Podcast: Ron Williams, “Learning to Lead”

Williams has written a book about leadership: “Learning to Lead: The Journey to Leading Yourself, Leading Others, and Leading an Organization.” However, he has also written a book about addressing many of the major gaps in society today, including the growth of inequality and the death of ethics.Ron Williams knows leadership. He was, after all, Chairman and CEO of Aetna. When he joined Aetna in 2001, its loss from continuing operations was $292 million, with earnings per share loss of $0.46. By the time Williams left in 2011, the company’s full-year operating earnings were $2 billion, with operating earnings per share of $5.17. Beyond the numbers, though, During Williams’ tenure, Aetna was named FORTUNE’s most admired company in the Health Care: Insurance and Managed Care category for three consecutive years.

Now Williams has written a book about leadership: “Learning to Lead: The Journey to Leading Yourself, Leading Others, and Leading an Organization.” However, he has also written a book about addressing many of the major gaps in society today, including the growth of inequality and the death of ethics.

In fact, Williams’ argues that it’s exactly because of these times that we must renew our focus on leadership. He writes: “Our society has a greater need than ever for talented, effective leaders. Given the enormous social and economic challenges we face, organizations of every kind – for-profit businesses, nonprofit organizations, and government agencies – are desperate for people of every background with the ability to formulate a compelling vision of the future and to inspire others to help make that vision a reality.”

Williams outlines the approaches one needs — lessons from his own experiences and those of people like Lucent’s Pat Russo, American Express’ Ken Chenault, Xerox’ Ursula Burns, McKinsey’s Ian Davis, and others — to grow as a leader. He acknowledges: Not everyone will become a CEO. That’s fine. Everyone still should live a life of purpose and action, and Williams outlines what he believes is the path to get there.

It’s a very personal book. Williams writes about growing up on the Chicago’s South Side, the powerful influence of his parents — his father was a parking lot manager who later became a bus driver; his mom a manicurist in a neighborhood beauty parlor — and the realities of creating a path in today’s business world. He writes for kids just starting out who want to understand how to become a leader and CEOs sitting in the chair right now who want to become better leaders.

More about Williams: Since Aetna, Williams has continued to help drive leadership in business, including in private equity. He as served as Operating Advisor to Clayton, Dubilier & Rice, where he is chairman of CD&R’s portfolio companies  currently serves as Chairman of portfolio companies agilon health and naviHealth.

His influence and experience don’t end there: Williams is the chairman and CEO of RW2 Enterprises. He is a director on multiple corporate, public sector and non-profit boards. Among many other organizations, he also is a member of the MIT Corporation, Vice Chairman of The Conference Board, and a member of the President’s Circle of National Academies.


Transcript: Ron Williams, “Learning to Lead”

Ron Williams, “Learning to Lead”

Chris Riback: Ron, thanks for joining me. I appreciate your time.

Ron Williams: Well, thank you. It’s a pleasure to be here.

Chris Riback: Why are you the least likely person ever to lead a $34 billion corporation?

Ron Williams: I would say I’m the least likely person because as a kid growing up, my dinner table talk was not about business. It was not about a career aspirations in the context of being in a corporation and climbing the corporate ladder. I had no idea that there were such a thing as the types of jobs that you would find in a major corporation. I lived in an urban inner city area, and I really had no construct of what I would do with my life, and yet, I ended up leading Aetna, which was one of the largest and most successful manage-care companies in the country.

Chris Riback:  I wanted to start this conversation really the way you started the book which you’ve just done. I’m quoting you and your line about being the least likely person ever to lead a $34 billion corporation of course, but in the beginning of the book, it’s a very personal book and different, different in a very powerful and, in my biased opinion, positive way from so many books that try to address the topic of leadership. Why’d you write this? What inspired you?

Ron Williams:  I was inspired to write the book because I was approached by many of my friends and colleagues from all walks of life. Many of them were African-American executives. Others were women. Others were people at different stages from different communities who said, “My kids don’t know what they want to do, and they really have no idea how to get traction in the business world and how to figure out a path to success where they can reach the point that they can have the kind of life that I’ve had.” At the other end of the spectrum, I got constant calls from CEOs who are confronting transformations, human capital problems, recruitment, challenges with their board, challenges with the regulators.

It occurred to me that at both ends of the spectrum, starting at the top of the huddles, people could benefit not from the academic perspective, not from the consulting perspective, but from the perspective of leaders who’ve been there and been successful through all of these challenges. That was really what caused me to say, “I will in fact write the book,” and that began the journey.

“One of the things a leader has to do is make a conscious choice about what leadership approach and style do they want. I believe that this values-based, high-performance culture is the bedrock and gives you an ability to communicate the strategy to create a high-performance team, to create alignment, to create engagement, and to get the organization to unlock the discretionary energy that every person brings to work and can choose to deposit at the company and help the company succeed or never unlock it and go home with it, and that it’s the CEO’s job to accomplish this level of engagement and communication. recognizing all of the balancing facts and stakeholders.”

Chris Riback: Isn’t that remarkable, how wide that spectrum is, how there could be such profound questions at both sides of…? I mean, that’s an extraordinary spectrum. There’s not much else that you could measure with that wide of a grouping. That must have surprised you to think of it that way.

Ron Williams: It really did, and it took me a while to piece together what I was experiencing. I knew that the new entrance into the corporate environment, we’re sorting it out, but as I talked to people who were in the C-suite or approaching the C-suite, I was really amazed at the amount of calls I constantly got from people saying, “I’ve got a new team. How do I get them engaged and motivated? How do I communicate the vision of where we’re going? How do I speak to my board?” It was really surprising about the commonality of themes.

Probably one of the most interesting things for me was that as I’ve talked about the book, it’s become clear that when you are in fact leading the organization, the issue of leading ourself is even more important because you really don’t have that kind of feedback, guidance, and possibly self-awareness and so it places an even extra burden on the leaders leading the organization to really look at themselves deeply and make certain that they’re leading the organization the right away.

Chris Riback: I have questions for you on that. The way you’ve structured the book, leading yourself, leading others, and then leading the organization, and that journey, that personal journey, I want to ask you about that. Yes, to your point, I would imagine that people in the board room, people looking to a deal, whether maybe at the C-suite level, definitely, but also senior middle managers who are looking to make that transition. There are just innumerable lessons in here, not only from yourself but also from some of the other leading CEOs and leaders that you quote in their examples that you cite in the book.

I couldn’t help feeling as well, and you correct me please if I’m misinterpreting this, that among your goals was something of a social good. One of your key goals, and you touched on this a little bit, was to help young people, people who as you write may lack some of the advantages that come with a privileged personal background, wealth, connections, and prestigious education, and for whom the game may even feel rigged. Is the game rigged? I mean, you write about the temptations of urban life as well as crushing student debt and low paying jobs. Are we configuring things in our society in a way that might not be rigged but might help perpetuate an equality gap that that has been noted in our society?

Ron Williams: I would say that one of the reasons I wrote the book was that I kept hearing that young people were getting messages that says, “Don’t try. There’s no way to make it. The deck is stacked against you. You can’t be successful.” People on the other hand heard messages that says, “We need the talent. We need the capital,” and people wonder is that about everybody but me? You’ll note in the book that I’m interviewing people like Pat Russo who led Lucent and Alcatel, people like Ken Chenault who led American Express, Ursula Burns who led a Xerox, and Ian Davis who led McKinsey as the director there and others who led nonprofits all talked about their journeys, which by and large were non traditional journeys. I think one of the things the book is hopefully going to do is say to people, “You cannot win if you are not at the table. If you’re not in the game and you’re not engaged, and you’re not working to develop the most important asset you have, which is yourself, then you certainly won’t win.”

If you get in the game and you work to develop yourself, then there’s certainly no guarantees, but the biggest problem American business has is finding the human capital to help innovate, to help drive success, and to help companies grow and thrive.

Chris Riback: What is self-leadership? Is one born with it? Do you either have it or you don’t, or can it be taught and learned?

Ron Williams: I think that often, people believe that leadership is a natural inherent gift. Certainly, there are people who may very well have that attribute, but I think people can in fact learn leadership, leadership behaviors, leadership traits and the fundamentals and basics of leadership resulting in good followership, which is really important. One of the ways to do that is to expose yourself to leaders and to seek out and learn from mentors whether they be official or unofficial, and to understand the strategic intent of the organization and the people in the organization.

I talk about two up and two down. You should try to understand the strategic intent, not just of your boss, but your boss’s boss. Who is it that is driving the department, the division, the company? How do they see the world? What do they do? Until there’s an opportunity to really learn the traits of leadership both through study in theory and then in practical experience by watching and observing and learning from the behaviors of others.

Chris Riback: Let’s talk about how you structure the book. We mentioned it before. Let’s get into it a little bit more now. Leading yourself, leading others, and leading an organization, how do you see that progression? Does it have to go in that order? I assume sometimes, it might not. Maybe there are times where folks find themselves leading others, and they haven’t quite figured out yet how to lead themselves, or even God forbid leading an organization where they haven’t necessarily gone through the proper progression. Talk to me about why you structured the book the way you did and how you see that journey.

Ron Williams: I think I structured the book because it is an array of competencies that are required. It is not that everyone will go through those competencies in a lock step, a hierarchical manner, but that each of those are fundamental to long-term enduring success and your responsibility as a leader. I would start with, for example, in many instances, someone is a very strong individual contributor. They’re the best analysts. They’re the best coder. They’re the salesperson. They’re the best attorney, and then all of a sudden as a result of that, they have the responsibility to lead a group.

Those are fundamentally different skills. In leading that group, there are times when they will need to revisit leading yourself effectively, so they are in essence adding on to their competencies, recognizing that they may in fact I’ll use the word tune up on the competency of leading themselves. As they lead a department of people and it gets bigger and bigger, and one day, they reached a point where they’re either leading the organization or on the executive committee and are expected to be a leader of the organization in a very different sense.

Then again, they have to draw on those foundational skills. You move back and forth between them. It’s not like you graduate from one and go to the next.

Chris Riback: That’s an important distinction. As I ask you about a couple of components of each of those different areas, that’ll be important to keep in mind that it’s not a straight forward journey. I want to follow up on one of the things you just said because it’s always been fascinating to me. I’ve seen it in financial services, and you seem to just identify that it goes beyond that sector and into other sectors where because someone is let’s just say a good bond trader, they all of a sudden become in charge of a division, and all of a sudden, they are leading 100 or 500 or even a thousand people.

They’ve been very skilled in a very tactical way, but it doesn’t necessarily translate into being a strong leader, and yet based on that tactical skill, they are escalated to that position of leadership. Do you see that in multiple sectors is what I’m taking from what you’ve said?

Ron Williams: Well, yes, I do see it in multiple sectors. In a way, the fact that you are a very strong, high-performing specialists in your area can in fact be a huge inhibitor in letting go of what you used to do and adopting what you need to do now. I will tell you that in my own career, one of the toughest lessons I ever had to learn was that that wasn’t my job anymore, that I was the best analyst. You give me a problem. I can figure out the hole in it, and I can figure out the solution to it. When you begin to manage people, and they brought you a 99% solution, finding the last 1% is not a motivating event.

There’s a process you have to go through of recognizing that, yes, you know how to do this, whether it’s trading bonds or whatever the discipline, but that’s not your job. Your job is to lead the organization to have the best collection of bond traders you can find. That’s a different skill. I think, like most things, recognizing and understanding it and then beginning to work to master the competencies necessary to be good at that is to start on the road to success.

Chris Riback:  Let’s talk about some of those competencies and some of the lessons that you really outlined. In the first section, leading yourself, one of the ideas that stood out to me start with minor miracles. The tougher the challenge, the bigger the opportunity. We are talking now, and it is graduation season, so I think this is appropriate. You really give a lot of advice to people starting their careers about the importance of finding jobs and let you learn, seeking ways to enhance your future marketability, experiencing different kinds of businesses, things like that.

Do most people get their early careers wrong, or do they not necessarily pay enough attention to the journey? Do they potentially worry too much about the job specifics and not about finding the learning opportunities that come really with any new experience?

Ron Williams: I think that’s true. I think people make a couple of mistakes. One is they overemphasize the particular job as opposed to what the job enables them to learn. The second mistake they make is they don’t invest in learning everything they can from that job. I have an expression that no matter who you work for, you really work for yourself, and so in working for yourself, your job is to become absolutely as valuable in that job as you can by learning everything about the job from everyone you come into contact with.

The reality is you probably won’t get paid for doing that in that job. You’ll get paid for doing it and the next job and the job after that. One of the other mistakes that people make is avoiding risk. Often, the greatest risk people run is not taking a risk, and you learn more in a risky situation. People are willing to give you greater responsibility. They’re willing to really challenge you, and if it’s already a mess, it’s hard to make it a bigger mess, so you have an opportunity to really fail and learn. Those would be a few of the pointers I would give.

Chris Riback: That’s excellent. You make me feel better because oftentimes, frequently it’s at home. I’ve been accused of having made small messes even bigger, so I’ll now respond, “No, you can’t. It’s already a big mess. How could I have made it bigger? There’s just no way.” That’s good advice. I’m learning leadership from you as we speak.

Ron Williams: Glad to help.

Chris Riback: Thank you. In the next section, leading others, here, I loved your focus on asking questions. What is the art of asking good questions?

Ron Williams: I think one of the things I found is that particularly in areas where there isn’t a well-developed six sigma or quality program where why is a driving force in that environment, the minute you ask someone why often they feel like they’re six years old, and they begin to rationalize whatever decision they’ve made. It inhibits, in my opinion, the real search for the underlying facts, and so what I’ve found is by asking questions, let’s say, helped me understand why that course of action is the one you think we should take. What do you think we could do to improve?

There’s a whole set of questions that are collaborative questions, not what I’ll call make people feel like accusatory questions. It may sound subtle, but it really pays big dividends because it uncovers embedded assumptions that people often don’t really think about that are inhibiting high performance.

Chris Riback: Are leaders afraid at times to ask questions? I could imagine a scenario where they could feel that it gets interpreted that they don’t know. Here, they are the leader. They’re supposed to have all the answers, and God forbid, they ask questions. It might imply that they don’t know the answers. Do you come across that? Is that a concern or am I inventing something?

Ron Williams: I think that I have seen that, and I also see where the leaders don’t really want to understand the issue. They want a report. I have an expression that says, “Don’t administer lead,” and when you administer, it’s one plus one equals two. When you lead, you are one plus one equals three or four. Through the process of asking questions and understanding, you are really bringing your insight and your experience to the solution into the problem, and you have to create a culture where people understand and expect that. That’s why it’s extremely important to create an environment where asking those questions is routine and normal and it’s done in a way that people are clear that you really want to understand. If I don’t understand, I can’t help you.

Chris Riback: Then the section leading an organization and what was really telling to me here, so now, you’re really talking directly, I believe, to the CEO here. Among the things that was so interesting to me was you spent very little time in this section talking about meeting numbers, talking about growing revenue, talking about expense cutting. You focused on culture, vision, communication. Talk to me about those types of skills. Is that the real key differentiator once you get to that CEO level that you need to be thinking about who are we, where do we want to go, and how do I communicate that and make sure that everyone from employee number one to a shareholder to a society member, someone in the community, that everyone understands where we’re going?

Ron Williams: I think you’re right. One of my observations was that there are endless books written on strategy, on finance, on how you in fact achieve financial sales goals, et cetera. What I wanted to do was speak to once those things are fairly well, you’ve got a strategy. You’ve got a value. You’ve got missions. The boards approved it. How do you really engage an organization and how do you create and sustain a values-based high performance culture? I think one of the things I learned actually from Ian Davis who ran McKinsey is that I believe that a values-based, high-performance culture is critically important, but people achieve high-performance cultures through fear, through intimidation, through financial rewards.

One of the things a leader has to do is make a conscious choice about what leadership approach and style do they want. I believe that this values-based, high-performance culture is the bedrock and gives you an ability to communicate the strategy to create a high-performance team, to create alignment, to create engagement, and to get the organization to unlock the discretionary energy that every person brings to work and can choose to deposit at the company and help the company succeed or never unlock it and go home with it, and that it’s the CEO’s job to accomplish this level of engagement and communication. recognizing all of the balancing facts and stakeholders.

Yes, you have to hit your numbers. Yes, you have to balance the interests of stakeholders, but you can only do that with the tools I’m thinking about, I believe, is the best way to do it.

Chris Riback: What a big idea that is, the idea of discretionary energy, the idea that any member of your organization has a reservoir of some size of capability for good will energy to contribute, and that a key role for a CEO is to figure out how to unlock that discretionary energy. Am I understanding your point correctly?

Ron Williams: You’re understanding it absolutely correctly. I always give an example when I would talk to our all employee meetings. I would say, “I want you to imagine two companies. They both have the same resources, the same market share, and the same financial and human resources. One company, every day, people come in, they do exactly what they have to do. Every day they wake up, there are 10 things on their list. They do the seven things that are most visible to their coworkers and peers. The other three things are truly discretionary. They can do them today. They can do them tomorrow. They can do them next week. They can do them next month.”

They are the only ones who really know whether they are unlocking those other three. Now, imagine the competitor across town where every day, everybody comes in and everybody does all 10. Every once in a while, they do an 11. Set the clock forward five years, and which company do you think is going to be most successful, have the biggest market share, have created more jobs, have created more customers? That discretionary energy is an enormous competitive tool for businesses.

Chris Riback: That’s an enormous idea. What part of leadership gave you the most trouble? What was hardest?

Ron Williams: For me, I think I was basically an introverted individual and so learning to be more extroverted was one of the hardest things for me to learn, and also, public speaking was a huge issue for me at first, but I’m a big believer that you fail your way to success, but I’m just glad nobody has videos of my early talks and presentations, at least I hope not.

Chris Riback: We won’t go to YouTube and find anything to post next to this podcast, I promise you.

Ron Williams: Well, I can tell you I think YouTube didn’t exist at that point. I was pretty good by the time it came around, but that was what was difficult, and really, really understanding the shift between being a high-performing, functional specialist and really leading the teams was a big jump for me. In a way, I understood leading organizations better that I made the shift to lead people. That took me some time to master.

Chris Riback: There are two questions that I would love to end on. First, nearly every person I’ve ever spoken with who has written a book has said two things. One, it was a great thing to have done as opposed to being in the middle of doing, and two, they learned something new about themselves. My question, did you enjoy the process and was there something new you learned about yourself in this process?

Ron Williams: Well, I would say I enjoyed completing the book. I have to say that if I had known how difficult it was to write 300 pages that I would personally be satisfied with as someone who is rarely satisfied with my own performance, I probably would have had some hesitation, but I feel really good about the content of the book and the end result. I think in terms of what I learned about myself was it helped me weave together my experiences into a cohesive philosophy and set of things that I can communicate to help the next generation really grow and thrive and be successful leaders.

I think, one of the things I was proudest of are the people that I have worked with who have gone on to be CEOs of their own companies. I have about five people who’ve worked with me who are now CEOs. About half of them are women, and that these were talented people who had plenty of capability, but they have all said that I had a very important role in giving them the opportunity to demonstrate their capability. For me, it was a culmination of bringing together the synthesis of my impact on the talent.

Chris Riback: That has to be incredibly fulfilling. When one reads about Bill Belichick, the New England Patriots’ head coach or Mike Krzyzewski, the Duke basketball head coach, as part of what makes them great leaders, great at what they do, there’s always something about their lineage, about the number of disciples that they have throughout the game games and in different roles. Yes, you are not comparing yourself to those two. I made the comparison, not you, but I would absolutely imagine that seeing folks who you had the opportunity to work with, seeing them succeed and go on to other leadership roles, that has to be among the most fulfilling aspects of what you’ve done.

Ron Williams: No, it really has been. I think the other thing that I enjoyed enormously and the book caused me to reflect on it more than I had recently was the cultural transformation of Aetna from a company that was losing $365 million the first year I joined to a company that made $2 million when I left and was voted the most admired company in our space by fortune three years in a row. It was a dramatic transformation, and it changed the lives of the Aetna staff. It was a place that people had a lot of pride in.

Chris Riback: Let me close with another place where you begin the book. It’s a comment on business, and it’s a comment I believe on society. The question is why do ethics matter? I ask because you write at the beginning, “We live in a time when too many of the role models visible in the media represents styles of leadership that are far from ideal. We’ve seen too many self-proclaimed leaders on main street, Wall Street, and even the highest levels of government who seem to be willing to cut ethical corners, to bend and distort the facts, and to substitute bullying for persuasion all in the service of self rather than to benefit the organization and the people whose lives are affected.”

It is a powerful set of lines. What do you feel has happened and what level of concern do you have for society and for business?

Ron Williams: I think I would start with leadership is both a privilege and an obligation, and what people often over focus on the privilege that they get from leadership and under focus on the obligation that they have by the fact that they’re a leader, however they got to that position. To me, I think we have lost, broadly speaking, the ability to collaboratively engage, to solve problems, to disagree but not be disagreeable, to assume positive intent to the [inaudible] it can be done. In some instances, you’re dealing with jerks.

That’s a different book somebody wrote on how to manage difficult people. That’s not my book, but I think that there is just something missing which will inhibit and represents a very role model, of a very bad role model for creating value not just economic value, but human capital in our society. Those would be my comments.

Chris Riback: Well Ron, it’s a powerful book. There’s a lot going on in the book. I really took it as a message for young people, and we talked about that. I read a lot of commentary about society and what you were just saying. I understand you may or may not want to go into specifics, but your comments about ethics and what’s going on in society, and then just practical takeaways, almost day to day how I can grow as a leader. There was a lot going on in the book. For me personally, that made it an excellent read. Thank you. Thank you for your time.

Ron Williams: Thank you.

 

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