you there are a lot of ideas out there from universal basic income to you know bigger roles for that for the state the interesting thing is is that your generation actually is far less enthusiastic about capitalism than my generation was at your age and there may be good reasons for that you know I happen to believe in entrepreneurial capitalism that's what I do but but the reality is not everybody you know interprets the benefits of capitalism the same way and if you think about your generation the states for the rest of the century it sounds a little weird that the whole century is going to go on with all of the wealth concentrated in a small percentage of the population and that that can be sustainable I don't know will it change how it will change will it happened over fifty years five years I don't honestly know but you'll get to see I won't you'll get to see it and maybe you'll figure out a different construct of the society that that you and your generation want to live in you for example have you ever been to weworks I have yeah when I was going around to get a you know a toured the campus I looked down at the John Huntsman building and it looked like we works when I went to visit Adam Newman the founder of we works and when you look at how their new concepts of creating new cities and we know that that the people are going to know more and more people are going to be living in cities they're probably going to be new cities they'll be smart cities it may be more communal than what my generation was used to so I grew up in the suburbanization of America and the interstate highway system and nationwide television all those things were built in my lifetime in your lifetime you're gonna see the the building of entirely new infrastructure entirely different than what occurred in my lifetime and out of that may come derivative results that address the issue you're raising which is you know how do we deal with this issue that in all likelihood most of the benefits from the innovations I'm talking about are going to a very very small percentage of the population maybe those ground rules will be changed by your your generation if we stick with what it is now I don't know the answer Thanks thank you [Applause] we are not too late to the party the party has just begun and with that John we'd be very honored if you would accept a small token of our appreciation thank you so much for joining [Applause]

Channel: Wharton School

Views: 60,747

Rating: 4.8835387 out of 5

Keywords: Wharton, The Wharton School, steve jobs, john sculley, apple, pepsi, leadership, lecture, interview, business, penn, university of pennsylvania

Id: 7MS0dlMONnI

Length: 54min 24sec (3264 seconds)

Published: Thu Apr 05 2018