Steven Rattner led the Obama Administration's efforts to restructure the auto industry in 2009 as Counselor to the Secretary of the Treasury, having taken a break from his private investment firm Quadrangle Group, LLC. He has also served as Deputy Chief Executive Officer at Lazard, after having worked at Morgan Stanley and Lehman Brothers. Rattner was also employed by the New York Times for nearly nine years, principally as an economic correspondent prior to working in finance. He is author of "Overhaul: An Insider's Account of the Obama Administration's Emergency Rescue of the Auto Industry."
Question: How do you recruit and retain great talent?
Steven Rattner: As you said, finding and recruiting and retaining top talent is the single biggest, most important part of any business. I remember somebody saying on a panel once many years ago, and I’ve never forgotten it, that his principle of his career had always been to work for the best people he could work for and find the best people he could to work for him. And I’ve always tried to do this same thing as well.
And another business leader once said to me, “”A” people hire “A” people and “B” people hire “B” people.” And so I’ve always tried to surround myself with “A” people on the theory that they would hire “A” people. And I’ve always tried to work for “A” people. And in terms of hiring people, it’s really giving people a sense of empowerment, a sense of motivation, a sense of involvement, and of ownership of what they do. And of course, compensation is not exactly irrelevant either, but I think more than compensation, people really want to feel that they are a part of what they are doing, and that work should be fun. I believe that work should be fun. I would not do a job that I did not think was fun.
Question: Is leadership different in business and government?
Steven Rattner: There are significant differences, and this is where many business people who try to go to Washington, or vice versa, find it frustrating. Business is certainly motivated by one principle objective which is to be, have the enterprise be financially successful and so there is a very clear standard of accomplishment, there’s a very clear metric, there’s a very clear scorecard that everybody follows. And there is kind of a command-and-control organizational structure, which is not to say businesses aren't collegial, but at the end of the day, there is a CEO who can make decisions and move something forward.
Even the President doesn’t have that much authority within his organization. He has to deal with Congress. He has to deal with outside constituencies and with independent agencies. So government by its nature is a much more collaborative, consultative, compromising kind of management style than the private sector. And that’s something that people don’t always appreciate.
When you go into government, you really have to keep in mind the famous saying of "not let the perfect be the enemy of the good." If you can get something done that is positive you can’t torture yourself over the fact that it is not perfect because there are so many cooks in the kitchen when you are in government.
Question: Why are some many people attracted to finance?
Steven Rattner: There’s nothing wrong with finance. It is an honorable profession. I would be happy if my children or friends went into it. It’s an important part of society. Finance is the lubrication that makes the economy work, and there’s nothing at all wrong with it. I do hope and believe that even people who go into finance will keep some balance in their lives, get involved with non-profit, give something back, public service, however they choose to do it. I think there’s more to life than finance and there’s more to life than making money. But there’s nothing wrong with finance and there’s nothing wrong with making money.
I think that the attractiveness of professions waxes and wanes a bit, and finance has been very hot for a while, I don’t think that necessarily will always be so, and I think there are many talented people who are going into other businesses, such as a business like Big Think. I have many talented – I know many talented young people who are trying to make their career as entrepreneurs and startups and interesting companies that could be hugely transformational to the country. So, I don’t despair about it.
Question: What would you do if you were starting your career now?
Steven Rattner: If I were starting my career again, I would go to China. There was a famous newspaper man who, I think Horace Greeley, who once said, “Go West young man,” meaning go to the frontier because that where, in America, the great opportunity was. And that’s how I feel about China. I’ve only been there twice, I think, but I’ve certainly spent time trying to learn about it, meeting with people and it’s a very controversial subject because there are many people who think China is a big Ponzi Scheme or is on an unsustainable course, or this or that. I think China is the real thing. And I think it – I think it is the great future growth story of the world, for the foreseeable future of the countries anyway. And if I was just starting out I my career, whether I be a journalist or a banker or a businessman, or even a government, I would be focused on China.
Recorded September 23, 2010
Interviewed by Victoria Brown