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A Wall Street wizard speaks up

WS talks to corporate titan Richard Jenrette

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in Leaders & Managers,Management Training,People Management

Richard H. Jenrette, 69, has an impressive résumé. The retired chairman, president and CEO of The Equitable Companies also co-founded Donaldson, Lufkin & Jenrette (DLJ), a large investment banking and securities firm that remains a Wall Street powerhouse.

Today, Jenrette proudly notes that DLJ employs about 8,000 people. It all started in 1960 when he and two fellow graduates of the Harvard Business School began marketing common stocks of small growth companies to a range of investors (while other securities firms focused on blue-chip stocks and bonds).

Jenrette calls himself a “contrarian manager” because he does not follow conventional wisdom in motivating people and making business decisions. In this interview with Working Smart, he elaborates on his unusual but wildly successful management philosophy.

WS: Now that you’re retired, do you read the latest management books?

Jenrette: Actually, I prefer to spend my time restoring old houses. I’m not a great believer in management fads or task forces or teams. I think a leader should let people work individually and not get too enamored of committees and consultants and endless meetings. It’s all very wasteful, but a lot of books will tell you differently.

WS: So do you think the same qualities that made you a strong manager in your 40-year Wall Street career still apply today?

Jenrette: Absolutely. That’s not to say I haven’t learned lessons over time and listened to others’ input. But I’ve always found that creative leaders let individuals carry the load. And here’s another thing I’ve always found: Hire people who are smarter than you are, and then let them take the credit.

WS: But if you want to get ahead, isn’t it foolish to let others hog credit for your fine work?

Jenrette: I’ve always promoted executives who give away credit. A smart leader follows the business and understands who really did the lion’s share of the work. Giving away credit is another issue—it’s a great motivational tool.

WS: You’ve faced some monumental challenges, from salvaging DLJ during the Arab oil embargo in 1973-74 to cleaning up Equitable’s messy balance sheet in the early 1990s. How have you handled such adversity?

Jenrette: Big problems take care of themselves. I learned that when I’d wake up at 3:00 a.m., full of worries. I’d make a list of all the problems I was facing. Two weeks later, I’d look at my list and realize that those same worries were mostly gone. They had been solved. When Equitable was going through its worst trauma, I had 96 key worries. But I adopted Scarlett O’Hara’s attitude, “I’ll think about that tomorrow.” It’s amazing how different things look if you get through the next day.

WS: You’ve always been a big champion of praising subordinates. That’s so basic, yet so rare in many companies. Why?

Jenrette: I don’t know, but I’ll tell you that praise is just as important as money. Here’s an example. DLJ recently hired a talented guy from Merrill Lynch. Even though I’m retired, I still get involved in some things there. So I met with him. He told me he had made a $30 million bonus from Merrill Lynch, but no one called him. He said, “I figured they didn’t care.” It wasn’t the pay that led him to leave, it was that he felt no one noticed him.

WS: What are some traits that you like to see in a rising manager?

Jenrette: I prefer people who have outside interests. If you’re totally wrapped up in your business, you can never get away from it. You need balance. And you need a support system of people who are always there for you.

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