“I cut my teeth in the industrial real estate markets right here in Southern California during in the 1980s, and so being here today feels like being home,” opened Walt Rakowich, former CEO of Prologis, at NAIOP’s I.CON West 2021 conference, held this week in Long Beach, California.
“Ten years ago, I spoke at this very conference about the state of the industrial markets. Now I’m here to talk about leadership.”
Rakowich said that we are living in interesting times, and he believes someday we’re going to look back at this period and say leadership mattered in our country, government, businesses and lives.
“Leadership has never been more difficult than it is today,” said Rakowich. “We have unlimited access to information but live in glass houses where anyone can see everything we do as leaders. This is a time of greater access to information, but it’s constantly changing, and that pace of change is accelerating. And yet, I believe there are certain truths that transcend this crazy world.”
In 2008, Rakowich got the call to return to Prologis, one of the largest industrial real estate companies in the world, as its chief executive officer. Many expected him to be thrilled with the offer, but he had concerns about the direction of the company and its performance in the 10 months since he’d departed. “On the night I got the call, our stock was down 95% from its high. I was scared to death and didn’t know whether or not I should take the job,” he said. “But the next day, I accepted the position. I had hired so many people there that I felt I couldn’t let them down. Over the course of the next four years, I learned a lot about leadership and myself.”
Rakowich says leadership can be summarized in four words: It’s Not About You. It is about the influence you have on the other people that you lead. If you can do that right – get out of the way and focus on other people – he believes you can become an incredibly successful leader.
“Before I could start my own leadership journey and find out how I could service others, I had to take a close look at myself and identify my own demons,” he said, noting that the two most common obstacles that every leader has are pride and fear.
“We have to understand what our values are as leaders,” Rakowich said. “Something that became painfully obviously to me was that the greatest leaders create trust in their organizations through transparency about everything. This goes beyond clarity in communication; it’s opening a window into our souls so that every employee can see our values and virtues and know how we are going to run our companies every single day.”
Rakowich shared three characteristics that he believes can best distinguish leaders:
Humility – While sometimes mistaken for weakness, real humility takes character and guts. “It’s not about being weak, it’s about admitting your weaknesses,” he said. “The minute you admit them, you free yourself from trying to hide them. It’s okay to have moments of vulnerability, and showing that can be a powerful tool to let others know you’re not quite as different from them as they may think.”
Honesty – It’s easy to be honest when you have good news, but having the ability to convey the bad news as well as the good is critical, Rakowich said, citing some of the tough choices he had to make as Prologis CEO and struggling to turn the company around. “Through transparency and honesty, we created trust in the organization. Honesty always starts with the little things – if you get the little things right, you’ll get the big things right.”
Humanity – Rakowich shared a story about a summer job as a garbage collector on his hometown sanitation crew during his college years. Through a series of mishaps and unpreparedness, he accidentally fell off the back of the garbage truck as it barreled in between neighborhoods. Luckily, he wasn’t hurt, and the rest of the crew – new coworkers who didn’t even know each other’s last names – helped him out. His misfortune showed that he was human, and trust and camaraderie formed among the crew. “Leadership is about being human, putting yourself in other’s shoes, lifting them up and giving them credit.”
Rakowich said he believes that if others see you as humble, honest and human, they begin to trust you. And when they trust you, you can establish a culture of transparency to achieve great things.
“People frequently ask me how I turned Prologis around, and I say that I didn’t. I let our people turn it around. They did lots of little things right day in and day out, and that led to big successes. We invested in them, trusted them, and helped them to succeed. People work hard for leaders they care about,” he said.
Rakowich said he considers three things every morning to center himself and think about others: Someone he can express gratitude toward, someone he can give a word of encouragement to, and how he can have a positive influence on those around him.
“It’s easy to get negative about the state of affairs today. If you want to have an impact, be positive. Good leadership always has a ripple effect.”