Jay Smith: Taming Toxicity, Ushering in Innovation

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Exploring the transformative power of culture with Jay Smith, CIO and Head of Innovation, TracFone Wireless, Inc.

Jay Smith describes business as an infinite game. Unlike sports, the endgame isn’t to win and move on to the next contest — it’s to stay relevant as the game evolves. In Smith’s view, cultivating inspired employees who are seeking a grander purpose than a financial result or shareholder value is the way to lasting relevance, achievable only through building a culture of safety, empowerment, trust, and risk-taking.

As CIO and Head of Innovation for TracFone Wireless, Inc., the nation’s largest prepaid, no-contract wireless service provider, Smith is a true culture steward. Inspired by the challenges of human connection, the thought leader and in-demand speaker has led culture metamorphoses at several firms throughout his career, including NASCAR, Oracle, ADT/Tyco, CNA Insurance, and World Fuel Services.

As any leader who has struggled with remodeling a demotivated workplace into a healthier organization will tell you, culture really does eat strategy for lunch. The successful delivery of financial results, customer results, and sustained market relevance depends on draining that toxicity, and keeping it from creeping back in.

“I think about the evolution of a company and their culture as a bank account,” Smith told BOSS. Deposits include making positive change for employees, showing them they can talk safely about mistakes as a way to learn and grow, and congratulating them on having initiative or taking calculated risks.

“Withdrawals come from massive change, like an acquisition or a pandemic. During those situations of elevated change, naturally people are going to feel anxiety, discomfort,” he said. “That's brain science; during those heavy periods of change people feel more uncertain, and that’s when the culture can easily regress.”

In March 2020, as the heaviest period of change in recent memory gripped the world, Jay's team decided to go fully remote. In preparation for the shift, leadership discussed its potential implications. Worries included diminished collaboration, creativity and productivity, the negative impact of remote work on overall results, and the dilution of customer experience.

“What we actually saw was more collaboration, not less, when we embraced the virtual work environment with the tools and solutions that we needed to do it. We saw more productivity, not less. We saw our best results in history during the pandemic,” he said.

The unprecedented circumstances also came with a few unanticipated downsides, including bleed through the boundaries between home life and the work environment. “We saw fatigue, we saw stress, we saw folks that weren’t taking care of their mental and physical health,” he recalled. The company had to move quickly to help their teams —family members, as Smith calls them — deal with these aspects of the new working environments.

As the pandemic eases, new challenges loom. “We need to navigate how we think about culture and the continued evolution of our culture, because it’s a journey not a destination,” he said, noting that, in an advanced culture change environment, in-person collaboration, camaraderie, and team building are essential.

“We need to balance the desirability and flexibility associated with remote working. And the important need to build strong personal connection through in person collaboration,” he said. “That is another personal challenge I’m personally investing time in and experimenting with.”

Smith has a passion for creating environments where people become the best versions of themselves, together with an agile mindset to create new pathways for imagination. Company-wide hackathons to discover creative solutions to solve customer problems is just one successful approach he uses. The highly collaborative occasions result in fresh perspectives to complex issues.

He cited the development of cash-to-service solutions during the pandemic, as one example. Cash-paying consumers in need of products and services were uncomfortable visiting brick and mortar retailers, so Smith’s teams needed to find creative ways for them to pay cash without exposing themselves or others to the virus.

“As a result, we launched a successful product. The team found a creative way to deliver products and services to customers’ homes in a safe and sanitary way.” he said. “Leveraging democratized innovation and the power of crowdsourcing to develop unique ways to solve customer problems is an example of advance cultural transformation.”

Nurturing the entrepreneurial spirit

When an organization’s journey is rooted in a foundation of culture and trust, opportunities for creativity and unique customer solutions abound, and the pinnacle to be reached is innovation. When companies democratize the process of breaking new ground, it charges the atmosphere. As Smith put it, “Everyone in the company feels excited and even responsible to take part in innovating for customers and their needs.”

In a recent episode of the CEO Sessions podcast, host Ben Fanning asked him how the entrepreneurial spirit and desire to innovate can be created in a multibillion-dollar enterprise. Creating dedicated, inspired, and multi-skilled teams responsible for real business decisions make it happen.

“This is part of the agile mindset,” Smith explained, stressing that small, self-contained cross-functional teams with the skills to produce a desired business outcome must be empowered to do so.

“Think of it as a team responsible for customer experience, branding, financial results, employee sentiment, IT, and other factors. The more you can create that autonomy and assemble a team to be able to operate they will have the entrepreneurial spirit,” he said.

“A phrase I coined at one of my previous companies was ‘a multibillion-dollar startup.’ That's how hungry we need to feel, that's how inspired we need to be. We just happen to have the financial backing of a multibillion-dollar company, which a lot of startups don’t have.”

These days, a focus on inventive CX is imperative for business success, and customer-centric cultures are fundamental to developing the complex insights that are required. When Smith holds team meetings, especially cross-functional ones, he keeps the customer at the center of the conversation so their voice is always heard.

“When we were in-person we would leave a chair in the conference room open for the customer, a symbol that reminded us not to become too focused on our own functional team, but more on the customer,” he said.

Successful companies treat the voice of the employee in the same way, with the same measurement and relentless pursuit of employee experience and satisfaction as they have with customers. “There's a direct correlation between customer experience and customer satisfaction with employee experience,” Smith pointed out. “Without the employee experience being there, you’re not going to get the desired customer experience.”

The realities of cultural transformation

Smith’s efforts to reform toxic workplace cultures have often meant confronting executive leadership with what he calls “the brutal truth” about their organization, via the voice of the employee. Simple surveys to gauge the unfiltered sentiment of the employees and the workforce at large will typically reveal that when people are poorly inspired, unmotivated, and unhappy, they are actually describing a toxic environment.

“Then the conversation goes to, ‘Do you think that a group of people that feel like this can deliver the best results for the company and the customer?’ The answer is no,” he said. “For me it's all about getting the voice of the employee heard and understood and tying the importance of how they feel to how we deliver results for our customers and our shareholders.”

If they’re serious about lasting cultural change, leaders must also be sure that their actions are aligned to their values. Smith has shepherded many of these realignment efforts. “I call it walking the walk, saying what you do, and doing what you say. That's integrity.” Without integrity, cultural transformations are impossible.

“How many boardrooms have you been in where there’s a framed set of words with executive signatures on them that looks good on the wall? If those values don’t exist outside of the boardroom and aren’t practiced, then it means very little, and it actually destroys credibility and confidence.”

Another trap to avoid is the dearth of two extremely important attributes of any good leader: humility and vulnerability. Inflated self-worth gets in the way of being humble, and in Smith’s experience, when leaders aren’t humble they lose the ability to recognize their blind spots.

“By being humble you open the door to hearing about those blind spots from your team, from your peers, and you allow yourself to continue to improve and grow,” he noted. Leaders must learn to be comfortable enough to admit their mistakes and discuss them openly and publicly with their teams. “It sets the tone for a safe environment where mistakes can be discussed and even celebrated as ways of learning and failing fast and growing,” he said.

The power of culture to change the trajectory of society through innovation is immense, and according to Smith, when companies recognize the fundamental importance of culture and assemble teams with the right talent, diversity, equity, and inclusiveness, that power is greater than anything else.

We asked Smith how aspiring leaders can take the transformational path. His advice? “Regardless of where you are in your career, be bold, take risks, fail fast as a way to learn and grow, and set audacious goals for yourself and those around you.”