It was 2007 and Prologis, a darling on Wall Street for the previous decade, experienced a rapid decline in stock price from $70 to $2 a share in a matter of months.\u00a0 In the blink of an eye, the one time investor favorite became the 3rd worst performing stock on the S&P.<\/p>\n
What changed?<\/em> \u00a0Why the rapid decline in the company\u2019s previously stellar performance? The Prologis board reached out to Walt Rakowich to answer those questions and turn the company around.<\/p>\n Walt\u2019s answer: trust. \u00a0He expands to say that fear and insecurity are all about you, while trust is all about others. \u00a0The CEO that leads out of fear and insecurity becomes dictatorial, stops delegating and wants to do it all himself so he can get the credit.<\/p>\n A recent Harvard Business Review Article reported on what CEO\u2019s are afraid of, noting the top three to be incompetence, underachievement, and vulnerability. \u00a0These fears can lead to insecurity about not having the right answers, underperforming the market or not staying relevant. \u00a0While fear and insecurity cause a leader to focus internally on himself; trust, on the other hand, opens a leader up to be all about others.<\/p>\n So, how do you build trust in an organization?<\/p>\n #1) Transparency.<\/em><\/p>\n Walt uses this term not in the sense that politicians may use it today which simply implies openness, but in a much more concrete sense. \u00a0To build the kind of transparency that leads to trust, Walt says a leader must \u201cbuild a window to her soul.\u201d \u00a0Let others in, be honest, be human. \u00a0Communicate openly even if you don\u2019t have all of the answers or haven\u2019t done the math yet. \u00a0Walk others through your thinking even before you know the end result.<\/p>\n Walt cited a town hall meeting he held with Prologis\u2019 worldwide employees when layoffs were looming. \u00a0At the time the employees undoubtedly knew the company was in trouble \u2013 why make them stand around the water cooler whispering about what management was thinking? He didn\u2019t have the answers yet, didn\u2019t know how many layoffs there would be or when, but he walked the thousands of employees around the globe through the numbers. \u00a0He showed them very clearly that without some layoffs the company would go bankrupt and everyone would lose their jobs. While undoubtedly it wasn\u2019t the message the employees wanted to hear, at least they felt connected to the issue and a part of the solution.<\/p>\n #2) Vulnerability.<\/em> The Prologis finance team had just told Walt that bankruptcy was looming. \u00a0It was the fist time he had allowed himself to believe that such a demise was even possible. \u00a0Feeling light headed, Walt excused himself from the meeting to get a drink of water. \u00a0He didn\u2019t make it far before fainting and hitting his head on the corner of a desk on his way down. \u00a0Waking up 5 minutes later in a pool of blood, Walt wasn\u2019t even sure for a few moments where he was. \u00a0Moments later, he cleaned off his cut and slowly made his way back to the conference room. \u00a0Exacerbated by the blood and fresh cut on his forehead, the team asked Walt what happened. \u00a0Walt\u2019s response: \u201cI don\u2019t have the answers, I\u2019m scared. \u00a0Can you guys help me?\u201d<\/p>\n The team stepped up, immediately telling Walt not to worry and explaining how they would figure it out. \u00a0And they did. \u00a0That same management team grew Pologis back to a $35 stock price and an investor favorite with more than $50 billion in real estate assets. \u00a0In Walt\u2019s words, \u201cif you can be courageous enough to show your true vulnerability, people will kill themselves to work with you.\u201d<\/p>\n #3) Human Heart.<\/em> Lunchtime for Walt meant waiting in line at the Prologis cafeteria, buying lunch for the employee in front of him and asking whoever it was, whether it was someone in the IT department, accounting or marketing, to eat with him. \u00a0The \u201clucky\u201d recipient of Walt\u2019s invitation was likely scared out of his or her mind to have to spend lunchtime in a serious conversation with the CEO. \u00a0But Walt began every conversation with \u201ctell me about your family.\u201d \u00a0He got to know them as a person, understood their perspective and what they were dealing with in life outside of the office. \u00a0And then he asked about his or her job within Prologis, what was working and what wasn\u2019t.<\/p>\n He found that the employee feedback during these lunchtime chats was a powerful tool for him to understand whether there was a chink in the armor of the organization and gave him a clearer picture of what was happening under each of his direct reports. \u00a0Even more powerful, though, was that everyone else in the cafeteria was watching. \u00a0The employees saw the CEO as another human being having lunch and getting to know a company employee.<\/p>\n The recipe for creating trust: make this language fluent in your organization.<\/p>\n","protected":false},"excerpt":{"rendered":" It was 2007 and Prologis, a darling on Wall Street for the previous decade, experienced a rapid decline in stock price from $70 to $2 a share in a matter of months.\u00a0 In the blink of an eye, the one time investor favorite became the 3rd worst performing stock on the S&P. What changed? \u00a0Why […]<\/p>\n","protected":false},"author":2,"featured_media":2248,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[375],"tags":[],"class_list":["post-856","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog-post","topic-business-strategy","topic-leadership"],"acf":[],"yoast_head":"\n
\nAdmit your weaknesses and insecurities, because when you admit them, you defeat them. \u00a0Admitting your weaknesses takes courage, but vulnerability is an extremely powerful tool for building loyalty.<\/p>\n
\nHow do you think of your employees? \u00a0As just a number or as a mom or dad that goes home to a family, makes dinner, and cares for loved ones at the end of the day.<\/p>\n