Stuart Lawson, CEO of HSBC Russia, believes that as you go through some difficult times you should know how to manage and that these times can bring more life experience and allow you to function even more successfully when things get better.
1. What other competencies do you have?
You also should delegate with confidence and you have to have this balance between establishing credibility and the ability to get into enough detail to satisfy yourself about something, but as a manager and a leader you can't afford to go too much in detail. As a friend of mine told me when I was turning that corner between manager and leader: "A manger takes out his broad sword and fights every fight in the arena. That's his job, he gets down to the arena and he fights. But if you are a leader you get to sit at a distance and make that thumb's up, thumb's down decision, you don't have to fight every fight. Even now you might have to pop in there just to remind yourself of what's going on and to remind everybody in the arena that you can still do it, but you shouldn't take the approach that your job every day is this battle". I think that leadership from management is a very complex shift, and many people do extremely well in their careers, they reach the level of management and than they get promoted to the next level, which moves them from manager to leader. Some people have a problem with that transition, because some people still continue to manage, and leadership isn't about management. It includes management but it isn't management. I know about it because I was one of those guys and the first time I got moved from a management position to a leadership position I didn't get it. I kept taking out my sword to fight a good fight instead of leading. But now this is my fifth bank that I've been CEO of, so, I'm getting the hand on it.
2. Can you give an example?
I'd actually rather talk about how I failed, because you can learn a lot from failure. If any of my old colleagues from Citibank, the first time I was here, will be watching this they'll recognize themselves. I had run the corporate bank in Italy before coming here for Citibank. I had been a crisis manager. Now, what do you do in a crisis? Well, of course, this is kind of relevant to today, because we also are in the beginning of a crisis that will last for years. What you do in a crisis is you, first of all, have to know what the situation is. You have to know where you are. You have to understand the environment, and you have to develop a plan. If you don't know where you are - you don't know where you're going. So, the first thing is you have to establish facts, what are the facts of that situation. Very rapidly you have to develop a strategy and tactics, and they are two different things, to take that business out of that situation. It may be a business, it may, actually, just be an account. You may have a bad loan, it's the same thing - establish the facts and develop a strategy and than tactics to get to that strategy. Than, frankly, you tell people what to do. Normally, in these situations where I had worked in Kenya, Egypt, Norway and Italy in crisis, I was parachuted in as the only person that they changed. I was put in charge of, principally, the corporate business, and I, basically, sorted it out. I had to fire people; I had to call in loans. I had to do a lot of very difficult things. There is a saying, which is your first loss is you best loss. It doesn't mean to say you should overreact, but it does mean once you've identified the problem, you need to get on with it. If you leave it than the problem can just get worst. It doesn't on the hold get better by itself. My experience has been, unfortunately, things tend to slide, and when they slide, they don't get better, they get worse. And you have to wait a long time before that cycle is turned around.
3. What happened next?
As a crisis manager I would come in, establish the facts, develop the strategy and tactics and do it. I wasn't very consensus driven, mainly, on the account of fact that I had been put into a fail situation. I only have to turne it up, I was like an old plague carriers: if I turned up in your front door, you understood that there was a problem. Everybody knew that I was there for a reason. When I got moved from this situation in Italy where there'd been this bad corporate bank and brought to Russia, my role was completely different. I was no longer managing anything; I was here to lead Citibank as it established itself in 95. We had seventy people, we were on our way to two hundred, and, today, there is five thousand. My job was to lead. I just didn't get that, because I had no prior training on how to be a leader. You see they don't do leadership courses. I mean, there are leadership courses but, generally, people work hard, they get promoted and than they get promoted again, and, suddenly, they become leaders.
4. What did you do?
Frankly, what I had to do at some point in a process was my direct reports sat in a room. We called it new manager assimilation. They sat in a room, and they were able to do comment on every aspect of what they thought about me: what did they know about me, what did they see in terms of what I did, what would they suggest that I stopped doing, what would they suggest that I start doing. I had to leave the room. There was a third party who did the hand writing. I've still got these pieces of paper to remind myself. And it wasn't a very pretty picture. It took a lot of effort for me to be able to internalize this. I would recommend to my fellow colleagues who have this opportunity of being promoted into a leadership role, I would urge them to create an environment where their direct reports can do this. It gives them an opportunity to deal with these issues upfront. So, they'd have a better chances to succeed. I think that would be one of the sort of "how to" things in terms of how to make this move from management to leadership. You have to be very self aware and to be open for feedback.
5. What you should always remember in these situations?
There is a balance here. You have to take that feedback but you also have to lead. You're not elected to the job. It isn't about getting their votes. Sometimes you have to make very tough decisions. Certainly, one of the things I would say as a CEO this is very lonely. You can't afford as a CEO to socialize with people that work for you. This is my experience. Other people may have different opinions, but I find that if you have eight reports, you will naturally find some of them are more fun to be with and more friendly than others. And, so, if you socialize, I'm not talking about seeing people in an informal context, you should do that, but if you socialize when you hang out, than you'll have favorites and you'll have people who aren't favorites. You shouldn't do that. Generally, I get together with some of the other CEOs in town and we are a sort of bickering, the CEO's bickering club, where we can download on each other on how we feel about the whole process. I think it is a very useful safety valve.
6. What else would you recommend to people who are getting leadership roles?
The second thing I'd say to people who are getting leadership roles is create an informal network, get yourself people you trust, people you can talk to openly and talk to them as much as you can all the time. I, clearly, not talking about talk to them about your bank strategy, don't give away secrets, but talk to them in a way that you can download. I think in most people's careers they will go through a learning experience where life doesn't go quite the way they thought. And, actually, the sooner they can get that done, the better. In my case it didn't happen for twenty-five years and, so, when it came it was pretty brutal.
7. Can you explain what happened?
That was when I came back to Russia. I worked as a credit officer for the guy who is a friend of mine now, who was my branch manager in St. Petersburg. I worked for him, being a credit officer, signing credits in a very small bank. And the reason I did that was I was desperate to come back to Russia. I knew if I could come back to Russia I could find a way of having something to do. So, the things that I found very helpful during this period were that almost none of my friends were bankers. My social friends tend to be artists or musicians or people involved in totally other industries. So, you don't suffer in your industry, you kind of have this broad network and, basically, they are there to support you, because they don't care whether you are successful or not. They care, hopefully, about you as an individual, and that's very helpful.
8. Do you think it is possible to become a leader without management homework?
Well, different people have different leadership styles, different situations called for different types of leaders. Certainly, by the way, I think as you go into a financial crisis you better know how to manage, because life gets pretty rocky and you are guiding the boat you better know how the boat works and you better know how everything in the boat works, because who knows what happens and whether or not you may actually be down on deck helping everybody, you're not going to be up in the cabin seeping your cup of tea. This is my approach, my attitude. You shouldn't try doing everybody else's job, because it may take away their management role and have to be very careful how you do this process. I'm not suggesting as a leader that you go down and interfere and is getting ein verybody's way. I think what you do is you see situations, you manage by example. When you get into this management role you don't have the time to manage anything from soup to nuts, because if you did that you wouldn't be doing all the other things. So, as a leader what you have to do is reach down into the organization every now and than, so that you can communicate your message by what you do in a particular situation, how you expect people to manage other situations, so that they understand the rules of the road. It might sound as a one way process, but don't forget you're always learning, so if you're not listening to other people's opinions and you just imposing your own opinion all the time you run a very big risk that you are going to get out of touch with the environment and that you're not going to benefit from all these other people's opinions which you should be listening to. It doesn't mean to say that you are going to agree with everybody but you got to be listening. I always in my discussions, particularly on credits, say "what's your point of view" before I give my point of view. You know, the chairman speaks last. And the reason why he speaks last is that if he speaks first, everybody agrees with him and than you get into a certain situations and you can see it, you know the unfortunate situations where the chairman wasn't listening because everyone was listening to the chairman talk first and nobody disagree. If you are the leader wait till you've heard other people's opinion before you give your own, because otherwise you won't get their opinions.
9. Can you be more specific?
I think in terms of that management issue everything that you do is judged. How you walk to work, how early you come to work, how late you stay. I'm, by the way, against that. I mean, I do have to come to work early; I do have to stay late. But, I am against that kind of concept. You don't have to come early or late - you just have to be effective. A day should be effective. If you spend the whole day chatting in the corridors, gossiping on the email, than yes, maybe you are going to end up staying late. It doesn't mean to say you have to stay late; you can work your day in a different way. Don't time manage people, I'd say as well. Everybody has got their own rhythm. You've got to let people to have their own rhythm. If they want to hang out and sit around the water cooler for an hour and a half, that's their business. Their business is how they deliver, whether they deliver what they are supposed to for you, and than you need to judge that, not actually, the manner in which they do it. By the way, in Russia where people judge you sometimes by the way you look physically, you're happy or you're sad, is the boss in the good mood or in bad mood, you know, these things are very important. I think it's very important to be aware that your judgment in any particular situation will be conveyed as part of corporate law to other people. So, make sure that you are consistent. Don't be a happy-snappy guy one minute and that churlish dark guy in the other. I mean, if you are going to have to be a negative guy, be a negative guy all the time, but don't get into this sort of situations where people don't know where you are coming from. I always have tried to deal from the top of the pack. That works for me. Generally, people find it quite difficult with me to start with, because I'm very direct. Over time the fact that I have these thirty-four years of experience, they see the value in it, and generally, before we part our ways I hope most people have learned something from me. Certainly, I've always learnt something from the experience, so I hope that they do to.
10. What can you say about difficult times?
You know, they say it's not how you fall down; it's how you pick yourself up. I think many learnings in life don't come from the easy days, they come from the difficult days. I've said to my colleagues here, that this is going to be a very difficult period. And, in a year's time when you look back you will have learnt more, you will be a much better banker, you will have, probably, lost money, but in your life experience you need to go through these periods, because these are the periods that allow you to function even more successfully when things get better. I'm not saying that everybody is going to enjoy it, they won't, but, really, learn from all these difficult times, because that will allow everything else to seem easier. It's like going to a gym, if you work out a lot and than things feel easier.
Prepared by Katia Barzova, Good2Work Intern, on December 1, 2008
