AIPIS 170 - Unequaled: Tips for Building a Successful Career Through Emotional Intelligence with Morgan Stanley's James Runde

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Welcome to the show. This is Jason Hartman, your host and every 10th episode we do something kind of special, kind of different. We what we do is we go off topic. So regardless of which show it is on the Hartman Media Network, whether it be one of the financial shows, economics, real estate, investing, travel, longevity, all of the other topics that we have, every 10th episode we go off topic and we explore something of general interest, something of general life, success, value. And so many of our listeners around the world in 164 countries have absolutely loved our 10th episode shows. So that's what we're gonna do today and let's go ahead and get to our guest with a special 10th episode show. And of course, on the next episode we'll be back to our regular programming. Here we go. It's my pleasure to welcome James Rundy to the show. He is America's longest serving investment banker at a single institution. That would be Morgan Stanley where he is Vice Chairman of Investment banking and he is the author of Tips for Building a Successful Care Through Emotional Intelligence. Jim, welcome. How are you?

I'm just great. Jason, I'm excited to be on your program.

Yeah, it's good to have you. And I assume you're coming to us from the Big Apple, New York City, right? Yes, Just an assumption, but I was right about that. You have certainly seen it all on Wall street and you're a very low key guy. You've been at Morgan Stanley for 42 years, is that correct?

Yes, that's right.

You've seen the changes over the years. And one of the things I've talked about on prior shows is how Wall street has changed in different decades. It seems a lot really, really changed quite dramatically in the 80s. Just to give us a context of your, your overall career, can you talk about that a little bit before we dive into emotional intelligence?

Yeah, I'd be happy to, Jason. So I started on Wall street in 1974 and at that time we had one computer and you did the data entry with punch cards. So you can imagine that Come a long way. Technically, Richard Nixon was still present in the United States. So there have been some changes politically. And then as the 80s went along, we had financial deregulation. Then in the 90s we saw the end of Glass Steagall. Then in 99. 00 we had the dot com bubble. Then in 08 and 09 we had the subprime crash. And now we've got a lot more regulation, a lot more technology, and we've had a lot of consolidation because the small firms merged into bigger firms so they could compete on a global basis.

Amazing. Yeah, just the amazing changes. I mean, entering data with punch cards versus where we are today with high frequency trading. Wow. It's an amazing, amazing difference. So would you have any insights that you can share with our listeners on just your thoughts? And I know you, you have very humbly said, you know, there are many great books written on all this stuff and many experts who are, you know, study just these specific areas of Wall street and, and the market in general. But what was the big change on Wall Street? I mean, was it really Glass Steagall? Did everything sort of go to hell in a handbasket with Glass Steagall, the change there, you know, or was it in the 80s or what? What happened? You know, just for a sort of.

Very generic general overview, the business became much more competitive in the 80s, I think. Clients started to shop around much more so that relationships weren't as permanent or tethered they were prior to that. Then I think, as I said a minute ago, we had the.com and the tech explosion in the late 90s. And so a lot of firms got very involved in selling what we used to call concept stocks. In other words, they were a company with a concept, but they hadn't made any money yet and didn't even have any sales. And so that was a completely different form of investment. And as you remember, Nasdaq went to 5,000 and then it crashed to 1,000. So there's certainly been a lot of changes in terms of the type of firms, the type of competition, the type of client relationships. But then I can't tell you the exact date, but the other thing that happened in the 90s and into the OOs was the mortgage bond business really took off and it became possible to in effect, finance your house through the bond market rather than going to the local savings bank. So that caused a big change, a big increase in how bonds houses were financed. It caused a big increase in the size of the mortgage bond market. And then because of low regulation or self regulation. There's a huge amount of leverage put into the equation. And so in 07 and 08 companies, Wall street firms had big balance sheets with a lot of leverage. Some people would say too much leverage. And there's plenty of blame to go around, but, you know, the rest is history in terms of 08 and 09 and what happened to Bear Stearns and what happened to Lehman Brothers. And you've read all the books?

Yeah, absolutely. You're an expert on emotional intelligence, otherwise known as EQ Emotional quotient. How does this play into what's going on on Wall Street?

Well, what I've learned, and the reason I wrote the book, is that I wanted people to get my perspective and learn from my mistakes in terms of the fact that EQ or emotional intelligence is secret sauce to career success. And what happened was that no matter what level you're at, whether you're processing business or you're bringing in business or you're leading a big practice, the common denominator in terms of promotion decisions is that people struggle on one of three things. Either their ability to adapt, their ability to collaborate, or their ability to empathize. So that's why, whether you're in banking, law, accounting or consulting, plus lots of other different kinds of jobs, you need to be conscious of how you're doing on adaptability, collaboration and empathy, because I found that it's the secret sauce to career success.

Very interesting. So it's not intelligence as we would normally think of it in terms of iq, but eq. What are some of the ways we can develop our eq?

That's a great point you just made. Because the cognitive skills, the IQ is easy to measure and you go to school for that. You can improve your intelligence or your knowledge by going to school. Your cognitive skills can be improved. And the other thing is that certainly from your parents and from other role models, you learn your work ethic. And so it's easy to, in a job interview to measure work ethic and cognitive skills. But the reason people need to work on their emotional intelligence is because I found it the differentiator in terms of promotions, as I said a minute ago. And for those who want to take their game up on emotional intelligence, I would recommend some action steps specifically, first of all, to prioritize it as compared to cognitive skills. Secondly, to ask for feedback from your mentors and your bosses in terms of how you're doing on adaptability, collaboration and empathy. Ask for chances to demonstrate all three of those. And there's some very good Books besides mine written on the topic. One of them is very famous book, how to Win Friends and Influence People by Dale Carnegie.

Yes, the good old famous. I mean, that's, that's a staple.

It's a staple and it's still as relevant today as ever. And another book that I found very helpful is called the Wisdom of Crowds by James Surowiecki.

Tell us about those and what they meant to this field.

Dale Carnegie's is a classic. Millions and millions of copies in all kinds of different languages. Because what people find is that they. Everybody knows about financial capital. But that book helps you understand the benefits and the techniques of building social capital. Social capital. You can describe it as reciprocity, or you can call it networking, or you can call it teamwork or getting along with a boss or getting along with clients and customers. That's what's covered in Dale Carnegie's book, James Surowiecki's book. For me, the punchline of that book is all of us are smarter than any one of us. So in other words, a person who's working on their own, a lone wolf, let's call that person, is going to lose every time in my experience, because a team will beat that individual every time. And so Surowiecki's book Wisdom of Crowds goes into great detail proving that point.

What do we need to know to do this? You know, this area, as I've looked at the books on it over the years, it just seems kind of amorphous and, well, I hate to say it, but fluffy, you know, like, you know, how can we really know that we, how can we improve and how can we measure our improvement? I guess, you know, I want to be really quantifiable about this. Or is it just not possible in the, in the area of emotional intelligence?

Well, I think the best litmus test is, is just do people, after you try to take up your game, do people react or interact with you differently than they did before because it's all social. The second thing I would say is that there are those who call emotional intelligence a soft skill. That's like saying software, you know, is hardware more important than software?

No, software is probably more.

Yeah, I think they're both important. Right. And I think of cognitive skills and work ethic as hard skills. And then of course, algorithms and differential calculus is a hard skill. Emotional intelligence is a soft skill. But hard skills and soft skills are both important. And the last thing I'd say is that there are lots of books on emotional intelligence written by psychologist or scientist. My book is much more applied. It's not theory. It's much more applied. It's much more practical, much more pragmatic.

That's great. So in some of these chapter heads, you talk about, you know, navigating one's career, and this really is much more than career. This is life. I mean, this is every area of life. Sure, but adaptability, adapting to adversity, collaboration, empathy. Do you want to expand on some of those?

I think the very first example of adaptability is when students leave school, Whether it's college or graduate school or business school, they need to make the adjustment that the model is completely different. In school. The teacher has the answer, and the teacher is there to help you in a career. The boss is looking to you for answers. The boss is looking to you for analysis. The boss is looking for you for insights or ideas. And you're supposed to help the boss get his job done. It's completely upside down. That's the first example of adaptability. I think the second form of adaptability is dealing with different bosses, dealing with different kinds of clients, different kinds of projects, different kinds of products. So those are two examples of adaptability right there. You mentioned adversity. You remember that Ben Franklin was a smart guy and he said there's nothing sure in life except death and taxes. Well, he forgot one. You know, it's sure that everybody's going to have adversity, whether it's professional or personal.

Yeah, good point.

Everybody hits speed bumps, and so how are you going to deal with adversity? And I think one of the most important ways to deal with adversity is having a good social network. So you can get emotional support from your social network.

Absolutely, absolutely. So quantifying that social network and building it very specifically and really, you know, doing that, that's sort of like a soft skill, Right?

Exactly. And I think that it's important to remember that people think that if someone's in their electronic Rolodex or their on their contact list of their smartphone, that means the person's in your network. What I've learned is if you haven't seen somebody or talked to somebody live in six months, they're simply not in your network. They may be in your electronic contact sheet, but it's very important to be systematic in terms of keeping your network alive.

Yeah, or they may be your friend on social media, but, you know, that's sort of meaningless unless you're really actually making real contact with them.

Right, exactly. Even if it's a cup of coffee.

Good stuff. Any Other areas of the book that you want to cover, like, you know, networking, risk, benefits, tips. You know, everybody would always say, well, networking is important, but few really dive into how to do it well, how to maintain a network.

Right? So in terms of how to do it well, I think first of all that everybody's heard of these networking events, networking, reception, and they take a whole stack of their business cards with them and hand them out. I do it the other way. I don't take any cards with me. I simply collect cards because I'm trying to collect people's email addresses. And I tell people I ran out of cards, but that gives me an excuse to send them an email, giving them my contact information, but following up on something interesting we talked about and hopefully getting a cup of coffee or some kind of personal connection so that I can expand the foundation of networking. Secondly, I think that people starting out in their careers make two mistakes. One, that they assume that networking is for senior big shots and they'll get to it someday, but they're too junior for it. Secondly, they know how to network. There are lots of good books about how to network, but my book covers why, why to network. What are the benefits, both professional and social? And the reason people don't network even though they know it's important and they know how to do it is because either that they're afraid of being rejected by people they reach out to, or that they'll be branded as political and somehow it's smarmy and therefore it's something they shouldn't do. But what I found is you've got to take the risk in order to get the rewards and benefits of networking. And they'll find that the benefits are long lasting and valuable and more than offset these fears and cost of being political or rejected.

You know, Jim, as an aside here, many people have of course criticized various characters on Wall street, calling them psychopaths. You know, just these massively indulgent people that make way too much money and live these crazy lifestyles. And so for you've managed to just stay away from that completely. It's surprising. You know, one of the things he told me before we started is that you drive a Ford.

And some would liken some of these characters on Wall street as, you know, psychopaths. Not in a clinical way necessarily, but they'd say they're just roll over people and step on people and do whatever it takes to get to the top. A lot of times those people seem to win in life. Is that an illusion or is it reality? An unfortunate reality.

My experience is that that's not a durable strategy because you've got to be nice to the people on your way up the ladder because you're going to meet the same ones on the way down.

Well, that's the old saying. Yeah.

And I think secondly, that because of the adversity thing, sooner or later you're going to need a social network. And then finally, I'd say that there are some people who are extravagant or ostentatious on Wall street. But I think the same could be said in the tech business. The same could be said in the media business. The same could be said in the.

Movie business, in every business. Sure.

So I think that there are plenty of characters, let's call them, in all walks of life. There are even a few in the.

Political world, more than a few. That is an illusion, then, in your opinion, about these overly aggressive people getting ahead, it's just not a durable strategy.

My experience is, as I said, it's not a durable strategy. There are aggressive people who temporarily get ahead, but it's not how I did it. And the people I respect who did really well weren't like that either. But that doesn't mean that there aren't. Aren't those kinds of people out there.

Yeah, absolutely. You know, in your 42 years at Morgan Stanley, and you've talked about that a little bit in this interview, you've seen so many changes in terms of emotional intelligence. Are there any things that we have to do a lot differently in adapting to the new world, to technology, to. Everybody is so busy and so overwhelmed. I mean, the, the information revolution has only. It's just overwhelmed all of us. I mean, I'm sure everybody listening would agree with that. In the old days, people actually had these sort of, well, seemingly at least contemplative lives where they could have a break and, you know, and actually think and be mindful about life, but not. Not much anymore. How does emotional intelligence have to adapt to all of that?

Well, that's a great question, Jason. So no question about it. Whether it's big data or artificial intelligence or virtual reality, there's no question that technology both has the plus side and a minus side in terms of overwhelming people with information. And so one of the things I talk about in the book is the importance of developing what I'll call a soft skill of turning information into insight. And I'll get to how to do that in a minute. But if you can take information and turn it into insight, it'll really help your boss if you can turn information into insight and give an insight to a client or an insight to a customer that's relevant and actionable by them. You've really differentiated yourself, you've really added a lot of value and you've really found a way to be extremely helpful and make a big contribution. So the steps I talk about in the book are first to take information, secondly, to put it in the context of the boss or the client or the customer. Third, to do some analysis in terms of the numbers and quantify, as you said a minute ago, quantify how that piece of information or that data relates to the client or the customer or the boss. Then finally apply some judgment in terms of or get some other people to help you with some judgment in terms of how important or what the likely impact of that analysis is. And by using those factors, you can turn information into insight and turn big data into a friend rather than a foe.

Very important skill and very important point that you make about not just having the information but having real insight and something usable. Are there any questions? I haven't asked you anything. You'd just like to share with our audience.

I just wanted to say that as I where I started is that in my book Unequal published by John C. Wiley, you can find it on Amazon and other places. Target has it now, Barnes and Noble has it, Apple has it on a download, Kindle has it on download that. I describe why emotional intelligence is the secret sauce to career success. And I want people to know that I made plenty of mistakes and I want people to learn from my mistakes and they don't have to repeat them.

Very good point, very good point. Well, you know you've got five star reviews on Amazon. Jim, thank you so much for joining us.

It's a pleasure. I was very excited to be on your program, Jason, by the way, did.

You have a website you wanted to share with the audience?

Well, the Amazon website has quite a bit of information. My Wikipedia page has quite a bit of information. But then there's also an author page. James Rundy.

Fantastic. James, thanks for joining us.

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