Reinventing the Leader with Walmart Regional CEO Gui Loureiro and Leadership Coach Carlos Marin

0:00You are listening to and watching Builders, where I interview CEOs, authors, authors, authors, and leaders about building businesses and careers. And today I have the co-authors of a new book, Reinventing the Leader. My guests are Guy Larrero. He is the CEO for Walmart Mexico, Canada, Chile, and Central America. And Carlos Marin, who is an executive leadership coach who works closely with Guy and many other executives. If you want change in your organization, I highly recommend this episode. And if you're interested in the book, we have a link to buy it in the show notes.

0:37Guy, Carlos, great to see you. Thanks for being on the program. Thank you for having us. Thank you, John. Thanks for having us. Pleasure to be here. Yeah, you've got it. I'm really happy to talk about your book, Hot Off the Presses. Guy, I want to ask you about something you talked about at the beginning of the book. Take us back a few years, I think a few years before COVID. You're CEO of a massive division of Walmart. It's called Walmex. And if you look at the numbers, the financials, you're riding high. But you decide you need an executive coach and you call Carlos and say what? Well, I called Carlos.

1:14It started by asking Carlos. We knew each other very well. We did some transformations before and we trusted each other. So I called Carlos and said, Carlos, I want to start a transformation of this business. I'm not very clear about exactly what I do, but we see other parts of the world that the digital transformation has already happened. It's a little bit late in Mexico. It's going to come. But the business is doing very well, and I'm not sure the whole team is going to be, especially the top team, is going to be willing to go through this transformation while we are doing very, very well. It can be seen as a distraction.

1:54And then I explained it to Carlos what I knew at that time. he said can you help me to convince the team that we should do it and can you help me to work to get it done and Carlos listened to me very carefully as he always do and he just asked me one question said fine but before we start I can help but before we start can I ask one question who's going to be the CEO of this new company and I thought okay you're kidding I am the CEO I am the CEO and I will continue to be the CEO he said yeah but we're not ready for it You're not prepared. And then he started to explain, you're command and control.

2:29You don't listen when you think you have the answer. And the company that you want to prepare to succeed in the digital era is the contrary of what you are normally used to. The same way you want to transform the company, you need to transform, not sure you can do it. And then I said, yeah, I want. When he got the view that I really wanted, he said, okay, so if you really want it, you can. and then he started to help me before he helped the company. And the funny thing about this is that we always think others have to change. You never think about yourself having to change. That's what Carlos opened my eyes to.

3:06That's really interesting. It's almost like you have created the company that you know how to run, not necessarily the company that you want to run or the division that you want to run. That's really interesting. Carlos, you take the call and you knew Guy for a while, but in general, what's your process for understanding how to help and how to coach? Your clients are probably all high-performing leaders, but have different backgrounds or from different industries. You might not understand retail the way that Guy understands retail. What's your process for starting an engagement? Usually it's to look at the people that report to the leader and try to get an assessment of how they are perceiving him based on his actions, his leadership style, the behaviors that he exhibits as a leader.

4:03And so the process is usually trying to gather that information first and then come back to him with a mirror about how he's being viewed by other people, basically. And since I knew Guy, I knew that he was now in a different corporate culture, very differently than what he had before. And sometimes, even though you can be very successful in one organization because you are kind of aligned with the culture, your style is perceived as something useful and helpful. and you go into another more structural, more traditional, more command and control, as he mentioned, culture, then some of your tendencies to be yourself can be malinterpreted or interpreted in ways that are not very helpful.

4:58And so the process is about helping him align his own way of behaving with the behavior of with the expectations of the company and then begin to see how you go about changing that slowly. Did you know that Builders is sponsored by Business.com? I'd love to tell you about a new free membership from Business.com for small business decision makers. It's called business.com plus, and it's designed to address the pain in selecting new products and services. What is the pain you might ask? It's things like knowing which vendor is best for your specific business, negotiating pricing, having access to someone who can answer questions for you.

5:41The new membership business.com plus handles all of that with a dedicated advisor, pre-negotiated pricing and solutions tested and reviewed by experts. Check it out at business.com slash plus. That's business.com slash P-L-U-S. You know, it's interesting when I and maybe others think about something like a digital transformation or transformation of some kind, I think maybe you might think we need new technology. We need new process. We need to find inefficient uses of capital, replace those, invest in other places. But that's not necessarily where you are starting. You're starting with understanding behaviors, motivations, why the company is what it is.

6:27Guy, maybe you could talk through, because that's not necessarily the first thing that I would think of. Maybe if you could talk through, Guy, something that you had to, maybe a surprise you got in 360 Feedback or something that you really had to look at closely about yourself to inspire future change. First of all, I think that one of the biggest ahas we had in our transformation was helped by the fact that the whole digital transformation was late in Mexico as a country, was that we would benefit a lot by changing the way of working, by changing the way we behaved before we even invested in even more technology.

7:07So we had the time to prepare the company for it. Normally, when those things happen, you start to put a lot of money on technology and digitalization and everything. And then you see what happens to people and you start to accommodate this. But we had the chance to move people towards that new way of working before we did that. and I think that one of the things I learned was when I knew the answer or I thought I knew the answer I was not listening even if I let time for people to talk people would talk but I was just inviting them to talk just to be able to put my position to impose my position at the end that was not compatible with the way we were trying to implement the company of empowering people of giving more freedom for people to work on it.

8:07So interdisciplinary teams, we think being empowered to deliver the goals. And if the boss thinks he needs the answer and he or she wants to deliver the answer, it doesn't matter what other people say, then you're not ready to leave that company. Very interesting. And I want to kind of apply these lessons to maybe something facing every company today. And that's tools, generative AI tools that can help marketers, that can help content teams, that can help pretty much any function within an organization. And your book discusses the drivers and challenges of change. But Carlos, how would you approach or think about helping a leader who's saying to themselves, I know or I believe I can be 20, 30, 80 % more efficient, but I have to sort of convince my organization of that, or I have to go on a journey to try to figure that out.

9:06Well, it was interesting because in the case of Guy, Guy initially assumed that he wanted me to help him with the team. They were the ones who needed to do some changing. And so Guy's initial contact was based on our previous experience of getting the team aligned with that. And again, remember that this is a very successful company. It's a company that is doing very well. And so the question was, why do we need to change? And so with the kind of transformation that he started to envision, it required that the team had to be in a place where they could begin to understand what they needed to do.

9:52And of course, not all of them were ready to make that change. Some of them, as we talk about in the three questions, you know, do you understand what this is about? You know, do you have the skills? You know, do you want to do it kind of thing? But so I started also interviewing the team, as I mentioned, and found them to be very willing, very professional, very willing to actually go through the process. And so we had an event eventually where everybody comes together. And the bottom line of this is the old traditional need to communicate better. So there is a lot of assumptions that people make about who the leader is.

10:37They don't know Guy yet, so they're making assumptions that are not really tested. Guy is also making assumptions probably about what's going on. And so the idea is to put everybody in a place where they can begin to talk, not about the business itself, but about who they are and what it is that they need to do and get them to, you know, get what we call a psychologically safe place for people to begin to drop the facades and drop their, you know, the way they want to be perceived by others. and just be themselves kind of thing. And so that process is very revealing even to them. So sometimes people have worked together for years, but they really didn't know each other until they went on a trip together with their families or something.

11:32And so this is basically something like that. It's creating a space where they can begin to be more themselves and understand themselves as people, not just based on the roles they play. you know so because if you're the financial guy or if you're the sales guy you know you that's the that's the that's your persona that's who you bring to the table and in the you that is within you it stays pretty much covered most of the time i was going to ask you about those three questions and um and i'm really interested gi in the in the second question do you do you have the skills because that seems to be something in a transformational context that could potentially feel very threatening.

12:18If you're transforming, it's almost implying you're asking someone to do something that they haven't been doing for the last few years. Maybe you could talk about that, how maybe you apply that question in one of your contexts, how someone can think about it. The idea came in a meeting we had with a consulting company that was helping us. and we were in a decisive moment of how we go, not go for that route of the transformation and they said everybody, the company and every person has to answer the three questions. And the first one is, do you understand it? And to my surprise, many times I realized people didn't.

13:03and instead of blaming people for understanding I had to blame myself for not being able to explain part of the reason of not being able to explain my thinking and others other people think were evolving and I remember talking to one member of my team you keep changing your views I'm evolving, this is a new subject, I'm learning and only stupid people don't change their minds So, but it makes difficult for people to follow you. So we have to reinforce communication and I had to learn. So I had Annette Grant, a storyteller, to help me to tell the story better. And also we trained other people in the company, not only the leaders, but people that we knew, there were voices heard in the company to tell the story.

13:57So understanding it is crucial. If you don't know where you go, you can take any bus. So people have to understand. And the second question is that do you like it? Do you want to be part of it? Because some people didn't want to. Some people, they wanted to continue to work the old way, and they would find thousands of companies where they could work the old way. but they can only answer that question if they understood it first once you understand you can make the choice do I want to change do I want the company to change or do I want to go to another place or some people decide I'm going to stand and fight against it but normally they don't tell the CEO they're going to fight against it and once you understand and you want to be part of it you have to answer that or the most difficult one but that's about you can you?

14:56and that is the question that when I discussed with Carlos he revealed to me that I was not ready for it so it's so frustrating when somebody tells you yeah but you can't you don't have the skills, you don't have the ability to do it and basically this is what Carlos told me and I thought that because I identified the need to change and because I designed the change And of course, with the help of many people, we never say I in Walmart. We always say we. Our founder told us, we never do anything alone. Because we identified the need to change, but automatically I was the person to lead the company.

15:38And what Carlos showed me, no, no, no. You need to first change yourself. So you get skilled to lead that company that you guys are trying to create. It's tough. and some people I remember one person left the company a person close to me he left the company the day he left he was very emotional and he came to me and said I'm very sorry to let you down I couldn't make it I wasn't able to lead in the new company and I said I have a different view I think you didn't want it I think I cannot tell you whether you can or not because you stopped in question number two And funnily enough, the guy was very happy because he felt it was better not to want it than not being able to.

16:27So it's crazy, psychology of everybody. But the three questions are very powerful. No doubt. Carlos, I want to ask you a question about pace of change. Because, you know, in many successful organizations, leaders want to move fast. I assume, Guy, when you're talking about transformation, you know it's going to take a while, but you want to start now. And that can be true with anything. But as I'm hearing some of the steps that you need to take, it can't be done overnight. Carlos, how do you guide one of your clients, whether it's Guy or someone else, about how to think of the pace of the change that you're trying to make?

17:15I am usually not the one guiding. In this case, it's Yi. But I think that once people begin to open up and begin to feel comfortable expressing their discomforts, whether they're understanding of what's going on, whether they're showing the willingness to make the change in themselves, and these conversations begin to take place, That in many ways sets the pace pretty much because I've seen companies where they wanted to make things really fast, but they actually backfire because the people were not ready. So when you say in that question, do you have the skill? Well, sometimes it's not the skill as much as the will.

18:06you know and so most people that i've worked with are incredibly smart you know like these you know very very technically in uh very at a very high level otherwise they wouldn't be in the position they're in the the issue is not sometimes the skill as much as the will because the will you know you you can you can uh will somebody into skill in some ways you have to have some skill first in order to get them to feel that motivation. The other thing is about when we talk about understanding is do they see a purpose in them getting engaged in this process, in this venture, in this journey with GEE?

18:53Do they see a purpose in that, personally speaking? And most of them are very committed individuals who made the company become what they were, The high level professionals, high integrity, you name it. It's all there. But the question to go to the next level and to do something that is a little bit dangerous from the personal point of view, stepping into something I don't really know very well, can I be a beginner again? We talk in the book about the concept of being a beginner. And once you are an expert at something, it's really difficult to see yourself as a beginner in something else. You know, your ego is already formed.

19:37Guy, everybody knows Walmart's a large company, but maybe could you give the audience a sense for how large your organization was at that time? Because it's not just necessarily your direct reports that need to be on board. it's a lot of folks. Maybe could you give people a sense of the size and then as you're sort of like cascading down, that might not be the right way to say it, but as you're like trying to cascade these themes down the organization, how do you think about that? When we finish the, I know better the numbers, the closer numbers. So when we finish the transform, finish, you never finish it, but when I finish my term at the CEO of the company end of 23, beginning of 24, the company was a$55 billion company operating in six countries, 240 ,000 associates more than 3 ,000 stores and building 200 new stores per year 6 million customers buying from us every day and during this period between 2015 and 23 we doubled the size of the company so the company was already very big when we started It is the biggest company in the stock exchange in Mexico.

20:53It's the biggest unit of Walmart outside the U.S. It's quite a big company. I'd say it's a 24 by 7 operation, sometimes a little bit crazy, but great because we play a big role in the country. Applying our purpose of helping people save money and live better. One of the big themes of the book is about self-growth leading to business growth. We often ask this question to executives, but Carlos, maybe I'll turn it around and ask the question of you. As you think about your own career and your journey as a coach, what's something that you had to learn to get you in a position to be able to help Guy and others like him?

21:42It's a very good question. I think a lot is about believing yourself. You know, sometimes in my position, in my evolution, there were times where I kept feeling like, what am I doing in this place with these people? You know, do I really have something to do? But that was a very private, very deep down kind of conversation. And then you have to be very honest with yourself eventually and to see that bringing your true self, even if you have some concerns about whether you belong there or not. But it's a lot about feeling or developing your own sense of security and your own sense of, yes, I can do this.

22:32And primarily is to see the responses that you're able to bring in other people. You know, some people are very, very open to what you're bringing because you are bringing some things that oftentimes are not very comfortable. and you have to stand your ground in a way, you know. But one of the things perhaps that I've had to overcome is actually probably shyness, you know, shyness. And to be able to stand in front of a group of folks like Yi and highly accomplished people and being able to deliver what you think you want to do. But you make it not about you. You make it about I'm here to help.

23:24It's a helping relationship that I'm having. I don't necessarily need to be an expert in your field, in your business per se, although I need to understand it. But I think a lot of it is all about your ability to believe in yourself and the fact that your purpose is to be helpful and that you're really trying to be helpful to others. And that changes you psychologically in some ways. You're no longer the guy who's standing there being an expert, like some of my colleagues are, you know, very, very comfortable being that way. I am more into my job here is to be helpful and to come up with a way to pose questions to you, to ask you to reflect and to be courageously self-appraise yourself in some ways in a very courageous way.

24:21But my job is to be your partner, your helpful, your helper in this case. So it's about a helping relationship, which is a lot about empathy and a lot about understanding that process. And at the same time, there are times when you have to be pretty tough, too, and take a risk. It's refreshing in hearing that answer to a certain extent that everybody on some level has some imposter syndrome. Absolutely. And also, you know, you were talking about being shy as a way to describe yourself. It makes me think of a question I want to ask Guy. I consider myself more of an introvert, meaning that the way that I recharge is sort of by being by myself.

25:09And it can be said as sort of lonely at the top. And when you, during any of this transformation, encouraged, had a challenge, or maybe you said, I don't know how I can break through this point. What was your process for resetting or recharging? Yeah, so nobody believes me, but I was introvert as well. but during my career I decided that this was not going to help me. So I probably went to the other side. In our business, we have one big benefit. If you want to energize yourself, go to a store and talk to our associates. If you go to a store and you talk to an associate, your perspective about a difficult day change.

25:53and you see the way they are motivated, the way they do things. It's so energizing. So we can go to school. I energize myself by talking to people. And that helped with the transformation because when you're trying to change something, there will always be people that are against it. But most of them, if the CEO is very determined to change, most of them will not come to your office to say I'm against it but they'll fight against it so ideally you should identify people that are against it that drag your energy and you should kindly ask them to leave but the problem is you don't identify them until it's too late so the second best option is to identify the ones that are in favor and give credit to them so that's the way we did so in our company when we want to recognize people, we give a pin.

26:54And people love pins. I love pins. We all collect pins. And we created one pin that says, there is a hierarchy of pins. So if you give a pin with our founder, man, this is the top pin. And I created a pin that's called I am digital in Spanish. Yo soy digital. And that pin I said, only I can have it. Only I can distribute it. so I used to walk around and see people that were working agile that were working with the new methodology and I would give them but slowly I would give to some people the pin and others wanted the pin because people were like showing their pin and it was a very scarcity helps and people want the pin and I remember that talking to those people were motivating me, talking to people that were I and going a little bit off the question there was one time that one of the first products that we launched that was going to help buyers to buy better for events like Mother's Day it's very difficult you need to buy a large quantity you need to distribute and then if you don't sell by the day X you have to liquidate the whole thing and we created a tool that was very good and half of the team was not using it so I called it between five buyers that were using it five buyers that were not using it.

28:18And they talked about the tool. Because I walk around and I knew about the tool when I argued. And the five people that were not using it were quiet, of course. How can they talk about something they don't know about? Because they decided not to know. And the other guys were very enthusiastic about it. So at the end of the meeting, I gave a pin to each of the five buyers that were using it, and I gave a certificate. Like, you are digital. Welcome to the transformation. and I look at the other five buyers and the only thing you want when you go to a meeting with the CEO is you want the CEO to get to know you at the end of the meeting so I look at the other five and said I hope next time we see each other I can give you a pin wow so those things motivated the team, I didn't say anything bad to them I didn't call their attention, I was not rude I just said to them look, here's the pin so we created the motivation things that others want to get to them.

29:19By doing those small things, we ended up motivating the whole company. I was motivated by that, by people joining the transformation that I helped to design. I'm going to have to get one of those pins. No, you didn't deserve it. You were a coach, but you're not digital.

29:41I love that. Well, to the audience, if you want to hear more stories like this and more advice and lessons from Carlos and Guy, get the book. It's called Reinventing the Leader. We'll put it in the show notes so folks can go to wherever they like to buy the book. And thanks a ton for being on the program today. Thank you for having us. We appreciate it. Our pleasure. Thank you. That's business.com slash connect.