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How Funny Makes Money

Many people know that The Second City in Chicago is a factory of funny, turning out some of the kings and queens of comedy since it opened in 1959. But did you know that funny makes money, too?

This isn’t an invitation to hit the road as a stand-up comedian, but a different take on doing business.

Kelly Leonard is helping lead the way in the application of comedy technology to business. That might sound funny, but he really is the executive director of insights and applied improvisation at Second City Works, which is a new offshoot of The Second City theater. He co-wrote the book Yes, And with the CEO of Second City Works, Tom Yorton, to share some of the principles of improvisation and how they can be applied to businesses and relationship-building.

Kelly had a nearly 30-year career at the theater as producer, creative director and the executive vice president, where he helped develop the programs to teach mere mortals the magic of comedy.

Why is that important? Because when you make people laugh, you earn a bit of trust and build bonds. Doors open with the right joke at the right time.

But who hasn’t had an attempt at humor do the exact opposite and get the door slammed in the nose? Comedy is an art perfected by practice.

In this interview with Publisher Paul Feldman, Kelly talks about how to develop your funny muscles and how to use the power responsibly.

FELDMAN: How can improv help businesses?

LEONARD: We teach people in improv to work and be successful in groups, making content. It is thoroughly applicable to anyone else, in particular to people in business, because human beings don’t often work well in groups.

We are not taught to work in groups particularly well. Even in school, working in groups ends up being a lot of individual effort. Either you ended up doing all the work or someone else did. Rarely is it balanced.

But improv teaches individuals to work well inside groups. It teaches you to weather failures. It teaches you to be agile and pivot inside moments of change.

These are all things that are becoming vitally important. Second City has been working with businesses since the mid-’80s, but in the last couple decades, it’s become its own business.

I’m sitting here today at our offices at Second City Works, which is the B2B arm of Second City. We worked with 400 clients last year, many of which are Fortune 500 companies, to do a variety of things. But many of those things were coming in and working with their people to get them to be more innovative and more creative.

FELDMAN: One of the primary tenets of improv is the use of “Yes, and” to keep the dialogue moving and more interesting. How is this important in a business environment?

LEONARD: “Yes, and” operates at the front end of creativity and innovation.

Most of us are oriented toward “No.” In behavioral science, they talk about the default setting of most human beings is to do nothing. Given the choice of going out for a run or sitting here and watching TV, I’m going to sit here and watch TV — I’m going to do nothing.

And we’re like that often at work. You know situations where people bring in some seemingly weird, crazy idea and our first instinct is “No. No, no, no, not interested.”

In improvisation, you want to go on positive, but that’s not enough. You have to say, “Yes, and.” You have to affirm and contribute. And you do that in order to explore and heighten.

FELDMAN: How do you integrate that into brainstorming sessions and into an organization?

LEONARD: “Yes, and” is powerfully illustrated in brainstorming sessions. We’ve all been in those meetings where there are 10 people in the room and two people are speaking. One of them is probably the boss, and the other’s the loudest mouth in there. That person brings up kind of a crazy idea, and it gets shot down.

That person is not going to bring up more ideas because those ideas just get shot down. Why would they put themselves at risk? And then everyone else has seen that the person got shot down, so they’re not going to bring up any sort of risky idea.

In improvisation, you want an abundance of ideas; you want seemingly bad ideas. So when you “Yes, and” for the first 10 minutes in one of these brainstorms, where no idea’s a bad idea, guess what happens?

A lot of those ideas seem kind of crazy, but there’s good stuff in there, and they might connect with another idea that got brought up. Plus, you know you’re not going to keep every one of these ideas; you’re just letting them live in the brainstorm.

That makes saying “no” later so much easier for the individual because at least they’ve had their idea vetted and maybe even written down. It’s much easier for them to let go of an idea when they know, “Well, look, there are 75 ideas up there. Mine’s not necessarily going to be the one.”

We use this expression in improvisation — “It’s important to find the idea rather than your idea.” And it’s very rare that one person alone has the idea.

In fact, almost every great innovation that’s ever existed was not developed by one person. Many hands had their role in things like the iPod or the car or the airplane. I know in America we love this idea of the lone genius and the lone creative —but it is a myth.

All these people had lots of different people, whether researchers or marketers or assistants or who knows what, helping out in making these great things come to life.

FELDMAN: So we’re in a fairly conservative industry with a lot of compliance. What would you say to anyone who thinks “You know what? This can’t apply to us because we can’t use humor; we have to be compliant.”

LEONARD: I have a great example of that. Four years ago, we partnered up with a group that is now owned by the New York Stock Exchange. They were offering ethics and compliance training that was dull as dishwater, and people weren’t paying attention.

And this stuff is hugely important, as you know. Lives are in the balance, and lots of dollars are as well. What they figured out, and science has backed us up on this, is that comedy is a very effective way to communicate.

So we have a thing called RealBiz Shorts, which are these short videos that tee-up ethics and compliance training. If it’s about not taking bribes from foreign companies or it’s about certain kinds of behaviors in the office, Second City does these really punchy, short, funny sketches that show you how not to do it, to reinforce the way to do it.

And this has been just a multimillion- dollar success for us because the issues are so important, they have to be laughed at because that is the way these messages and these ideas sink in. And, more and more, people are beginning to understand that comedy is an incredibly effective tool to communicate.

The advertising industry figured this out years ago. The vast bulk of the ads that you see on television are attempting to use humor — I’m not going to say they’re funny; a lot of people practice comedy without a license. But the really good stuff —the stuff we remember — is funny.

Especially right now with the rise of all the sort of humorous news outlets that we have, whether it’s “The Daily Show” or Samantha Bee or Trevor Noah, all those guys become truth-tellers for us, in part because they’re using humor to talk about things that are really troubling or really hard or very partisan. Somehow, through the lens of comedy, it allows us to really take these difficult topics and put them in a national conversation.

FELDMAN: It definitely engages people at a different level with humor. It lowers their barriers.

LEONARD: Yes, and there’s a little bit of science on this. Harvard recently did a study on status and humor inside organizations, and the interesting thing they discovered was that people who use humor in the workplace were considered to have higher status and higher confidence.

They also studied people using taboo humor, humor that was inappropriate. The results were that not only were they also looked at as having higher status, but, conversely, they were looked at as having less confidence.

Comedy is so effective that it really can up your chances of success in a business setting, and it can destroy you. And we all know this simply from the mass amounts of failed tweets that take down one corporate person after another corporate person, seemingly on a weekly basis — except for certain people who may be in charge of our country. But everyone else seems to be affected by this level of tweeting that gets them in trouble.

FELDMAN: In your book, you talk about some essentials of comedy. What are some essentials that might actually help businesses be funnier?

LEONARD: Companies crave authenticity. They want to feel authentic and speak with an authentic voice. That means they’re going to have to be a little vulnerable. A lot of companies are not comfortable being vulnerable, but part of that is allowing yourself to be made fun of.

Domino’s was an example of one of the great successes in the modern era. Domino’s, we all know, had this pizza that tasted like cardboard, and then they decided to make a change. They came out and said it — “Our pizza was terrible. We’re changing it. Try it out.” And they had a huge turnaround.

I think too many companies are so invested in never looking like they made a mistake that they lose any sense of a sort of authentic connection with the customer base. As we’re understanding the way that the millennial and Gen-Z generations approach the world, we know that approach is a nonstarter. That is going to doom companies that don’t know their behaviors need to change.

FELDMAN: Fear of failure is the enemy of improv. You talk about learning to “fail well.” How do you that?

LEONARD: Fear of failure is what screws everything up. When we’re seeing 1,000 to 2,000 people audition at Second City over the course of an entire week, we can pretty much tell the people who are not going to make it within the first two or three minutes because they are petrified, and they show it. And, conversely, the people who are successful don’t have that sense at all — they walk on stage with a sense of ease. They’re making just as many mistakes as the person who’s so visibly scared. They just can sort of breeze through the mistakes.

There are rules around failure and making it work for you. You can’t just say to someone, “Oh, by the way, it’s OK to fail.” It is, but it isn’t always. So, at Second City and in improvisation, when it comes to failure — you need to fail fast; you need to fail together, and you need to fail in context.

Failing fast is, essentially, not lingering on your mistakes. Recognize you’re going to make a lot of mistakes, get over it, get by it and move on to the next thing.

Charles Limb is a neuroscientist at the University of California in San Francisco who has been studying the effects of the human brain when people improvise. He did an experiment with a bunch of freestyle rappers in an MRI, where he had them do rote written material and then improvise.

When they were improvising, he noticed that the part of the brain that self-censors and has shame goes down. And what he thought was going to happen is the part of the brain that stimulates the English language would go up — that didn’t. That stayed the same as when someone was doing a written piece.

And his thinking on that was, “Wow, it’s not that you need to stimulate the sort of language part of the brain to be able to improvise. You just have to get rid of the fear, and you have to get rid of the shame.”

It’s a fear of failure going on there. So, failing fast is all part of that.

FELDMAN: What are some strategies that can reduce the fear of failure?

LEONARD: You’d have to practice it. If you have a business that is reliant on people being able to survive lots of mini-failures and you need them to innovate, you have to give them practice.

This is the thing that just astounds me, which is you would never say to a professional baseball team, “Oh, you guys have to go win the World Series, but we’re not going to have you practice your game.”

People are going to their offices every day to make millions of dollars, multiple millions of dollars for companies, with zero practice. It’s ridiculous.

At Second City, we have basically a failure module, and it’s called “The Second City Improv Set.”

If you’ve ever come to Chicago and seen a Second City show on a weeknight, what you’ve done is come in at 8 p.m. and see a two-act review. There’s probably some improv in there, but it’s mostly scripted. Afterward, we bow and say goodnight, but we also say, “Hey, we’re actually going to do a little bit more. Do you want to stay?”

We take a short break and then that third act is all improvised. There are many things going on there that make it a safe space to fail.

We set this up to fail in context. It’s late at night. We’ve already let people know that it’s going to be a bit different. Often, the actors will change into more casual clothing. The improv show is free if anyone wants to come in and take a seat.

The cast comes out and takes suggestions from the audience, and we just start making it up. Now the failure rate for the improv set is at least .500. But if you talk to people who come to Second City, it’s often their favorite part of the evening. So you wonder, “Why would their favorite part of the evening be the part that succeeds less?”

Well, we’ve changed the rules, and they recognize that those successes have such a greater power. It’s comedy without a net. It’s authentic. You’re seeing the vulnerability on stage.

The other aspect of it is we’re working inside an ensemble, so we’re failing together. We’re failing as a group. Harold Ramis used to talk about the fact that there’s no greater success than sharing success, doing it as a group. Similarly speaking, there’s no greater failure than sharing it with a group.

If you think about the best storytellers in your life, the people that you just love when they tell stories, how many times are they telling stories about things going right? That’s never a funny story. The best story is when it’s a fiasco, an utter fiasco among a group of people. We love that because we connect to it.

When failure becomes a dirty word, it means we’re not using something that is so essentially human and bonds us.

FELDMAN: One thing I really got out of your book was the chapter about how to build an ensemble and not a team. Why is an ensemble more important?

LEONARD: The late, great teacher Sheldon Patinkin said you always hear that “Your team is only as good as its weakest member.” But we say, “Your ensemble is only as good as its ability to compensate for its weakest member.”

This is crucial because, at any given point, one of us is going to be the weakest member inside whatever group we’re operating in. Maybe we’re great at math. Maybe we’re terrible at math. But at some point, your group is going to have to do math, which means someone’s going to be good at it, someone’s not going to be. Do we want to be part of the ensemble that ostracizes the person who’s not good at it or be part of the one with the person who is lifted up and supported by everyone else in that moment because they’re going to do the same for us later?

So we very much think that a much more healthy way to approach the kinds of groups that exist at work is thinking about an ensemble, rather than a team.

FELDMAN: And you also take that to hiring. To hire well, you say, means hiring different.

LEONARD: Yes. In baseball, are you going to hire a bunch of right-handed power hitters? No. You want one or two of those — that’s it. You need diversity to fuel your group; you want that difference.

When we’re casting a six-member Second City cast, we’re looking at gender, race, socioeconomic background. We’re looking at who are the strong writers, who are the strong actors, who are the strong comedians, who’s got a strong point of view. We’re taking differences into account first.

Having a bunch of people with similar skills and similar POV will very quickly get you into groupthink, which means you ain’t going to get anything original. That is where the dull stuff comes out because everyone agrees, everyone thinks the same way.

We want people who are going to challenge each other in a complementary way, which is what improvisation does because it encourages you to have a personal point of view that is strong, different — that can stand up in the face of adversity. But, at the same time, you have a skill set that teaches you how to incorporate that strong point of view with other people who have similarly strong points of view that might be diametrically opposed to yours.

FELDMAN: You’ve said listening is extremely important to improv and it’s also a muscle that you can develop. How do you develop that?

LEONARD: You practice it. One of the great exercises that we’ve got is one in which you have to use the last word that I say as the first word of your sentence. Simply doing that requires you to listen to the end of the person’s sentence.

When you do this, you realize you don’t listen to the end of people’s sentences. You get the gist, usually about halfway through, and you start formulating your response.

What are we missing when we’re not listening to the end of people’s sentences? Turns out, a whole lot. You can’t successfully improvise a scene on stage if you’re not responding completely to what was just said, because the audience is listening to the end of that sentence. So you need to listen to the end.

That’s one part, but, like any muscle, you can’t just do it once and think that it’s going to work forever. You don’t go to a gym and lift some weights and say, “OK, I’m done for the year. My muscles are now just fine.”

There are other exercises, but I think the key is simply to understand, without shame, that you probably are a lousy listener to begin with. Don’t worry; everyone is.

If you really just focus your attention on trying to listen deeply throughout the day in, let’s say five conversations, you’re going to experience a significant change in the way you’re relating to other people. And that’s going to be a positive change because people know when you’re listening to them.

FELDMAN: How do you see leadership evolving into the future?

LEONARD: More and more people are looking at empowering their workforce. And they have to because it’s so decentralized. Many people work from home. The whole idea of needing to have this office where everyone’s coming in every day — that doesn’t exist in the same way it used to.

I was talking to Jason Fried, who runs Basecamp. He has a great TED talk and has written some books about work. I host a podcast, and he came in for it because he’s based here in Chicago. And he actually says the worst place to get work done is the office because it’s so filled with distractions.

He was talking to me on a Wednesday afternoon, and I asked, “Well, how many people are in the office right now at your work?” He said, “I don’t know; I didn’t go in.”

So he called over and there were three people there — and he has about 47 who work for him. And I asked, “Well, how do you manage the control?” He says, “I hire really good people whom I trust. We have ways to communicate with each other, online and in other ways. We can Skype each other; we can talk all the time. And we have very specific jobs to do. I know when those jobs are getting done, and I know when they aren’t.”

It’s just different now because we are able to communicate and work in a whole other manner with our connectivity. And that’s not to deny the importance of human beings getting in a room together — that’s absolutely essential for a lot of business but not all of business. I think enlightened, good leadership is constantly evolving.

It’s important to recognize it’s not changing the value system. It’s not saying, “Oh, I don’t believe in hard work. I don’t believe in education. I don’t believe all these sort of hallmarks of things that we think are important to good leadership.” What it is saying is “I need to recognize that human beings all operate differently.”

In fact, a lot of human beings operate irrationally. So if I’m using a rationality marker, that’s my first mistake, because that’s not the way people behave. So, better to understand the way people behave and the way human beings are and then operate from that place. And you probably will be a lot more successful getting the best out of individuals who work for you.

Founder, President, Publisher [email protected].

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