Leaders & Friends Episode 8: Joe Hogan

Thanks, Jeff. Thanks for having me. Appreciate it.

Yeah, Jeff, I think ambition is a good term. I was very ambitious as a young person. I loved business. Like you, I played sports, so you expect to be able to contribute as much as you possibly can and to improve. As I joined GE, more than anything I wanted to excel as an individual contributor and figured that out. Sales was really good for me because I went from metal sales to plastic sales. Then you start thinking about leadership at some point, how do you develop leadership skills. And you can never forget about your family. We're both raising young families, so how do you balance all those things and make them work? It was a kind of frenetic time in life overall, but I look back at it, it was exhilarating. When I came into Plastics, we had such a wonderful cultural environment there that fit my personality very well.

That's a good question, Jeff. I would say after I got out of sales in about 18 months, they took me to headquarters and I was just trying to assimilate Plastics and all the personalities back then with Uba and Jeanine and the whole gang. You wonder how you fit in. Then with the product I had, which was polycarbonate or polybutylene terephthalate at the time, and we were moving into polyetherimide, I kind of understood this business. I understood the end uses, the properties of the materials. It wasn't just selling something; it was assimilating it and figuring out within the culture. And I loved that we played offense, Jeff. This wasn't so much about operations, but how could you really drive demand and make it work? It just felt like I could fit in this culture and make a contribution.

Jeff, it's a really good question. Fortunately, with GE I had a lot of international experience. We traveled all over the world. Growing up in Cincinnati and Pittsburgh, we didn't know what an American was until some European pointed to us and explained what an American was supposed to be. Living in Belgium and Holland in the early 90s and then moving into London, I thought I had a pretty good assimilation of international business. But when I moved into ABB, what was really interesting is that it is truly a European company. GE was an American company projected internationally, so our culture was infused throughout the world. But with ABB, being a Swiss company, your only survival of being large is outside of Switzerland, but they didn't necessarily project their Swiss culture. Their German business was German, their Chinese business was Chinese, the US business was more US-based. So I had to figure out the whole culture of ABB and how to appeal to it. There were a lot of things, specifically the operational piece: Europeans are very conservative, they don't take risks like you and I used to. I was trying to get them to update their risk profile. They were great marketers, good managers of what they had in optimizing that, so I needed to bring in some leaders that were different. Also, ABB is still the largest industrial company in Switzerland, so there were political aspects of working with big Swiss banks, dealing with politicians and labor. I had to be more attuned to that. My board was great, with so many different cultures. I had a great chairman, Bischofberger, who walked me through a lot of that. I think I just had to bring my game up a level. I have a lot more sensitivity from a cultural standpoint; I was dealing with a different culture and had to acclimatize.

Yeah, Jeff, that's a really good question. There were two Wallenbergs: Jacob Wallenberg and Michael Treschow, who used to be CEO of Unilever and ran a couple of industrial companies. They were a great tag team because Jacob brought years of investment experience, a breadth of understanding of other businesses he was on and invested in. Michael Treschow was the ultimate operator; he knew detail, understood exactly how the business was moving. What I learned from both of them was that Jacob could give us good comparisons about what was going on around the world, where investors were making sense. Treschow could really help operationally in what he thought made sense in certain areas in specific companies around the world. They played the long game. I started that job in September of 2008, right after the great financial issues. I came back to these guys and said, 'We've got to take a billion dollars of cost out of the business. Here's what we're going to do.' What really surprised me is they said, 'You're not touching R&D. Not going to touch R&D, Joe.' I hadn't planned on doing it, but it was great that they said that because they wanted to play that longer-term game. In European business, you're not going to hear that from an activist.