Private Equity Personality

Sunday January 22, David Rubinstein, the head of Carlyle Group was on Fareed Zakaria’s show Global Public Square on CNN. The Carlyle Group is one of the biggest private equity firms in the world.

The subject was private equity, in the context of the recent flogging of Mitt Romney over his salad days at Bain Capital. Whether you love or hate private equity – understand it or think it’s a mystery – Mr. Rubinstein presented a very cogent argument for why private equity makes sense as a business and even helps middle class people who co-invest alongside Mr. Rubinstein and his partners. Middle class people like teachers, policeman, and other union members can and do co-invest in private equity funds through their own pension funds. They seek the same superior returns that the Carlyle Group is seeking.

But this isn’t a post about private equity. It’s about connecting with people. Mitt Romney can’t do it. David Rubinstein can – but he didn’t – at least not on this show.

Mr. Rubinstein presented a collection of facts that assembled his argument for private equity as a good thing. It was rational, logical and well spoken but in my view it didn’t connect with his audience as well as it could have. It would have been great for a business school audience but that wasn’t who he was speaking to – he was speaking to the world.

He could have connected much better if he had woven his private equity story around his dad, a postal service worker in Baltimore who never made over $8,000 a year. He could have said that his father, a middle class worker, might have been one of his unseen partners at the Carlyle Group through a public worker pension fund. He mentioned his dad toward the end of the interview but too late to help much.

I’ve never met David Rubinstein but he’s a terrific talker. Go on You Tube and watch him talk to business school students at University of Maryland last year. He has a quick wit, great stories and owns his stage. He connects with people, regaling them with family stories about growing up middle class in Baltimore, the only child of two parents who never graduated high school. Humble roots for #139 on the Forbes 400 list.

He could have done that on CNN with Fareed and everyday people might have connected with his point and his person. Instead he came off a bit stiff and a touch Romney-like, delivering facts without feelings. He left his personality home.

Bottom line – when talking to real people about real things, be the real you.

Lead with Dad!

Smooth the Seams

Watch the best conversationalists in your life or business. Can you see and hear the seams of their conversations or does it flow smoothly based on a mutual sharing of information with their counterparty? Usually they make it look effortless. It's not based on inborn ability. It's based on years of practice.

Too many times in business meetings we ask a question and respond immediately and abruptly with our next point. We either don’t follow up with a question to find out more or we don’t share our side of a similar story, observation, conclusion or experience. It’s like watching ping pong being played on the wrong kind of table.

Smooth the seams by drawing the other person out and then giving back. Follow your own curiosity until you reach a point of more natural transition. Relationships in life and business are built on sharing experiences. It helps us connect with people.

You Gotta Believe

Managers transmit information. Leaders transmit belief.

Recently we saw two examples of leaders trying to transmit belief to the American people on TV.

The first was a 60-second BP commercial by its Chairman, Tony Hayward, apologizing on behalf of his company for the Gulf oil spill and pledging to set things right. The second was a 17-minute talk by President Obama from the Oval Office explaining the status of the cleanup efforts and the government's plan to design a strategy to restore the Gulf region.

Normally if you went and compared their skills at persuasive communication, President Obama wins in a walk because he has a well-deserved reputation as a charismatic speaker, whereas Mr. Hayward has a well-deserved reputation as a gaffe machine who makes Joe Biden seem a model of decorum and temperance.

In my view though, both failed.

They both read their comments off a teleprompter and lost any chance at transmitting belief and connecting with the American people on an emotional level. They both hit on how many feet of boom have been laid out, how many ships deployed, how many thousands of volunteers and troops on the ground - a list of facts best recited by someone below their pay grade.

President Obama, perhaps feeling the tug of his lawyer/college professor DNA, gave us a teach-in on the Gulf Oil Spill, repeating information we've been bombarded with 24/7 on cable TV. He sounded like someone getting through a committee update, not a leader transmitting belief and confidence to a severely wounded region and its bewildered, abused and angry citizenry.

Tony Hayward could have been reading from a Hallmark card he picked up at a convenience store for all the impact it had. He had no visceral connection with his words; no emotional intent in his delivery; and a flat lifeless tone that left viewers unconvinced, uninspired and unimpressed.

One might say: "Wait a minute, Reagan used a teleprompter." Quite true, but with a huge difference.

Let's face it, the man knew his way around a camera. Reagan's talk from the Oval Office on the day of the Challenger disaster was a masterpiece of messaging and a model of a leader transmitting belief using a teleprompter. He had two distinct advantages - a terrific speeechwriter, Peggy Noonan, who understood how to combine lean language with soaring imagery, and a lifetime in front of the camera making people believe.

So what's a President or CEO to do? Trash the teleprompters? Fire the speechwriters? Go watch sail boat races or play golf?

No, No, and (duh) No!

They can and should find opportunities to connect on camera or in person with nothing at all. No notes; no teleprompter; no slide deck; no written speech. Just a mental outline of their story and their preparation, confidence and wits.

If it's a video message like a webcast to the people in their company or in the country, make it short. Reagan's Challenger talk was 4:27. Kennedy's famous Ich Bein Ein Berliner speech was 4:42. The Gettysburg Address was 270 words and Martin Luther King's iconic I Have A Dream speech was a little over 10 minutes.

If it's a Hook and Hammer for a Town Hall, do three minutes on either side of the duller-than-dishwater details and farm that part out to some person in your organization who's really good at it. The audience will have no problem recognizing you as the true leader and will see the real you, not the phoney-baloney you, reading bare bullets off a boring slide.

Sure, it's scary. Sure, you might make a mistake or flub a line or make a gaffe. As evidenced in the Obama and Hayward examples though; you can have all the money, power, and technology and even read the darn thing - and still fail.

So as a CEO, what have you got to lose?

You do TV interviews all the time with no notes. You sit on all-star global panels with no notes. You probably did your last wedding toast with no notes. Why not go down to your in-house TV studio if you have one. Fire up the camera. Look into that little red light and just talk. Do it several times until you're convinced that you didn't embarass yourself and then let it fly.

Your colleagues and employees may be thrilled that you pushed past all the boilerplate B.S. and finally talked to them as adults.

Your alternative is to wait until you're playing pinochle out on the front porch at the assisted living facility and you turn to your card buddies and say:

"This is what I would have said back when I was chairman of the board - if it wasn't for those damned lawyers".

Take a shot!

Listen, Learn, Lead

Many successful senior executives approach difficult challenges by using a process called Listen, Learn, Lead. They get in conversations with key players; ask a ton of questions; learn the critical issues facing the business; and then start to lead that business and those players down a new road to success.

In the process, they build up their knowledge base, solidify critical relationships and display credibility because their solutions are grounded in fact and experience rather than presumptions and projections. One might argue that President Obama used the Listen, Learn, Lead approach leading up to the latest troop deployments in Afghanistan. Dick Cheney characterized it as dithering yet his favorite general David Petraeus called the process thorough and necessary.

Which brings me to the heathcare debate and the President's agenda post the recent Massachusetts Massacre. Many are starting to write his political obituary as an ineffective one-term president. That's probably premature. After all, Reagan, Carter and Clinton each had similar job approval ratings at the end of their first year in office. Reagan and Clinton managed to right their ships and sail off to second terms, Reagan in an historic landside. Carter, oh well...

President Obama is now getting advice from all and sundry on how to right his ship. Go pick fights with Wall Street because everybody hates those guys anyway. Ram healthcare through before Scott Brown can park his pickup truck in the Senate garage. Dump healthcare entirely and focus on jobs and the economy.

How about this Mr. President? Try: Listen, Learn, Lead again.

First, to free up some of your time, tell Joe Biden that his sole assignment between now and November is helping businesses create jobs and lower the unemployment rate. Give Joltin' Joe an 8.5% target unemployment number and a blank check to broker fast-track deals with Congress on tax cuts and targeted incentives for business to wake up the economic engine in this country. He'll love the gig and he might make some headway while you hit the road again.

Then, go throw some Tea Parties of your own around the country. Not in all 52 states but three to five in each region of the country between now and Opening Day of the baseball season. Just don't serve tea. Maybe Coke, Pepsi, Burgers and Brats instead. Make it more a talker and tail-gater at the VFW Hall rather than testimonials and tea at the Junior League. No booze. Arguing healthcare and jobs sober is wild enough.

Make each session three hours long for an audience of 150 people with a meet and greet before and a long goodbye and some gladhanding afterwards. Don't pre-select the audience. Make it some kind of fair lottery process to get a ticket and make sure that the screening process to get into the hall is as stringent as possible so we don't have a repeat of some of the security snafus of recent memory. If the Salahis show up, tell them the party's over.

Avoid making it a politically correct audience or an audience of ringers. Let your presence (and the Secret Service) handle the screamers and yellers. Chances are you will end up with strong opinions and a few loud voices, but you may end up with a respectful group of concerned Americans willing to talk.

Bring a prominent Republican and Democrat from each state along with you as your partners. Make the setting in the round with the three of you on stools in the middle. Then you and your partners play facilitator and draw out the audience. Avoid the politician's pattern of making a long self-serving statement followed by a leading question. Try playing reporter for a change.

Neither you nor your partners can advocate for any agenda in the session. Your sole jobs are to listen and learn and walk away with a new or renewed understanding of the voice of the people. Your pledge to the participants at the end of each session is that you and your partners are going to go back to Washington and work on solutions - together. You seal the promise with a handshake at every session.

I know you probably think your administration has been there and done that on this sort of approach, but this time it's different. You and your administration are being viewed broadly now as out of touch. In response you have sent out a legion of fairly ineffective communicators on your team to talk at us - not with us. You are pushing us, not persuading us. You are advocating with agendas, not convincing with arguments. You are leading, without listening.

As a result, an adminstration that was swept into office on a wave of populist change (or so it seemed) is now portrayed as a bunch of paternalistic Ivy League elitists who wouldn't know a boilermaker from a Beaujolais.

I know this may all sound hokey to you but give it a try. In the time it takes Joe Torre to see what kind of team he has on the L.A. Dodgers for the upcoming season, you and your partners from both parties can get a fresh read on where the country's head is on the key issues. You will also call the opposition's bluff by getting them to put some skin into your game for a while.

A few caveats if you take up this challenge:

• Televise the entire tour on CSPAN
• Drop saying I and My on tour - try using We and Our
• You and your partners can only question and listen
• Except for Secret Service protection, no entourage
• Go on TV and report what you all learned
• Attack the (low-hanging fruit) issues you heard on tour
• Draft a joint legislative agenda and pursue it together

Most of your advisors would say this Listen, Learn, Lead approach is a waste of time or mere window dressing. Yet, you were elected with a promise to try to change the political dynamic in this country - to get beyond partisan rancor and bring us together. In spite of that pledge, we are mired even deeper in the Advocacy Abyss and drowning in discord.

In business, people of all political stripes find ways to solve incredibly difficult problems in part because they are all committed to a shared purpose - generating profit. In politics, we appear unable (at least at this point in our history) to solve problems together because we have lost the commonality of our cause. We have lost our ability to talk together, to reason together, and to work together. Yet in business, we can. In crises, we can. In communities, we can.

Why not stop being the leader of the people for a few weeks, eat a slice of humble pie and return to being a servant of the people. If you listen and learn, you will lead more effectively because there's a better chance we'll follow you.

Have faith in us. We're the ones who put you in the office you now hold. It's not about you. It's never been about you. It's about us - all of us together. You said it yourself - that what faces us are not Republican or Democrat problems, or liberal or conservative problems - they are American problems.

At tour's end we can all join in a chorus of Yes We Can - and mean it this time.

The Geithner Gap

After Timothy Geithner made his initial speech as Treasury Secretary to the public on his banking plan, the reviews were not kind to say the least. He got panned on content and delivery.

On content, it was the old "where's the beef" argument. The market, the pundits and the public wanted more details on the plan and were left wanting. They expected more - and got less.

On the delivery side, he got horrible reviews as well. Why?

First of all, President Obama must own a teleprompter company because it seems that everyone in his administration has used one for a speech. Secretary Geithner used the left/right teleprompter setup as well and came off like a student reading a book report. In his first opportunity to look the American people in the eye and gain their confidence, he bailed out and read his words off a teleprompter screen. He failed in his first big test as a communicator.

It's a shame too, because it was a pretty easy test. His predecessor, Secretary Paulson, was probably the worst communicator in an administration known for lousy communicators. It's unfortunate because both men seem to be very decent fellows who are smart, savvy, credible, experienced and highly accomplished. They have been communicating in business and govenment for decades.

They should succeed as communicators. Why did they fail?

For the same reason many of us fail as speakers - we don't connect with our audience. With a simple 'prepared but unscripted' leader message at the beginning and end of his talk, looking directly into the camera, Geithner could have transformed his talk, and the public's reaction to it.

He had no Hook at the beginning (to grab the audience) and he had no Hammer at the end (to nail down his message).

He 'presented' to us. He didn't 'talk' to us.

I'm not suggesting that speakers like Geithner should never use a teleprompter. President Reagan did, but he made it look like he wasn't. He made it look like he was speaking directly to you through that television screen.

Why did it work for Reagan, and not for Geithner? Because Reagan knew how to connect with people on television and Geithner doesn't, yet.

Heck, it worked so well for the Great Communicator that it turned my mother into a Reagan Democrat. He made her and millions of other Americans feel better; feel more confident; and feel that things would work out in the end. Emphasis on feel.

Even when he made his 'arms for hostages' confessional from the oval office on television he connected, one human being to another; enough so that many Americans were willing to at least give him the benefit of the doubt, even if they were opposed to him politically. He didn't convince everyone but he connected well enough to keep it from being a total communication disaster. The American people, after all the angst, let it go.

The key is connecting.

Watch President Obama tomorrow night. He's a public speaker for the ages, like Kennedy and Martin Luther King and Reagan. Yet even he can fail to connect with his audience on occasion. In fact, he's fallen so much in love with teleprompters, he runs the risk of coming off android-like - 'Obamatic'.

He is becoming so focused on giving the 'perfect' speech that he's ignoring the emotional connectivity with the American people that helped get him elected in the first place. He succeeded at convincing voters across the country that he was 'one of us' while the opposition pulled out all the stops to convince people of just the opposite. He was able to do it.

That takes connecting.

So on February 24th at 9 PM, President Obama should look directly into the TV camera and simply 'talk' to us - at least at the beginning and definitely at the end. I know he'll be in front of Congress but he only has one audience - us.

He has a challenge not unlike a father or mother sitting down at the kitchen table in the midst of a family crisis, looking into the eyes of their children and saying; "Everything is going to be alright. We'll get through this together".

It's sounds hokey, but Tuesday night that's the whole ballgame right there. He needs to speak fron the head, the heart and the gut. Otherwise it will just be a bare collection of facts to be dissected the next day on CNBC and MSNBC and Fox - and they are going to do that anyway.

So next time you give a speech at a conference or sit across the table from a group of clients or give a talk to your church group, please remember to connect first. Look them in the eye and talk. Don't look down or away and read. Start human and end human. Grab them with a Hook and then hit them with a Hammer.

Connect, Connect, Connect!


The Global Coach