Richard Fain - Royal Caribbean Chairman | How Culture Took Us from $550M to $90 Billion

Why are you failing at retirement? I thought life was going to be so simple and so quiet. It seemed to be involved in so many things. This feels very good. All those people who say that retirement is difficult, nonsense. It's just choose the things you want to do and do them. He was handed the wheel of a modest cruise line and transformed it into a global travel empire with fleets that dared to dream bigger than the horizon. Richard Fane, the man who re-imagined what a cruise could be. The most important thing I had was good luck. I was in the right place at the right time. When I had good luck, it was in the right place at the right time. I worked hard to take advantage of. If all you do is what you did, then you're not going to get anything different. A vision is almost like saying I have a hope. The vision is important, but it also needs how am I going to get there and what am I going to do to make that happen. Introducing mega ships, pioneering experiences, and building a culture obsessed with good enough isn't good enough. For over three decades, he steered through storms, innovation, and entire industry revolutions. Particularly, if you're on a longer-term course, keep in mind the longer term and accept that there are going to be bad things that happen along the way and don't look back except them, but it isn't going to take me off of my path. It will make your life both more fun and more successful. Why are you failing at retirement? That's my wife's line. I don't know. I thought I was life was going to be so simple and so quiet, and yet I seem to be involved in so many things that I'm having trouble doing all that I want to be doing. But I must say, this feels very good. I'm feeling I get to do things I like to do. I get to choose when to do them. So I'm busy as I want to be, but I'm enjoying what I'm doing. I love that. So I think that, by the way, for all people that are super ambitious, I think it is very hard to actually retire and to actually turn off. No, it isn't. No, I've heard that from so many people and it's nonsense. This is the best thing I've done. It's just it's so much fun. I get to spend more time with my family, but I also get to do the things that I love to do. So I had the best job in the world. I worked with the most wonderful people in the world, and I enjoyed every day I went into work. But now I'm enjoying a different kind of life. And no, all those people who say that retirement is difficult and that you don't have enough to do nonsense. It's just choosing things you want to do and do them. It's great. So you spent 33 years, correct? 33 years as CEO. And that is one of the longest ten years in public companies. Very fortunate. It doesn't happen often. No, it doesn't. And I kept pinching myself. And one of the things that's interesting is I would go through, you know, over that time, we completely turned over our board a number of times. And somehow they still put up with me over the period. So I was very fortunate to have it for 33 years. And I also think it allows you to complete more. So you actually see the results of your work. You see what you did right, what you did wrong. And you keep building on it. So I have to say it was not only did I love what I did, but it also gave me a chance to do it and to see success when we had it. And failure when we didn't. It's interesting because I think a lot of... I actually agree with you, obviously, completely. I think it's smart to have this long-term vision. But especially in public companies, a lot of companies have very short-term. So focusing on the next quarter and they're focusing on what does that next quarter look like. Was now, like, looking back, you understood that longevity has a huge advantage. But is that mindset of long-term thinking? Is that something that you've always had in your career across everything you've done? Well, I've been fortunate that I've been in businesses that encourage that and that I've had mentors and associates who support that. So that actually is lucky because there is so much pressure from so many sides to focus only on next month, next year. It really is strong. And I think that's one of the advantages of having been in the position so long because I actually was able to point to some successes. And so when I argued we should do something that may not pay off for five years or seven years, people were willing to put up with that and see, oh yeah, well, that's been the approach and it's worked so far so they're willing to continue it. So I was very fortunate to be able to do that. But I think it's essential for success. Yeah, I agree. I just, I wish more people thought like that. I mean, we're talking about a very specific sort of circumstance when you're running a public trade company. But the thought of long term towards anything is one of my favorite ideas. I think that it, I think that of course, it plays out in companies of the size of what you were running. But I also think that it plays out if you're starting a company, if you're at any point in your career. Like just playing the long game is something that I feel like we're getting worse at as a professional society. I think we are getting worse at thinking long term because the pressures are overwhelming. But choosing who you work with, and being able to actually talk it out. I think one of the things that helped me was, and people say I talk too much, but one of the things that helped me was we actually dialogue about these things. And people almost take it what you can't do that because my God next year is really going to be a problem. When we talk it through and say, well, yeah, next year is going to be a problem. But two years from now, four years from now, we really see where that's going to lead us and being able to actually have the discussion and really look at it from different angles. And eventually, even people who started out thinking short-term come around and say, you know, if this really works and it has before, then that'll be fantastic. So I think it's a question of not accepting and just saying, oh, okay, I agree with you. We'll go, we'll worry about next year. But no, let's have a discussion. So this is, I mean, when you first started working at Royal Caribbean, obviously, it was a very different company than it's evolved to today. So walk me through a little bit so people just know your origin story because again, 33 years in one company is a very, very long time. Was that something that you had set your mind to that you wanted to work in the travel, hospitality, cruise business, or where did you start that sort of pushed you down this path? The inflection point that eventually got you to CEO. Well, of course, the most important thing I had was good luck. You know, I was in the right place at the right time. I worked with people. I had mentors who were supportive and knowledgeable and really inspiring. I also, when I had good luck, it was in the right place at the right time. I worked hard to take advantage of it. But the main thing I had was luck in having happenstance into an industry. I didn't expect to go into this industry, but I was working with a company that had a small interest in a cruise line. So I started to get a little involved in the cruise line and what I saw there blew me away. So I was just lucked into that. Never expected this to be that long period. The founder of the company, who was then the president, was a terrific guy who had created something very special, created a culture. You could already see the importance of that culture. And so I was able to take what he had built and just build on it. But I started really standing on the shoulders of others who had come before me and done well. What in your opinion? Because you mentioned words. I want to go through some of these words that you mentioned before, but you mentioned what you mentioned. Culture is a catalyst. That's interesting. Like how does culture translate into actual like business metrics, KPI's, revenues, a net promoter score, whatever you want to measure for your customers, but also intentional. Intentionals are a word that comes up repeatedly. So there's something that you're doing specifically that's driving that and letting everybody believe it and buy into it. Not just have words on a website. And I think you put your finger on something because the intentionality of going after something is critical. As we both said, people say, oh yeah, ethics. That's one, ethics or culture. It's in our DNA. But it isn't, and that almost implies that it's inherent. We've hired people who have this in their DNA and they make it happen. Intentionality means, no, it doesn't happen by itself. It's not a natural evolution of things. It is something that you work at every day. And so if you want a culture of innovation, if you want a culture of integrity, if you want a culture of long-term thinking, you actually have to talk about it. You can't just take it for, oh yeah, of course everybody is a person of integrity. No, you have to think about it. You have to talk about it. You have to discuss it. You have to say, how does this advance if it's integrity? How do I make sure? How do I talk about it? How do I make sure my people understand that I feel this way? Not just assume that that's the case. If I'm talking about excellence, how do I communicate that? So you actually have to discuss it. You actually have to focus on it. You actually have to do things that demonstrate it. So part of it is by leading by example. And so when you're making a decision and other people see it, then that's, they learn from that. So Royal Caribbean, which day is more than 100,000 employees versus a couple of thousand just a few years ago, we actually talk about these things and it permeates through the organization. And by the way, that also goes up to the board. The board, the management, the executives, the officers, all the people throughout the organization have to be aligned on these things. And the way you do that is by discussing them in general and by discussing them in the context of specific decisions. And then that's what allows an organization of 100,000 plus employees, which is a wild amount of employees. That's how they all start to move towards the same North Star. And they understand not just how to move towards the same North Star, but the way that they move towards that North Star. Yeah, you know, I don't care what organization, you know, I don't care how careful you measure everything and how careful you are about articulating what the things are. There's still a lot of unspoken expectations. And everybody knows in any organization, but especially in a large organization, costs are important to keep under control. But what does that mean? It's very easy to be, I'll just take this example. It's very easy to be the cheapest operation around, because you just do the minimum that you have to do. And it's relatively easy to define if you want to be, I don't care about costs, I just want to be at the best. But to find, and I always love the comparison, if I say I want the best car in the world for the price, is that a Lada, which is a piece of junk or is that a Rolls-Royce? Both meet the criteria, but because one can be the best in the world, I don't care about the price, and that's true if it's a very high price or a very low price. But having a clear understanding so that each decision you make fits in with the long-term goal, that's the key. Because that's the other question, too, you want to be intentional about every decision you make. You want to make sure that there's a framework or a lens, I don't know if that's the right word, that each decision passes through when it's made, but that has to be the whole organization that sees the decision framework the same way. Because it's hard to be intentional when not only yourself is making thousands of decisions every single week, but every single person is making thousands of decisions. Is that, is there a framework, or because you mentioned you speak about it, and you talk about it, but when people are pressured, they're only human. So how do you make sure that even in high pressure situations, like culture is maintained when you're making endless amounts of decisions across 100,000 people? Well, that's basically you've put your finger on exactly what I wanted to write the book about. How do you do that? How do you communicate that? How do you end up getting alignment so that you're all understand what you're trying to do? One of the famous stories that I love was when JFK went to NASA and was visiting at NASA. And he saw a janitor and he said to the janitor, what's your job, what do you do? And the janitor's response was, I'm helping get a man on the moon. That, that purpose is what you want every organization to have, and you can have it. You talk about it, it's a culture permeates. It's not one person saying, I want a culture of this, that, or the other thing. It's, you all bleed it, you all understand it. And it's, by example, I don't make thousands of decisions a day, I make some decisions, but actually there are thousands, hundreds of thousands of people making individual decisions. And so you do it by example when an issue comes up, how do you respond to it? And one of the examples when I given the book was when we decided we were discussing whether or not to put an ice skating ring on a ship. And the simple answer was to do it on Teflon, on artificial ice. But it was a compromise, it wasn't very good. An ice skater on artificial ice doesn't have that amazing gracefulness, that frictionless move that you see when you see them skating on real ice. So we made that decision, and it was a very tough decision because it was staggeringly expensive. I have no doubt, I have no doubt. And it's only expensive to do, but it's expensive to operate because now you have to maintain the ice and you need the world-class skaters. And we've been able to do that, but everybody sees, oh, they didn't compromise here, they made the choice if we're providing an excellent vacation, every aspect of it has to be excellent. Another buzzword is vision, and you point out that vision is very different than intentionality. What does vision mean? Why is it not the thing the people should be trying to achieve? Achieve a vision, I have a vision for the company, whatever that is. What's the difference? Well, I do think vision is important. I didn't intend to minimalize it. It is important that you have a vision and you know where you're trying to go. It's not enough, but it's not enough. A vision is almost like saying I have a hope. Every organization I see, including ones that I don't think are successful or are likely to be successful, say, oh, we're going to be the best in the world at this. But if they don't go at it with intentionality, it's not enough just to say that. People aren't going to say, oh, the boss says that, so that's what we're going to do. If it contradicts all the other aspects of the culture and the organization, you really need somebody to say that's the vision and here's all the things we're going to do to make that vision a reality. It's the vision is important, but it also needs how am I going to get there and what am I going to do to make that happen? And if everybody is working to make that happen, that's where you get success, not just the vision. One of my favorite quotes, it sort of sums up what we were just talking about. True intentionality requires unwavering focus on the long-term objective and not being distracted by easy compromises. It's beautiful. It makes a ton of sense. Now I'm going to not challenge you, but I guess play a little bit of devil's advocate. So how do you have, because that quote, I love playing devil's advocate, so absolutely that. That, by the way, that's the way you create culture because if nobody is playing devil's advocate, you just have group think. Well, that's what I was going to ask. I was going to say, so how do you have that? But also encourage an organization and a company that has how else to describe it? Like the psychological safety for somebody to put up their hand when they don't think what is going on, it should be what's going on. Well, that is the culture. And I wish I knew there was some great secrets out there. You do this, that, and the other, and you create a great culture. But it's what you do. And what we do is we keep trying things. We have a dope in dialogue. And again, it's by example. So if somebody comes up and says, wait a minute, you said you were going to do this, but is that really what you want to do? Is that really going to achieve your objective? And maybe they're playing devil's advocate. Maybe they just really feel you're wrong. And you have that discussion. That's what creates confidence that you've come to the right answer. When you think about the people that you work with, those people will make or break an organization. And for any successful company, they have to have people that are independent thinkers that challenge the status quo. How do you find those people? How do you get them aligned with the culture, but not sort of dim maybe the experience or the devil's advocate that they can bring to the table? Because somebody who is, I've always thought about this. How does somebody who is an entrepreneurial minded person who can be very beneficial to an organization work within the confines of a public company that has structure and order? And this is the mandate. How do you find and retain and help those people thrive without killing their spark? Well, that's our challenge every day. And that's one of the things that I think has made us so successful. We have been successful in attracting unbelievable people. I mean, it is the people, it's the people, it's the people, it's the people. But then, when we're together, we gin each other up. We encourage each other. I still remember one of the examples that thrilled me at the time was we had an architect make a presentation. And she had a very difficult area. And she made a presentation and it was transformational. It was just so different than everything else. And everybody, when she was finished, applauded. And that never happens. And then she was followed by another architect who was used to going into presentations and having everybody said, oh yeah, that's very nice. Because an architect's presentation is always very nice. Hers was extraordinary. His was about to be very nice. And so he stood up and said, I'm about to give you my presentation, but it's not at the level that's going to attract your applause. But I'm going to leave this meeting and at our next meeting, I will learn that applause. And so it becomes a competition. You understand that people are looking for and willing to listen to new and different ideas. And we do that internally. And so we get, everybody loves to play Devils of. I enjoy it. And it's interesting and you learn from it. Eventually you have to reach a decision. But you are rewarded by either promotion or just by kudos for innovative thinking. And people begin to learn that and then everybody feels empowered. One other thing that I thought was interesting because another really good quote is alignment is not synonymous with consensus. And consensus often leads to the least objectionable outcome rather than the best possible outcome. So how do you know when it's alignment versus, I guess consensus would be somebody saying, like fake agreement, like, oh fine, right? Like, oh fine, I guess we'll move in that direction or oh fine, I guess I'll buy into this project even though I don't actually believe in it. So how do you actually get alignment and not just this sort of this water down consensus? So I think the consensus often is just a constant series of compromises. And it's a little like somebody's taking something that is clear, because clarity is important. But somebody's thinking clear direction and then saying, well, okay, but we don't have to do quite this. And consensus, when I've seen that organizations work towards it, well, okay, I need your support. So I'm going to accept your change. And I had one person I've worked with him in years who used to call that creeping crud. So you take a really clear, unequivocal, uncompromising direction. And you say, well, okay, but I'll make a compromise here, which by itself isn't terrible. And I'll make a compromise here, but that compromise gets you to buy in. And in the end, we all sit around the table and say, ah, we like where we've ended up. But where we've ended up is a compromise. It's watered down a little bit, yeah. It's exactly, it's watered down, if I may use the term half-assed, it is, it's not consistent as opposed to, okay, let's talk about these things, but let's understand exactly what it is. And let's look at whether your suggestion really makes this substantive you better. And if we don't think it does, let's be honest about it. I'm not going to say yes just because I the group, just because I want you to sign onto this. We're going to look at this together. And what we find is everybody has their voice, everybody is heard, their opinions are respected. But in the end, we need to move forward with clarity, with intentionality, and without ambiguity. Quick question, what's your go to when you got 10 minutes before a meeting or a workout? For me, it just used to be whatever I could grab, which usually meant skipping meals entirely or just grabbing something that left me crashing an hour later because it was just full of garbage. That's why I'm partnering with Hule. 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And frankly, I don't know anybody that doesn't have a little bit of egoistical or evotistical views. And frankly, we've had very successful people at War Caribbean and they are rightly proud of their success. So I don't say we should eliminate ego. I'd say we should build on it and give them more to be proud about. So when you come with an idea and it's successful, terrific. And you should be proud about it. And maybe that will also encourage you to come up with another good idea next year. And so I don't think in our case, ego is necessarily, now if the ego can go too far and then if something is a good idea simply because it's mine, that's really destructive and exactly the way you said. But generally, I think one of our attitudes at War Caribbean has been passion and passion also can discourage alignment because I'm passionate about my idea. But if I understand that if we're all together on this, we end up in a better place, that works. And that's where the North Star really does matter. That's where the North start. Because you also have this idea, this philosophy of continuous improvement, never being satisfied, constantly seeking better, which I think is that's a very important idea to have. Continuous improvement, it really means that you're not happy with, it's not that you're not happy, you're not satisfied. How do you make sure as a leader of an organization? You strive towards what's next, the next thing, the next innovation, the next milestone. But how do you constantly do that without sort of tiring out the people that you're working with? Because that means that there's always this moving target, right, you're always moving the goalposts, which is it can be a good thing, but it can also be tiring for people that are always trying to do the next thing. It can be tiring, but the thrill of improvement, the thrill of seeing it, overcomes all that. I don't think I was ever tired at War Caribbean. I was never tired. It was so exciting and it was always something new. It was whether it's food or a ship or an ad campaign or employee benefits program. These were exciting things. And everybody throughout the organization had the satisfaction. I think satisfaction overcomes fatigue any day of the week. So I don't see that as a problem. I saw that as an opportunity. Is perfectionism a good thing or a bad thing? Well, I think there are pros and cons. I'm not sure the insatiability is the same thing as perfectionism. And in fact, continuous improvement helps because I don't have to reinvent the needle or the fire or whatever it is. I just need to know that I've made it better and that I can continue to make it better. And one of the advantages of continuous improvement is, and I think this is very important, is it's not looking back, it's looking forward. So I say, here's the way I can improve this. Doesn't mean that I've been doing it badly. It just means that I can do it better. And by the way, now that I've gotten it better, I hope you do better still. So it can be tiring, but it can also be energizing because it creates the energy of I can do even better and I'm being applauded, because giving credit is a part of this. I'm applauded for the changes I've made, whoever I am. And again, that's whether that is a cabin steward or a head of marketing, whatever your position, you can do that job better. I like that. I think that that's probably where, if I was going to think of how perfectionism could be toxic, it's striving towards perfectionism without actually saying that the work that you've done is good. And perfectionism also kind of implies criticizing because there's no such thing as perfect. And actually, one of the ironies is, the continuous improvement really says, there is no such thing as perfect. I can do better and I'm not, it's not because what I did was bad, it's because we can always do better. And perfectionism is there is a perfect answer. And I think there's never a perfect answer. Roll Crimin is better today than it was a year ago or four years ago when I stepped down a CEO or 10 years before that. We're continuously improving, not striving for perfection, but striving for excellence. That's so important. I see this a lot with founders, obviously, that are just starting their business for the first time and they feel like it's never enough. Like what they're doing is never enough or what they've accomplished is never enough. And I think that it's a little bit, this is more of an entrepreneur discussion but it's very isolating when you're alone in your building and you don't have a team or a group or a board that's saying, no, we were incredible 10 years ago but now we're even better. If I may, just to build on your point, I often use the word North Star because I think North Star is what you're going at. But one of the things to remember about the North Star, the North Star is a great navigation tool. You, there's the North Star, I know where North is, that gives me a direction to go in. But nobody thinks they're going to get to the North Star. The North Star is beyond your ability to reach. It is a direction and you never get there. And so that's why I would argue continuous improvement is not seeking perfection, it's seeking improvement. And when we look at NPS or when we look at employee satisfaction or engagement or guest satisfaction, we're actually, we're not looking to get to 100. That's an impossible goal and not even a particularly good one. But we're looking to constantly do better and to have a continual upward trend. And that's what's been successful for us. And I think that's the difference between what we do and perfectionists. Who influences the decisions the most? Is it something that the people that speak with the guests? Sort of they have that in boots on the ground that can understand what's actually going to make the experience better? Is that is there some sort of framework for filtering ideas up from the people that work with the guests? I'm assuming that's probably a smart idea because they're the ones that experience it. But also how do you make decisions on what to actually focus on and spend time and energy and money on to, again, move closer to that North Star when you do have a million different options? Well, that of course is the biggest challenge of any leader. And as I have, and you've quoted me before saying the first job of a leader is to lead. And it is to make sure that you're hearing all the input from the people that have it. And the key part of that is the people who are on the ground who are dealing every day with the guests who, of course, have a great deal of insight. And we look at that all the time. That's a key part of a driver. But it's also important to look outside of that. I very focused on the quote, which I ended up using a lot that was attributed to Henry Ford. Don't know whether he actually said it or not, but it's too good a quote, so I'll use it, which was if I asked people what they wanted, they would have said they wanted a faster horse. And so part of it is to understand what people want, but part of it is also to understand what they might not yet have imagined. And I think that's part of the success that Royal Caribbean is that we have people who can bring both to the table and fight it out. I mean, one of the best things that Royal Caribbean is the passion that people bring. One of the worst things that Royal Caribbean is the passion that people bring, because they don't give up. This is the right thing, and there's this is the answer, and this is what we should go with, and how can you not go this way? But we get to hear all of that, and then we get to work it together and reach alignment on a clear and unambiguous path. And it's reaching that alignment. So the process of reaching the alignment is key to our success, and then the determination to stick to that alignment with intentionality. What is the, that's a very, I love this idea of like going outside and finding things that people have never even thought of before, because the obvious, the obvious thing is to speak to the gas you figure out what they want more of or want done differently, that's a great signal. But when you think about true innovation, it's again, doing things that have never been done before. So how do you go outside and find things and new ideas? Like, is there a strategy or a framework or something? So, first of all, that is a constant challenge. And so one of the things we have done is we have, again, with intentionality. So we don't want to just ignore what people want and say, well, you don't know what you want. We know, and this new thing. So we set a framework for ourselves, for example, on a new ship, that every new ship will have one-third traditional, one-third innovative, one-third revolutionary, one-third evolutionary, one-third revolutionary. And so it allows us to try totally new things. The ice skating rink happened to be one of the rock climbing wall, flow rider, skydiving simulator, North Star. We can do all these things that nobody ever said to us. I'd like to see an ice skating rink on a ship. I'd like to see a flow rider where I can those surfing simulator. I'd like to go skydiving on a ship. Nobody ever said that to us. But we put them on knowing that if they didn't like it, we've given them everything else. So we make sure that we cover the traditional. We make sure that we put in the evolutionary. So this is traditional but better. And then we put in these revolutionary things, which we think they're going to love. And so far, we've been extraordinarily lucky and successful at that. But there are exceptions to that, and we try it. But we constantly are moving, but without giving up what we know works. So it's a bet, but it's a safe calculated bet. That's a good way to put it. That's the way I wish I had known that language when I was writing the book. It's a bet, but it's a calculated bet. If you think about the stakes with the company, with not the company, with the product that you have, the product you have is a multimillion dollar product. So the implementation of a bet is expensive. It's not like changing an ad set on Facebook and seeing if it converts at a higher row as than what we're doing last week. It's sometimes tens, probably tens of millions, if not more, for some of these bets, right? So it does have to be safe, it does have to be calculated, and it can be expensive if it doesn't work out. Well, first of all, in some cases, it's not an M, it's a B. That's very true. It's not millions, it's billions. Because remember, our new ships there costing a couple of billion dollars each, and we're ordering multiples of them. So it's a big bet. It's one we do carefully calculate, and we have enough experience to be able to understand. But yeah, we do need to make sure that we are learning from what we've seen in the past. But also, it's a bet not to do these things. I think that's the other thing I would just emphasize. If all you do is what you did, then you're not going to get anything different. And if you want to, with our North Star, has been to provide such an amazing vacation that we became, that we become, not the best cruise line, but the best vacation provider. Jason, my successor, has coined the term, I love it. He said, we don't want to be the vacation of a lifetime. We want to be a lifetime of vacations. And I think it says it so well. So our North Star was always to provide something so wonderful that we would expand our horizon and not just be a great cruise line, but be a great vacation provider. The result is we've gone from a company that was worth the 1988, $550 million, to now overall worth a little more than 90 billion. So it's been, it's worked. And it's worked because we have focused on not just taking some risks, but carefully gauged risks. One thing I wanted to discuss, you speak about a culture of wow. Now, I guess that started as an acronym, wow, but explain what that is, because a lot of the ideas that we're discussing feed into this culture of wow, but where did this first idea come from? Because this is, I mean, it's a title of the book. So obviously it's important. But what does this culture of wow really mean? Well, as you say, we had started out. We wanted to provide certain guidelines to our employees. What is it that they should be doing? And we came up, we wanted an acronym. We wanted to call it gold anchor standards. And so we had a G and we had no, and I have a D, an L-rather, and we hadn't yet figured out well, we couldn't come up with a D that fit in. And we were actually agonizing over because we liked the gold, but we wanted a D. And somebody then said, deliver the wow. And I mean, it was, the room just went silent. I mean, I do remember this very vividly. And she just said, deliver the wow. That's a D word. I mean, it was really the W word, but she got it into a D. And everybody said, my God, that's what we do. And a wow is something special. And we do so many special things. And it is the cabin steward that makes this fancy towel image for you. It is the waiter that provides an extra dessert because they know you like meringue or what have you. But it's also the supply chain, the logistics person, who one year says, you know, we've got people queuing up, the trucks queuing up at the pier because we have a lot of trucks supplying the ship on a Saturday morning. We can spread that out and do it this way. So one year she makes it so that that's more effective. And then a year later, she comes back and said, well, we'd slashed here, we solved the truck queuing problem. But now we have so that the stuff is stored on board in a way that makes it harder for the crew member to get to. So we solve the truck problem. Now let's reorganize the way we store the food, or not food, or whatever the supplies are, so that it makes it easier for the crew on board to get to it and therefore provide a better service to the client, to the guest. And so that's delivering the wow. It's just going above and beyond, working on a problem, agonizing over it and coming up with a new and better way. And when do you teach that to the person that you're hiring and bringing them in? Is it from the interview? Is it from the first time you ever speak to them? Well, that's what culture is all about. Yes, we try and search for that and find that when we're looking for new people. But the best education doesn't come from the top. It comes from your coworkers. Peer pressure is the best way of things. So people talk about bleeding Royal Caribbean blue. This is the way we do things. It isn't necessarily work harder longer, but smarter and with more focus on what you're trying to do. And it becomes, frankly, a self-fulfilling prophecy. We want to be the employer of choice. People here that working at Royal Caribbean is inspirational, so we get a better set of resumes to start with. And one thing leads to another. The HubSpot podcast network is a success story partner. Now a quick podcast recommendation. I've been listening to Truth, Lies, and Work. They're in the HubSpot podcast network, just like success story. It's this husband and wife team, Al and Leanne Elliott. They break down why people actually do what they do at work. So if you have a business, if you manage people, if you have to hire people at any point, you have to listen to their show. I just listened to an episode on why good employees suddenly quit. That's an issue that we all have, and it totally clicked for me. One of the reasons I explained is why it's not usually about the money. It's about all these little promises that we as founders, entrepreneurs, managers, leaders, we break without realizing it. Like when you tell someone you just hired, that they're gonna learn all these new skills, but you just keep giving them the same tasks over and over and over again. It made me realize that I've probably lost a lot of good people for dumb reasons that I never noticed. And hiring is one of the most important things you can figure out. 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You're going to dive into breakout sessions where you can immediately implement what you learn. And plus San Francisco's legendary startup ecosystem provides the perfect backdrop for networking with all these great entrepreneurs, decision makers, industry leaders, peers who are actively shaping the future of business. From September 3rd to 5th at the Moscone Center, you're going to be surrounded by forward-thinking professionals who turn insights and ideas into breakthroughs. Don't just watch the future unfold, be part of creating it. Visit inbound.com slash register to get your ticket today. You wrote about even the fact that angry guest letters on when people had a negative experience, they still mentioned and praised individual crew members. Is that something that surprised you? Is that I feel like that's not normal. I feel like when somebody... I'm just thinking, my bad experiences, when I have a bad experience, maybe I should think about the good and the bad experience, but usually it's just the bad experience sort of blankets everything. That's exactly right. You know, of course, my wife and I have never argued, but when what I hear is that when couples argue, you know, you did this wrong and then you did this wrong and then you did this wrong and everything is wrong and you just get angry. And I remember, many years ago, I got a particular letter and it really did start out, dear Mr. Fein, you are an idiot. And your company is terrible and everything about you is awful and you know, it's kind of expect this and then they said, but wait a second, I have to tell you that these crew members were extraordinary. And that's when I knew, I mean, that really brought home to me. It's the people that make this special and they are so marvelous at that that it even overcome this incredibly angry person and even they had to balance their complaint with complimenting our extraordinary crew members. Just because that person or that crew member or crew members, they delivered this while. They delivered the while and by the way, it doesn't have to be exceptional. They delivered the while, they were friendly, they had a smile, they went that extra mile. Instead of saying, oh, you want to know where that shop is, it's down the corridor to your left and then take your first ride. No, they take them there, let me show you and just let me walk you to it. That takes 30 seconds of your time, but that's a wow, it's, but by the way, crew members don't think that's a wow. They think that's what they do and they do it every time and that's what gets people to come back and that's what makes our culture so successful and our people just so extraordinary, so wonderful. For somebody who's listening to this who that resonates with, obviously it's not just one thing that has to happen to move a company in the right direction, but where should that person start, that CEO of a company where people do kind of do mediocre, half-ass, if somebody asks for help, they do the bare minimum, but the company is, okay, it's working, however you define working, but they want to move it more towards people going the extra mile and taking the extra step. How do they start moving towards that? Well, this isn't something that happens overnight and one of the advantages that I've had is, I came to a company that already had a very excellent-striven culture, be I worked with some really extraordinary people and we also had alignment and I can't overstate how important it was that there was an alignment between the board, the top management, the executives, et cetera, that this was important and it's years and years and years to accomplish that, but it has paid off nicely. I know that you look at ships as sort of this physical manifestation of the culture as well. So it's not just the people, but it's the product. It's the thing that you deliver to the customer. So explain that concept, explain how you take the product and you turn that into a physical manifestation of this wow culture that all the employees, they're all living and breathing this and they're all going the extra mile for the guest, but how do you actually turn the actual product into a manifestation of this? You know, again, once you start out and articulate this is what we're trying to accomplish. The ships, for example, are tools, just like a carpenter has certain tools, we have certain tools and if you're going to give people a vacation, then the ship has to be consistent with that. And if you say to yourself, one of the things that people want today is more choice and the choice isn't good or bad or good or better, but maybe I want to go to an Italian restaurant tonight and a French restaurant tomorrow. Italian food isn't better than French food or French food better than Italian, but they're different. And at different times I want different things and different people want different things. And so you start out and say, how do I meet my guests needs better? And what are those needs? What is it they want? And if what they want is more choice, they also want beauty. I think people enjoy beauty. So we put a lot of effort into the artwork on a ship. Not because I think our guests or our people think our guests are art connoisseurs. And nobody takes a role Caribbean cruise because it has better art. But when you run board, the art enriches you. It makes you feel good. Beauty is something we all care about. And so basically you just break down what is it that people are looking for. And then you create a passion around everybody seeking that objective. And I'm very fortunate. We're all Caribbean. We have people who are really passionate about figuring out what will make people happier. And we keep getting better at it. We learn, we build a ship and everybody says, that's extraordinary. But the first question we ask is, what can make it better? First question, and we've been extraordinary fortunate with the ships we built. We are widely regarded as designing some wonderful ships. But when it comes out, we say, now what could make it even better? And what's the next step of that? And we've just come out with a number of ships. And now we're already saying, the team is now saying, what are we going to do next? And I know that they're going to come out with something that's even better. And again, part of continuous improvement is not saying, why didn't they come up without five years ago? The continuous improvement is that's terrific. And 10 years from now, we'll obsolete those ships. One story that I find incredible is your COVID story. Because I don't think that many industries were as sidelined as much as the cruise industry was, right? So you had zero revenue for 18 months. You had 40,000 crew trapped at C, 36 billion in financing. Just as a human being, as, like, listen, people, I think sometimes forget that CEOs are just people at the end of the day. How do you navigate that? We can talk about, like, you know, the strategy of how you navigate it, but how do you, as a human being, like navigate it? And you still have some hair too. That's not easy. Certainly one of the more traumatic parts of my life. But I think I would actually say the simple solution is the people. The people in this case would include the people I worked with who were as passionate as I about making sure that we come out of this properly and successfully. But the people, in this case, also, who's my family, who put up with me and my, you know, one of the problems with the pandemic was all the things you talked about took an amazing amount of time. And so I was immersed from early morning to late at night. And my wife, my children, my extraordinary grandchildren, my eight extraordinary grandchildren. If you'd like, I have pictures. But my extraordinary grandchildren were all very supportive. I think the fact, this is something else, which is not given enough respect in today's corporate world, which is the value of experience and longevity. The team at Royal Caribbean, we had worked together for a long time. The average senior officer at Royal Caribbean has been there for 15 years or more. So we shared the culture. The other thing, which I think was very helpful for us, was we articulated early on a North Star. And it was a North Star, which I think was somewhat unusual because most companies that went through trauma in very few went through zero revenue. Turns out that's a hard way to make money. A little bit, right? But we started out saying, our issue isn't how we're going to get through this. Our issue is how we're going to emerge from this, because there was never doubt we would emerge, weren't sure when. But the issue was, how are we going to emerge from this strong, vibrant, and with an amazing future? And by the way, we also recognize that we can't be alone in this. How are we going to come through with this strong? How are our travel agent partners going to come through it strong? How are employees? The suffering was unbelievable. And so how are we all going to come through this? So that was part of it. Now you asked about me personally. One of the problems is, which all of us in the senior management shared was we had to demonstrate confidence throughout. You know very well that if you walk around saying, oh, always me, what am I going to do? And isn't this terrible that this is happening to us? The one thing I rejected very early was victimhood. Why is the cruise industry a victim here? Well, everybody was a victim of COVID. The enemy here was COVID. The enemy here wasn't the government or this or that. It was COVID. And as long as we work together, we knew we're going to have a comment. And one of our jobs, all of us in the management team, was to express and to show confidence. So one of the things I did to make sure that I was confident was I ate a lot. I really had more chocolate in that two-year period than any other time in my history. I had to let my belt out. I mean, so that helped me. But I had learned, by the way, again, experience I had been through other crises in the cruise industry and learned that if you're going to lead, you also have to evidence the kind of confidence and leadership that you hope that all your people share. So this is not a time to complain, woe with me. This is a time to say there's opportunities here. How are we going to take advantage of those opportunities? One thing that you speak about is that fear makes people stupid, which I love. Maybe you shouldn't have said that, but OK, yes, I did. I don't disagree. I don't disagree. I think it does. Not in a negative way, in a very practical way. When people are stressed out, they just make bad decisions. Well, and they become afraid. And so what they fear is you only fear what's close. You don't feel somebody, nobody fears what's going to happen in five years from now, three years from now. So that fear, focus their attention so much on the short term that they lose the opportunity to see the longer term. So I do believe acting out of fear, I probably shouldn't have said it, but acting out of fear makes people stupid. One thing I thought was interesting. You mentioned that, unlike after 9-11, we stuck to our guns. So obviously 9-11, another major crisis period. And you said, we understood that you cannot overcommunicate the North Star. So explain to me, because what that's alluding to it, I don't want to put words into your mouth. So correct me for a moment, what you're alluding to there is the way that you reacted to another catastrophe. It was not as ideal as how you reacted to COVID, which COVID actually for the cruise industry specifically seems like it would actually be a much harder hit than 9-11 was, considering just the time that COVID lasted. So if you're going to look at lessons learned from 9-11 versus what you did with COVID, what was the major difference in how you sort of navigated both of those incidents? Well, Scott, I think your point's a good one. COVID was multiples of seriousness compared to 9-11. 9-11 was very serious, but it was very clear to me and to others that 9-11 was a fairly temporary kind of interruption. And it wasn't a terrible interruption. I mean, it was a terrible interruption, but it wasn't existential. This is really going to hurt. And we knew that. And coming back to where I said, I don't do say in the book, I don't think we did as well as we could have, is we knew it, but we didn't communicate it as well. And so people outside of the inner circle who were reading the newspapers and hearing that nobody's ever going to travel again believe that. And we didn't do enough to give them the confidence that those papers were wrong. And so they succumbed to the fear and then the thousands of decisions that they made weren't as good as they should have been. In COVID, we became hyperactive in communicating to our people, to our travel advisors, to our suppliers, to our employees, what we knew. And also to the public. And so we really worked harder. And did I think a better job of making sure that they knew what we knew about what the likely outcomes were going to be? And so I think that's one of the lessons from 9-11 was that importance of over-communicating. I think that's a very important lesson because I think that too often, sometimes we make the incorrect assumption just because we believe something, everyone else is going to believe it. And I have never hurt a company or been worse off for over-communicating something. And then you start to realize like, oh, maybe not everybody's on the same page as me. So let's find a way to get on the same page. What's obvious to me may not be obvious to other people. And it's possible I'm wrong, in which case, over-communicating just helps, because now that we're going to get the feedback and maybe I'll realize I'm wrong. But if I'm right, then making sure they see it overcomes this issue that fear makes people stupid. And by the way, not having the full information makes people afraid. So I think in COVID, that was a key part of our success in getting through that. One more thing I thought was an interesting period of your life and your career. And obviously, this was huge for real Caribbean was your transition out of the CEO position after 33 years. So this is not something that everybody will go through in their life, being in a management leadership position for 33 years and trying to find a succession. But some people, I think, have a hard time after 33 years finding somebody to take the reins. How do you pass the reins on to the next person? How do you, I don't want to say give up control, but ultimately you get a control. Yes, it's giving up control. And what are the lessons that a leader, a CEO who's listening to this, a founder even, because I know, well, listen, you weren't the founder, but you had to take over control from the founder and then you passed on control to Jason Liberty. But what are the lessons that you've learned from succession? How do you make it work properly and not turn into chaos? Because from what I understand, your CEO transition, and it sounds like actually the founder transition to you and then you to Jason, both went relatively well. So what did you do right? What do many people do wrong? First of all, I think the most important part of the success of my transition to Jason was that Jason is an extraordinary leader. He is inspirational, he is knowledgeable, he is methodical, he is passionate, he's all the things that you would want in a leader. And so the most important thing is to have a good leader. I think, and he and I have worked together for over 20 years and I think, again, the most important part of the transition was the new team that took over under Jason's leadership were just wonderful people. Jason, the team working for Jason, the culture in the organization were fantastic. So I think that was a part of it. The other was a realization that I care about Royal Caribbean, I care about the company that I was involved in and participating in the development of it. And if you wanted to do well, the best way is to have good people in place and let them do it. It's, I think I have a little bit, this is, I would actually draw a very strong conclusion to my own experience with our four children. Once they go off, they are on their own and they will make their own mistakes and they make, they do some things which I just say, oh my God, how could they do that? They do other things where I say, oh my God, how come I never thought to do that? And so, but the one thing that you know, I mean, obviously I studied this before making the transition, the one thing that you know that doesn't work is second guessing. And there's no such thing as a clone. Jason Liberty is a very different person than I am, but he's terrific at what he does. And so, I think that's the part that has made it all successful. And I look at that. The other thing I would say is, and this is an important part of it, I look at it with pride. His success is my success. You know, he is building, just as my children's success, even when they make all the mistakes they make. And if they're listening, I want my children to know that they've made lots and lots of mistakes. And I'm prepared if they ask me to point out every single one of those mistakes, but their success and my children, each of my children has been successful in their own rights. And each of them is very different than me. And now that I see my extraordinary grandchildren growing, I'm thrilled every one of them is just better than the other. And again, if you want, I can tell you more about them, but they're doing it their way. What worked for me doesn't necessarily work for them, but they have to do it, and I can't be prouder to see how the team at Royal Caribbean is doing and how the company continues to go from strength to strength. I love it. I mean, what does it feel to let something go after 33 years? You know, it's an interesting thing. On one hand, I miss aspects of it. I loved going to work every single day, literally, even in the worst of the times. It was thrilling to go to work because of the people I worked with and to deal with problems like that. But now I deal with different things, and that's just as thrilling. And so actually, now I'm getting the best of both worlds. I get to see Royal Caribbean thrive, and I get to do other things that I love doing. The book, delivering the wow culture is a catalyst for lasting success. That's available this October, and it'll be available whenever this drops, because I think that when this is going live, you can get that book anywhere you get books, Amazon, et cetera. Yes, and the pre-orders are available today. Is there anywhere else that you want to send people or just go look at that book, find it on Amazon, go get it. Just go wherever you go that any bookstore will have it. You can pre-order it. And I do point out that all any of the proceeds for me go to a scholarship fund for the children of Royal Caribbean employees. I have to give that a plug, because I think education is so important, and to be able to give a little back to the families of the people that have made Royal Caribbean so successful to me is very important. If people read this book, we've gone through a whole bunch of ideas that have really helped Royal Caribbean grow over your tenure, and we'll continue to help it grow. But if you wanted them to read this book and just take one key lesson away, what would that one key lesson be or the most important idea that you want to leave them with? So I probably will refuse to come up with one, because I'm not sure I can do that. But I think the two things are the focus on people, the people are what makes the difference people are what make you successful. And how do you get the most out of people without damaging anything? And the importance of long-term thinking, I think we are so calibrated these days to focus on next month, next year. And I certainly know as a CEO, I often said that nothing I was going to do would make any difference for the next 12 to 24 months at any point in time. And you've just, it's hard to think of that long-term future because our society has moved much more short-term. Last thing I wanted to ask you, you've given over lots of wisdom, but if you could go back and tell your 20-year-old self, one piece of advice, what would that piece of advice be? Ask Colleen for her hand in marriage earlier. That's your advice, but say you only wanted to pass on one piece of wisdom to your kids or your grandkids. What would that piece of advice be that's helped you the most? It could be business or it could just be something that's really helped you in your life. Don't let short-term things bother you as much. Don't look back. Particularly if you're on a longer-term course, keep in mind the longer term, and accept that there are going to be bad things that happen along the way. And don't look back, accept them. This happened, but it isn't going to take me off of my path. I think even when people try and think long-term, something bad happens and it always does, always. But don't let that bother you. Say, okay, that was a distraction. That's not the substance. That's not going to change where I'm trying to be three years from now, five years from now. And if you can do that, and it's not easy, but train yourself to do that, and it will make your life both more fun and more successful.