On this episode, Bob shares his invaluable insights around leadership, innovation, and empathy garnered from his journey through West Point, his three-decade long career at Procter & Gamble, and his tenure as the Secretary of the Department of Veterans Affairs. ---------
“My advice to young people is to focus on the purpose and the values of the organization you're going to, the character of the people in the organization. Forget about the job title, forget about the salary and focus on the things that really matter and that are enduring because those things aren't enduring.”
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*(2:00) Bob’s purpose
*(3:45) How Bob’s North Star developed
*(6:00) Bob’s childhood in Indiana
*(8:30) West Point days
*(10:25) Post-West Point
*(13:30) Leaving the military and joining the private sector
*(15:40) Procter & Gamble gain Bob
*(18:00) Don’t fixate on a particular position
*(22:25) The hardest decision Bob had to make
*(24:40) Equating leadership in the military vs. leadership at P&G
*(27:00) How P&G operates
*(29:45) Developing empathy as a business leader
*(31:00) Inventions are almost never used for their original purpose
*(34:00) What Bob did before joining the VA
*(35:42) If it weren’t for the VA, American medicine would be nowhere
*(36:50) Lessons learned while at the VA
*(41:00) The courage needed to run the VA
*(43:15) The next generation of the VA
*(45:20) Bob’s core advice for younger vets
[00:00:00] Eddie: [00:00:00] Like there's all these exceptional founders that founders or CEOs of firms you've, um, you've been successful both in the military as well as in the private sector, as well as in the public sector. Like, has there been any common theme as to like why you wanted to choose. What you were going to do with your life next?
[00:00:18] Because the amount of success that you've always had has opened probably tons of doors. And you've been super selective about what you've wanted to do and the value that you wanted to provide. How did you go about thinking about that?
[00:00:30] Bob: [00:00:30] Well, D I, I don't consider myself successful. I consider myself a, uh, a work in progress and, uh, Uh, but I think the common theme, uh, throughout the thread of continuity throughout the various experiences I've had is, um, my purpose, the purpose, uh, to improve the lives of the people that, uh, I can touch and, uh, That desire to improve lives, uh, led me to want to go to west point.
[00:00:57] It led me into the infantry and the second airborne [00:01:00] division. It led me to the Procter and gamble company whose global purpose is to improve the lives of the world's consumers. And, uh, it led me, uh, to the department of veterans affairs. So, I mean, That's the consistency. And I think I recognize a very young age, probably as a boy scout or a, during some of the church organizations.
[00:01:21] I was a member of that. I really enjoyed helping other people. And I, and I wanted to make a difference in that.
[00:01:29] Yep.
[00:01:29] Eddie: [00:01:29] And you talk about this a lot about your, your north star, your, your idea of being able to help others through every single thing that you do. Um, and, and maybe it was, you know, growing up in the church or whether it was the boy Scouts, but at what point in your life do you think, and what age do you think that, that, whether it's a, a flip that kind of a switch that just kind of flipped on or something that gradually developed over time?
[00:01:51] Can you talk a little bit about, um, how that came to be? Because it seems to be the driving thing. That allows you to push yourself. To the [00:02:00] excellence that's necessary to reach the top of whatever field that you're in.
[00:02:04] Bob: [00:02:04] That's a great question, because I think rather than a, um, a flip of a switch, it was an evolution and I don't think it was a deliberate evolution.
[00:02:13] In other words, it was rather fortuitous. So. As a youngster, uh, as being a member of a church group that would go out and do service projects, uh, when I was young, uh, being a boy scout and, and working on, um, all of the things, uh, merit badges service projects, necessarily for boy Scouts. Uh, but then, uh, applying to west point for the first time, uh, at the age of 11.
[00:02:38] Uh, in sixth grade, uh, obviously very, very early in the process at a time where I was ineligible. Um, but Mike and, and applying to Donald Rumsfeld, Donald Rumsfeld was my Congressman at the time in north, north, Northwest suburb of Chicago. And, uh, fortunately Congressman Rumsfeld, [00:03:00] the lady. Secretary Rumsfeld, um, just kept encouraging me.
[00:03:04] He said, you know, this is great. Keep applying every year, keep building up your file. Um, keep taking the test. He gave the civil service exam in order to choose who he would nominate and, um, and it just. Evolve that way. And, and of course, going to west point to me was a dream of a lifetime. Um, I, you know, I grew up in Gary Indiana.
[00:03:27] I grew up in a house that was across the Calumet river, uh, from the U S steel mill, um, west point and the military opened up opportunities for me. I wouldn't have otherwise. Yep. No, that makes a lot of sense. I, I grew up in, uh, the Northern suburbs of Chicago and so I I've driven past Gary many times. Um, and you know, people have their thoughts about Gary, but that's how.
[00:03:54] Where you, you grew up in that's home base for you? I guess? Uh, it, it was, it was right. I was born, [00:04:00] um, having lived all over the world with the Procter and gamble company with the military, uh, home now is wherever my family is. We live in Orlando, Florida in the winter, and in the summer we live in Cincinnati, Ohio, but, um, I had, uh, a wonderful childhood, a wonderful childhood.
[00:04:17] I had loving parents. Uh, very spiritual parents, uh, diligent parents. And, um, uh, while we didn't have a great deal of money, um, you know, we tried to take advantage of every opportunity that we had and, um, the love and support and values that my parents and grandparents gave me were very, very important.
[00:04:41] That's good to hear. And it sounds like the household that you grew up in, I mean, The tenacity that you went after that, um, the, the nomination at 11 years old, it sounds like there was something in like young Bob McDonald already when, you know, before that age, which is incredible March to a different drummer [00:05:00] because, uh, remember what was going on when I was 11 years old, this is 1964.
[00:05:06] Uh, the Vietnam war. Uh, the military was not, um, popular at the time. Uh, in fact that, uh, reminds me when, when people say to me today, thank you for your service. Um, in the back of my mind, I'm thinking, well, where were you in 1964. 1972 in 1972, I marched in president Nixon's inaugural parade and it is not an exaggeration to say that we were spent on that, that we were had things thrown at us.
[00:05:39] Uh, the military, you know, it's the military fights our wars, but the military doesn't decide when to go to war. And it's often such a, uh, I'm misunderstanding that military people like war, they don't, they're the ones who get killed and, uh, I'm MacArthur captured some of that thought in his duty [00:06:00] honor country speech.
[00:06:01] Um, but you know, I, I just wish that people would realize our military, uh, I'll be a necessary for national defense. Really doesn't change its purpose. It doesn't decide when to go to war. Yeah, absolutely. Um, and maybe we can fast forward a little bit to your years at west point. I mean, obviously you were really successful top 2% of the, well I'm work in progress.
[00:06:25] I would never, yeah. Well, I mean, that's what I kind of got out of reading some of the, I forgot which HBS case study, but when you were, you know, I think your plebe year, you were two or 300 in this class and eventually you worked yourself. And I think one of the funniest things I'm hearing is that if you had more time, you would have probably penetrated.
[00:06:45] Well, I, I, I believe Vince Lombardi's statement that he never lost a football game, but sometimes time ran out. Um, so yeah, you're right. I mean, I was a plebe, uh, I had had a great high school. Um, [00:07:00] education. I worked on an IBM 360 computer, uh, in the 19 69, 19 70, 19 71. So, uh, this was, this was a good education.
[00:07:11] I came to west point and in those days, Uh, they posted your grades, uh, in the Sally port, you'd go into the Sally port, the tunnel they'd have your grades up and your class number was there. That's the only way you knew it was you. And I remember going there after the first, uh, first few months and seeing that I was 200 in the class.
[00:07:32] And I thought, oh my goodness, I've never been 209. Anything I'd better giddy up. So, uh, I, I started to work harder and I also, um, I think started to catch on a little bit more to this idea of being graded every day in every class. It's a, it's a hard, it's an unusual concept. You have to get used to. And, uh, as you say, I graduated 13 on a, about 867 or so.
[00:07:56] And, um, you know, time ran out. So [00:08:00] John McMurry, our in our class graduated one and he deserved it. I don't think he was under much threat from me. Well, it takes a lot of work to get, um, up to the top of the class at west point. And, you know, people talk about how it's, where, you know, people that are valedictorians are top of their high school come and really get a humble experience.
[00:08:18] But, um, you were able to come, you know, from, from growing up in Gary to west point, um, and really, you know, achieve a lot of success there. Can you talk a little bit about after west point, um, joining the military, you, you know, you branched infantry, you head to Fort Bragg. What did you, what were you thinking?
[00:08:36] Like, what were the goals after that? Cause like west point gives you a lot of very clear goals. Like how do I rank academically, physically militarily? I don't know if it's changed from junior years, but then you get into the military and obviously you. You want to achieve success? What was success for you at that time?
[00:08:52] Well, I, I, as you say, I, I branched infantry. I was the second person in my class. Uh, number 12, [00:09:00] uh, Mike Wimmer also went to infantry. I was 13. I went infantry. Um, I chose what I thought was the, uh, the tip of the spear unit and the second airborne division. Uh, the choice was, was frankly, between the 82nd or the first of the 509th in Vicenza.
[00:09:17] Uh, I chose 82nd. Um, and I went to airborne school ranger school, uh, when I got to a second jungle warfare score decor for school desert warfare school with my unit. And, um, my point of view was very simple, which is if you're going to be an army officer, you go to west point. If you're going to be an army officer you're in the infantry, if you're going to be in the infantry, you're an airborne ranger.
[00:09:40] Et cetera. You're going to be in the second airborne division. You know, you don't want to do anything, uh, second best. And not put your entire self into it. So I did. And, uh, while I was on active duty in 82nd airborne division, I, I took the officer advanced course by correspondence. [00:10:00] Now this is kind of weird because there was no computers in those days, at least not personal computers.
[00:10:05] So, uh, I would punch cards. I had a sponge and then cards and I would punch holes in these Hollerith cards, mail them in the Fort Benning and they would respond and I graduated. Um, at the top of my correspondence course class in the officer advanced course. Um, so when I went to branch and I said, Hey, look, I want to be enlightened infantry women.
[00:10:28] The majority of my career in those days, instrument were generally mechanized, infantry men. And we had a lot of forces in Germany. So I said, I'd love to go the, um, the Marine Corps advanced course. And I remember, I forget the assignments officer said, well, well, we don't do that. And I saw, I know I drove from Fort Bragg to the Pentagon to give you six months, nine months, 12 months.
[00:10:51] I don't remember how long notice that liked to go the Marine Corps advanced course. Could you please figure it out? And I said, whatever you do, don't, [00:11:00] don't send me to the armor advanced course. Cause I had an army unit. And army orientation training, which I think is now called CTLT. And, um, I didn't enjoy it.
[00:11:10] I was spent all my time in the motor pool and, um, my joke is I didn't study thermodynamics to, to spend time in the motor pool. Um, so I didn't enjoy armor and I, of course I got orders to the armor advanced school. And, uh, I called the guy and I said, Hey, look at, you know, I wanted to go to the Marine Corps, advanced course.
[00:11:31] He said, why? I said we don't do that. And I wrote down armor advanced course. And I said, yeah, you wrote down because I told you I didn't want to do that. So, um, it didn't work out the way I wanted it to. Yeah. It sounds like a lot of things did though. And while you were in the military, obviously accomplished all these great things.
[00:11:50] At what point were you thinking. You know, I've, I've accomplished a lot in the military. I want to have a go at the private sector and see what that entails as well. [00:12:00] I have tremendous respect for, for people who spend their career in the military. What I decided after that, um, interchange with, uh, Mo person and the order getting orders.
[00:12:11] The armor advanced course was I probably wasn't going to, um, realize my full potential. Um, if I stayed in the military that the military is great. Uh, it's wonderful for many people, but, um, I probably wasn't going to get to my full potential because I won, I wanted to do things differently. And, um, there wasn't, there wasn't a place for that.
[00:12:32] At least not for me at that time. Well, and one of the things that we hear consistently is like everybody, when you're in the military, you transition at some point, it doesn't matter if it's true, you know, earlier, late in the career, everybody needs to find a job. And, and you as being the, you know, the eighth secretary of the VA, like you probably know that better than anybody.
[00:12:50] Um, but when, so, you know, one thing that I kind of wanted to better understand is you left the military and I can't really put myself back into what it was like at that time [00:13:00] that, that transition. Um, as far as what industries were booming and all these different things, but you chose to go to P and G Procter and gamble that had a reputation at the time.
[00:13:09] For not necessarily like bringing people in at the level and you would probably, you know, as an airborne ranger, you know, had it comes to all these things in the military, it sounds like you had to start at the lowest kind of low in the organization. And, and can you tell us a little bit about that and what you were feeling?
[00:13:25] Sure. Uh, I interviewed, I wrote to maybe 150 200 companies. Uh, I interviewed with, uh, maybe 30, 30, 5 40. I had an engineering undergraduate degree. Uh, I had passed the professional and, you know, the, uh, professional engineers entry exam, which was called the engineering training exam. But I had an MBA. Uh, I should have said this, that after I'd completed the officer advanced course correspondence course, I then did an MBA at night and on the weekends.
[00:13:57] And I felt like, uh, I needed, I [00:14:00] needed an organization where I could feel the same sense of purpose and values that I felt at west point and that I felt in the army. Um, and, and for me, the Procter and gamble company had that purpose and had those values. I realized, uh, fortunately that, that there's nothing wrong with starting over again.
[00:14:20] I mean, when we graduate from west point, as you say, if I graduate 13th of my class, I start over again as a second Lieutenant, you get to ranger school, they rip off your rank. Um, and you start over again. And I started over again at, uh, Procter and gamble at that time. We, um, we only hired at the entry level.
[00:14:40] We have. Some positions higher now, but, but generally at the entry level. And, um, and that was a rude awakening. I worked for a, um, uh, you know, I worked for people who had maybe been fraternity presidents, but, uh, certainly had not taken an airborne infantry battalion, [00:15:00] uh, as the assistant S3 to the Arctic circle and back.
[00:15:04] Yeah. Yeah. That's, it's, it's pretty wild. I think it's a lesson too, because as we, you know, obviously on with the old drag club, we talked with a lot of that sort of transitioning and people think about what they want to do. Um, it's, it's a Testament to know that, you know, you do kind of play this game of chutes and ladders sometimes of reaching to the top of a different organization or an industry.
[00:15:26] And you kind of come in and you start. Start not necessarily at the bottom, but you know, you have to read out my advice to young people is focus on the purpose and the values of the organization. You're going to the character of the people in the organization, forget about the job title, forget about the salary, uh, you know, and, and focus on the things that really matter.
[00:15:48] And that are enduring because those things aren't enduring. Well, and that's one of the things that I wanted to ask you as well, because you are, I've heard you say that [00:16:00] people ask you all the time, like, what does it take to be the CEO of Procter and gamble? Like one of the most historic companies in America.
[00:16:06] And, you know, you spent 33 years climbing up through that organization and probably doing all sorts of different jobs all over the world, but, you know, What you're, you know, you, you have a very great answer to that, but, you know, and I'll let you kind of say your answer to that, but I, you know, my question would be like, what does it take to be the CEO?
[00:16:26] But I always find what you say to this is a fantasy. My point of view, Eddie is don't fixate on a particular position in a particular company, um, fixate on a purpose, you know, While, while 33 years climbing the ladder, as you talked about sounds, um, uh, somewhat mechanical and, um, and, and now in retrospect may look that way.
[00:16:52] Uh, I didn't feel that way at all. I mean, I just, I continually was challenged and I worked hard. Uh, to, [00:17:00] uh, build the business and build the organization during these challenges. And then suddenly they gave me a new challenge and one challenge was in the United States. The next challenge was in Toronto and Canada.
[00:17:11] The next challenge was in Manila and the Philippines next challenge was in Kobe, Japan after the earthquake. The next challenge is running a global business from Brussels. The next challenge was. Being chief operating officer of the company. Next challenge was being CEO. Next challenge of being CEO and chairman.
[00:17:27] So, um, you know, my, my point of view is, uh, if an organization can continue to give you challenging experiences and if those challenging experiences continue to grow you, then, um, why switch? Switch companies? Yeah, no, that's absolutely. That makes a lot of sense. And out of those places also, I'm fascinated by the way, to run a business.
[00:17:53] What was your favorite spot that you were, I guess in some ways? Well, I love them all. Let me briefly, [00:18:00] uh, give you an insight for each so in, um, In Toronto. Uh, I, I, I would argue in the Procter and gamble company, working in Canada is a tremendous, uh, first international assignment for an American, because the one thing that Canadian doesn't want to be mistaken for is being an American.
[00:18:21] And the one thing you don't, the one thing you don't say in Canada is, well, here's how we do it in the United States. You know, countries that are, that should. Long boarders, and that have a lot of history between them, Canada, United States, Austria, and Germany. Um, I could go on Japan, Korea. Um, these are the most, uh, fraught culturally, and you as the leader have to be.
[00:18:46] Uh, hypersensitive with tremendous empathy to make sure that you're respectful of that culture. And, um, and not trying to project your culture, uh, on them. [00:19:00] Um, I can't tell you a number of times. As a Canadian, when I was there, uh, I would be offended by things Americans would say to me, like, you know, uh, they'd show up at the border was snow skis in the middle of summer, something like that.
[00:19:15] Come on. Yeah. So in the Philippines, that was a great experience because. Uh, so many people in the Philippines live in abject poverty, and it was a real opportunity to live amongst the Philippine people and understand what it's like, uh, to suffer from that poverty. And then of course, from my standpoint, as business leader, what can I do to help raise them out of poverty?
[00:19:40] In terms of Japan, um, uh, very, um, amazing culture. We arrived there right after the Kobe earthquake the week after the Kobe earthquake and watching the Japanese people work together to rebuild their country. If, if you remember the Kobe earthquake, there was a famous picture of an, [00:20:00] of an expressway that was literally.
[00:20:02] Laying on its side. And, uh, and the, and the Japanese people just rebuilt the whole thing in a very short period of time, tremendous unity of purpose there. Um, and Brussels, uh, Brussels was a great place to run a global business because in your time zone, you could catch the United States, uh, six hours earlier, and you could catch Japan.
[00:20:24] I think it's eight hours later and it was a great place to run a global business. So we really loved every word. Gotcha. Yeah. Um, well, it sounds like they were all great places to be then, um, transitioning a little bit, um, when it comes to all the different positions that you've had in Procter and gamble, um, what were some of the hardest decisions that you had to make while you were there in your defense?
[00:20:49] You know, bill it's almost that you would think you had. I think the hardest this decision is, is whenever you have to, um, fire someone or whenever you have to give someone bad [00:21:00] news. And, um, that's always the hardest because you're not only affecting them, you're affecting their family, their relatives, potentially their income, their livelihood, their self-esteem, uh, these are the hardest decisions.
[00:21:14] I mean, leadership. Is at one time a blessing, uh, because you're given responsibility for someone's life. It's also a tremendous obligation to make sure that you, you do it with, uh, the kind of care that's needed. It was always my goal that if someone wasn't working out in a position to have them recognize that before I had to tell them, in other words, give them enough daily feedback so that, uh, they knew that yeah.
[00:21:45] Succeeding before I had the tell them, Hey, you're not succeeding. We're going to have to move you on. I Al I, when I speak to large groups, I oftentimes will say, okay, everybody who gives their subordinates sufficient feedback, [00:22:00] please raise your hand. And every hand in the room goes up. Of course I give sufficient feedback to my subordinates.
[00:22:06] Uh, then the next question is how many of you in this room, uh, received sufficient feedback from your superior? And no hand goes up. The point is. Everybody believes they're not being given sufficient feedback, even though they may be. And it's always surprise, uh, sometimes when someone's not working out, but you work hard as a leader to try to make sure that the person has enough feedback that they know they're not working out.
[00:22:33] They're unhappy. So they want to switch jobs, uh, before you have to switch them. Yeah. Yep. That's a, those are great lessons learned. It's, it's interesting. Um, for a lot of the listeners we've, you know, served in the military and there's like a, kind of like a structural way to, to do feedback. Um, and oftentimes in companies it's like once a year, there's like a 360 or something like that, that you do.
[00:22:59] Um, [00:23:00] but did, did any of your time. Like leading troops in 82nd. Um, and, and going through kind of that process of providing feedback or leading to that carry over at all, or how did you, how did you equate like leadership in the military versus leadership at Proctor and gamble? Well, I think, I think those of us who've been in the military.
[00:23:18] Are blessed that we've had experiences leading in the military because, um, particularly in small units, uh, in the second airborne division at that in those days, uh, most of my soldiers lived in one building in bunk beds. Um, I tucked him in at night. I woke them up in the morning. I had an intimate relationship with every one of them.
[00:23:41] I knew their families. I knew their birthdays. Uh, I knew their creditors, um, that kind of intimacy, uh, leads to trust and trust is an essential quality of leadership. Um, the challenge is how do you achieve that? Uh, in the private sector, [00:24:00] number one. And then how do you achieve that over a large organization?
[00:24:04] I mean, if, if you're the CEO of the Proctor and gamble company of 120,000 people, or you're the secretary of the VA and you have 400,000 people, how do you achieve that same level of trust? That same level of intimacy? Um, it's a high bar, but once you've done it in the military, which, and in a small, yeah.
[00:24:22] Um, you realize that that is the epitome of leadership is, is having that trust and having an intimate relationship. Yeah, it's, it's um, it's fascinating because people, like, I talked to a lot of younger, um, veterans that leave the military and when they're getting out, they are, you know, everybody kind of wants it all.
[00:24:44] Like you want the pay, you want the title, you want the company and you, you want the leadership as well. What I often find like two to five years after leaving the military and trying to transition is one thing that everybody really misses is the leadership. And [00:25:00] because sometimes there's not as many opportunities, frankly, to be intimate with people that you're working together to accomplish a mission with in the private sector, because the it's, the organizations just aren't as big, but one thing that, um, but maybe Procter and gamble.
[00:25:14] I dunno how big of a company it was when you joined. Um, but it's, you know, obviously it's one of the largest companies in the world today. Um, maybe it provides the ability to just have that many people to lead and be intimate with when it comes to achieving it, it, um, that military experience, that intimate experience creates empathy, right?
[00:25:33] And a consumer goods company, that's serving 5 billion people a day on the planet, you know, 5 billion people are using a P and G product. You've got to have that empathy or you can't, you can't design and build those brands. And then the company operates like a small company. So for example, I was the tide brand manager in the United States.
[00:25:57] I had a team, a marketing team of about [00:26:00] four people and we ran a multi-billion dollar business and the company was more or less the investment banker for that brand group. So that was, that was appealing to me because you maintain that nuclear team. Um, but obviously then empathy that you. Need and that you share, uh, extends throughout, throughout the company.
[00:26:23] Um, you asked me how big was it? When I joined, when I joined the company was $10 billion in sales, global sales. When I retired, it was $85 billion in global sales. When I joined, we had, um, I think about 30,000 people. When I retired, we had 120,000 people. When I joined the stock price was $2 and 32 cents split adjusted today.
[00:26:53] The stock price is $135 a year. Sounds like, um, well, I mean, [00:27:00] obviously Procter and gamble. It's one of the iconic household name brands, but I, you know, I don't think people realize when you hear Proctor and gamble, like what that means, because there's so many brands under it. Um, and whether it's, I don't know if most of it's been through M and a or through like just, you know, organically building these really, um, kind of staple things that we all have in our houses.
[00:27:22] Um, we use the products every single day. I think w you know, you tie it, you tie this all to your mission of, of service, um, and, and, you know, helping others, um, Can you, can you talk about how you came to develop and understand the, how the value that Proctor and gamble was providing to both the us and then eventually the world, um, really impacted your motivation and your grandmother brands?
[00:27:47] The brands, the company during my time had about 300 brands globally. Um, and. Generally, what I would do as a CEO or at any level that I was [00:28:00] at is, is when I would go to country. The first thing I would do was to go into consumers' homes and watch them use our products. And the whole idea was to have a dialogue with them and to get insights of how I could make their life better.
[00:28:16] Then I generally would go to retail stores and watch people shop for our products. In those days, most of the shopping was done. Uh, in, in retail stores. Um, and one of the things you learn is, is again, you develop your empathy. So for example, um, some of our brands we got through acquisitions, some of the brands we developed, um, no consumer is going to say to you, Hey, look at, I'm washing my floor with a mop and a bucket of water, and I'm taking your product spic and span or Mr.
[00:28:52] Clean. And solubilize it. In the water and then wiping it on the floor, but then I have to drive a floor. Why don't you [00:29:00] guys take a, um, the technology you have in Pampers, put it on the end of a stick and take the technology you have in Mr. Clean and put it in a little vessel that sprays in front of the Pampers and call a Swiffer.
[00:29:18] I mean, no, consumer's going to do that right. You and the R and D organization as you visit homes and as you become empathic for what the need is, you can kind of make those connections. You know, there's a wonderful book by a guy named James Burke who taught at Cambridge called connections. And he also did a television program in the eighties called connections.
[00:29:41] Innovation inventions are never used for what they're designed for in the end. So Burke's program may start with a ceramic mug in Delph and another ones to keep beer cold in the middle ages, because beer was the only way. The only thing you could drink in [00:30:00] the middle ages to make sure you were drinking pasteurized.
[00:30:03] That's why beer was so popular, but that seems ceramic that keep, that kept that beer cold is the same ceramic that ended up making up tiles on the bottom of the space shuttle and Burke and Burke. And his program leads you from Delph all the way through the creation of the space shuttle. So a couple of few examples, um, Alexander Graham bell invented the telephone because he worked in a deaf school.
[00:30:33] He never expected. We would carry cell phones in our pockets. Um, Marconi invented the radio for two ships to communicate at sea. He never expected the radio to come on land. Thomas Watson, the founder of IBM, um, said that us may need two computers someday. Uh, at the time the computer was taking, the S was used to take the census of the country.
[00:30:56] Using these punch cards that I used. Um, [00:31:00] and he never thought we need more computers. So it's all of us bringing our diverse selves and our diverse experiences, our individualism to these ideas building upon other's ideas that create a great invention. So it Procter and gamble company. And at the VA one things I would purposely do is I deliberately put diverse groups of people together.
[00:31:25] Because diverse groups of people are more innovative than homogeneous groups of people. Yeah. I, I think that, um, at least within the investor community that I work in, a lot of people really do believe that. And there's there. That's why there's a huge push for a lot of the DNI or diversity and inclusion initiatives out there.
[00:31:44] Um, but it's also fascinating to hear, um, how. Innovate. Like, it sounds like your mind, you know, there's management at larger organizations like a Procter and gamble and then there's product. And it sounds like [00:32:00] you also have a huge fire for just innovative products. Do you, does your, do you still well think about things like, like, okay, so you went from Procter and gamble.
[00:32:08] You were the CEO, and then you went to the lead, the, the VA. And, but like you still live in this world. Does your mind still kind of turn and turn and like think of innovative things and want to do things an example. So, um, when I left the Procter and gamble company, um, I did a couple of things, uh, in between before the VA one was I developed, uh, as CEO of Procter and gamble.
[00:32:36] I developed in innovation, um, uh, Accelerator in Cincinnati called central fuse. Uh, and that's still operating today. And the idea was how do we attract entrepreneurs to the Cincinnati greater Cincinnati region? How do we attract venture capital, the Cincinnati region? And, uh, part of that was in the [00:33:00] Procter and gamble interest.
[00:33:01] We put up $25 million. And it was matched by the community. We developed a fund to funds that we would invest in venture capitalists, uh, who took a look. Yeah, yeah. At the businesses we were developing in Cincinnati. Now the, the, the own interest in it was of course, with those businesses, developing Cincinnati, Procter and gamble could meet with those entrepreneurs.
[00:33:25] Often we could actually. Test their businesses, ideas for them. And oftentimes we'd buy their company or we'd invest in their company. So it was, it was in our self-interests, but, um, but Steve case, for example, visited us from his, um, Best of the rest or trip. I think it was where the rest of the referees trying to get innovation off the two coasts, uh, we haven't Cincinnati and it's and it's it's community-wide um, so I mean, that was, that was, uh, a really important, uh, [00:34:00] Aspect.
[00:34:00] And then of course, when I got to the VA, one of the one, the VA is a, um, the VA is the prime mover of medical innovation in our country. Uh, VA spends about $2 billion a year on, uh, medical innovation. Uh, they invented the first cardiac pacemaker. They invented the shingles vaccine, take an aspirin a day to ward off heart disease, sensors in the brain to move per static devices.
[00:34:24] Uh, first liver transplant, I could go on and on and on, but if it weren't for the VA American medicine would be nowhere. So one of the things we did going to the VA is we is we put that on steroids and we created a, um, uh, an innovation task force who was responsible for not only creating innovation, but also spreading the innovation, uh, across the VA.
[00:34:50] It's also a small, small world, but actually I'm Patrick Henshaw. He's class of 2008. He, um, actually came to visit Seattle yesterday. So we had coffee, but [00:35:00] he was talking, he, I guess he used to work at central views and now is doing something called render in Cincinnati that is somehow associated with central fuse.
[00:35:08] Uh, but that's, that's really cool. Yeah. Small world. But then transitioning a little bit to the VA, obviously. So people had their opinions about the VA prior to, um, you know, what it is today. You were tapped by president Obama and asked essentially to, to fix this. And, you know, he had some, some really great words, um, to say, I mean, um, President Obama was quoted saying, what, what especially makes Bob the right choice to lead.
[00:35:37] The VA now is his three decades of experience in building and managing one of the world's most recognized companies, Proctor and gamble. The VA is not a business, but is one of our largest departments in the workload at the VHL. The VHA alone is enormous, not VHA VA loan alone is enormous. Bob isn't X is an expert at making organizations better.
[00:35:57] Um, so you oversaw $10 [00:36:00] billion in restructuring. Well, okay. Well at the VA, like what lessons did you learn at the, at P and G that really allowed you to be successful? Um, well, when I, when I first got the call, uh, about serving at the VA. Uh, gee, this must be God's plan because, uh, here's a guy who went to west point served in the second airborne division as an infantryman.
[00:36:23] Uh, never saw combat during my years of service, went to Procter and gamble to learn about customer service and then went to the largest medical system. In the country with the most important client in the country, the veteran, uh, only second, only in the world to the UK medical system. So how could I take all of that learning?
[00:36:45] Uh, put it together in order to, uh, uh, make the veteran, uh, experience, uh, better. So we brought in, uh, uh, technology that we use to Proctor and gamble called human centered design. [00:37:00] Um, w we, we put the veteran at the center of everything we do, and then we journey mapped the veteran journey from the day that we raised our hands to be sworn in.
[00:37:11] Till the day we bury you in a VA cemetery. Then we looked at all of those touch points of the VA. Along that journey line, we call them moments that matter. And we asked the veterans what they thought of, how we were doing in those moments that matter, uh, the scores were pretty solid. Uh, because it never been measured before, uh, the scores were, were so brand new and we had a lot of, uh, re-engineering work to do.
[00:37:38] Part of the problem was whenever an organization is in crisis, whether it's private sector or public sector, it turns inward. It turns inward, and it worries about its survival and it forgets about its customer. So what I had to do first and foremost was to put the veteran at the center of everything we do not the bureaucracy.
[00:37:58] But the veteran [00:38:00] and, um, and that's why the journey mapping was so important. That's why the structure of the organization focused on the veteran was so important. And then, and then we just had to, um, uh, give people the training, uh, to do the right thing for veterans and to get, build trust. We had the, we put together a 90 day plan and, uh, the primary strategy of that plan was to rebuild, rebuild trust, because we had lost.
[00:38:27] When those veterans were waiting for Karen Phoenix, and the only way to do that is. When you have a, a large bureaucracy, it's very easy to criticize that bureaucracy. What I had to do was have them put my face with that bureaucracy and know that my heart was for the veteran and I was going to do everything I could.
[00:38:47] And I was going to be accessible. I gave out my cell phone number publicly, the Washington post published it for me. Uh, so I was getting calls from veterans and we tried to solve every veteran problem that we could. [00:39:00] Um, and over time we built trust. We built trust from, uh, maybe the high 30% today. It's, uh, nearing 90%.
[00:39:09] Um, and we did that by building capability and, uh, by putting the veteran at the center of everything we do, and by changing the culture, From a rule-based culture to a principle-based culture. Yeah. I mean, I, what I can speak firsthand on the improvements that we've seen through the VA over, over, especially during your tenure.
[00:39:31] Um, how was it scary because of the reputation? Like it's kind of a no-fail mission that in some ways, you know, hadn't necessarily been done well for, for a number of years. Um, if you come in and you don't do a good job, it's, it's almost like. It's not like coming in at a company and failing, it's like coming in and kind of failing, you know, the veteran population in America that nobody really wants to be associated with.
[00:39:55] Um, it's the epitome of Teddy Roosevelt's [00:40:00] speech in Paris about the man in the arena. Um, you're in a very public position. People die in hospitals. Uh, any journalists wanting to win a Pulitzer prize or whatever for journalism, uh, we'll try to dig up things about the mistakes you made and why that person died.
[00:40:19] Uh, you're going to get knocked down. You're going to get bloodied. Uh, but it's, it's a question for all of us. It's a question for all of us as west pointers of veterans. Uh, how do we want all of our lives? Do we want to be the person in the arena who. Gets bloodied gets knocked down, gets up again. Uh, or do we want to be the person who stands on the outside of the ring as the critic?
[00:40:40] Um, and, um, I've always wanted to be in the arena, but yeah, it was scary. Um, it's scary, not so much for you. It's scary for your family because you're worried about your family with all that. Public criticism. There's always an opposition party in politics. Um, and so you're always going to be [00:41:00] criticized.
[00:41:00] The benefit I had, uh, frankly was I was working with my classmate. Uh, Sloan Gibson is the deputy secretary and both of us had had successful private sector careers. Sloan had been, um, the, uh, done a fantastic job as the CEO of the USO. Um, basically doubled the giving in five years to the USO built incredible capability.
[00:41:25] And neither one of us really needed the job. So we acted that way. We acted like we didn't need the job. We were going to do the right thing. We weren't politicking for any additional position. And I think that freed us up, um, to do the right thing and oftentimes. To call members of Congress and other politicians to task for being political about an issue that shouldn't be political.
[00:41:50] Yeah. I mean, it really shouldn't be right. Cause if there's anything that we need to do, it's, it's support, support everybody. Who's um, really supported us, um, through the years. [00:42:00] Um, is there anything that you thought. You know, w w where else do you think that the VA kind of needs to go? Like, what is the next generation of VA healthcare you think for the American veteran population?
[00:42:11] Well, uh, first of all, I think, uh, you know, the, the VA's role is oftentimes dictated by what goes on in department of defense, which is of course dictated by. The president and other decision makers who decide where we go to war when we go to war. Uh, an example of that is, um, during my time as secretary of the VA, I visited Vermont, um, a state with a national guard, uh, when I was in the army, people joined the national guard and the reserves because they didn't want to go to Vietnam.
[00:42:44] Whereas the Vermont national guard had deployed eight times. Since nine 11, you know? Um, and that just puts a tremendous burden, um, on the VA it's a, it's a great burden. They have to cause that's what we want to do is take care of people, [00:43:00] but, um, just a tremendous burden. And, um, as a result of that, we have to, we had to build a lot of capability.
[00:43:08] We didn't have, we had to go to weekend hours. We had to hire more doctors. Uh, we had to build more clinics. Um, I think the future is decided. The balance between private sector care for veterans and public sector care. When I got to the VA about 8% of appointments were done in the private sector. When I left the VA about 20%, I think today about 30%.
[00:43:35] And it's really up to the secretary to work with Congress and say, look it, maybe we're going to hold it 30% or maybe 35 or 40. I don't know what the number is. And, and so what we've got to do is we've got to invest in that 35, but we've also got to invest in the 65. We need to tell Congress where to invest the money in order to get the best network for veterans, both private [00:44:00] sector and public sector.
[00:44:01] And those two sectors have to work together. Um, Homogeneously, uh, for the betterment of veterans, uh, it's gotta be a seamless transition from one to the other and back again. Yeah. That's uh, um, it sounds like there's, you know, obviously we've come a long way, but there's still, um, there's still more work to do.
[00:44:23] And, um, it's a, it's a great organization. It affects the lives of so many, uh, great Americans out there. I think as you know, as we're kind of nearing the wrap up here, one thing that we always kind of in the show with is what, what advice do you have for, you know, what would be the core piece of advice that you'd have for, you know, younger in their career veterans that are scaling, um, either, you know, transitioned out or scaling and, and trying to really make an impact and serve others.
[00:44:53] Um, what, what are the core things that have been kind of instrumental to your success that you wish you could share with others? Well, number [00:45:00] one is, is, you know, that my top leadership belief is have a purpose. Figure out what your purpose in life is. Uh, don't go through life simply meandering from event to event, uh, or reacting to your cell phone and other stimuli.
[00:45:14] Figure out what your purpose is, uh, check in on your calendar. Make sure you're driving that purpose. Uh, that's number one, number two would be. Don't stop learning. Um, I used to bring in, uh, I would train general managers and leadership at P and G I'd have about 200 new general managers every year. Uh, I bring them in, I bring new hires in and I have the new hires complained to the general managers about their archaic leadership.
[00:45:42] You know, they didn't know how to text message. They didn't know how to do certain things on the computer and I'd stop it and say, okay, well, the question is 20 years from now. What's going to be the text message for the young person. Things constantly change things, constantly evolve. As you get older, it gets harder and [00:46:00] harder to learn new things.
[00:46:02] Develop the discipline. Now that when you hear a word, write it down. When you hear a concept, write it down, then go back and research it and learn. Keep learning, make yourself more valuable to your family and to your enterprise. By continuing the learning. I think that's so important. And third I'd be remiss if I didn't mention.
[00:46:24] Help me to choose the harder, right. Rather than easier wrong. Uh, that phrase from the west point, cadet prayer may be the most insightful phrase in the English language. Um, I had a lot of experience in business. Businesses never start are to fail organizations. Don't start out to fail, but what happens is they do the wrong thing when it's small.
[00:46:47] And that's small, wrong things to lead to a larger, wrong thing, which leads to a larger, wrong thing, which leads to the downfall of the company, you know, in 1955, the first year of the fortune 500, [00:47:00] uh, there, uh, the top 50 companies, they're only nine companies still on that list. Uh, proctoring gambles, one of them.
[00:47:08] And, um, and I think that, um, People just make small mistakes. They're willing to compromise a little bit. And it leads to the downfall of the company. Yeah. That's, that's fascinating. I feel like it's, you know, speaking of, of learning, I feel like, um, I've learned so much, uh, in this time spent with you and I could probably continue learning for hours if I, if we had more time, but thank you so much for, for being so gracious.
[00:47:37] Thank you. Time. Joining us on this to come back. We really appreciate the support, Bob. Thank you so much. Best wishes, beat Navy. Awesome. Being Navy. Beat him.