How rethinking everything can bring clarity in a complex world

In this episode of the Innovation Realized podcast, Hal Gregersen, senior lecturer at MIT, discusses new ways of thinking.

Key takeaways:

Don’t focus on the short term, be clear about your long term intent
Embrace exponential technologies
Develop truth-seeking mechanisms that leave no stone unturned
Develop the ability to see, think and listen deeply
Ask better questions, challenge the status quo and engage in collaborative problem-solving
Rethink your mindset and strategies to navigate the challenges of the future

Announcer

Hello and welcome to the EY Innovation Realized podcast series by Elevation Barn.
Our world is characterized by more forceful changes that appear quicker, trigger more interconnected and widespread impacts, and often strike all at once. Some call this the poly crisis or perma crisis. Whatever you choose to call it, the bottom line is a business climate that has become far more complex. This environment requires leaders to rethink core assumptions, challenge to establish assumptions and rethink best practices that no longer work.
This Elevate series will bring you inside the 2024 EY Innovation Realized Global Summit to hear the new ways of thinking our complex world requires. Each episode is a provocative one-on-one conversation between a leader exploring these vital topics and impact leader, Will Travis, founder and CEO of Elevation Barn.
Elevation Barn is an international community of world leaders and experts focused on unlocking a purpose-driven legacy for sustainable personal and business growth. To learn more, visit ElevationBarn.com.
And now to your host, Travis.

Travis

Today's guest is Hal Gregersen. Hal is a senior lecturer at the MIT Sloan School of Management, former executive director of the MIT Leadership Center and ranked as one of the world's 50 Most Influential Management Thinkers by Thinker's 50.
He's the author of 10 books, including his most recent Questions Are The Answer, is a co-founder of the Innovators DNA, a consulting firm based on research with Clay Christensen and Jeff Dyer, and is an INNOSIGHT fellow.
He's taught at INSEAD, London Business School, Dartmouth Tuck School of Business and Brigham Young University and was awarded a Fulbright Fellowship in Finland.
Today, we are discussing the Rethink Agenda: in a complex world, how can rethinking everything bring you clarity?
Hal, welcome to the Barn.

Gregersen

Will, great to be with you. It's always for whatever reason, I'm always humored. When I hear my bio, it feels like an obituary. But that's not a bad thing.

Travis

Well, I know you're very much very far from that. I've seen you in the performance as well, that brings it to life. But anyway, I've got lots of great questions here today. And first of all, I just want to ground things.
The biggest picture challenge we all face at the moment is that the world feels like we're in such a complex disrupted state. Some call it the age of poli-crisis or a perma crisis, from your incredible wisdom and the depth that you're spending your hours thinking and working and challenging. What advice can you give leaders to rethink as they make critical decisions today? And can you share some of your best practices strategies that will help them address these super time-sensitive needs?

Gregersen

Well, it's a great question. And I think it's really crucial to think of a simple example and then come back to responding to the actual practicalities of what do I do, if you don't mind?

Travis

Yeah, great.

Gregersen

For me, the example is roughly 10 years ago, when Jensen Huang at Nvidia saw that people were using GPU processors to make computers to then use algorithms that were decades old in ways they've never done before. This was a decade ago. He then stepped back and rethought what the future of Nvidia might look like. And he could easily imagine in his mind's eye, like others, Dr. Lisa Sue at AMD were also doing the same thing. It's the notion of he could see in his mind's eye in roughly five to 15 years, this world is going to be revolutionized across every industry. And when he tried to shift his company to that long-term intent, short-term investors were irate as were gamers who [were] like why are you shifting your attention away from us?
But Jensen, like so many leaders who are navigating this uncertainty today, had, number one, a long-term intent. So that's my first answer to you. It's like, if all we focus on is the short-term, and in a world of uncertainty, the short-term becomes even shorter-term. If that's all we do, we're dead. And so, it's this notion of I have a conviction about something long-term that I'm not going to be swayed on. And I will make short-term moves in order to get there. And we've all heard that notion of short-term long-term.
And usually, managers roll their eyes when they hear that I heard that one before. But my world is just short-term. And all I can say is that in this age we're living in, that's the starting point. It's like, what's the grand challenge in the spirit of MIT leadership, we call it challenge-driven leadership, what's the grand challenge that has a much longer time horizon than we normally have. And if we don't think and operate that way, we will be stuck in a really problematic world.
The second part is Jensen, and Lisa Sue, they all had this sense a decade ago that not only is there a long-term intent that we're operating on, but they grasp exponential technologies, rapidly changing technologies, they could imagine in their mind's eye, something changing a million-fold. And most leaders today, including myself, can't imagine current large language models being a million times better within five to 10 years, what does that actually look like? And yet, they're capable of understanding those kinds of high volume rapidly changing technology impacts. And they don't have those, those technologies don't work against them, or they work for them.
And the final piece is, when you're engaged with these rapidly changing exponential technologies, you can't do it alone, when you're tackling big, tough, wicked challenges. Some things can be done solo, but these are systems, and we engage those.
And so, the short context is, Will, when we're living in an age where it's short-term focused, we don't want the world to change. And we're regressing into ourselves solo. But the people who are succeeding in this kind of world have a very different approach, which is, what's the challenge much bigger than me? Far larger than I am? It obviously has a long-term intent, it's going to engage these exponential technologies in a positive way. And I can't do it alone, it's going to require broader ecosystems to pull this off.
Now, here's coming back to your question. Sorry, long intro. But when we operate longer-term, when we engage in rapidly changing exponential technologies, when we are working with other people, instead of so low, uncertainty, unknown, and the unexpected rise, that means we have to rethink,

Travis

Yeah, it seems common sense, though, right? You know, it's if you're riding a bike, you look ahead, if you're with a group, they will watch your back. That seems common sense, why? Why isn't this embraced? As, you know, why isn't this kindred quest, this ability to lean on each other, the way that business leadership exists?

Gregersen

One of the biases in exponential that world of exponential technologies is called the exponential thinking bias, which is effectively even if we're trained in math and science, Will, when we're given a simple calculation of, you know, you invest 400 euros a year for the next 40 years, and you get 5% interest per year. And compounding what does that equal in 40 years, people underestimate by a magnitude of 10. Instead of two and a half million, it's 250,000. Even smart people with math backgrounds have a short-term bias, and they don't think that's a long-term thinking process.
And so, the notion here is we're not all like Warren Buffett, who when he was a teenager cut his own hair, because he did the math on that amount he would be spending on a haircut and what it would pay off in 30 years, most of us don't think that way. Right? But if we use that logic of finance in the world of life, and think about this notion of compound, not just compound interest, but compound learning, I am doing something different today in order to make something bigger tomorrow.
And why don't we do that? Because ranging from universities education to the first professional role we have to the first managerial role we have 80% or more of people, and especially leaders have a very short-term orientation. And the average C-suite leader reporting to the CEO, their tenure is less than five years. Shocking. Which means it's practically impossible to do anything long-term, big impact projects take at least six years.

Travis

Can you help leaders personally embrace more of what, and depart from more, to help them embrace the unexpected? What do they need to do less of? And let go of to be able to? Do they just have to ignore this fear that their lives are on the line within a five-year period? Or do they focus on different principles?

Gregersen

That notion, Will, of letting go and taking on, I love that framework.
So, take large language models as a simple example. I do this exercise called the question verse where when I'm stuck on a problem. I literally, even if I'm alone, I set a timer for four minutes and try to generate 20 questions. And when I finished generating those 20 questions, 85% of the time, I've rethought the challenge.
But then what I now do is input those questions into a large language model and say, what are the patterns here in these questions? What am I focusing on? And then it's what are 10 or 20? More questions that I should have asked that I didn't.
And then it's out of all of those questions, which ones seem most important to make progress on this challenge? And why is that so? Now, that's something I could not have done three years ago. But I can do it today. And so, if I'm willing to take that risk of engaging with the technology in order to move my project forward faster, it's concrete. It's real. And it's impactful. And it's usually positive here and now.
Now, what I have to do, though, in this age of AI, is be very careful when last year in 2023, when OpenAI brought out that large language model ChatGPT, I, instead of generating those first 20 questions myself, I lazily asked the computer to give me those 20 questions.
And I realized doing this three or four times, I am giving up my capacity to ask good questions. And so now I've made a very conscious choice. I'm going to do the hard mental work myself by generating those questions, initially, myself, then engage with the technology in order to collaboratively build something I couldn't before.
So, coming back to what do I do differently? Number one don't run from these rapidly changing technologies that could rapidly change our world for the better. But at the same time, be incredibly vigilant about those technologies, scraping off your human capacity in ways you don't want to happen.

Travis

It really is an exponential moment that, you know, this new wave of solutions is not only disrupting, but it's also making us think harder. But to your point about the questions we ask, they say that wisdom is the questions we ask in life, not what we tell, I was told by a brave man once, how should leaders rethink their assumptions, therefore, and approaches? And does it change when they're embracing a generative AI system? Or is it just a rule of thumb that you've realized, as you ask brilliant questions I've seen when you've been leading some of these workshops and things, I'm like, I never thought of that question. How do they rethink their assumptions and approaches to make sure they achieve what objective you're focusing on?

Gregersen

In a project I've been doing with Ed Catmull, one of the cofounders of Pixar for the last five years, we've been studying and researching people like Jensen Huang at Nvidia and so on. Right. And one of the things that we've realized is that all of these people who are really good at navigating the absolutely unprecedented elements of uncertainty we're living in, they are equally exceptional at generating and sustaining truth-seeking mechanisms.
Because when the world has a longer-term intent, and the exponential technologies are rapidly changing, and I'm engaging with others, uncertainty is going up. Yeah, reality is not fixed. Even if we want to think it's not. And when reality is not fixing [but] is changing. The question becomes, well, what truth-seeking mechanism am I engaging, to cut through the fluff is what they would call it in the UK. It's like, don't fluff me, how do I cut through the fluff? What's my strategy? What's my mechanism?
Now that sounds pretty simple and straightforward, but, honestly, relatively few people are conscious about that. So, I just got back two days ago from Nairobi, Kenya, where we had our 15th grandchild.. We're a blended family. I had three, she had four. Now I have seven kids. And anyway, two big families. But when I was in Nairobi, I met with a friend, their professional friend and colleague, we were sitting having a conversation at a cafe. And he raised a challenge. And I said to him, Will, here's a truth-seeking mechanism for me that question burst method process I just described earlier. And given your challenge, would you like to do this with me? And he was aware of the truth-seeking mechanism. And he knew me well, Will. And he said to me, looking me in the eye, I think I'll try it later on my own.

Travis

He immediately went to the solo.

Gregersen

Yeah, even though we had a trusting relationship.

Travis

Was that for fear?

Gregersen

It was, I think, partly for fear that he knew, or he was confident that there would be some awkward questions surface during that conversation. Yeah.
And, so I said, let's step back, and I'm like, you don't have to do this. It's an invitation. But if you do it with me, you might see things in a way that could surprise you. And what's really cool, Will, is not five minutes of going back and forth. He's like, let's try it.
Now what he was doing was he was being vulnerable with someone else about a real challenge that he's wrestling with. And if we move deeply inward, in an age of uncertainty, and don't move outward with truth seeking mechanisms to get a different perspective, on a reality, that's always shape shifting, right now, we're operating not just in the dark, but in the dark, with a world that is under our feet moving right and left. And the window of light that gives us some path to start walking through, not clarity, but at least a path is I've got that kind of mechanism.
You know it at Pixar, they use a brain trust mechanism for directors who are at the top of the creative heap where they actually get people giving them feedback and questions nonstop for three hours about the challenges they're wrestling with. You know, there are other mechanisms, other places, but the question I often ask leaders, Will, is, what's your truth seeking mechanism? Is it working? Is it vibrant? Is it alive? Is it relevant? And a lot of leaders, they wrestle with that question.

Travis

I love that you're actually, you know, I was interviewing a gentleman last week, and he was talking about psychedelics being a required catalyst for the right questions and balancing with, you know, that being an external influence, but also his internal influence was, how do I get how do breath work and calm everything down? Yeah. In my head the whole time I'm racing, going, why don't you just ask yourself the right question, instead of having to distract into a zone. That may not be the relevancy of how you're actually thinking when you have to perform as a leader [it does] change the parameters. It feels like you walk this tightrope between psychiatrist and mentor and Guru. How are you balancing these elements of input when you should lean on the pedal more or when you should just allow the natural process and flow of that leader to just find its way?

Gregersen

I'm gonna go back to in response, Will, that notion of, if I worked with you well, and you were my supervisor? The question I'd be asking you is when you show up either online or literally in some office with me, do I, Gregersen, know, with clarity, what the most important challenge is that you care about?
And the more political an organization is, the moral opaque those challenges are.
And so, it's like, if the first step is I, as a leader, have to be clear about the challenges I care about. Right? And then the next part becomes if the challenge is bigger than me, you have to know about what challenge do I care about, right.
And for me to be willing, like my friend in Nairobi Kenya, to reveal to you my challenge takes hard work. It takes time it takes caring it takes being there.
But once you get to that moment, where these are the collective set of challenges, it [is] a 360 sort of logic all around me that we care about. Then my task as a leader is like, I am going to at least double the horizon of whatever my current challenge is.
So, if I'm thinking one year out, go to two years for three years, six, four years, eight, that's often the best people can do is like, double that horizon, make the challenge bigger. And if you do that, don't play management consulting mumbo jumbo games with me, which is, you know, the flavor of the day challenge because everybody else is doing it. No, you've got to own it, Will, I have to own it. And when I have the sense that you own that, the world just shifted like the tectonic plates moved in the organization like an Earth. It's just like, now I know.

Travis

Seismic.

Gregersen

Exactly. Seismic.
And so, for Ed Catmull. And the reason I was so intrigued by Ed, five years ago, and we've been working on this project from 1970.
In the 1970s, when he was the first one mathematically to figure out how do you model a 3d image on a screen computer screen. He won the Turing Award for that, in part recently, because he's mathematically capable of figuring that out.
But when he did, he also thought to himself, I've always been an artist, I've always wanted to make movies. And given what I just did, we could make a 90-minute full length computer generated animated film. That was his long-term intent. He thought it would take 10 years, he worked for George Lucas at Lucasfilm, on Star Wars two and three, when those first came out. And all the time he was making software, hardware and storytelling advances on his bigger long-term dream, as they were doing short-term things where movies had to come out in three years. It took 23 years from start to finish for Ed to make that movie. But he was resolute about the intent and committed every step of the way to create value for whoever he was working with, in that process.
And so, for me, Will, it's just like, I’d done this work with Clayton Christensen and Jeff Dyer around the innovators DNA, and we discovered the skills of, you know, interviewing people like Pierre Omidyar founder of eBay, and so on. And basically, they ask provocative questions that challenge the status quo. They observe the world like anthropologists, they network and talk to people who are different from them in perspective and worldview. They rapidly experiment prototype, and they take the time to make the connections [to] connect the dots that other people don't.
Now, those five skills we know from a 25,000 data points that actually help anybody famous or infamous, you know, or not, it's like, help anybody make better progress and their challenges.
But here's what I realized in this exponential age, Azeem Azhar has put in his recent book, it's just like in his exponential age, it's those five skills or my book, Questions Are The Answer, around creating conditions where you're wrong, uncomfortable and reflectively quiet. They're necessary, all of that. But I realized they're not sufficient in this time, 2024. Something else is going on. And that's when I realized, it's this other stuff. These people have paid a price to understand the value and power of long-term intent. And they know over the course of their 30 years that nothing significant happened without at least a six-year time horizon.

Travis

Right, yeah. And it seems that I mean, you, it's like your friend, when you were in Nairobi, and you were saying, you know, it took five minutes to create him to see that this conversation would be a benefit. It seems that you have to be in an environment where this line of depth of thinking is permitted. And many leaders today, as you said earlier, don't feel that, how can you sculpt that environment so that you feel you're safe? And that you have the room to answer the right question at the right pace to be able to deliver the long game?

Gregersen

Wow. So many things come to mind.
First of all, there's the notion of, number one, I've got to not only hold but embrace the tensions of short-term long-term, rapidly changing slow changing technologies, solo system work, those are tensions. And it's the spirit of and not, or it's like, I get it.
And so, for these leaders that Ed and I have been studying, they don't think either or when it comes to long-term, short-term, it's just not their way of [doing things], it's like both. That's the first part.
The second part is what are my truth-seeking mechanisms? And underneath that, it's how do I see and think deeply? Which is what you're asking.
And, unfortunately, we get so caught up in the thick of things for most of us that we don't think deeply. And, that it requires, I'm thinking out loud here with you, okay. Yeah, it's great love, which is, it requires number one getting outside of ourselves. Deep thinking that self-centered does not go very deep, deep thinking that other centered, for lack of a better word, and vice [versa], [takes] the cosmos to collaborate. It's like, I'm thinking deeply about an issue that's really important to the future of this organization, or my community, or my family.
Now, to think deeply, it is imperative that I see deeply. And listen deeply, not just hear, not just notice, but I see deeply. And that, for me is where photography has always been a personal mechanism, to sharpen, inspire, restore my ability to see things I otherwise wouldn't see. And so, when I grabbed that camera, I am purposefully engaging with the world in ways I normally wouldn't.

Travis

Is it because it slows you down to be able to realize that you have to capture the right image versus flow through it. What's that? What's the trigger difference to you?

Gregersen

The deepest form of seeing is a moment when the making of a photo reveals something new about the object in the photo, and the person making it, myself.
And so, we live on a little island, semi-island north of Boston called the Nahaunt.
And one night in the wintertime I was driving home recently, it was a few months ago, freezing cold, and there was a work crew in the middle of the night trying to fix a broken water main. And they were like going to the New York City Ballet. They were coordinated. They were like they were like a Special Forces crew. I could just see it.

And so I stopped for two hours making photographs of them. And wow. And the photographs are they some of them just are jaw dropping for me. As I walked in, I actually went home and printed a half dozen photos and took them back to them because I wanted them to have it as sort of this is theirs.
And that moment created that seeing deeply that I never would have imagined, which is one of the workers had the time to stop. And we were talking and he asked about me and I asked about him and I mentioned that my father was a pile driver, which are these big, massive machines that drive those steel beams in the bottom of skyscrapers to make the foundation for them to not fall over. Right. And he looked at me and he said, wow. They are amazing at what they do and so skilled, and, Will, long story short, my father and I had a troubled relationship growing up. And I've had to wrestle with some of those troubles. He was a good human being in so many different ways. But we had troubles in other ways. And that moment when we were having the conversation and this stranger was telling me about how cool these people were. It's like my heart was finally ready to open to accept my father in wholeness for who he really was and appreciate him good and bad.
And it was a tender, powerful moment where I saw something inside of myself. There was a function of caring enough about seven people fixing a watermain to freeze my butt off in the cold for three hours. They knew I was committed to them, and it led us to an insight that otherwise would not have happened.

Travis

And I love that you saw it through fresh eyes of somebody who was also, you know, working in industry, like your father, where your father's job was to go deep. Your father's job was to take things deep to ensure the stability of the long game. The construction on top of it, amazing.

Gregersen

Well, it is amazing. And that's where, you know, very recently, a close friend of mine passed away David Breashears. He was the Cinematographer Director for the 1996 IMAX film about Everest when that disaster happened, a dozen or so folks passed away. Yeah, David passed away suddenly in his late 60s. He lives nearby here, and [is a] huge loss.
But I'm gonna go back nine years when David and I were in the Khumbu Icefall together. I was very sick with some mild altitude sickness and some infection.
David had made a commitment before I left to my wife that he would bring me home alive. And when my ego was telling me to go higher into the icefall, David, and Fulah Sherpa, had been watching me carefully. And David resolutely looked me in the eye and he said, No, we're going back. David had the long-term in mind. Yeah. And even if it pissed me off in the short-term, he was not going to let go of the long-term. And that's one of the things I loved about Breashears.
And that's that notion of you don't play games with people at work or home, about these long-term intents that will require sacrifice to get there. We can't play games with people around these things. Because we're inviting them to give up something for us all to get there.

Travis

Yeah, we sometimes forget that we're actually all tied together, you know, and especially in mountaineering, right? You need something like that, that the weakest link, or the strength of the team, is what gets everybody there. And that's what gives you that elevated perspective.

Gregersen

Well, in exponential age, technologies are combining and compounding, by definition, because they're exponential technologies. That word, exponential, by definition, means the future is unpredictable. Yeah. And the consequences are unknown. And this cuts right to the core of most managerial assumptions, which is they like to be in control.
But in this world we're living in with that word exponential. There's, again, the cute speaker management consultant speak of using that word, but when you look at it as a hard concrete word and concept, what it means is, things are going to be unexpected and unpredictable, positive and negative. Are you ready for that kind of world? And those consequences could be so significant, that it will impact all of us in the spirit of what you were saying, Will, all of us. Yeah. Which means none of us are big players in this play we're in right now. We're all central players.
And I mentioned earlier, we have 15 grandchildren, I have an obligation to those 15 kids. And I think we all due to that next generation, which means this is not a conversation today, just about how can I survive between 2024 and 2025 in my business, because the way in which we approach that challenge. If we don't rethink it and approach it differently, [it] may actually, at a collective level, create consequences that are irreversible for the rest of us.

Travis

Absolutely. And it's, you know, the timing for this conference. The theme of this year's Innovation Realized Summit is rethink. What key message do you want to ensure that you leave behind at this event to make sure that leaders feel they can be empowered to ask the questions that need to be asked?

Gregersen

David Brearshears once told me when they're stuck in a really dangerous, uncertain situation, stop, breathe, think, act. I think once we've done that, then it becomes this, I want this to be on, Will.
And I'm thinking what is the message? It'd probably be the following.
Five years ago, I took an incredibly deep dive into this thing we call exponential. And what does that mean? I'll admit being a novice in that space. Three years later, I'd felt like I drunk out of seven different fire hoses at once. And realized that even though I've studied innovation, and inquiry for most of my life, in a variety of different settings, what I knew was insufficient for where we are.
And I'm reminded of Mary Parker Follett, in the late 1800s and early 1900s. During the Industrial Age, she was a management consultant during that period of time. And she just often said, we don't have the words, we don't have the words to describe what we're talking about.
And the words I'm now going to use are my best attempts at what else might I do in order to navigate through this world? Of course, I got to stay curious and ask questions. Of course, I've got to learn how to hold tensions that are going to be inevitable. Of course, I've got to figure out and understand, you know, exponential technologies and things that aren't changing. Of course, I've got to do all of that.
But underneath all of that, I've got to have this enhanced, deepened, refined sharpened capacity, to seek the truth, to understand what's really going on here. And that is going to require seeing things I've never seen before, searching for things I've never searched [for] before. And being very surprised, often uncomfortable with what happens.
You know, a good friend of mine, Matt Dwyer, runs innovation materials at Patagonia. And he calls his team members, truth seekers. And he expects them to leave no stone unturned. For example, if you're trying to find the purity and clarity of a supply chain, no stone unturned team, we've got to get to the truth of the situation.
You know, the instant we become managers, you know, people start telling us what they think we want to hear and stop telling us what they think we don't want to hear. And the higher we go on organizations, the worse that gets.
And in the age we're living in, right, all of that is compounded.
And so, I suppose my most important message for Innovation Realized is you've got to rethink your truth-seeking mechanisms in a world where truth is changing really fast, about you, about your team, about your organization, about our communities, our nations, our societies in this world we live in.
And if you have not considered what those truth-seeking reality seeking mechanisms are, do it today. Don't delay. The world is moving too fast for us to be operating on assumptions that reflect conclusions from the past. And that's the notion of not rethinking, not challenging the assumptions and, again, all of that, Will, you know, all of that is something that we've been told before.
You know, we've been around long enough to know that rethink your assumptions, you know, challenge your assumptions.
All I can say is rethink and challenge them with these truth-seeking mechanisms in a way that we get hit over the head so hard. We can't not rethink. You know, seek out that sort of a context. I suppose that's what we're in. Because if we don't seek it out, it's gonna seek us.

Travis

Spectacular. Gregersen. Always bringing a fresh light to what really truly matters to us all. Thank you for taking the time to join us this evening. This morning, wherever people are in the world.
And I can't wait to join you back again at EY Innovation Realized this April and dig deep and help others elevate what truly matters in their world.

Gregersen

And, Will, a reciprocal thank you back for being a very good listener for asking good questions. And for continuing our conversation about how do we navigate this incredibly beautiful, fascinating and challenging world.
Thank you.

Emma Ross

We hope you've enjoyed this episode of the EY Innovation Realized podcast series by Elevation Barn.
If you would like to learn more about the vibrant and accomplished Gregersen, please visit halgregersen.com. To learn more about Elevation Barn, please visit us at elevationbarn.com.
To find out how EY leaders are helping clients rethink their business approach to unlock value for their organizations, visit ey.com

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How rethinking everything can bring clarity in a complex world

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