Sallie Krawcheck knows a thing or two about risk.
Sure, she’s been successful. Krawchek’s one of the rare women who has scaled the granite peaks of Wall Street with aplomb. Over the past two decades she’s worked her way up from being a research analyst to the chief executive of Sanford Bernstein, then went on to become CEO of Smith Barney, CFO of Citigroup, and president of Bank of America’s wealth management. Last year she installed herself at the helm of 85 Broads, a global women’s networking organization, after buying it from founder Janet Hanson.
“At every stage of my career,” Krawcheck says, “I have taken significant risks.”
Krawcheck’s career path has been defined by taking big risks. “It started when I was a research analyst, I was writing negative things about companies, back when no one wrote negative things,” she explains. “If I was wrong, I would be fired.” A few years later she was asked to become director of research. The only hitch was that skills she’d acquired being an analyst had no relation to the job as director. She made the leap anyway. After all, not being fully ready for a new opportunity is a positive.
Though prevailing wisdom suggests its better to take bigger risks when you’re young and have less to lose, Krawcheck maintains the gambles she took got bigger when the career stakes were higher.
“The biggest risk in magnitude I took was during the sub-prime mortgage crisis at SmithBarney where we accidentally–not evilly–mis-sold our products to our clients,” she admits. At the time, Krawcheck recommended returning the money. “My bosses disagreed and I didn’t give up,” she says bluntly. What happened next has been the subject of much spilled ink. Krawcheck’s push for fair compensation didn’t gel with CEO Vikram Pandit’s vision. Krawcheck argues, “It paid off because the clients benefited, but I lost my job.”
Without missing a beat, Krawcheck adds, “All this mythology grows up on how risk payed off big time. Some didn’t pay off for me immediately.”
Her fearless attitude was born out of a time very early on when she was afraid she might lose it all. Ironically, it started out as fear itself. Krawcheck recalls the first few months in her very first job out of college. “ I remember worrying that at the age of 23 I was going to have to file personal bankruptcy because if I lost my job my parents couldn’t afford to pay for the lease on my New York apartment.”
That nightmare never did see the light of day, which leads Krawcheck to muse that there is a hierarchy of motivation, similar to Maslow’s hierarchy of needs. “Only when you have some degree of comfort that you have that safety, you can be motivated by different things like looking for excellence, intellectual engagement, changing the world, or doing great things for clients.”
That said, Krawcheck quips that insecurity has always been a driver for her. In fact, she remembers that at Bernstein they actually hired for insecurity–albeit not the crippling kind. “
No one builds their career alone, and Krawcheck says she’s had several people who helped boost her up the corporate ladder. She recalls how helpful it was to get spontaneous feedback when presenting her findings at Bernstein in her day-to-day work. At other times, sponsors would recommend her for projects and promotions. “A mentor is someone who answers questions,” Krawcheck explains. Many a corporate program provides this kind of interaction she says, “It’s helpful, but stilted.” The more valuable alliance is with a sponsor, she contends. “Someone who is vested in you.”
Given her deep roots in the male-dominated financial industry, it’s not surprising Krawcheck never had a woman sponsor her along the way. Krawcheck says that having so few women at the table in the banking industry didn’t make for a whole lot of BFF love. “Research shows people are less likely to want work for a woman,” she says, “It’s not fair, or right, it’s not about people being mean. It’s recognizing the universal truth.” That’s partly why Krawcheck often asks other women, “What have you done to help another woman?”
“Everyone isn’t going to like you,” Krawcheck maintains. “Sometimes those who are skeptical can become your greatest advocates and fans if you win them over.” Others simply won’t let you win anything.
Krawcheck recalls a senior analyst at Bernstein who would make a great showing of putting his head in his hands and sigh loudly, each time she went to speak. When she went to his office to ask for advice on how she could do better, Krawcheck says, “He told me to eff off.” She laughs. “I had to let that go. For something like that you have to have a sense of humor.” Success is the best revenge, though. Krawcheck eventually became the No. 1 ranked research analyst, without his support.
Bottom Line: Krawcheck’s come a long way from worrying about losing her apartment, but admits uncertainty is always just behind the door. “I thought I’d be married until I was 100,” she says ruefully, “Then he chose a different path. It happens.” On the career side, Krawcheck cautions, “The greatest risk in this business environment is complacency. Those who stop growing won’t have jobs at some point.”