Mind Without Fear

by Rajat Gupta

  Finally, after I had been with the firm almost seven years, I was elected junior partner, in January 1980. It was a relief to have reached that critical rung of the McKinsey ladder, albeit a little late. Many of those elected with me had joined after me, including some from the class behind me at HBS. Funnily enough, when the election day came around I had forgotten the precise date. It was a Saturday, and I was recovering from some dental work that morning. When Jon Katzenbach, the head of the office, called to congratulate me, I was speechless—literally, as my mouth was still numb from the Novocaine. I attempted to mumble a response before handing the phone to Anita, who explained my predicament.

  Geetanjali

  While waiting to be elected partner, I’d reached another milestone of a more personal nature. In early 1978, Anita and I had learned we were expecting our first child. We had recently moved out of the city and bought our first house, in Middletown, New Jersey. Anita had taken a job at nearby Bell Labs, working on designing satellite communication systems, and was also working toward her PhD. It was a long commute for me—almost two hours each way—but her office was just five minutes from home, which would be perfect after the baby came.

  Our daughter was born that fall. She took her time coming—Anita and I spent a long day playing cards and waiting for the labor to begin in earnest. I was at the hospital for the birth, but after just a few days I was forced to leave for a business trip. When I returned, I requested assignments that were less travel-intensive, which the firm generously agreed to, and was able to spend more time at home.

  I was mesmerized by the small, exquisite human who had joined our family, and spent many hours lying on our couch with her asleep on my chest. Watching her expression change, I thought of Tagore’s musings on the origins of the smile that flickers on a sleeping baby’s lips. “There is a rumour,” he wrote, “that a young pale beam of a crescent moon touched the edge of a vanishing autumn cloud, and there the smile was first born in the dream of a dew-washed morning.”1 We named her Geetanjali, after Tagore’s poem, but with a twist in the spelling. Like most Indian children she quickly became known by a pet name, Sonu, which began as the Bengali endearment Sona, meaning golden.

  Both Anita and I keenly felt the absence of the extended families that naturally help with the work of child-rearing in India. I tried to help out more around the house, but the reality was that my work was demanding and my days were long. Our new home was a modest house by American standards, and it had some issues. Anita hated the linoleum floor in the tiny kitchen, and after listening to her complaints for several weeks I decided to take it on myself to replace the flooring. The guy at the hardware store assured me it was a simple job, and sold me various tools I would never have expected to need. I would soon learn that home improvement projects are never as simple as they seem. A series of setbacks and several more trips to the hardware store culminated in a collapsed basement ceiling, which left us without a workable kitchen for several weeks. Anita shook her head and told me that in future we would hire a contractor. But when I finally installed our new shiny tile floor I was extremely proud of the result.

  Unlike many of my colleagues, I made a conscious choice to keep my work and personal lives quite separate. Early on, I made an important decision that I stuck to throughout my career: I would not take up golf. Whatever advantages my colleagues may have gained on the golf course, I preferred to spend my weekends with my family. I also rarely met my clients socially, although it was common practice for my colleagues to use the firm’s generous expense accounts to develop clients over dinners. As my career progressed, I never found my difference to be a disadvantage—clients seemed to appreciate the fact that I was not like my fellow consultants, and they found it fascinating. A story about what it’s really like at an Indian wedding was much more interesting than yet another discussion of a golf shot. This became another key lesson: use difference to your advantage.

  An Unforgettable Engagement

  In early 1980, shortly after my election as partner, I took on an assignment that remains among the most unforgettable of my entire career. The company was Arrow Electronics, based in Long Island, New York, a distributor of electronic components, semiconductors, computer products, equipment, and so on. They were relatively small by McKinsey’s standards, but one of the senior partners, Carter Bales, had gone to school with the three guys who owned the company, so he took on the assignment as a favor. Our task was to help them with their strategy and forward planning.

  On December 4, 1980, we were due to make a presentation at the company’s annual management meeting at Stouffer’s Inn, a quiet, upscale country hotel in Harrison, New York. I had a scheduling conflict: my other client, GE, needed me to give a speech at a conference in Bermuda the day before, so it was decided that my colleagues would handle the Arrow presentation while I served GE. On my return, I got in my car and turned on the radio to hear a news announcer reporting on a tragic fire that had occurred—at Stouffer’s Inn. “Multiple casualties … electrical fire … conference center …” I listened in shock. These were the days before cell phones, so I had no way of finding out if my team or our clients had been hurt. I changed course and drove directly to the inn.

  As I pulled up at the hotel, the smell of smoke hung thick in the air, and fire trucks blocked the driveway. Jumping out of my car, I was relieved to see my team standing outside, but my relief turned to horror when they told me what had happened: they had been on their way to the meeting when they saw flames in the hallway leading to the main conference room. They ran to alert the hotel staff and get help, but it was too late. The fire had consumed the windowless conference room and twenty-six people had died, including thirteen of Arrow’s senior executives. I knew all of these people, and had worked closely with some of them for the past year.

  Only one of Arrow’s owners escaped the tragedy—John C. Waddell, executive vice president, who had returned to their offices the night before to deal with media questions regarding a stock split that had been announced earlier that day. Waddell had joined Arrow in 1968 with his venture capital partners Duke Glenn and Roger Green, who had served as chairman/president and executive vice president, respectively. Although all three were in their early forties when I met them, Waddell struck me as a somewhat old-fashioned character, more comfortable out of the limelight. He had been the least involved in the day-to-day running of the company. Now, he found himself alone at the helm.

  The next day, we showed up at their headquarters to see how we could help. Waddell had gathered all the employees and Duke Glenn’s widow, Lynn, had come to speak to them—an extraordinarily courageous thing to do on the day after she lost her husband. She urged unity and resilience, asking the assembled workforce to “keep the faith” and not get spooked, even if competitors came calling and the future of the company looked uncertain. After her moving speech, we met with Waddell and he asked us to help. Essentially, my team and I stepped in and helped run the company for the next six months.

  The business of consulting suddenly became very personal, and I grew up fast during that assignment. Nothing in my Harvard education had prepared me for dealing with a company that had been, as the New York Times bluntly put it, “beheaded.”2 How were they to rebuild? What could they do to support the widows and families of their lost colleagues? How could they pull together and motivate a shell-shocked and grieving workforce? How could they give investors confidence as their stock price tumbled? And how were they to fill the gaping holes on their board and in their executive offices? We helped them to navigate all of these issues, eventually recruiting an ex-McKinsey guy, Steve Kauffman, to take over as CEO. Arrow survived that traumatic episode and today is a Fortune 500 company with more than $23 billion in annual revenue.

  An Unexpected Invitation

  “How would you feel about transferring to the Scandinavia office?”

  Scandinavia? The question took me aback. When Jon Katzenbach, one of my early mentors who had recently become head of
the New York office, asked to meet with me in the spring of 1981, I had hoped for a new challenge, but I’d never expected something like this. Why me? I asked him. Surely an Indian would not be the most natural fit for the Scandinavian culture. He explained that a partner named John Forbis, with whom I’d worked in New York, had recently transferred there, and had asked for me. I was flattered but very hesitant. Was I ready to once again move to a new country and adjust to an entirely different culture? Would my career languish, so far away from the power center of the firm? And more importantly, how could I ask my wife to uproot herself and the baby, when we’d only just bought the house and settled down? Anita had recently returned to her job at Bell Labs, after six months of maternity leave. She couldn’t have asked for a better situation—her commute was short, she was working for a great company, and she was finishing her PhD. I thanked Jon for the opportunity, but told him I would have to ask my wife—fully expecting that her answer would be a firm “no” and I could elegantly excuse myself.

  Anita’s response, however, surprised me even more than Katzenbach’s original offer. “Well, why not? Let’s go.” I was out of excuses, so I accepted the position, though not without some trepidation about whether I’d be able to fit in and succeed there.

  Later, I would find out the real reason for Anita’s unexpected willingness to make the move. Initially, when she’d gone back to work, we’d hired a wonderful Italian grandmother to care for Sonu, and Anita felt at ease leaving the baby in her very capable hands. But then this woman’s son persuaded her to come work at the family restaurant (she was a fabulous cook), and we lost our babysitter. Since then, we’d been through several unsatisfactory replacements, and Anita was feeling increasingly like she should be home herself. The proposed move gave her the excuse she was privately seeking to quit her job and be a full-time mom.

  In 1981, we packed up and moved to Copenhagen, Denmark, where the firm’s Scandinavia operations were based. The initial plan was for us to stay two years. If the US had been a culture shock, Scandinavia was another planet. As I’d expected, it was a very homogenous population. I suspected that many of the local people we interacted with outside of the business community had never seen a brown face and I often noted the looks of surprise when I met clients for the first time.

  When I first joined the office, it was a small team of about twenty professionals, operating out of one room. As it turned out, by the time I got there, the senior partner who had asked for my transfer, Forbis, had left, along with several other principals, so although I had less than three years’ tenure, there was only one partner above me, the head of the office. A tall, charismatic Norwegian who had opened McKinsey’s Copenhagen office, he would quickly become a mentor to me, particularly when it came to his greatest talent, introducing and developing clients. This had never been my strength, and I was grateful that he invited me to work directly with him and learn from one of the best. He also introduced me to another great client guy, Christian Caspar, a Swede based in the Stockholm office. Christian had been elected six months after me, but when it came to developing clients, he was already a master and a rising star in the firm.

  I set up a meeting with him, but was put out when he canceled at the last minute. We rescheduled, and I traveled to Stockholm, only to find that he wasn’t at his office. How is he some great client guy when he can’t even keep an appointment? I wondered, infuriated. When he finally arrived, he didn’t seem too concerned that I’d been waiting for several hours. I’m not usually a confrontational person, but I told him flat out: “If you ever do this to me again I’ll never work with you again.”

  Christian’s charm soon softened my irritation, and he took me to his office, where he showed me a complex graphic from the Swedish financial newspaper that analyzed the network of companies owned by the Wallenberg group, Sweden’s wealthiest business dynasty. He began to talk me through it, explaining who he knew at each company and how they were all connected. Get to know the right people, he said, and your influence and reputation would ripple through dozens of companies. It was a powerful lesson in networking, and I would later witness its truth. I took on an assignment with a tech company within the Wallenberg empire and became connected to two of the team members assigned to our study—Leif Johannson and Lars Ramqvist. Several years later, Johannson would become CEO of Electrolux, Ramqvist would become CEO of Ericsson, and through them, I would go on to serve two of Sweden’s most prominent companies.

  Besides Christian, there was one other partner on the team during my early days in Scandinavia, Jan Aarso Nielsen, who had a year less tenure. I became good friends with both of them, and together we were the young Turks of the office.

  Although the office manager was brilliant and charismatic, he was also erratic. He’d run hot and cold, sometimes blowing up without warning. We’d arrive at the airport to take a flight and he’d be missing. He’d show up late—or not at all—for client meetings. I soon began to notice that he had a tendency to drink a lot. At first, this hadn’t seemed that unusual—everyone in Scandinavia seemed to drink more than Americans did. But soon, he started to become an embarrassment to the firm. At office dinners, he would drink far more than anyone else at the table, becoming incoherent and sometimes highly inappropriate. We never discussed his behavior—it seemed taboo to do so—but we did our best to cover for him.

  Things came to a head at our annual office offsite meeting, which was held that year at the ski resort of Courcheval in France. The office manager began drinking on the bus journey. That night, he was supposed to introduce a speaker, and he made a fool of himself—his remarks were rambling, incoherent, and peppered with insults. After we got him back to his room, Christian, Jan Aarso, and I looked at each other and knew we couldn’t keep quiet any more, however much we respected our partner professionally and liked him personally. We were the most senior people in the office besides him, so the intervention fell to us. Looking out over the moonlit ski slopes late that night, we debated the best course of action.

  I felt that we had an obligation to at least inform the firm’s managing director, Ron Daniel, who had been office manager during my time in New York. I was prepared to call Daniel myself; however, I was worried that if I acted alone, it would be seen as a personal betrayal. Plus, if the firm decided to do nothing, I didn’t want to be singled out for retaliation. We agreed that we would make the call together, the next morning, presenting a united front.

  Daniel happened to be in Paris when we called him. “Ron,” I began, “this is a delicate matter, but there’s an issue with—”

  “I know,” he replied. We didn’t need to say more—he was already aware of the problem and had guessed the reason for our call. He invited me and my colleagues to meet him in Paris the next day. “Don’t say anything to him, just come.” This was a little awkward, since it meant disappearing in the middle of our retreat, but things were going to get a lot more awkward if we didn’t intervene. We booked the first flights to Paris the next morning. When we met with Daniel, he informed us that he’d already discussed the issue with the firm’s executive committee. The office manager would be relieved of his duties immediately and would be checking into the Betty Ford Clinic. (He would go on to make a full recovery and have a very successful business career. Two years after the intervention he returned to Copenhagen and invited me and my colleagues to dinner, thanking us for saving his life.)

  “We’ve also decided it’s not in the firm’s best interests to send a senior person to Scandinavia to replace him.” Ron turned to me. “Rajat, we’d like you to take over as office manager.”

  I was taken aback, to say the least. Yes, I was the most senior person left in the office, but I’d only been a partner for three years, and I was just thirty-three years old. No other McKinsey office was managed by a junior partner.

  Ron Daniel had always had confidence in me—at times more than I felt I deserved. He had been the one my professor at Harvard approached to ask for a second chance on
my behalf. He’d consistently encouraged me through the uncertainty of my early years with the firm. Once, a fellow young associate and I had time on our hands and took it upon ourselves, uninvited, to do a strategic review of the growth potential of the firm in the US. We concluded that the market was saturated, new competitors had entered, and McKinsey would have a tough time growing. Ron graciously heard us out, even though our analysis turned out to be way off the mark. I think he appreciated our initiative. If Ron thought I was up to the task of managing the Scandinavia office, I told myself, I should at least try my best.

  Arriving back at the office Monday morning, we felt daunted by the task ahead of us. We were bright and full of zeal, but we were inexperienced. And the office, at that point, was just limping along. Did we have what it took to develop new clients, make the office truly successful, and keep our team busy? We resolved to give it our best shot and prove to the firm that we could manage without a senior partner, and not only sustain but grow the office.

  Learning to Lead

  I had never been in a managerial role before, and with no one to tell me how to do it I had the opportunity to develop my own particular leadership style and practices. I had always been a team player, oriented toward collaborating and uplifting others, and I decided that this was the culture I wanted to foster in the office. Christian and Jan Aarso enthusiastically signed on to this team approach.

  An early opportunity came when the annual partner elections arrived. There were three associates on our team who were candidates—two Americans, Bill Hoover and Tom Wylonis, and a Swede, Micky Obermayer. If all of them were elected it would have effectively doubled the size of our partnership, and many would have argued it made sense to delay some of their elections so we could grow more slowly. But I respected all three and wanted to show my faith in them and the office, so I recommended that they all be made partner. I felt confident that they would be approved, because they deserved it, and I thought the firm should support our fledgling office.