Weaponizing Trust in Tech Diplomacy

ABOUT THIS EPISODE

Tech diplomacy is still a fairly fresh concept. In most western countries, it’s a movement for advancing freedom through adopting trusted technology.

But as authoritarian regimes like China and Russia continue to preempt technology for nefarious purposes, democratic governments look to the private sector for assistance.

Keith Krach, Chairman and Co-Founder of the Krach Institute for Tech Diplomacy at Purdue , tells us what executives can do to help counter the techno-authoritarian playbook.

Join us as we discuss:

  • Why “trust” is the most important word in any language (5:10)
  • The State Department’s need for more private sector talent (17:22)
  • A call to action to C-Suites for a China contingency plan (24:47)  

Craving more? You can find this interview and many more by subscribing to C-Suite Blueprint on Apple Podcasts, on Spotify, or here.

Tech diplomacy is still a fairly fresh concept in most Western countries. It's a movement for advancing freedom through adopting trusted technology. But as authoritarian regimes like China and Russia continue to preempt technology for nefarious purposes, democratic governments look to the private sector for assistance. Keith Kroc, chairman and co founder of the Kroc Institute for Tech Diplomacy at Purdue, tells us what executives can do to help counter the techno authoritarian playbook. Join us as we discuss why trust is the most important word in any language, the State Department's need for more private sector talent, and a call to action to c suites for a China contingency plan. They're listening to c Suite Blueprint the show for C suite leaders. Here we discuss no B S approaches to organizational readiness and digital transformation. Let's start the show. Keith, thanks so much for joining me. Hey, George, thanks so much for having me. I appreciate it. You know, we're gonna talk about some serious topics, but to start things off on maybe a somewhat lighter note, thinking back to when you were a docu signed back and starting a two thousand nine. Did you ever think that in two we would still have fax machines, that they'd still be hanging on here for for the last drop of blood, you know, I thought those would be gone by now. People said that docu son would just be a feature of Adobe, but I looked at that as an opportunity because I knew we could run the same play that we ran, you know, at Ariba, And now you know there's a billion users around the world with DOCUSI can you talk about running the same play? You know, if I look back at your career, you're you're such an amazing change agent and a catalyst, from from GM to Ariba, tow Docu signed to to the Department of State, and you know, you're the change guy. But what I find amusing as you look back at all that, is there so much At least it looks like there's...

...a lot of consistency, consistency in your values, consistency in the playbook, and this focus on trust and vigilance and highly performing teams. And I feel like that's just important as a human And I'm curious where those roots were. Does that go back to the mean working in your dad's machine shop, where did where did you build all that? Yeah, it totally goes back to you know, my dad had a five person machine shop into good times and the tough times. It was just being him. It was right in small town Ohio. You know, our our customers were the Big three. And I was well that at the age of twelve. And I learned those great Midwestern values obviously from my dad, and a work ethic and a great sense of humor. You know. I remember, uh, you know, we would go in on Saturdays and we scrub the toilets and I remember him like yelling across the stall the other one and I hated it, and he just goes, Keith, we can't solve world peace, but we can try, you know. I mean that was a kind of thing. You know. I get paid fifty cents scenari. It's beyond the back, you know, as we and like a ten hour shift, you know, ninety degrees and you go, Keith, we don't make a lot of money, but we sure a lot of fun, don't we. You know I made say so you know you learn that s that's important, that's so important. And you know, and now you've co created the Croc Institute for the Protect Diplomacy at Perdue. You I know recently, uh, the Department of UM Commerce Secretary Ramando, she was out there and she gave you kudos, saying that it was what you're doing with the Clean Network initiative is brilliant. And I don't care how successful you are, it's nice to hear those kudos, not just for yourself, but but for your team. You know, I'm curious if you could expand a little bit on on why did you co found this, what's the mission? What do you guys trying to do there? Oh, which, by the way, before you do, what I love about it is that it's nonpartisan, And what I love about it is that it's not just about ideas. He seemed to be showing people how to get stuff done, which is just killer. Absolutely, And you know, first thing I...

...want to say is it's always a team effort, right. I mean, made a living surrounding myself by people who are are smarter than me at and so the CROC Institute for Tech Diplomacy at Purdue is it's rapidly becoming the pre eminent global authority on tech diplomacy and a thing called tech state craft which integrates high tech business strategies with foreign policy tools based upon this UH doctrine we created at the State Department called the Trust Doctrine. But the but the premise of the institute. It's founded on technology must advance freedom, and technology can be used for good purposes, it can be used for evil purposes. And so it's really designed to advance freedom by combating authoritarian regimes like China and Russia. It's interesting freedom. You know, when we think about trust, you you really have the most freedom when you're within that circle of trust, right when you have that those norms and everything nailed down for for trust. And I'm curious, how have you how have you used that concept of trust, you know, within this institute and within your career, and how do you accelerate it? Sure? You know, I mean trust has been at the forefront of every company I've built, was the forefront of defeating the Chinese Commerce Party's master plan and control the five G. You know, I really believe that trust is the most important word in any language. You do business with people you trust, your partner with people you trust, you buy from people you trust, you love, you love people you trust, and you know, a docusent I used to stand up on stage and I would say, look, guys, we're not in the software business. We are in the trust business. We deal with people's most important documents. Those are the ones that...

...you signed. And so we utilize that concept at the State Department when it looked like the Chinese Commerce Party, their most important company, their backbone for their surveillance state, their national champion, Huawei, and five she was gonna run the table all over the world and then and that means that they cannot just control cell phones, but also power grids, sanitation systems, internet of things, manufacturing processes, autonomous vehicles, you name it, and um and basically we use that trust droctor to defeat them. If there's anything that's a trust business, it's it's five G. And you know, one of the interesting things when I was at the State Department, George, who was my first sixty bilaterals with foreign ministers or economic ministers or finance ministers, I had asked him. I'd say, hey, how's your relationship with China? And they would go, well, they're really important, they're important trading partner. And then it seemed almost every time they look both ways like somebody's in the room and they go, but we don't trust them. And that's what rang bells in my head. So if you think about UH, the principles that protect our freedoms, they are things like transparency, reciprocity, respect for rule of law, respect for property of all kinds, respect for human rights, respect for the environment, respect for sovereignty of nations, respect for the for the press. You know, accountability, integrity, and all of those equal trust UM. And what we found, George, was that UM in the China and Russia have been used to those principles against us. And so what we did is in one Jiu Jitsu Mo, we've flipped them on their back and used it against In SS, we weaponized the very principles that protect our...

...freedoms. And that all adds up to trust. That's tremendous. You know. I feel like too many times you hear the phrase trust takes time, and I feel like that gets translated into that's all trust needs is time, and it's not true. You need the clarity, which it seems like you've done a great job of outlining what does trust mean for us? It needs the accountability and it needs the the intentions UH put forth on that that trust to actually make it happen. You know, when I was digging deep on on what you did with the Clear Network Alliance, I found a sentence that I'll read it here because I was impressed. But I say, Kroc wanted to be able to move fast, and so we needed to align the multiple agencies and departments within the U. S Government around a competitive US technology strategy. And I laughed because I was like, how the hell are you going to do that fast? And then you managed to do it in nine months. So you know, I'm curious to hear about that. You know, how do you get people bought in and and how do you push away the naysayers and then actually get something done like that? Yeah, you know, it's really a great it's a great question because you know, we know in the business world the ultimate strategic weapon is speed. And you know, and you know when you're when you're disrupting an industry, you're creating a category. It's not the big that's gonna eat the small, it's the fast it's gonna eat the slow. And so you go into government that not typically goes fast. Um, how did we do that? Well, one of the things we did is we had a strategic plan, we had a playbook, We got our teams totally aligned. I brought in twelve results oriented executives and entrepreneurs and technologists from Silicon Valley. I also brought in the dean of engineering at Purdue, who's just been named the next president to work on our team. And you know, we do how to move fast and so to get that buy in, and we had you know, we had we had great clarity. And you know what's amazing in the United States government, if you're getting...

...results, then everybody's just gonna jump on board. And that's exactly what we did. What I also liked in your approach was you recognize that, you know, when we think about bureaucracy and policy, that they were using too many sticks and not enough carrots, and that you needed to look at these organizations like the consumers. So you were really bringing what you learned from the private sector into the public sector. And what was that shift like to start using more carrots? George is really a good point, because what was interesting for me is that these things we use and Silicon Valley, you know, if she's called practicing economic war craft, because it's all about being the category king because player, you know, player category kid gets the market cap of the market resources players two before five, they gotta fight over the scraps. It just so happens when we play economic warfare out here in Silicon Valley. You have to play by the rules because if you don't have your integrity, you're not gonna last very Um. Now, uh, it is State Department. What we learned. It's like superpowers. So I'll give you an example. So, uh, all previous efforts, government efforts had failed. Um in terms of stopping Huahwei. They had all the momentum. And as we know, you know, in the rapidly changing market, everybody wants to go with a leader, and leadership is not defined by size, it's defined by momentum. So our strategic comparative was to reverse their momentum and replace it with ours. And so, uh, what was happening is the previous efforts. You know, it's kind of I'll be honest, it's like the ugly American going around pounded tables around the world and your prime ministers saying, don't buy Whahwei. And I said, hey, you know what, why don't we do something different? Why don't we treat these countries and these telecommunication firms like customers, and the customers always right. Nobody likes to be told what to...

...do. So you need a value proposition if you expect somebody to partner with you. So we created a seven step value proposition as we would go around and talk to these uh, these countries and telcos and to me, it just seemed like common sense. But for a lot of people, uh in government at the State Department, they said, Wow, how do you think of that? You know, it's just instinct. That's funny. I feel like I used the same approach with my five year old daughter. You know, you can't just demand that they do what you say. You kind of have to have those sticks the carrots, right and really treat them like the customer. I've got to leven year old twits. I hear you, George totally. So so now I'll bounce around your career a little bit to kind of, you know, take it from different points. So because you you use the same playbook um at most of your organizations, and I'm curious if this was style difference or if it was on purpose. It was this inverted pyramid from vision down to an execution with execution being the small one. But then for your for your clean networks, it was it was upside down with the execution being much much bigger. Was was that on purpose or is that just a style difference of your playbook? So I've used that same playbook of it's You're right, It's shaped black, a pyramid, vision, mission values, team rules, long term goals, strategy, all boiled down to execution. I've used that it dead companies ever since I was a General Motors, you know, since I was a VP there and and when we created you know GMF for Robotics, which is now the largest manufacturer industry robots, all the way through Raza computer software. I usedally when I was sharing the board of for new and of course you know, uh rebu docum sign all that and um. So sometimes I changed the color verdict just you know, just for a a little change, a little flavor. But you're consistent still. But what's what's funny is like got you know, I've got a bunch of...

...guys who worked with me, uh you know, across multiple you know, companies that brought a lot of the State Department and you know, one guy, Mark Carlson, who's been with me from general motors that everything thing I've done. He just goes, all right, croc just headwater stir, here we go, playbook, run to play and it and it works and you tweak it over time in terms of different nuances, but the basic framework works. That's fantastic. And let's focus in on a reba because you're part of that co founding team. This is a uh, you know, black campus. It's a really new new market completely. Um, you're you're not You're in the kind of the middle of your You've you've got your belt under your legs under you from GM and other and starting another company. Um. How much of your kind of leadership principles and everything we're already formed in rock versus are you now learning on the job, figuring things out as you go? Well, I think the way I look at it is, you know, I've always jumped in water over my head, so to speak. Um, And and that's how you learn the most, by getting blooded into battle. So I think the way to look at it is my transformational journey has been a you know, uh, high velocity. And you make a lot of mistakes along the way too, and that's when you learn the most. And by the way, when you're jumping water over your head, that'said adrenaline rush and almost after a while it becomes addicting. So I think that's one of the first steps to becoming a transformational leader. So you know, added up all along the way, but it really does it. You know, a lot goes back to when I was at Purdue. A lot of things that I learned in leadership positions in the Sigma Kai fraternity. And then you know, one of the VP of General Motors of twenty six you talk about jumping water over your head. So you just keep adding those, uh, you know, those different plays and you're learning all long. You know. The...

...other important thing too is my mom would always say the best way to learn is from your mistakes, and the best way to learn that is o pe other people's experience, she said. You know, so I've always been blessed with great mentors and I'm a big believer uh in mentorship. That's one of the reasons why I created this company called the Global Mentor Network. And you know, my boy said, you have to have enough to make mistakes on your own. So I think it's a combination of mentoring jumping in water over your head and just being curious. I think I love nothing more than sharing the many mistakes that I've made with others so that they can learn from them. It's it's the real place, are right? Yeah? And you know what, when you're mentoring somebody, the most important thing is to talk about your fears, your failures, and your flaws. That's what mentees want to know and and so that's really important. And by the way, also I always say the most nonintuitive advice I always give young fathers is talk about your mistakes because that takes the pressure off these young guys and and they're gonna have a lot of it. It also teaches them to take risks. And it's okay to fait. I'll write that one down. My wife is gonna like that. You know. I tend to think that I'm just always right and always perfect. Key. So, you know, when you moved over to State from the outside, I would think that that's a big shift in in in a lot of aspects of your career in your life. You what what was that changed like and what lessons did you learn from moving to the Department of State. First of all, I fad the blessing of live in the all American dream growing up in smalltown Ohio and all that um So to have the opportunity to give back to our great nation was was really a great honor and something I couldn't pass up. In terms of running US economic diplomacy. You know, one of the things that really struck my cure curiosity was,...

...are these same principles that worked in the business world, that worked in the nonprofit world, that worked in higher education, that were so successful in doing a lot of transformations with that work in government? And what I found out the same principles applies as a matter of fact, their superpowers. You know, it all starts with building a high performance team. And you know, one of the things that I've learned in my career is that diversity of thought and having a team of different temperaments, talents, and conviction is the catalyst for genius. So when I brought these twelve guys from Silicon Valley and combine them with these amazing career foreign service officers and civil service who can speak four to seven languages, work their tail off their north stars national security, it was like magic. It was like a sixty sixty deal that was an amazing experience. That is also why I'm such a big pusher that my advice to young people is go take a stint in government. And by the way, we need more people from the private sector. And when I mean private sector, I don't mean lawyers, not even bankers there. I call those guys wealth transfer guys. What we need is wealth creation people, people who have manufacturing or high tech because what's going on it's all about economic statecraft these days, and tech state craft. It's more operators that can get things, more operators. Yeah, and you're absolutely right, George, because that was the other thing what I saw clearly is there's a tremendous gap between policy and execution. And as we know, you can have the greatest policy, you're the greatest strategy in the world, but if you can't execute, you're gonna lose every time. You could have an okay policy, okay strategy, but if you can out actually cute everybody else, you're gonna win every time. Yeah.

Yeah, The dirty secret amongst strategists is that strategy parts actually kind of easy. It's all the rest of the stuff that's it's hard to get done. And so now, um, you know, You've been tasked the chair of the Global Tech Security Commission at the Atlantic Council's Global China Hub. What's that all about? That sounds important and I'd love to hear more about it. Yeah, this is this is uh A tremendous and unique as a back into the White House, both sides of the aisle. And so, you know, think of the nine eleven Commission, you know how big that is. This two year commission. But which makes it different is it's an international commission. We'll have commissioners from fifteen different countries. Will also have commissioners representing fifteen of the most strategic national security UH tech sectors. And so the mission is to develop the global tech Securities strategy for the free world and also to develop offensive and defensive strategies in each one of those tech sectors to advance freedom and combat techno authoritarianism. So it's really very much a continue with that mission that we were on at the State Department, and you know, being able to put something like this together, it's really tough for a government to do. So having a private sector lad, I think is going to actually allow us to move really fast. And each one of those commissioners will build their own advisory council of ten to fifteen experts in either that country or in that specific tech sector. So at the end of the day, what you're doing is you're creating a movement to advance freedom through the adoption of trust and technology. Mm hmm. You know, given these roles that you're playing, do you you must just puntiff caton, think about the moment in time that we're...

...at right now, right some people will label at the Fourth Industrial Revolution. Uh, you know, whether you want to label at that or not, it seems that we're in this great moment of change and if we don't address it the right way, we can end up in in a bad spot. You know what, what do you how do you think about this moment in time? Yeah? You know, it's interesting you say that because after a while, you're patent recognition just kicks in. You know, like back in the early eighties when we when we started g MF for robotics, you know, that was a whole technology paradigm shift. They have these things called ant se con drollers. You know, we started ras the computer engineering it was workstations, you know, Ariba. We were the first enterprise application to be written on the internet. That was another way, doc you sign it was Oh, all of a sudden, now you've got cloud and mobile and now I look at this paradigm shift right now, and I see this wave coming, and this wave where citizens are waking up to China's authoritarian regime and their doctrine of retaliation, intimidation, coercion. This is a huge paradigm shift. And I can tell you what. They have no respect for human life, for human rights, for the environment, for sovereignty and nations, for rule of law, and and they want to spread their techno authoritarianes and you can see it. And by the way, TikTok is one of the ways that they do that. There's a lot other ways. But the way I look at it is this is that inflection point that we have to step up and do something. Because if there's anything I learned at the State Department, this democracy, this two d ear plus experiment that we're living in, it's only an experiment. And the natural order of things is the bad king, the dictator, and the emperor. That's the laws of physics. And you have...

...to fight every day to keep those freedoms. And the other thing that something I really saw is that if it was for the United States, would be a hundred countries that wouldn't even taste freedom. So now we've got a big threat upon US and the Chinese Countries Party represents a real and urgent threat to democracies around the world because they're dictating a dictator out of the box with their technology, surveillance tools, and their money. Those are great points, and it doesn't come for free, and and it really democracy only really works the more that we all participate in it. So, you know, as we think about those sea level executives are out there, you know, I have the pleasure of working with them at both enterprise and mid market, and I know they're already being vigilant about so many things. They're trying to maintain their culture, they're trying to stay the market leader, maintain margin, cash flow. What responsibility to these business owners and sea level executives have and what can they be doing to to help preserve their trust and and our our p and innovation all of it. They can do a lot. And by the way, I had really great experience with all kinds of CEOs of the State Department, particularly during COVID, like when we were repatriating citizens all over the world. And I was calling up, you know, the CEOs of Delta and United and UPS and FedEx, and they were helping us get PP and everything. But um, they can do a lot. Message I would give to c e O S is what I'm seeing out there, and that is this. Some of the most prominent board members are demanding from their CEOs a China contingency plan because what they've seen is they saw what happened with Putin's bloody invasion in Russia and three hundreds of the top global companies had to pull out all the way, lost hundreds of billions of dollars and they had no plan on the shelf how to do this. And now they look at China and his clamp down on the private sector, extreme lockdowns of five hundre million people on...

COVID over there. You know, his aggression with Taiwan, the real estate market collapsing, him getting unlimited power, is the potential for him to nationalize American companies over there, and you know, this is an inflection point. And so these CEOs have to have a China contingency plan because the you know, the boards, our fiduciary duty to our shareholders is to mitigate risk. So we have on the shelf, you know, a plan if there's a cyber breach. Well, this is a big risk and you've got to have a plan. So I'm seeing these guys demand it. And so then what the CEO does is he'll go to his executive VP, so go to his VP of supply chain, sales finance, and they'll each kind of prepare a chapter in this China contingency plan. And then when it gets presented, you know, to the board. You know, it's not like something board. You know, they don't like vote on it like annual Charlotte, You just kind of nod your head. So in other words, is blast. And then the smart CEO begins the implementation because and I pen an article unfortunate about this, and the way I ended, I said, look, when the dreaded becomes the inevitable, it's time to develop a plan and execute on it. So this is key. And one of the things that's happening at the CROC Institute is we're getting a lot of requests. What does the China considency plan look like? Do you have a checklist? So we're putting together we're putting together something for boards and for CEOs and outline the checklist to follow because there's a lot of nuances, uh in that you don't want to miss, you know, one of the key prongs. Yeah, the easier you can make it for him, the better, right. And as a consultant, I love playbooks and tech techlists. You know what I find interesting is amongst many of our other episodes, there's a common theme of how important resiliency is in your strategy, how important sustainability is, and and if you're gonna address those, there's a way and you're gonna avoid the China contingency. Uh.

You know, based off of everything I'm hearing from you, you have to And I'll say, what CEOs can really do to help is, first of all, pull your supply chains out of China because there are a risk, um they really are, and make sure that you've got alternative places. The other thing is, you know, and and you know, I really talk a lot about this in terms of the average American citizen and also a lot of companies don't realize that they're financing China surveillance state that enables what many countries, including our own, called genocide and what United Nations calls crimes against humanity. And so these boards have a moral responsibility and a fiduciary duty to divest from these Chinese companies that are controlled by the Chinese Commons Party. So that's that's an important factor. Number one. The other thing is to plement security safeguards for intellectual property theft. I mean, I had that experience that the Reba Ali Baba's took a lot of our intellectual property. And by the way, I remember going over to China a few years later and I said, hey, what are you guys gonna stop stealing our technology? And they just gotta laughed and chuckled. They said, look, you know, we don't really have a word for like stealing, and and uh Chinese, you know, if it's there, you just take it goes. It's your guys fault and problem. You're not protecting your intellectual property. And China does in a lot of different ways a lot of technology transfer. And by the way, if you're gonna build a plant in China, you're not just handing the blueprints. You're teaching the process engineering. You're training at workforce, and they're gonna come back and beat against you. And so many companies have made that made that mistake, just building your own innovator's dilemma for yourself by by embedding over there. Um. So, Keith, were you making a lot of sense?...

We're coming up on a time. One question I love to finish with is, you know, throughout your life, from from your from your dad's machine shop to where you are now as a father, as a leader, what's the best advice you've ever received? Mm hmm, Well, I'll tell you. I remember when I came back for Thanksgiving and I'm drinking beers with my dad. I came back from Purdue. You know, I'm like twenty one years old or whatever, and he goes to me, Keith, you ever feel like you're in a jam you can't get out of, you know, like you're you're getting you know, you ever get dead feeling like what do you mean? Dad? He goes, and he was a box from the army. He goes, like, you're getting pumbled in the ring and you can't get out and go, oh yeah, that warm feeling. He goes, You know, there's only one He goes, There's one way to get out of it. Two works every time. I go, what's that? He goes, mock yourself out. Now you didn't use big words like self delt for getting humor or anything like that. It came from Germany, he said, mock yourself out. It works every time he goes, just do it. You know, I'm like, okay. And then I remember walking up the stairs is late night. He puts his arm around me and he goes, and you know, um, don't mock out other people. He goes. That hurts her feelings and it's not funny. I think that. And so I think the sense of humor is a superpower too, and and and a self deprecating one. Because a way to build trust is to talk about your feels, your fears, your failures, and your flaws, because you make yourself vulnerable. And when you make yourself vulnerable, I'll tell you about time people reciprocating in kind and that causes a connection. So you know, if your most strategic asset, and the business world or any diplomatic world is trusted relationship, and everything is divided by time, your ability to...

...build trust quickly is a key skill that's huge, And it sounds like a great relationship with your father. Keith. Thanks so much for everything you've done for your service. Thanks for sharing your wisdom here. I really appreciate having year you got it all. The best to you, George and and thanks so much. You've been listening to see Sweet Blueprint. If you like what you've heard, be sure to hit subscribe wherever you get your podcast to make sure you never miss a new episode. And while you're there, we'd love it if you could leave a rating. Just give us however many starts you think we deserve. Until next time,.

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