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‘What It Takes’ Blackstone founder’s journey to success

Jo Ramos

In “What It Takes: Lessons in the Pursuit of Excellence,” A New York Times bestseller, Chairman, CEO and co-founder of Blackstone Inc. Stephen Schwarzman details his unwavering ambition in his journey of achieving excellence.

It begins from his humble upbringing in the middle-class suburbs of Philadelphia, folding handkerchiefs in his father’s drapery and linen business; leading up to co-founding the world’s largest asset manager, spearheading international diplomatic and economic conversations, creating prestigious scholarships and pledging hundreds of millions of dollars to charities.

By highlighting key episodes of his life and extracting crucial life lessons, Schwarzman created a list of “25 rules for work and life,” which according to Schwarzman, anyone looking to master their craft should study.

Of the 25 lessons, three serve as the most profound, insightful and applicable to one’s life.

The first: “No one person, however smart, can solve every problem,” Schwarzman wrote.

“But an army of smart people talking openly with one another will.”

During his second year at Harvard Business School, Schwarzman sought to meet with the dean, Lawrence Fouraker, to discuss defects in teaching, students, administration and curriculum.

Fouraker failed to take his advice seriously, leaving Schwarzman to swear that if he ever owned an organization, he would make it as easy as possible for people to see him and tell the truth.

Blackstone exemplifies this within its zero-defect culture, where everyone is encouraged to speak up, ask for help and make decisions collectively.

The second lesson was on the importance of finishing work quickly and efficiently, which saved Blackstone and Schwarzman several times throughout his career.

“Time wounds all deals, sometimes even fatally,” he wrote.

“Often the longer you wait, the more surprises await you. In tough negotiations especially, keep everyone at the table long enough to reach an agreement.”

Blackstone’s first buyout fund amounted to $800 million with 33 investors, each with a team of lawyers.

September 1987 saw stock markets hitting record highs. Schwarzman worried Blackstone would plummet, resulting in his hard push to finalize the legal details of the deal by Oct. 15, 1987 — only four days after closing the fund, the Dow Jones Industrial Average plummeted 508 points.

If they had closed the deal any later, their efforts would have gone to waste.

This speaks to how delaying gratification and persevering through adversity can increase the chance of yielding higher results.

“Failure is the best teacher in an organization,” Schwarzman also professed, the third substantial lesson.

“Talk about failures openly and objectively. Analyze what went wrong. You will learn new rules for decision-making and organizational behavior. If evaluated well, failures have the potential to change the course of any organization and make it more successful in the future.”

Failure fueled Schwarzman’s desire to succeed.

His first failure was a miscalculation in his financial reports for a presentation on a food processing company’s chain of convenience stores with Lehman Brothers, resulting in a failed presentation. He would then analyze every step of the process, ensuring all the details were right.

Later in his career with Blackstone, Schwarzman was the decision maker in a failed investment with a steel distribution company called Edgcomb.

A young banker with insider information on the company pitched it to Schwarzman, who relied on it instead of listening to those who foresaw the disaster.

Schwarzman was embarrassed by his failure, stating he fell into the trap of listening to the greatest man or woman sitting at the end of the table instead of listening to the whole table.

Furthermore, he would reorganize Blackstone’s decision-making strategy into a lengthy three-round procedure to encourage a “greater sense of collective responsibility.”

Schwarzman detailed how he encountered adversity with ambition and courage, seeking to achieve something greater than himself, and encouraged everyone to “reach for a fantasy worthy of your pursuit, with rewards commensurate to your effort.”

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