November 23, 2024

Corner Office | John Donovan: John Donovan of AT&T, on Seeking Results Instead of Praise

Q. What were some early leadership lessons for you?

A. There are certain characteristics that give people a start — and for me, I remember starting to use them when I was named captain of my hockey team. I think after that it becomes practice. I think those characteristics are the ability to set a framework that makes sense to people, and being articulate. You can look at the landscape, characterize it and set a framework for action, then be able to articulate it clearly. You have to have antennas for picking out what’s really important.

So you have to have those basic skills and be a good pattern recognizer. I was always good at those problems where you go “two, four, six, eight, what’s next?” And you start to put those skills together and then, like anything else, you get better with practice.

That said, if there’s a situation where someone else needs to lead, and it’s working, that is A-O.K. I don’t feel a burning need to be in charge, and I don’t feel that it’s a bad thing to follow when the right things are getting done. So in some respects, I don’t have the innate drive that certain people have about control and ownership and leadership. When I left Silicon Valley, a lot of people bet me that I wouldn’t last at ATT. They figured that because I’d been a C.E.O. before, I couldn’t go work at a big company where you have bosses, and you don’t control everything.

It really isn’t even a consideration for me. I just derive great satisfaction from a well-played plan. As a matter of fact, I have an aversion to situations where credit is showered upon leaders. Those don’t sit easily with me. Maybe that’s because I was one of 11 kids in our family. I love engaging, but I don’t like the compliments, with somebody saying, “Hey, great job.”

Q. Other lessons?

A. The first thing I noticed very quickly early on was that hard work is central to what you do, and that’s not any magic or science. I said, “Well, if I start today, and I outwork everybody, then the only question is the starting point.” So I figured that if I work really hard I can be in the top 5 percent in any field. It just gave me some comfort to say, O.K., I’m going to do fine financially, so I shouldn’t make decisions based on money. My objective should be to gain the broadest set of experiences I can, and just try to drill deep everywhere I can. And so I played the game for breadth. Early in my career, I bought businesses, fixed them and sold them. Some went well; some didn’t. I did some home development. I was in sales. I went back to business school.

A lot of people work hard to get ahead, and I recognized early on that it’s a differentiator. I just figured that there was a certain amount of this that’s just raw tonnage.

Q. What else?

A. I worked at Deloitte, and became a partner there. That’s probably where a lot of my development occurred as a leader. There were simple things around teams. I developed team skills because I started to engage in deliberate deflection of credit in an environment where it was all about credits. What I started realizing is that people appreciated when you played for the result, and not for your role on the team. So I learned there that giving credit away, deflecting credit, was an effective thing to do. I think I learned a lot of subtleties about teams and how you assemble teams.

Q. Can you share some more insights on that?

A. If you figure there’s a karma pool out there floating around for credits, you have to stop playing for credits. I remember the day I realized that, and that I probably never again needed to involve scorekeeping in anything that I did.

Q. What are some questions you ask when you’re interviewing job candidates?

A. I always ask questions about what words people would want on their tombstone. So I’ll ask, “If your professional colleagues were going to put three words on your tombstone — I mean literally three — what would those three words be?” And then the follow-up question is always the one that surprises people. I will then ask, “Instead of three, what’s the one word?”

I’ve tried to assemble teams with people who were grounded enough, and comfortable enough, to be able to have these kinds of conversations. When you find people who have that sort of grounding, then it can be about the problem you’re working to solve together, and not about the person.

The leadership part for me now is so much more about game planning than about the role that I play in the game plan. I love the opportunity to take a role that I had and give it away to another team member, and the team result is as good or better. I sort of see myself over time as needing to play the game less, but I’m becoming better at getting even better results by that combination of the right framework and the right people in the right positions.

Q. Back to your tombstone question. What’s the one word for you?

Article source: http://feeds.nytimes.com/click.phdo?i=d11ed086d0bec7cb3969febe9fa2f780

Mortgage Settlement Challenged

The New York attorney general is moving to block a proposed $8.5 billion settlement struck in June by Bank of New York Mellon and Bank of America over troubled loan pools issued by Countrywide. A lawsuit filed late Thursday accuses Bank of New York of fraud in its role as trustee overseeing the pools for investors.

In papers filed in New York State Supreme Court, lawyers for Eric T. Schneiderman, the attorney general, contended that Bank of New York misled investors about its conduct as overseer of the securities. The bank also breached its duties to investors by agreeing to the deal with Bank of America, according to the complaint, because the trustee is conflicted and “stands to receive direct financial benefits” as a result of the agreement.

Questioning the fairness of the deal, the attorney general’s lawsuit said that it could “compromise investors’ claims in exchange for a payment representing a fraction of the losses” that have been suffered by investors.

When the terms of the deal emerged, they appeared to be quite favorable to Bank of America. On June 29, when the deal was announced, Bank of America’s shares closed with a gain of almost 3 percent.

A spokesman for Mr. Schneiderman declined to comment. Jeep Bryant, a spokesman for Bank of New York Mellon, disputed the attorney general’s allegations, calling them “outrageous, baseless, unsupported by fact and law” and saying that the bank would fight them in court. “We are confident that we have fulfilled in all respects our responsibilities as trustee,” he said, adding that Mr. Schneiderman’s action fails to understand the “benefit the settlement would provide to investors.” 

Bank of America purchased Countrywide in a distress sale in early 2008.

A judge overseeing the settlement will ultimately decide whether it should be approved. A court hearing on the proposed settlement was scheduled to take place Friday. Mr. Schneiderman’s lawsuit is likely to change the nature of those discussions.  

As announced by Bank of New York, which is overseeing 530 mortgage pools issued by Countrywide, the deal would require Bank of America to pay $8.5 billion to investors holding the securities. The unpaid principal amount of the mortgages remaining in the pools totaled $174 billion. Lawyers representing 22 institutional investors, including the Federal Reserve Bank of New York, BlackRock and Pimco, contended the deal was favorable.

But other investors in the Countrywide pools who were not part of the settlement negotiations between Bank of New York and Bank of America complained that the terms were inadequate. Among the criticisms made by a group of investors known as Walnut Place were that the negotiations were conducted in secret and that Bank of New York was conflicted as a negotiator because Bank of America agreed to cover all its costs and liabilities relating to the deal.

Mr. Schneiderman’s contention that Bank of New York breached its duties to investors is significant because a trustee that agrees to oversee loan pools like those issued by Countrywide must abide by the rules governing the securities. Such rules require that lenders deliver to the trust complete and original mortgage documents for each loan in a pool, for example, and require that the trustee notify investors when such loan documents are missing.

Bank of New York led investors in the Countrywide pools to believe that the lender had in fact delivered complete and adequate mortgage files for each loan as was required, the lawsuit said. The bank also misled investors by confirming that loan files relating to hundreds of thousands of mortgages were complete.

But the bank failed in these duties, the attorney general’s complaint said. After conducting a review of court records in the Bronx and Westchester County, Mr. Schneiderman’s investigators have determined that Bank of New York did not ensure that notes underlying properties were delivered properly to some trusts, according to the lawsuit. If loan documents were not delivered as required to the trustee, investors could recover the money they invested in the mortgages.

“Investors in the trusts were misled by Bank of New York Mellon into believing that Bank of New York Mellon would review the loan files for the mortgages securing their investment, and that any deficiencies would be cured,” the lawsuit said.

Article source: http://feeds.nytimes.com/click.phdo?i=93b205e8ab4c46c11e3d50c9a268f90c