Walt Bettinger of Charles Schwab: You’ve Got to Open Up to Move Up
ByADAM BRYANTFEB. 4, 2016
Walt Bettinger, chief executive of Charles Schwab.CreditJoshHaner/The New York Times
This interview withWalt Bettinger, C.E.O. of theCharles Schwab Corporation, was conducted and condensed byAdam Bryant.
Q. Tell me about your early influences.
A.I had the quintessential Midwest upbringing. Youngest of four kids, grew up in a small farming community in northwest Ohio, and there was a modest-size private university in town. My dad was a chemistry professor. Mom was a stay-at-home mom who was involved in volunteering at a lot of things around town. I worked almost full time at a grocery store for most of high school.
How have your parents shaped your leadership style?
I remember shortly after I graduated from high school, my dad came into my bedroom one Saturday morning and handed me a letter. It was his letter of resignation from the university, which surprised me. My dad was in his early 50s, and it wasn’t something you’d expect from a full tenured professor at his age.
He explained that there had been some animosity between the professors and the administration, and that the professors had voted a union in. He said to me, without making any judgment about whether a union made sense or not, that he felt he had gone into teaching to be in service to others and that the professors were focused more on themselves than on the students. He just didn’t feel that it was in keeping with his principles, and so he resigned. He soon got another job at a different university, but it was just a bit of a shock to me in the moment.
I’d always understood from my parents the concept of service to others, and the priority of what you can do for others rather than yourself. But to see it in action at 18 was powerful. It was just one of those examples of how a lot of people say a lot of things, but when push comes to shove, are your actions going to be in alignment with the principles that you espouse?
What about lessons you learned in college?
A business strategy course in my senior year stands out. I had maintained a 4.0 average all the way through, and I wanted to graduate with a perfect average. It came down to the final exam, and I had spent many hours studying and memorizing formulas to do calculations for the case studies.
The teacher handed out the final exam, and it was on one piece of paper, which really surprised me because I figured it would be longer than that. Once everyone had their paper, he said, “Go ahead and turn it over.” Both sides were blank.
And the professor said, “I’ve taught you everything I can teach you about business in the last 10 weeks, but the most important message, the most important question, is this: What’s the name of the lady who cleans this building?”
And that had a powerful impact. It was the only test I ever failed, and I got the B I deserved. Her name was Dottie, and I didn’t know Dottie. I’d seen her, but I’d never taken the time to ask her name. I’ve tried to know every Dottie I’ve worked with ever since.
It was just a great reminder of what really matters in life, and that you should never lose sight of people who do the real work.
What are some other leadership lessons you’ve learned?
One of the things that was most challenging for me was the confidence to open up. I’ve always been a relatively private person, and maybe with a natural tendency to assume that people really don’t want to hear what you might have to say.
Most people want to hear about themselves; they don’t really want to hear about you, and so I probably utilized that over the years to my advantage — to ask about other people, learn about other people.
But one of the lessons I learned is that, in the transition from management to leadership, I had to open up. I had to be vulnerable. I had to share with people. In fact, it was more important than anything to share with people the great failures in my life as opposed to the successes.
I draw a distinction between management and leadership. There’s a contractual relationship with your manager. And you can do your job and fulfill the terms of that contract and never really have your heart in it.
But leadership is something completely different. With leadership, you make a decision every day about whether you choose to follow someone. And you make it in your heart, not your head. The ability to inspire followership is so different than management, and it requires transparency, authenticity, vulnerability and all things that are completely unnatural to you when you are trying to build and achieve and accomplish.
How do you hire?
I’m most concerned with the kind of person they are, their character. I’ll ask questions like, “Tell me about the greatest successes in your life.” What I’m looking for is whether their view of the world really revolves around others or whether it revolves around them. And I’ll ask them about their greatest failures in their life and see whether they own them or whether they were somebody else’s fault.
One thing I’ll do sometimes is to meet someone for breakfast for the interview. I’ll get there early, pull the manager of the restaurant aside, and say, “I want you to mess up the order of the person who’s going to be joining me. It’ll be O.K., and I’ll give a good tip, but mess up their order.”
I do that because I want to see how the person responds. That will help me understand how they deal with adversity. Are they upset, are they frustrated or are they understanding? Life is like that, and business is like that. It’s just another way to get a look inside their heart rather than their head.
We’re all going to make mistakes. The question is how are we going to recover when we make them, and are we going to be respectful to others when they make them?
Discussion questions:
- Do you know the names of any of the Aramark custodial staff here at MRHS? Any of the Chartwell cafeteria professionals?
- Have you been to a restaurant when someone in your party did not receive the food as expected? How did they react? How will you react?
- How do the answers to #1 and #2 above relate to leadership?