Transcripts For BLOOMBERG The David Rubenstein Show Peer To

BLOOMBERG The David Rubenstein Show Peer To Peer Conversations July 31, 2022

Over much of the past three decades, ive been an investor. The highest calling of mankind, ive often thought, was private equity. [laughter] and then i started interviewing. I watched your interviews so i know how to do some interviewing. [laughter] ive learned in doing my interviews how leaders make it to the top. Jeff i asked how much he wanted. He said 250,000. I said fine. I didnt negotiate with him and i did no due diligence. David i have something id like to sell. [laughter] and how they stay there. You dont feel inadequate now because youre only the second wealthiest man in the world, is that right . One of the greatest growth businesses in the world is consulting. It seems everyone today is either using a consultant or is a consultant. The largest Consulting Firm in the world is accenture, with more than 569,000 employees and a market cap over 200 billion. Julie sweet has grown it dramatically in the several years she has been ceo. I had a conversation with her about why everybody uses consultants and why everybody should be a consultant. So, it seems as if everybodys a consultant these days. When people are being raised, they dont say to their little child, i hope you grow to be a consultant. Why does everybody want to be a consultant, and what are all of these consultants doing . Julie well, david, i think we define the label consultant, because sometimes consultant seems to imply that we only give advice. When you look at what accenture does, were different than the traditional version of a consultant. Our clients look to us for two things. Relevance you know, how to help them be relevant today and tomorrow, like at jaguarland rover, who hired us to transform the marketing of their vehicles and the experience of their owners. And then the other thing they look for is results, right . So, not just advice, but how do things change and how do you execute . Like someone who hires us for a supply chain, where we help digitize it and change their inventory results and their inventory turnaround. So, we dont simply consult in a traditional sense. Were really about relevance and results, and thats what is driving our business. David lets suppose im a Large Corporation and i have a problem. And typically today when you have a problem what you do is, you call a consultant. They call you up and say, would you consult with me to help solve my problem . You then put in a team of people . Julie thats a great question. You know, i think one of the most important things is, we always start with, what is actually either the problem or the opportunity . And were very focused on Repeatable Solutions that get customized by the client, but not trying to be bespoke. The old consulting is, let me come in, let me bring a bunch of people in and study it. But today you can start with data. We serve 75 of the top five fortune 500. So what were bringing to our clients often are solutions that then get customized that are based on experience. And we invest a lot. Well spend 4 billion this year in acquisitions. Well spend about 800 million in r d. We have over 7,000 patents or patents pending. So all of these things are assets to help our clients achieve their goals faster, with Higher Quality than they can do on their own. And thats really the test. And sometimes, by the way, we say to clients dont hire us, because either their Business Case is not ambitious enough or they dont need us. David what about a consulting project . In my example, i am a ceo. I call you up, i say, give me a solution. How long does that normally take . Does that take six months, a year, or is it a forever solution, it is going to be five or 10 years . Julie i think one of the most important things thats come out of covid is the need to move very quickly. I had a lot of clients postcovid who would say, we move so fast, i want to keep going. And i would always ask a simple question, david, what have you changed . Oftentimes, you know, they havent changed. We dont operate as Big Companies permanently in crisis mode. When you think about how long does this solve things . A lot of it starts with the company being willing to set aggressive goals, right . And so we are doing work, for example, with a Large Consumer goods company, where we said, were going to, in 12 weeks, have a pilot to actually improve their manufacturing. And that, precovid, probably wouldve been a sixmonth project. Not because of accenture, but because of how the client worked. And so what we are trying to do now is work with our clients to work differently and to work faster. David how do you charge . Do you charge by the hour . Do you charge by the project . Is it a costplus profit thing . Whats the secret of your billing . Julie so, our preference is to either have a fixed fee or have something that shares upside or downside. And the reason for that is that we dont view ourselves as a vendor or a consultant in that we are keeping ourselves at arms length. We believe that the best way to get success is to cocreate solutions, have integrated teams. The advice i often will give ceos is that our team at accenture and the clients team should have the exact same performance objectives, so that theyre completely aligned. Now, not every client is willing to work that way, but we think its really important. And so we have plenty of clients who want to bill by the hour, and thats their choice, but thats not our preference. David ok, lets suppose somebody hires your firm, and they have a oneyear consulting project. And at the end, they say, i dont like this consulting advice. Im not going to follow it. In fact, im not going to pay your bill. Does that ever happen . Julie well, look, we are not perfect, so it may happen, but shame on us if it takes a year to figure out that our client doesnt like what we do. One of the things that we focus on a lot is working with the client, day in and day out, sidebyside, and not throwing things over a wall to consult them. So, unlikely that that specific scenario would happen. David so, without violating confidences, can you give me an example of something where you advised somebody, and it turned out to be great for them and they were so happy that they were willing to brag about the great job you did . Julie well, weve got lots of examples of that. [laughs] so if you take for example what we are doing with shiseido. We announced a partnership there and we are helping them digitize the experience of the end consumer. We are helping them redo their inventory and their systems. And so this is something that we are both very proud of, the work we are doing together. David lets suppose you need a consultant. Who do you call . Do you call mckinsey or do you call one of your own people . Julie so, normally we call one of our own people. But i will give you a great example. When i became ceo, i needed to put in a new operating model, and i wanted to do it faster than any we had ever done in our past and any client had done, to prove that you can move at scale. So, six months, biggest change in our history. At the time, our practice was completely sold out to do change management and new work design, and the head of my practice said, i think you should hire this Small Company called kates kesler. And i can tell you, my leaders were like, why are we hiring a different consultant . Within two weeks, the same leaders came back and said, we need kates kesler to be part of accenture, and they are today. So, im grateful that they took the call, because im sure it was a little intimidating to have accenture hire someone. But, you know, the lesson for that is to have humility. And one of the things i think is really important when we look at leaders in the industry around digitization, its those that are not always willing to build it themselves, as having all the answers, but those that actually look outside, and accenture did the same. David do you have any mistakes you made or failures you can talk about, so people feel youre not just superhuman . Julie people ask that question as if the only challenge is at work. Challenges come in a lot of different packages. David lets talk about how you rose up to be the ceo. So you grew up where . Julie i grew up in tustin, california, which has a little sign, and it says, work where you must, but live and shop in tustin. So, southern california. David i thought it would have a sign that says, home of julie sweet. [laughter] doesnt have that sign yet . Julie we are going to have to work on that. David were you a star athlete in high school . Julie i was a speech and debate star. Starting when i was a freshman, i used to do two types of things. My dad would get into his vw and i would do the circuit, the lions club, the optimists club, and im greatly appreciative of all of those clubs, because they helped me earn money for college. I was on the speech and debate team and really loved that. My parents didnt love it so much at times, because i apparently used the skills against them, but it was definitely a great way of creating a skill that i use today. David in other words, if youre a debate champion, you can debate your parents. Julie yes. [laughter] david and they didnt like that. Ok. Where did you go to college . Julie i went to Claremont Mckenna and then i went to columbia law school. David so did your parents say you should be a lawyer, or you went because you are good at talking and debating and so forth . Is that why you went to law school . Julie yeah, so i wanted to be a lawyer since i was in eighth grade. And i remember in my senior year in college, before i was accepted going to columbia one of my professors said, have you ever met a lawyer . And i said, no. And he said i am not letting you sign away i was borrowing all of the money to go to college, to go to law school im not letting you go until you meet a lawyer. I met a lawyer and said, great, i still want to go to law school. And i went to law school. David so, you went across the country, and i dont know why you went to columbia. Because you like places that begin with a c . What was it . What prompted you to go from claremont to columbia . Julie i look back on it and im not sure why it was at that time. Maybe because i had gone to china during college. But i said, ive grown up in southern california. I should experience the east coast. I fully intended to go back to southern california, but i fell in love with new york. And so it was actually a deliberate decision that i needed to diversify my experience. David after you graduated from columbia, you went to work at cravath, swaine, and moore, which is large firm in new york that i was a Summer Associate at, continuing the c, cravath. Why did you pick cravath . It wasnt a place a lot of women had become partners at. Julie it wasnt. At the time i remember when i came back and accepted the offer, my women friends were saying, what have you done . And all my male friends were like, congratulations. It was definitely not, at the time, the selection of choice. Its now run by a woman, by the way. I picked it because i had no intention of staying a lawyer. It was the best in the world, and i wanted to go there for two years and then go off and make my career, at the time, i thought, in asia. David so ultimately you stayed, became a partner, i think the third woman partner . Julie i was the third corporate woman partner and ninth in the history of the firm. David so youre a corporate partner at cravath, which is a wellcompensated law firm, lets say, and youre making a fair amount of money. Why did you decide to leave and give up the partnership and were they shocked . Julie i think they were surprised. But i was leaving for a great role, so they were very supportive. You know, i still remember being at my desk and picking up the phone when a recruiter called me about the accenture job. And it was a few months after my father had passed away at a very young age, at 68. And i think, looking back, thats why i took a meeting. And i basically said, im 42 years old and i can see my future. And it would be a great future. I loved cravath. And accenture offered me something different. And i, you know, decided to take it, and i think it was the last gift of my dad, to be honest. David so, did you think when you joined the company that a female would become the head of this gigantic organization . Or did you think that it was going to be a typically malerun kind of thing . Julie you know, i didnt think about it because i joined as general counsel. Joining as general counsel, the average tenure of the Leadership Team hours in was 30 years. I didnt come in with the expectation that i would be ceo. And, you know, really, when we think about, how do you make a change in leadership and how do you continue to foster diversity in your leadership, our former Ceo Pierre Nanterme was a great example of someone who sponsored me, saw potential, and created a new pathway that i certainly didnt have an expectation when i came into accenture. David youre one of the largest private employers in the United States, is that right . Julie thats right. And thats globally, of course. And last year, actually, were really proud that we added a net 100,000 jobs around the globe. David so, during the period of covid, you added that many jobs . I mean, why was business so good during the covid period . Julie you know, its really interesting. When you think about what happened in covid, sort of overnight, there was we all moved online. And accenture, since 2013, has been building our capabilities in digital cloud and security. And so at the time of covid, right, we became relevant and critical for, really, all of the worlds leading companies. When you look at this fiscal year which we just ended, we actually had more clients who had over 100 million in bookings in the first three quarters of our fiscal year than all of last year, driven by what we call compressed transformation, the need to digitize all parts of the business. David now, one of your competitors and you may not admit you have competitors, but a Company Called mckinsey youve probably heard of them. They say, we dont want to be a publicly traded company. Were a partnership, and its easier to do this when youre not a publicly traded company. But youre a publicly traded company with a market cap of over 200 billion. So, what do you think about those who say they should not be publicly traded . Julie its an interesting opinion. For us the markets are an important part of discipline. Right . We are given our results every quarter. And of course, we think it really attracts talent. Our employee Value Proposition is a really strong one because of our stock, which is a huge part. We have a payforperformance and culture tied to creating value for all of our stockholders. So, it served us well in terms of attracting great talent. David but youre not competing with private equity, i hope. Youre not going to be trying to steal people from private equity to go into consulting, i hope. Julie no, private equity seems to be trying to compete with professional services, and hiring a few people and acquiring a lot of professional services these days. David well, that has been a growth business. That is why you see a lot of acquisitions there. Now, youre doing this from washington, d. C. Washington, d. C. Is a great place. Its the capital of our country. But its not necessarily known as a place you run global businesses from. Why are you headquartered in washington, d. C. . Julie you know, we have not had a headquarters really since for 30 years, three decades at least. Precovid, we were probably the Largest Organization running itself remotely. Our leaders are around the world, and so the sort of de facto headquarters has always been wherever the ceo is. So, the last ceo was in paris, it was in paris. Before that, it was boston. Before that, dallas. And so d. C. Is a great place to be based. And, in fact, this is the first time in 30 years that the ceo and cfo are out of the same office. And so i am very fortunate to have Casey Mcclure here with me in d. C. David so during the covid period of time, did you go into the office or did you work remotely . Julie i worked remotely. One of the things that we are, you know, famous for is being very close to our clients, so our offices arent the center of our work. And because we have a distributed Leadership Team, i literally, even precovid, would go to the office and be on teams calls. And so during covid i wanted to make sure our people felt comfortable working from home and didnt feel pressure to go into the office. David so, how do you meet your clients . You dont need them yourself so much because youve got other people around the world. And during the covid period of time i assume you didnt go meet anybody. You were just traveling from your office to your home, if that. Julie right. Precovid, i did definitely travel a lot, and i think we have all learned during covid that connections can be built remotely. And certainly, you know, my fun fact was i became ceo september 1, 2019 and literally six months and 11 days after becoming ceo, covid, you know, the pandemic was declared. And so i have had a very interesting first couple of years. And i built really strong relationships by leveraging technology and really thinking about, how do you build connections . And i think one of the great learnings out of covid is this idea of omniconnections. And i think too many people focus on remote work and hybrid work and physical location, as opposed to, you know, how do you connect with people . When do you need to do it physically . You know, how to be intentional, and, you know, whats required for connection. David so how do you keep up with whats going on around the world . I mean, you have so many consultants. Do you know all the big projects . Do you get reports daily or weekly or monthly about whats going on, or if there are problems . And do you have to go out and woo the clients yourself to get the business . Julie first and foremost, i lead by example. And our business is about clients. And so every quarter i publish, for all of my managing directors, how any client meetings ive had and how many meetings i have had with our ecosystem partners, to reinforce that our business begins with understanding our clients. I call it the proximity imperative. So, i spend more than 50 of my time with clients, not just wooing them, not in a sales mode, but understanding them, building relationships. And thats really what our entire foundation at accenture is built on, is that proximity to clients. And then with respect to, how do i run the business, one of the most important lessons that i think any leader has is you build a great team, and then you rely on them for what they have been asked to do. And so, i dont micromanage. I really focus on, you know, who is doing what and w

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