Ending the Human Suffering in a Tech-Driven World of Work with Richard Sheridan

Ashish Kothari:

Hi, Rich. It is so lovely to have you with us on The Happiness Squad Podcast. Thank you for spending time with us and for giving me a real-time tour of Menlo Innovations the last time I was in Michigan.

Rich Sheridan:

Awesome. Well, it's great to see you again, Ashish.

Ashish Kothari:

So Rich, I want to ask you to tell us a little bit about Menlo Innovations and what inspired you to start it.

And friends, for those who are listening, I truly feel Menlo Innovations in Ann Arbor, Michigan, is one of those flourishing lighthouses. It's a workplace designed so differently—not to accentuate human suffering or cause human suffering as a side effect in the pursuit of profits.

It’s a place that is about being successful through ensuring the people who work there are flourishing. I’ll give you a little bit of an intro from which to really listen, and encourage you to visit for yourself. But we’ll try and capture as much of the magic of Menlo Innovations here on this podcast.

So, sorry Rich—back to you. Tell me a little bit about what inspired you to start it and give us a little bit of detail about what you do.

Rich Sheridan:

older. It started way back in: 1971

I was a freshman in high school. I started coding because they offered a computer science class, which was crazy. It was the first time that had ever happened in the school system I was a part of. And I just fell in love. I thought, “This is cool. This is my opportunity to be an artist.” I wasn’t that good with a paintbrush or a pencil, but coding is an artistic activity.

It absolutely is. It’s creative, it’s imaginative. There are many ways to do the same thing. I just fell in love with the idea that you could do this for a living. And I got the opportunity to do that. I eventually went and got a formal education from the University of Michigan here in Ann Arbor, where I live.

Pinch me—I’m in the profession that I love. I'm now well schooled in it. I’m ready. Let’s get going.

Very quickly, I started to discover the dark side of our industry. For those who know the software industry, this will be familiar. For those who don't, you might be surprised that the software industry—even to this day—is often a “lots of overtime” kind of culture.

We’re delivering lousy stuff on a regular basis that is low in quality, and doesn't delight the users at all. In fact, they get frustrated. They’re like, “Why does it work like this?”

And the people who do the kind of work we do here at Menlo—and I did when I was a programmer—we're really good people. We have big hearts. We want to serve others. That’s what engineers do. They build things for other people. And when those people get frustrated, it actually steals a piece of our heart every single time.

Eventually, it becomes just a job and a paycheck. And I was never wired like that.

There was a period of my career that was literally unhappy. Trough-of-disillusionment days. I was thinking about escape plans to canoe camps in the Boundary Waters in Minnesota or something like that. But this was what was feeding my family. This was keeping a roof over our heads. This was my chosen profession and career that I thought would carry me for a lifetime.

And by my mid-thirties, I wanted out.

My inner optimist kicked in. When I looked around, I found out it wasn’t just me. It wasn’t just the company I was working for. It was endemic to the whole industry.

And I thought, “When there are endemic problems, there are great opportunities.” So I started reading a lot of books—but not books on technology. I started reading books on how we organize humans more effectively. How do we get the most out of them without killing them in the process?

I was drawn to a lot of culture, management, and leadership books. Eventually, I had a moment—as a VP of R&D—a “click” moment where everything snapped together. All my pain and suffering informed a journey. All my book reading laid the foundation for that moment—when you know it when you see it.

Over two years, between: 1999

I didn’t use that word back then, but it absolutely was.

Then, in a sudden instant, it was all taken away when the internet bubble burst. Now I’m out of work. My stock options went to zero. I lost everything—except for one thing.

They could not take away what I had learned in those two years.

Ashish Kothari:

 Yes.

Rich Sheridan:

That became the basis for Menlo Innovations. We are a custom software design and development firm. We build software on behalf of other business customers. Every business these days needs software, and we build that for other businesses.

That's what we do.

But we have a crazy mission, as you know, Ashish. It is to end human suffering in the world as it relates to technology—by returning joy to what we believe is one of the more unique endeavors mankind has ever undertaken: the invention of software.

The central word here is joy. And we define it very tangibly.

We want to delight the people we intend to serve—the end users of the software. We want to delight them with high-quality software. We want to delight them with software that is actually usable by regular human beings—not just the engineers who built it.

In order to accomplish different results, you have to take a different approach. And I’m guessing you and I will dive into many elements of our different approaches as we go along here.

Ashish Kothari:

Yeah. I want you to restate your purpose again for our listeners because there are so many purpose statements out there—a bunch of words, artistic, colorful. But for me, I felt your purpose alive when I walked through. So restate that for us, please.

Rich Sheridan:

Yeah. The way we describe our mission is to end human suffering in the world as it relates to technology. We talk about three stakeholder groups. We're very specific about this.

We want to end suffering for the people who do the work. We want to end suffering for the people who pay for the work. And ultimately, our highest goal is to end the suffering of the people who ultimately use the work.

The people whose work lives, whose daily lives, might be impacted by work we do in this room—because they use some piece of software we've created to accomplish a goal that's important to their business, their career, their work, their profession. And if they're frustrated every single day, we have failed.

So we are going to do everything we can to make sure they are not suffering. Then we turn the suffering around and say, what's the goal? The goal is joy.

The goal is to return joy to this wonderful profession of designing and developing software for other humans.

Ashish Kothari:

I love that.

Friends, if you want to know more about this unbelievable place, I finished reading—after experiencing it—this beautiful book that Rich wrote. It's called Joy Inc. I'm holding it up: Joy Inc.: How We Built a Workplace People Love.

It's just a beautiful, beautiful read that takes you into the story—all the way from the beginning to some of the key lessons that you can integrate into your lives.

Friends, look—Rich, you tuned into this so early, 20-plus years ago. And you did it because your heart showed you the way.

Rich Sheridan:

 Yes.

Ashish Kothari:

And you said, “I want to do things differently.”

In the last 20 years—especially in the last two or three years—all the research has caught up to the work around flourishing.

Companies with flourishing cultures, high work wellbeing, high happiness—outperform competitors. They have higher profitability, they have higher productivity, they have more creativity.

Two to 3.5% higher shareholder returns is what’s at stake here, year over year, versus competitors—that you can unlock if your employees are more satisfied.

index in the three years from: 2021

So there is real science here, and I really want you to listen to this next part of our conversation. Because the way you design your workplace—those flourishing practices—are not just good for people.

Don't do it just to end suffering for your teams.

Rich Sheridan:

 Mm-hmm.

Ashish Kothari:

You should. But my point is—don't do it just for that.

What I'm telling you is if, as leaders, you're not doing it... if, as board members, you're not demanding it... you are not living into a core fiduciary responsibility that you have as executives: to maximize shareholder and stakeholder value for all.

So tune in and listen to some of the real practices. This is not a theory. This is what we are about to get into next.

So Rich, there is a very distinct way at Menlo—you call it “our way.” It’s your codified approach in how you work. Talk to us a little bit about three or four core elements that are really at the heart of that unique way.

Rich Sheridan:

Yeah. We fundamentally are systems thinkers here, Ashish.

Simple, repeatable, visible, measurable systems will outperform complex bureaucracies every single time. It’s literally like running around the track and lapping your competitors because you just have a better system in place.

So all of us in our workplaces should be thinking about the systems we use, and trading away our bureaucracy in favor of those systems.

You’ve been here. You know what it feels like when you walk in the door. I will tell you that almost universally, people visit here for the first time and the first word out of their mouths is, “Wow.”

So you get that here. I get it every single day. I’ve had that wow feeling when I walk in the door at Menlo every single day for almost 24 years.

Imagine how much that thrills me as the founder—to be able to say, when I walk into the place that I helped create… What is that wow? What is the palpability?

At a basic level, one of the most squandered energy forces on the planet—which I love that the science finds us and says, “You are doing this”—is the force of human energy.

Everybody knows what human energy feels like, sounds like, acts like. You can sense it. It’s palpable. When you come into Menlo, you can feel that energy. Why?

Number one, you can just see a little bit behind me here—it’s a big open room. It’s colorful. There’s stuff on the walls. Important stuff—not just fun, motivational posters or anything like that—but actually work-related things.

We’re very visual. We believe in tactile artifacts. You peer into the room and you see it: everybody's in a conversation here.

It’s a noisy place. People are confounded by that. Like, “Isn’t software supposed to be done in the library quietly?”

Well, not here. Why? Because everybody here is working in pairs—two people, one computer, all day long.

That is not unique to Menlo. There are other companies that do pairing. It’s rare, but it’s not unique to us.

We do it every single minute of every day. We pair all day long. If you and I were working together, we’d literally be sharing a keyboard and a mouse. We'd be in conversation all day long, trying to solve a problem together.

And that construct alone—just the simple construct of putting two people together—human energy begins to thrive.

Why? Because you get stuck, you stay stuck. I get stuck, I stay stuck. But if we get stuck together, we help each other out of it.

I will tell you, my wife and I do the Connections game in the New York Times every day.

Right after I do Wordle, we do Connections together.

It’s amazing how much better we are at doing Connections because we’re together.

She’ll be like, “What about this?” and I’m like, “Yeah, that’s it!” And then we move along and figure it out together.

I would encourage your listeners—if they’ve never done that—to just try it. See how much faster it goes. How much better you do at that game.

Well, that’s what’s happening here.

Software has never been a typing speed contest. It's always been a problem-solving contest. And two people are better at solving problems when working together.

And I don’t mean just solving them—I mean solving them well, solving them completely, solving them in a simpler fashion than they would have had they done it on their own.

So those pairs, working shoulder to shoulder, side by side in the room—the noise level is up because they’re in conversation all day long about the work they’re doing.

Then, every fifth day at least—sometimes more frequently—we switch the pairs.

If you and I are working together, next week you’re working with Ted and I’m working with Angelina. Then the next week, you’re working with Angelina and I’m working with Ted.

We keep revolving the pairs around the room. What does that do? People look at that and say, “Oh, that must slow things down.”

Absolutely—it does. It slows us down. And we go faster at the same time.

Why? Because the stuff you and I thought was perfect—Ted comes in, starts pairing with you, and he says, “Hey Ashish, are you sure that’s going to work?”

And you’re like, “Well yeah, Rich and I did it.”

And I’m leaning in, because I’m sitting nearby, asking, “What did you find, Ted?”

And within a second, Ted’s found something really important. That new perspective brings fresh thinking.

Maybe we got a little cocky. Maybe we got a little tired. Maybe we’ve done something like this before and thought we got it right. And then Ted comes along and he’s like, “Hmm, I’m not sure.”

And just in that little instant—quality begins to soar.

And you know what quality does for teamwork? It’s like rocket fuel.

Ashish Kothari:

Yeah, it's like oxygen, man.

Rich Sheridan:

Absolutely.

If you go home at the end of the day and feel, like Deming said so famously—he said it best: that all anybody asks for is a chance to work with pride.

If we walk out the door and think, “We did good work today,” that makes you want to come in the next day.

Quite frankly, I think the most important thing that does is you go home and have a good dinner with your family. Your kids see that you’re excited about your work life. Most kids don’t see that from their parents.

 Most kids are sitting around the table, hanging on every word as Mom and Dad complain about work. And then we wonder—why do kids not want to work anymore? Maybe it's because they’ve watched their parents complain about work for 20 years.

Ashish Kothari:

Struggle, suffer. Yeah, absolutely.

Rich Sheridan:

That simple construct alone—paired work, switching the pairs at least every five days—makes a difference.

Some people who do pairing switch more often. We've just chosen that cycle. But it’s really the pairing and the switching that matters.

The other part that we believe fills a team—and doesn't diminish their human energy—is clarity over ambiguity. We are very clear here.

When you walk in on a Monday morning, you know exactly which project you're on, you know exactly who you're paired with, and you know exactly what's expected of you.

We have a funny name for that system of work—we call it freedom through tyranny. And people are like, “Wait, you're supposed to be a joyful place.” And we say, “Yeah, it's joyful because by giving you that level of clarity, you are now free to do the work that you love—almost unfettered by any management system.”

No one's asking, “How's it going? What are you working on? Are you almost done? Can you stop working on this?” We are abundantly clear how we plan and how we execute the work.

That is so refreshing for people—not coming in on a Monday juggling 15 priorities because they were assigned percentages to projects and all that kind of stuff. They're not thinking, “I know I have a lot to do, but I have no idea what I should start on today.”

We are abundantly clear. There is no question when people walk in—exactly what they're going to be working on and who they're going to be doing it with.

We're also pretty clear, in the coding world at least—and certainly in our design world—on the methodology we use. So there’s a lot of stuff taken off the table in terms of “How should we approach this?”

In our world, we’re going to write automated unit tests before we write the code. When we write the code, we don’t put comments in the code—which is crazy. That’s not what I learned in school.

We use humanly readable words in the code itself. We write small methods.

So there aren’t a ton of rigid standards—just enough that people say, “I know how we’re going to work together when we do this,” and we don’t have to spend all day arguing over the minutiae of the best way to do something.

We have a basic structure that says: this is the way we do things. Then, the freedom kicks in—because once you know what that structure is, now the sky’s the limit.

We can solve a problem any way we want to, as long as we’re fitting within these pretty light guardrails of our system of work.

Ashish Kothari:

Yeah. I have a couple of questions, but I'm going to hold off on that. I'm literally smiling, because at Happiness Squad, we created a framework around organizational flourishing called PEARL—which we have found to be really powerful to unleash human flourishing and, through that, drive higher performance by addressing all the losses.

You've literally rattled off each of them in our conversation.

You talked about Purpose—a purpose that is lived. I felt it. It's about alleviating suffering. Not just for the team or the customer, but for the end consumer.

E stands for Energy. Are we creating positive spirals of energy through how we engage? Do we leave the day more excited than we came in, more filled with energy? You talked about that in the design of the place as well as the collaboration you create.

A is all about Awareness. Awareness is as much about using our strengths and growing, but it’s also about role clarity. What am I working on? Making sure we don’t have too much kind of reporting and that I’m being my most productive.

R is Relationships. Do you feel psychologically safe? Do you feel trusted? Do you belong?

And through your paired, continuously changing work—you’re fundamentally breaking down silos. You get a chance to work with everyone. You’re implicitly deepening relationships through work. You don’t have to do a once-a-quarter dinner and drinks outside the office. People are building relationships and learning from each other all day long. That’s what you’ve engineered.

The last is what I want to ask you about. I know you do it, so I’m just going to ask:

L is Life Force—which is how do we make sure we are working in neuro-friendly ways?

How do we make sure we are not working all day long in meetings with no breaks, which literally creates brain fog and accumulates stress?

Talk to me a little bit about how people work so that they are cognitively at their best.

Rich Sheridan:

Sure. Yeah. There’s a lot to talk about here.

Here’s a simple one I don’t want to miss, so I’ll just say it first—even though it may not be the most important. Or maybe it is. I’ll let you decide.

I always love when people who’ve studied this stuff come and see us. They say, “Oh, you’re doing this stuff.” I love hearing, “Tell me more.” Because I learn as much from your view of things—you’ve really thought about this.

We have, too. Sometimes I hear people say things and I’m like, “Oh yeah, we never thought about it that way.” So we learn when people come and visit.

Which is why I highly recommend tours. Tours is part of our energy.

Ashish Kothari:

 Yes.

Rich Sheridan:

We typically get about 3,000 people a year traveling from all over the world to see what’s going on in the room behind me.

Well—imagine how that feels to the people who work here.

Ashish Kothari:

Absolutely.

Rich Sheridan:

They're like, “What? We're interesting enough that all these people want to come see us?” They want to talk to us, they want to learn from us, they want to interact. They want to ask questions about how we do it and why we do it this way—and why we think it's better.

And that just energizes our team, for sure. Another one is what I call laughs per hour.

Ashish Kothari:

Tell me more. Maybe I should change my life force to laughs per hour. Tell me about laughs per hour.

Rich Sheridan:

People often ask me, “What are the KPIs for joy?” I find that a hilarious question, but I tell them: laughs per hour.

They ask, “What do you mean?” I tell them we had a guy here, Dan, who retired from Menlo a number of years ago. He ended his career here—his last 10 years, between 55 and 65—working in the space you saw.

He once said something that really stuck with me:

“I have never worked for a place that has as much laughter as we do here at Menlo.”

He's talking about a long career. And the last 10 years were in a place filled with laughter.

Think about laughter. What better expression of psychological safety, of psychological ergonomics?

We don't laugh when we're afraid. We don't laugh when we feel like we’re being chased down and hunted.

We laugh when we’re comfortable, when we’re in good relationship with other people. When we can banter with one another—not at each other’s expense, but in the sense of lifting each other up.

That's a big deal for us.

It's not like we teach people to laugh. I just hear it all the time. I sit out in the room with everybody else. The open and collaborative work environment is another big part of that life force—because you can feel it.

A fun one you didn’t get to experience—it wasn’t happening that day—but we invited newborns into the office. All day. Every day.

Typically, they come in at about three months old and stay until they're about six or seven months old. They're with their parent. This is not a daycare. They're literally in a front pack, in a pack and play, in a swing, in a car seat—whatever the parent wants.

Every parent—moms and dads alike—have that opportunity. Most take advantage of it.

I just got out of a baby shower for Matt and his wife, Emily. They're going to have a baby in May. Matt knows, if he chooses to, he can bring that baby to work with him—no questions asked.

If you want to add life to a space—life force—bring in a baby. And the babies love it. Why? Because they hear all this energy. If you’ve ever taken a baby to a noisy restaurant, they’re calm. But take them to a quiet restaurant and you start to panic—they’re going to destroy the ambiance of the whole space.

Here, the babies join in the banter.

I remember one of the first babies we had here. She started making what you could affectionately call dolphin sounds, the kind a five- or six-month-old makes.

The whole team laughed as loud as they could.

It didn’t take long before she connected, “If I make that sound, I get laughter.”

Those kinds of things are a remarkable part of our culture.

People ask me, “What does that do to the productivity of the parent, though?”

I say, “Compared to what?”

Getting a phone call from daycare that your kid just threw up and you have to leave right now?

Parents are always worried, “How is my child doing?”—especially at that very young age.

So it’s been a delightful part of our culture.

The other thing I think, and this is really to the heart of the matter—and I’m sure we’ll talk about our interview process as well because it’s very unusual—during the interview, we pair people together with another candidate.

And we give them the weirdest instructions they’ll ever hear in an interview. This is literally teaching our culture from the moment of first contact:

Your job is to help the person sitting next to you get a second interview. Make your peer partner look good. Help that stranger—this perfect stranger who, by the way, is competing for the same job you are—help them succeed.

We will judge you in this first interview based on how we see you support and help another human being.

Ashish Kothari:

 Amazing. Wow.

Rich Sheridan:

There’s probably a lot more we do here, but those are the things I can think of that really contribute.

Ashish Kothari:

I’m just thinking about that. We ask people, “Tell me a time you helped somebody,” and someone will come up with a story—whether they did it or not. But what you’re creating is a real-time show: Do this. And it’s very hard to fake—especially if you don’t know how.

Rich Sheridan:

Somebody once asked, “What if the candidates come in and fake collaboration?”

My co-founder quipped, “If they can fake collaboration 40 hours a week, I’m good with that.”

Ashish Kothari:

Exactly. No, I love that. I love that.

So question for you. I want to go to this pairing conversation.

I'm sure you have people who say, “I get it. When you pair, you get higher quality. You go slower to go faster.”

But really, Rich—isn’t it two people coding for 40 hours versus 40 hours of output? Because the two are just doing one thing.

Do you really feel you can make up the 40-hour gap in hands-on-keys output with this approach? What do you say to them?

Rich Sheridan:

Yeah. You can imagine—

Ashish Kothari:

This is not the first time I’ve been asked that question.

Rich Sheridan:

Everyone asks about it. It makes sense. It’s the most logical question ever. They’re like, “Okay, Rich, you feel like you’ve discovered the cold fusion of teamwork. So tell us more about this.”

And I do believe that. I will tell you—this construct, just that one: pairing and switching the pairs—I would give up everything else before I gave that up.

That would be the last thing on Earth I’d let go. You’d have to tear it out of my cold dead hands.

They’re intrigued: “Why? You’re the CEO. You're the guy making sure the company turns a profit. And you seem willing, for some odd reason, to cut your productivity in half to achieve some ethereal result.”

So what’s the proof?

Funny thing is, I can usually touch on it pretty quickly.

Most people get that when you're doing creative, imaginative, hard R&D work like we do, people get stuck a lot.

People say, “Oh, I’m great if I’m in a quiet room with my headset on. I’m in flow.”

But if you actually did time-lapse photography of them over the course of the day, you’d see—they're stuck for half the day.

And even the parts of the day that don't look like they're stuck, the real question is:

Are they doing good work right now?

Are they solving the actual problem?

Or are they going in the wrong direction?

Let me tell you: when you've got another human there, you have to think out loud. They're listening. They're checking—“Is Rich going the right way as he's typing on the keyboard?”

That stopping and talking, making sure we're right—quality goes through the roof.

And here's the proof in the pudding. I can say this now after 24 years—I never imagined I’d be able to say what I'm about to say.

In 24 years of doing hard, important, custom software development on behalf of our business clients—some projects go on for years, cost millions of dollars, and often hold the lives of people in that software’s hands.

Just to give you an example—we rebuilt the Organ Transplant Information System at the University of Michigan Health System.

So when I say it holds the lives of people in its hands—

Ashish Kothari:

It literally holds the lives of people.

Rich Sheridan:

And so, in 24 years, Ashish, I probably hold a record that no other software company could ever speak to. We have had two software emergencies in 24 years.

Ashish Kothari:

Wow.

Rich Sheridan:

You can imagine, every one of your letters—purpose, energy, life force—imagine being able to say that about your work:

We are basically emergency-free.

What does that mean for the people in there?

It means you did good work on behalf of your clients. You kept people alive. You helped scientists try and discover cures for HIV and various blood borne cancers.

We work in all kinds of arenas. The fact that people have worked here their whole careers and have never experienced a software emergency—that’s unheard of.

I said this at a software conference a few years back. People came up to me and either said, “You're lying,” or “You must have a bad definition of emergency.”

I said, “No, I don’t think so.” I told them what the emergencies were, and they said, “Okay.”

It’s unheard of.

I remember being challenged about this by a gentleman I was giving a talk to at his company. He said, “I think this is all BS. Let me tell you how we work here.”

I challenged him back.

I said, “Bill, pretend I took everything you just described about your company, brought it back to mine, and we switched to your way of working. What do you think would happen?”

To his credit, he thought about it. I was literally watching him process the answer to this Socratic question. It was like watching every cell in his body change as he contemplated the answer.

Then he said this:

“I’ll tell you what you’d have, Rich, at minimum: You’d start lying about being done with things. You’d start kicking quality problems down the road for someone else to fix. Your customers would begin to notice those quality problems, and then you’d start to lose market share. You’d go from number one in your market to number two or three—because your customers can see your problems.”

He said, “You’d have at your company exactly what we have here.”

Ashish Kothari:

 Yeah.

Rich Sheridan:

I was astounded at that change of mindset—right there, in that one single question.

I kept in touch with that company. People later told me that guy was never the same after that day. He changed. He realized he was at the center of the problem.

It was his own spirit and attitude that were causing all those problems—because of how they ran their company and their team.

There are lots of ways I can measure things, but here’s a simple one everyone can relate to.

Someone once walked through here on a tour, like you did, and asked:

“Hey Rich, I noticed nobody’s on their devices when they’re working. No one’s on their phones or playing with Instagram or something.”

I said, “Yeah.”

He said, “How’d you do that?”

I said, “What do you mean?”

He asked again, “How’d you get people to stop doing that?”

I said, “Let’s go talk to them.”

We went up to a pair of people. One of our senior team members was asked, “Why don’t you get on your devices?”

Her answer was so precious:

“I’d be letting my peer partner down.”

She felt a personal responsibility to the person sitting next to her. She said, “If I’m screwing around at work, it’s costing not only me time—”

Ashish Kothari:

 Absolutely.

Rich Sheridan:

“But someone else, too.”

The guy who asked me the question goes, “That’s it right there. You’ve just saved 50% of the labor just in that construct alone.”

Ashish Kothari:

Yeah. Well, since I walked that tour—I'm an ops guy.

By the way, I grew up as a software engineer. My first job was with IBM. Then I worked at Keane doing Y2K renovations. Then I was at KPMG before I—

Rich Sheridan:

You experienced as much human suffering as I did then.

Ashish Kothari:

Oh my God. Talk about human suffering.

Rich Sheridan:

You could write a whole book with me about your suffering.

Ashish Kothari:

Then I spent 12 years in operations work before I started focusing on flourishing. Operations taught me all about how to build programs that drive scalable, sustainable transformations across thousands of people, in distributed workforces.

Many of them are in blue-collar roles where people ask, “Wait, can we really train people like that?”

And I say, “Yes.”

And by the way, those factories that are highly productive and producing high quality—there’s also an energy about that place. Because people are proud to show up.

The things we think are the result of people feeling good? It’s actually the other way around.

Rich Sheridan:

Absolutely.

Ashish Kothari:

How do you make people feel?

I’ve thought a lot about that. I talk about it differently than a lot of researchers and practitioners. I talk about human assets and losses—availability, performance, and quality.

People say, “Oh wow, you think about losses?”

Yes.

And here’s what comes to mind. On one hand, you can think about a 40-hour “loss” because two people are working on one thing.

Rich Sheridan:

Mm-hmm.

Ashish Kothari:

But friends, walk with me through this pathway—coming from that background.

First, let’s talk about absenteeism and attrition. Or call it availability loss.

Rich Sheridan:

Mm-hmm.

Ashish Kothari:

Software is a high-attrition, high-absenteeism environment—because people burn out.

Rich Sheridan:

 Yep.

Ashish Kothari:

With stress and anxiety, people leave. Every time someone leaves, all that knowledge walks out the door.

Then you bring someone new in, and now you have to train them up. Forget the fact that if someone left in the middle of the project, maybe they documented everything. Maybe they didn’t.

That knowledge resides with them.

I think you've solved that problem in three ways.

First, by pairing—there’s always two people who know what you're working on. So even if someone leaves, the knowledge isn’t lost. It’s distributed in the system. It's not just in the code. It's in the people’s heads—and they're all around.

Unless everyone quits, that’s not a problem.

Second, because of the environment you've created, your rates of attrition and absenteeism are almost zero.

Right there—

Rich Sheridan:

We have normal attrition. This is a college town—people get married, their spouse gets a job somewhere else, and they leave.

But because of what you just said—and remember this too, Ashish—it’s not just that two people know the work. Because we continually switch the pairs, all of them do.

So we don’t actually fear people leaving. It’s not that we want them to leave, but we don’t fear it—because we have no towers of knowledge.

Ashish Kothari:

Absolutely. And compare that to the usual 10–15% attrition. That’s why I say “almost nothing.” You’ll have some natural attrition—people retire, people get married.

That’s a big one. Most companies lose 10–20% just in this bucket alone.

Then let’s talk about performance losses—which means, when people are working, are they producing the output?

Most will say, “It’s very hard to measure in software.” It is—but here are the levers I’ve picked up for why you’re creating higher performance during the time people are working.

The first is what you just said. When people work alone and run into an obstacle, they give up. That’s when they go to their device or get stuck or spiral down.

By having two people working together, you've eliminated that loss of stuckness, which happens all the time.

Second, software is fundamentally a creative, problem-solving task. There are seven ways to solve a problem. Some might be more or less efficient, or more or less prone to bugs.

By having two people think about it—and then a third person when you switch the pair—you’re giving yourself the opportunity to find a more efficient path, or at least explore it with fresh eyes.

Rich Sheridan:

Right. What happens when we switch the pairs is, if you and I are continuing work that Ted and I did the week before, two things happen on our first day together.

First, I’m teaching you what we did.

Second, you’re asking me questions so that you can get up to speed.

In that conversation, quality improves.

Ashish Kothari:

Absolutely. Hold off on quality for a second—that’s the third bucket, which I was just about to get to. But yes, that conversation absolutely improves quality.

Another thing that affects software all the time—I’ve done this. I’ve served banks, I’ve served bad CPGs.

You can’t honestly say every person on your team is equally proficient. So what are you doing here? You’re training on the job.

Those who are less experienced are learning from others. And those who are less experienced are also questioning things—bringing in new creative approaches someone else may not have thought of.

You’re also creating shareable code and practices. Knowledge transfer is a really big thing that holds teams back.

Another performance loss you’re addressing is multitasking. Your people aren’t distracted by devices or juggling 15 projects. They’re working on one thing.

Rich Sheridan:

 Yep.

Ashish Kothari:

And if a user calls, you switch and go solve that bug. Now you have to get back up to speed.

In the system itself, you’ve designed away all that chaos.

I’d bet there’s 40–50% of performance loss that shows up when individuals are working that you’ve completely eliminated.

And then, of course, the quality loss—oh my God. The fact that you said you’ve only had two emergencies.

I’ll tell you a real story.

I was running a leadership session with the CIO of a large bank—talk about human suffering.

This person said to me, “I get panic attacks when I wake up in the morning and go into the shower.”

I asked why.

He said, “Because I’m not next to my phone.”

Rich Sheridan:

Oof.

Ashish Kothari:

“If something breaks, I can’t respond to it.” Because things are breaking all the time.

Rich Sheridan:

Yea. That 15-minute shower is a torturously long time. There might’ve been two or three emergencies in those 15 minutes.

Ashish Kothari:

Right. Think about that: “I don’t feel I can take a shower.”

Rich Sheridan:

 Right.

Ashish Kothari:

That’s the state for so many people.

People who are “on call” because the software is buggy.

I’m sure you’ve been on teams where you’re expected to stay all night—because something is going to break.

Rich Sheridan:

 Yep.

Ashish Kothari:

And people accept that. “You're on call.” If you're a doctor or surgeon, I get it. But on call for software is avoidable—if you design it right the first time.

Rich Sheridan:

Funny story about that.

We just finished a big project with a client. Multi-year. They were transitioning from a mainframe to a cloud-based environment.

They had to retire the mainframe because all their programmers had retired.

Our team worked closely with theirs—probably five years on that project.

Recently, in the last few months, it started rolling out. They’re getting warehouses online, customers are switching over to the new system.

They came to us and said,

“Hey guys, we don’t really know how this is going to go. We need your team to be on call through the night. Just have your phones on, be ready to jump up, have your computers at home.”

And we said, “Okay.” The customer was asking for it.

It was the first time that had ever happened in our career.

That lasted about two months—of our team being on call, ready to jump up, throw on a robe, go to their computer, wipe the sleep out of their eyes, and get to work.

They never called.

The team recognized, “They’re paying us for these hours while we’re sleeping.” And they got to sleep.

They were never called the entire time.

Every listener should be asking themselves:

What’s the price you’d put on that?

Ashish Kothari:

 Yep.

Rich Sheridan:

What’s the insidious effect of all those emergencies your banking friend is dealing with?

It’s diminishing the impression of their business in the minds of their users.

And if it's a bank—banks are a little harder to switch, sure—it’s a pain to change your banking relationship.

But everybody knows there are plenty of other banks they could go to. There’s a switching cost, yes, but eventually, if you cause your users enough pain, they will switch.

All of those things matter.

Here are a couple more you should think about, because I can see what you’re doing, Ashish. You’re building your list—you’ve been doing that for a long time—and that’s awesome. That’s exactly what we should all be doing when we think about helping human teams flourish.

When someone here goes on vacation, we do something no other tech team would do:

We forbid them from checking in electronically with the company.

We don’t turn off their email accounts, but if we catch them checking email while they’re away, we’ll gently and humorously chastise them when they return.

Lisa, for example—her husband is originally from Hong Kong, and all of his family still lives there. When they go on vacation, they’re gone for six or seven weeks. That’s a big trip, especially with two kids.

He doesn’t work for us, but she does. And while they’re on a beach somewhere, he keeps looking over at her and asking, “Why aren’t you on your laptop? Shouldn’t you be checking your mail?”

She just smiles and says, “No. I work at Menlo. They actually chase me down if they catch me checking my email.”

Imagine the effect that has.

What’s the difference between her and him? They’re both on the beach. He’s on his laptop while the kids are playing in the water. She’s making sandcastles with the kids—exactly what she should be doing.

She’s recharging. She’s living life. She’s enjoying her family.

You want to talk about flourishing? That’s it. That’s why we have vacation days.

Now imagine you're the expert in something—say, the Oracle 9.1.0.12 Service Pack 3 expert. That’s a real thing in our industry. People get that narrowly defined, and that’s all they do for years.

Then one day they say, “I’m getting tired of this. I want to do something new—AI work, a new language, a different project.”

And the company says, “Oh no, I’m sorry. You’re the only one who can do this. You're the value right here.”

And the person says, “Yeah, but I don’t want to do it anymore.”

And guess what? You can’t quit either.

Ashish Kothari:

Because anybody else will want you to do that.

Rich Sheridan:

It’s like the three laws of thermodynamics:

You can’t win.

You can’t break even.

And you can’t quit the game.

Here though, even if you are that tower of knowledge—and we do have people who know certain things deeply—because they’re paired, they’re constantly sharing what they know with others.

After a while, you’ve got five or six people on the team who know what that person knows.

Now they can switch projects, move to a new technology, or do something they’ve never done before.

And the beautiful thing is, in our world, everyone’s in the same room. No walls. No offices.

Ashish Kothari:

People can always walk up and ask them if they need help.

Rich Sheridan:

You don’t even have to do that. You just say, “Hey Ashish, can you come over when you’re ready?”

You don’t even have to move.

We call that high-speed voice technology, by the way.

Ashish Kothari:

I think this is so brilliant, and I always go down this pathway because people hear this and they get it in their hearts but they don’t get it in their minds.

Rich Sheridan:

Yep.

Ashish Kothari:

Because the reality is, as you said, this way of working, you are not unique but you are rare. Why? Because people fundamentally don’t believe it.

They don’t believe it fully, they might wish it in their heart, but they’re stuck out of fear and your minds keep you going the old way. I told someone recently, “What we’re discussing—it’s all common sense.” But it is not common practice.

Rich Sheridan:

Absolutely. And everything I’ve described to you today? It’s dirt simple.

It is unbelievably simple to do these things.

But simple doesn’t mean easy. And simple doesn’t necessarily mean fast—because we’re talking about changing human behavior, which is one of the hardest things to change in the planet.

But you just gave your listeners a tremendously good tour of Menlo—without them having been here. Now, when you visit and see it with your own eyes, you’re confronted with a reality you can’t unsee.

Ashish Kothari:

Yeah. Well, my friend—as we’re building the Happiness Squad, you’ve given me so many ideas.

I’m transported back to what I felt when I visited you.

And I just want to say thank you.

We’ll probably have you back again. I’d love to. We could go on for three hours, Rich—there’s so much gold to mine here. So much that you’re doing.

Thank you for your bravery, your courage, your heart in what you’ve created.

And you know I’m going to do my part to get more of my clients to come see you.

Because they can hear this…

They can read about it in Joy Inc.

But once they walk through the premises—

Rich Sheridan:

Yep.

Ashish Kothari:

They’ll realize that despite the fact that AI—agent AI—can now do 90 to 100% of what programmers can do…

It will never come close to what you’re doing with humans at Menlo.

So thank you for what you're doing. It’s so great to have you here. I appreciate you.

Rich Sheridan:

Thank you, Ashish. Great to be with you today.