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Volume 21 No. 6
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Former CEO Seth Waugh on leading, learning, golf and a ‘No assholes’ rule

Seth Waugh thinks schools are cool.

“I love being around schools,” he tells me with a smile. “I grew up at a school, basically, and I think school is one of the coolest places on earth. That energy, that passion, people expanding themselves, growing. I like high school the best because I think there is a purity to it that’s really cool.”

That’s how my conversation starts with the longtime financial executive who led Deutsche Bank’s swift rise in the U.S. as its CEO for more than 12 years. I met him recently on a sunny, breezy Thursday morning in Florida, as he greeted me at the door of his beautiful home, looking healthy and lean in a tan sweater, khakis and loafers with no socks. He guides me through the kitchen out to the glorious beach front, where he talks up the quality of life and business opportunities in Florida. “Geography will matter more in the future than it has. I’m really bullish on Florida, in particular, and the Southeast, in general.”

Waugh, at his Florida home, says “The opportunity to reinvent yourself is pretty cool.”

The setting is a long way from The Lawrenceville School in New Jersey, where his father taught English and all five Waugh boys attended. “Five boys, we all went there, grew up and played sports there. It’s basically our home,” he said. Now Waugh is spending far more time at home after stepping down from Deutsche Bank in February 2012 to spend time with his family: wife Sheila and son Clancy. He grabs a few bottled waters, and we head into a sitting room followed by his two Cavalier King Charles Spaniels, Deacon and Gus, who are our companions during a two-hour conversation on life, learning, leading and, of course, sports. His sandy hair slicked back, Waugh has a soft-spoken, easy style, and we talk of him leaving the frenzied world of finance and his newfound free time.

“I’d been doing this for a long time,” he said. “We have one son who is now a freshman at Wake Forest playing golf, and frankly, I just ran out of time. I’d been commuting for seven years to New York, and I’d never really lived at home while he was at home. It had been 30-odd years of traveling 60 or 70 percent of the time. I really wanted to be at home.”
Last summer, Waugh hit the road and served as Clancy’s caddie as he played in three top amateur tournaments. He wrote about the experience in a fantastic piece for Golf Digest that I encourage everyone to read. “It was probably the best time of my life,” he said. “Just hanging around with him and my wife, Sheila. Being in the ropes and competing with him was fantastic, but so was all the other stuff around it. That was July and August, and then we dropped him off at school, and it was sort of ‘OK, now what do we do?’”
Waugh admitted it took a while to adjust, but he’s started the process of figuring out what’s next. “The opportunity to reinvent yourself is pretty cool,” he said.

As he says that, I hear a loud snore from Gus, whose head is propped on Waugh’s lower leg. I get a cup of coffee and we transition to his start in the financial world, where he had to decide to either follow a passion or a business career at 21.

“I went to Amherst College. When I was graduating, I had three job offers: two were in coaching/teaching, and the other was trade and commodities in Minneapolis,” he said. “I couldn’t decide what I was going to do. My then-girlfriend — now wife of 30 years — listened as I walked her through the options, and she goes, ‘You’re going to teach and coach at some point, so go do business because you don’t really know what it’s like and it’s probably easier to go from business to teaching than from teaching to business.’ I said, ‘Well that makes sense’ and I took the job.”

His rise was quick. He went from Merrill Lynch to hedge fund Quantitative Financial Strategies and then was named CEO of Deutsche Bank Americas in 2000. Leading a global operation in finance is surely intense and likely cutthroat, but for Waugh, it all came back to being happy. “I’m just a big believer that if you’re having fun and you’re happy, then you’re really good at what you do,” he said. “If you’re not, eventually, you’re playing in traffic, and it’s not going to work out. You ask any parent on earth what they’d want for their kid, and they’d say you’d like them to be healthy and happy. If that’s the case, then why aren’t we allowed to be happy? If you’re going to be banking 12 hours a day, almost seven days a week, you’re spending more time doing that than with your family. You’ve got to like it. You’ve got to have fun. Not every second; that’s unrealistic.”
Gus snores louder; clearly he’s happy. “There is a feeling that if you’re happy, you’re not working hard enough,” Waugh laughs. “There is a feeling in the corporate world that you have to be miserable. You have to be a jerk because people are expected to be a jerk. I just never believed it. I always try to make meetings fun and interesting. People felt free to talk and free to ask any question to understand what was going on. At the end of the day, we had a mission that was worthwhile. We were going somewhere and we were doing it in a way that we’d be proud of.”

So outside of being happy, how did he manage and lead?

Waugh at one time was mentioned as a possible successor to PGA Tour Commissioner Tim Finchem.

“To the extent I had a style, it was very team-oriented,” he said. “It was very collaborative. At Lawrenceville, we learned around a Harkness table. They’re oval tables that sit 12 people, and the idea of Harkness teaching is that it’s a discussion-based technique. Everybody around the table is supposed to make the other person better. I sort of have Harkness table management, where you have a lot of discussion, lead it where you want it to go, and create a consensus. I knew what I wanted to get done when I got to the table, but I wanted everybody to feel a part of what that was.”
And if they disagreed with you? “Even if they disagreed with what I was doing, I’d try to have them feel good about why I did it and the fact that they were a part of getting there,” he said. “Part of leading is making decisions, particularly hard ones, and you realize that people do want to be led. They want to be on a team, they want to have a voice, but ultimately, they want to be led.”

What about the lessons of learning to lead at a young age? He shook his head slightly, and said, “You have to be willing to fail, you have to be willing to listen, you have to be willing to live with what you did wrong and learn from it and try to repair it. The hardest part for me was, and probably still is, to not take each decision personally. You have to take it seriously and think about it in a personal way, but you have got to live with the results in a way that is not personal and not emotional. You’re going to win hopefully more than you lose, but you’re going to lose some, and you’ve got to let go of that.”

Waugh seems so kind and mild-mannered that I ask how much harder consensus-building is this way rather than being a dictator. “I never wanted to be ruled imperially and I never wanted to rule imperially,” he said. “I never wanted to come from above. It’s easier to be a dictator. It’s harder to do it the other way: It’s more time-consuming, more frustrating. You end up having a lot of conversations about ‘stuff.’ But ultimately, you have to make decisions, and you still have to explain it to everybody. People want to be part of a team, want to be proud, want to be an insider and feel good about where they are. I tried to create a culture and abide by the culture at all times and always do the right thing. Part of that culture was, No assholes allowed. Everybody knew that. Ultimately, we were going to have a big discussion, but we were going to leave the room as a team and support that decision even if you didn’t think it was 100 percent right.”
I had to press him on his “No assholes” rule. He pauses and isn’t sure he wants to use the term, but I insist it’s fine. “If you ask anybody that worked for me, my golden rule was publicly ‘No jerks,’ and privately ‘No assholes,’” he said. Could he tell an asshole during hiring? “You try to hire talent but also hire culture,” he stressed. “At the end of the day, we’ve had to wash a few out. Oftentimes, the better the producer, the bigger the jerk. If you actually take one of them out, particularly if they’re a big producer, people start going, ‘Wow, they’re actually serious about this.’ As much production as somebody does, there is an enormous amount of damage that they do because they bring down the happy factor, bring down the fun, bring down the culture, and zap energy in a way that is divisive, as well as cheat on management time. You should leave places if you think the bad guys are ruining them.”

I get a second cup of coffee and Seth gets another water. He shoots me a quizzical look and says, “This is probably boring. Don’t you want to talk about sports?”

So we shift to his thinking about when Deutsche Bank made a big and surprising move into sports by landing title sponsorship of new PGA Tour Labor Day event in Boston in 2003. “We started to look at sports after we had built something at Deutsche Bank that I was becoming proud of,” he said. “We had the right momentum, and I thought it was time to advertise that — not literally advertise, but celebrate where we were and where we were going. We needed a platform to do that. We were trying to figure out something in the U.S., specifically, that could kind of turbo-charge everything we were doing.”
Sports was his focus. “We looked at tennis, football. We looked at sponsoring people, but … we came to golf for a couple of reasons. The values are there, it hits our demographic very well in terms of our clients who are high-earners and tend to play golf. You can entertain with golf: You can’t put somebody on the field at the Super Bowl, but you can put them on the course at TPC with Tiger Woods. That’s pretty unique.”

Waugh also sought to own something the bank could brand. “Owning something for one week seemed to me more powerful than just putting your name on something repetitively over the course of a year,” he said. “It seemed to me that if we could own a town, own an event, and put that energy into that, that would be the best way to do it. I didn’t want to be just another week. I didn’t want to just take over somebody else’s event. I wanted it to be ‘the Deutsche Bank’ because that’s what we’re about and it’s about branding yourself. I wanted it to be ‘the Deutsche Bank of Boston.’ I wanted to brand it around Boston, but I didn’t want it to be Boston.”

Waugh said that golf’s hospitality opportunities, including playing with Tiger Woods, can make for “a really cool day.” 
Photo by: AP IMAGES

The event quickly became unique with its rare Monday finish on Labor Day and connection with the Tiger Woods Foundation, which resulted in Woods appearing for the first five years. It also was very successful for the brand in Waugh’s eyes.

“The sponsorship worked out better than I ever imagined. I thought it would be good, but I didn’t realize how good,” he said. When I asked what a CEO looks for besides business results in a deal, he pointed to company pride. “It really had an enormous effect on our brand in the U.S. and our culture in the U.S.,” he said proudly. “Our people took a lot of pride in it. It worked internally because people saw we’re investing in the U.S. We have pride in the event, and we could see our brand on television. You feel great about the charitable element. You feel great about the economic engine part. You feel great about the client entertainment, especially as it’s becoming increasingly hard to spend time with people. You’re spending countless hours by the time you have dinner, play, have a beer afterwards, and you’re putting them with Tiger Woods, Adam Scott or Rory McIlroy. That’s a really cool day, and that client is going to bring their kid to caddie and their wife to walk along and they’re going to have a great day in Boston and they’re going to feel really good about us. It had a bigger and wider impact than I ever imagined.”

I asked what advice he’d give to a CEO interested in this type of investment, and his answer was simple: involvement. “I felt I had to be really involved,” he said. “The only way I thought I could make sure we got a return on it was if I personally owned it. I spent a lot of time, especially the first few years, figuring out how it worked. I’d talk to players, to caddies, to wives, to volunteers. ‘How’s it going? How are we feeling? What can we do better?’ Caddies just wanted good food and parking. Back to the happy thing: I wanted anybody who came through that gate to say, ‘These guys are good guys and this is really a happy place and I want to come back here.’”

With his love of schools, learning and teaching, I close by asking his advice to young people.

He paused for a long time, gazing out toward the ocean, and spoke cautiously in saying, “What I’ve seen a lot of, particularly around New York, is dominated by Wall Street. Everybody’s parent was in the business, and every kid figures that is what they need to do. Maybe it is, but maybe it isn’t. Why not think about what else is out there and where else you could do it rather than just get on a train and go to New York and go to Wall Street. Because that’s what you think you’re supposed to do? Back to being happy and having fun — and that may not be fun. If you’re getting a 6:15 a.m. train every day and getting home at 8 at night and you don’t like what you’re doing, that’s not good. You should feel good and be good at what you do. Maybe rather than be happy, it’s to feel good about it. Everybody has got to work hard and do what they need to do, but if you’re somebody full of promise and trying to figure out what to do, then you should explore a bit.”

“I’m a big believer in liberal arts — learning about the ‘why’ early in life.”

“I’ve always been better when I went an inch deep and a mile wide,” he said. “When I have 50 things going on, I’m really efficient. Meeting after meeting after meeting, and dinner and then travel tomorrow? I’m good. You give me an empty room and no agenda, I don’t know what I’m doing. I tell kids there are two ways to do well in life. One is to go an inch wide and a mile deep and become an expert in something, and the other one is to be able to connect dots and go wide. There are times in your career where you need to go deep, you need to become an expert and get really good at it. The unique people are the ones that can connect those dots. The real game-changers are people that are taking those verticals and connecting them horizontally.

“I’m a big believer in liberal arts — learning about the ‘why’ early in life. Eventually, you’re going to have to get really narrow, but you can’t forget the ‘why.’ We get kids in high school doing internships on Wall Street. I get it: That’s a filter to get you to where you want to get to. But go mow lawns, go to Europe, experience life — because eventually if all you know is one thing, you’re not going to ever be able to connect the dots across things that are unique and see what’s wrong and what’s right. That ‘why’ part is really important.

“In your career, you’re going to get narrow, then get wide. The only way to be good at the wide is to understand the narrows. You need to have the ability to go deep, because that gives you credibility and gives you knowledge, but you don’t want to get stuck deep. Certain people just like to go deep and stay deep, and that’s fine. We all need those, but I think the unique ones are the ones that go wide.”

It’s been more than two hours, and I’ve invaded Waugh’s personal time long enough. Deacon and Gus are up and running around the house, and Waugh has a full day ahead. He offers me a water for the road, walks me out to my car, and I ask him what’s next on his schedule.

“The beauty of Wall Street for me was that every day, there were younger, smarter people than me that made me better,” he said. “I loved that part of it. I try to spend a fair amount of time in Silicon Valley now just because there is this passion and energy in what is going on out there that makes you better.” His daily schedule now is still filled, but less intense.

“I’m addicted to activity and being involved in things,” he laughs. “I’m not very good at ‘no’ and so when people ask me, I tend to want to help. I’m not good at doing things halfway, so I get fairly involved. If I’m on a board, I want to really be on the board. If somebody asks me to help their kid get a job, then I really try to help get their kid a job. As a result, I tend to get overextended. Somebody once asked me, ‘Why do you do this?’ and this is going to sound so self-serving and romantic, but I like making people’s lives better. That’s what gives me a charge. That’s my perspective running a business or being a friend. It just makes me feel good.”

With that, Waugh offers a smile and an easy shake of the hand, heading back toward the beach on the way to reinventing himself.

Abraham D. Madkour can be reached at