Lessons In Leadership: One On One With Walt Rakowich

I spoke to Walt Rakowich, the former CEO of Prologis and author of Transfluence, about his journey and best advice

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Adam: How did you get here? What experiences, failures, setbacks or challenges have been most instrumental to your growth as a leader?

Walt: Growing up in Pittsburgh, I had the greatest parents a kid could ever want. I was very fortunate. We weren’t wealthy, but they taught me a wealth of enduring values that I have used as a yardstick in my life journey. One of those values is to view my challenges as opportunities. The greatest challenge I have had as a leader is taking over as CEO of a fledgling Fortune 500 company that was on the brink of bankruptcy in 2008. Our stock had dropped over 95% in 10 months and we were faced with an exploding leadership crisis that was eroding day by day. The values I got from my upbringing had prepared me for that opportunity, and they guided me as we turned the company around.

Adam: How did you lead the turnaround at Prologis? What are the best lessons you learned from that experience?

Walt: I led the turnaround by being singularly focused on what was best for our company, our employees and our shareholders. I also put a great deal of emphasis on being transparent. We live in a world of glass houses where leaders are under a microscope and are exposed at all times. Transparent leadership is the only way to lead in this more transparent environment. 

The three best lessons I learned are: 

  1. Adversity provides you with your greatest opportunity to lead,
  2. When you go to battle, make sure you have the right people on the bus with you, and
  3. Make sure you always live your values and lead by example. 

Adam: What are your best tips on how to effectively lead during a crisis? 

Walt: Every crisis is different. A crisis caused by a large customer’s bankruptcy, for example, may be different than a major employee strike or a virus, for that matter. And yet the way one leads is actually quite consistent from crisis to crisis. I believe great leadership is always about influencing others to accomplish outsized things. And influence starts with building a foundation of trust. During a crisis, a leader needs to understand that people are watching and listening even more intently than when things are going well. So leaders can be very influential in a crisis. How they deal with situations, how often they communicate and how they treat people matters greatly. In a crisis, a leader is under a microscope and people emulate the way they act. So leaders need to be mindful of the values they want to see lived out in their organization and lead by them consistently.

Adam: What are your best tips on how to thrive during a down market?

Walt: Down markets require a heightened emphasis on communication and transparency given the strained emotions and tensions that everyone is experiencing. I think there are four things a leader should do in communicating and being transparent, especially during a downturn:

1/ Consistently communicate over and over and in multiple ways. I was amazed at how many times I communicated something only to find that some people had misunderstood or, worse, totally missed key points. I learned that repetition drives understanding, which is vital to execution.

2. Avoid procrastination on emails and other requests. Procrastination kills progress and can give people the feeling that their need is not important.

3. Be aware of the message that silence sends and manage it appropriately. Perceptions become reality.  By not addressing the elephant in the room, a leader can mismanage the situation and create negative feelings as a result.

4. Don’t let pride get in the way of conveying the truth, even if it’s painful. The toughest thing a leader has to do is communicate bad news, because no leader likes to feel like they are failing or the situation is out of their control. But leaders need to remember that the truth eventually gets exposed. In the long run, a leader’s credibility is at stake.

Adam: In your experience, what are the defining qualities of an effective leader?

Walt: Building trust is the most important ingredient for leadership success. I believe there are three behaviors that help a leader effectively build trust. They all start with “H” so I call them a “3-H Core.”

The first “H” may surprise you. It’s humility. You don’t hear about it much but it’s powerful. It’s about how you perceive yourself. As a leader, you must get out of your own way. Leadership requires a recognition that it’s not about you. Your job is to lead and influence others. That requires putting your pride and fears aside. And that’s tough for most leaders. Frankly, the best decisions I ever made occurred after I dealt with my fears and prideful nature. I became more humble and could see more clearly. 

The second “H” is about honesty. Leaders must tell the truth and communicate it over and over again. Transparency and honesty always win in the long run. And if you’ve dealt with your fears and pride, you’re in a much better position to be honest with yourself and with others.

And the third “H” is to act with a heart for other people—to be human. Leaders who act with empathy influence others. It’s not easy, because we all have biases. But it puts people at ease when you meet them where they are, show them respect, and treat them with dignity. Also, to build trust, a leader must show trust. You do that through empowerment and recognition that comes from the heart. Again, you will succeed at this by putting your pride aside and recognizing it’s not about you. 

Adam: How can leaders and aspiring leaders take their leadership skills to the next level?

Walt: I’m a big fan of executive coaching and personal boards of directors. If you want to find out how you can improve, you must have the courage to ask. A good place to start is to hire someone to administer some basic evaluation tools like personality or strengths testing and 360-degree evaluations. A good executive coach will help you to spot gaps and create a development plan to address your weaknesses and improve your strengths. I also think a personal board of directors or an accountability group of advisors can provide you with sage advice on work and career-related matters. I have used both approaches throughout my career, and they have made an incredible difference in helping me develop the self-awareness to know where I stand and how I can improve.

Adam: What is the best advice you have on building, managing and leading teams?

Walt: People desperately want to be a part of something that creates meaning and purpose in their lives. They want to work for a cause and not just a living.  Great leaders help create an organizational purpose and find ways to align their people to that purpose in meaningful ways. We did this at Prologis through continuous recognition, storytelling and strategy briefings that highlighted alignment. We also created opportunities for people to give back in their communities and emphasized the importance of them doing so. We wanted our employees to see that we cared about them and were willing to do our part in making our world a better place.

Adam: What are your three best tips applicable to entrepreneurs, executives and civic leaders?

Walt: My advice is this: Long-term success depends on the amount of trust leaders build. And building trust starts with a simple timeless premise: Leadership is not about you, it’s about the influence you have on others. There are three key things that a leader should focus on to lead in this way:

1. Look outside of yourself. Personal pride and self-absorption sink great leaders. 

2. Embrace transparency. The world is more transparent so leaders need to be, as well.

3. Act authentically. Do it with humility, honesty and heart.

Adam: What is the single best piece of advice you have ever received?

Walt: It’s called the Golden Rule, and it’s found in the book of Matthew. “So in everything, do to others what you would have them do to you.” (Matthew 7:12)

Adam: What is one thing everyone should be doing to pay it forward?

Walt: Paying it forward incorporates the idea that it’s not about you, it’s about what you do for others. I believe the best leaders do exactly that. They are inspired by the duty they have to influence the lives of those around them. And in doing that, they make everyone they touch better people and better performers. I call it Transfluence. It’s leadership that has a “transformative influence” in the lives of those you lead.

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