262 – Compassionate Leadership With Donato Tramuto

John Over the last two decades, I’ve been on an insatiable quest to learn everything I can about leadership, and what makes the best leaders so good after running companies small and large over the last 20 years. Today, I speak on stages all across the world to audiences who are interested in that same question. My name’s John Laurito. I’m your host, and I invite you to join me on this journey as we explore this very topic and what makes the best leader so good. Welcome to tomorrow’s leader! 

John All right, tomorrow’s leaders, I got a great guest for you today, Donato Tramuto. I love that name, did not Donato Tramuto, who is a tenured executive, a philanthropist, and an author. I love the conversation I had with him. He talked a lot about compassionate leadership. He wrote a book about the topic and one of the quotes he had. He said, You know, everybody talks about culture eats strategy for lunch. He said trust eats culture and strategy for lunch. I love that. I love good quotes. In any event, great conversation with him. I really think you’re going to like this podcast. Here we go. 

John All right. Welcome to tomorrow’s leader. Where we dove deep into all things leader-related and related to leading yourself and leading others. I’m John Laurito your host. I’ve got a fantastic guest today. Donato Tramuto. He is a long-time tenured executive, a philanthropist, and the author of the most recently released book just yesterday, called The Double Bottom Line How Compassionate Leaders Captivate Hearts and deliver results. Donato, welcome to the show. 

Donato Thank you, John, for having me. It’s a pleasure to be here. 

John Absolutely. And what great timing. You had the release of the book yesterday, so congratulations. I know what kind of effort that certainly takes, and I love the whole intent or mission of the book in your work, which is compassionate leadership. Let’s talk about that. You’ve got a lot of leaders, obviously, that are tuning in wanting to learn how to become better leaders. What a compassionate leader means different things to different people. What does that mean to you? 

Donato Well, it’s very interesting, not just to me. One of the things John that was really great about the book is that I didn’t want it to be about me. So we interviewed 40 global leaders, and the definition that we extracted from that cohort was a compassionate leadership is an empathy in action, not just empathy. It’s empathy and action doing something when you see the pain in another person, we see something wrong. You do something. 

John I like that. What is that? Where has society moved? I mean, have we moved? Are we getting better? Do you see that improving? Do you think things with everything that’s happened have gotten worse? What’s the trend in leadership? 

Donato Well, great question. That’s why I wrote the book. I still see too much of the old face of leadership in organizations today. You know, listen, I have been leading companies for 30 of the 42 two years that I’ve been in business. And there is still a top-down hierarchy. The boss has all the answers type of leadership. And I think what we uncovered in this book is that you’ve got five generations now in the workforce, but your Gen Zs and your millennials are now representing 50 to 60 percent of the entire employee population. Yet the average age of the CEO that we see in the companies is 59 years old, by the way, that’s the same age of our political elected leaders in Washington. 

Donato And so there is this old notion that the boss has all the answers and that simply doesn’t work anymore. Today’s workforce is too young, too diverse to disengaged, and too tired of not being heard and respected. And that’s why I thought this book really was very well time. By the way, I thought of the concept back in 2017, and interesting enough. That was five years ago. And yet things have really diminished significantly. Not only in business. The trust has been lost in religious institutions. The trust has been lost with respect to country leaders. And so whether or not we hit it correctly, I do think that people are yearning for a new leadership approach. 

John So what was it five years ago that you saw or was there an event that kind of triggered this aha moment for you? 

Donato Yes. And it was something that I had done myself and so In 2016, I became CEO of my first public company called Health Wage Health, which I had two Divisions. One was making a lot of money and one was losing another money. And as a public company CEO, I was getting pressure to make a decision on the top-performing division. And I said You know what? I’m going to do something different. I’m going to go out and listen to the two thousand employees and find out what their version is on what I should do with that division. Now I could have just shut it down and the market would have been happy with me, right? But I would have then put two thousand employees on the street and I would have harmed our customers who are buying products from both divisions. No, you know what I did. I implemented, which is in the book What I now call the three-tier approach using tenderness first to gain the trust. And then you can be tenacious. And I practiced that in that situation. I went around. I wish listened, met with the two thousand employees, and got their comments. 

Donato And I realized that I then gain their trust because I was implementing my decision on their information. And guess what? I didn’t sell the company. I did something that had never been done before. I paid a company 25 million to take the shot-performing division that we had invested nearly a billion dollars into, and that was one of the best decisions I made on the day we announced it. The stock doubled. We saved the job of two thousand employees, and we didn’t have one chaotic havoc in that decision. The employees moved over to the other company. And by the way, that division today is performing very well within shear care. And so that was yeah. 

John And that and that decision came about specifically because you took the time to get out and listen to people and that gave you the information that helped you make that decision. 

Donato As Yogi Berra, my favorite philosopher, once said, You don’t want to make the wrong mistake, you’re going to make mistakes in business. But let’s try to be more cautious to avoid the wrong mistakes. And you’re absolutely right. I took the time to listen to people, and I don’t think I ever would have made that decision had I not listened to the people. So I got the results I wanted in terms of shareholder value. I also got the results in terms of the trust of people. 

John I love that you may have listeners, I’m sure, that are tuning in saying though, Hey, that sounds great in principle and concept, but I’m under the gun. You know, I don’t have the time to do that. I’ve got, you know, quarterly estimates or earnings estimates that I’ve got to try to meet or exceed. I’ve got, you know, board the board and investors just really putting pressure on me. What’s the message to that leader that feels like? I mean, does Wall Street have the patience to allow a leader to do that? 

Donato They do, and it’s not one or the other. And that’s why it’s called the double. The bottom line is we’re not saying, you know, that compassionate leadership is about being kind and being nice only it’s about getting the trust. So you’re not going around with a pooper scooper. So many examples we give in the book of 40 leaders that we interview where when they didn’t take the time to put people first and listen to what the actual events in the organization were unfolding, they made a lot of mistakes. And then the long-term damage is far to repair. And so it’s not having one or the other. I gave you the example that we doubled. Yeah, the market would have wanted me to make the decision within 60 days. I wish I could guarantee you that would not have had the same result. 

Donato So it’s really up to the leader to gain the trust of their board. And the board knew where my heart was, that I wasn’t overlooking the need to deliver the results. What I was doing was trying to avoid chaos. And that’s where you have to communicate. One of the attributes that we found in passionate leadership is consistent, consistent, consistent communication burgeoning. When I got on my earnings call, I set the deadline with the market that in six months I would deliver the strategy. And so you have to communicate in a way where you can practice compassionate produce and at the same time, be able to manage the outward markets in terms of time and delivery of the outcome. 

John I think that’s a great message. And what I hear you saying is there’s not it’s not. It’s the compassionate, empathetic leader that shouldn’t be confused with the appeal-based leader that needs to be liked and make everybody happy a compassionate, empathetic leader is truly one that is understanding and listening and taking the time to hear people but not afraid to make the tough decisions. Not afraid to deliver a tough message. If I’m understanding you’re right, absolutely. 

Donato That’s why that 30 is their tenacity. But too many leaders start with tenacity first, and so they don’t listen. They’re not understanding what the people are saying. And by the way, this was five years ago. The workforce has changed as a result of the pandemic. The workforce now is demanding that they be heard. They’re asking that their input and what they’re seeing in the marketplace, that we listen to them. So, you know, whether or not we believe that this is the way to go, I really think that you have to understand what the employees are asking for. And the only way you’re going to gain their trust is by incorporating their input in a way that reflects good decisions in the company. 

John What does that look like for a leader, CEO, or leader of a large division or business unit to really have had it working the right way? And there’s a lot of communication and that leader is really tuned in and listening. Well, what does that actually look like? I mean, are they asking for that or are they doing the listening tour periodically? Do they have an advisory board? I mean, what’s the rhythm on that?

Donato sort of question, so I’m going to probably shock the listeners on a few points number one culture. For years, we have been taught that culture, each strategy for lunch and you need to toss that out. Trust each culture and strategy for lunch if you don’t get the trust of the organization. I really don’t care how much time you spend on developing a culture of empowerment or culture of inclusion. You have to get the trust first. And so in the example that I gave you, John, when I was appointed a CEO of a public company, I got up the first day and I said to the 2500 employees, I do not expect you to trust me today. What I will do over the next number of months is meet with all of you so that the decisions I make will reflect the best of what I have learned in my engagement with you, and that’s when I will get your trust. So what happened to that decision? There had not been any bonuses in seven years. You know, the first year after we made that decision. 

Donato Employees received 200 percent of their opponent’s cash. What do you think? Did I gain their trust? Absolutely. The next year, they gained a one hundred and fifty percent bonus. And so you have to have consistency in terms of how you do it. And by the way, you can’t let one decision be your definition. We started to implement a program called Ask Me Anything, and what that was was on a Thursday. I would send an email out to the entire organization with the highlights and lowlights of the company. So I continued this involvement. You know, I couldn’t always meet with thousands of people, but I then found a connective tissue of how I could stay connected to the organization by sending this email out, but I wanted to step further. The next day, we had a one hour ask me anything based on that email. 

Donato So as a leader, your feet must match your words, and you can not think that because your executive team is listening to you that it’s getting down to the organization, you have to go in and have connective tissues that have a check and balance for what you want communicated in the organization. And these asking anything-calls were by far the best strategy that I have ever implemented as a leader. By the way, funny story, I was going to stop them because I thought after a year we didn’t need them. Oh my God, you would have thought we had a right in the company and we kept them in place. So you have to really discipline yourself to say it’s not a one and done and you can’t practice shingle management. You can’t fly in, do one decision-making around being compassionate, and then go off. And, you know, next time doing something different, there’s going to be consistency. 

John Yeah, I love what you what you’re talking about. And there are a couple of things that come to mind because I’ve seen different organizations where there are two mistakes I see relating to what you’re talking about. One is that they listen or supposedly listen, but then don’t do anything or take action on that feedback at all, which almost is worse than ever, you know, they’re almost rather just not do a listening tour, so to speak. But the second thing is, there’s a lot of leaders that say, You know what I do put myself or we do build that culture around, Hey, give us feedback. We want to hear what you say or ask us anything, but they really don’t mean it and their actions don’t say that they don’t. They don’t have, you know, they’ll have prepared questions that they’ve selected out of 100 questions that have been submitted prior to a broadcast or something. Or they really don’t want the questions, the tough questions, because so part of this is really putting yourself out there and being vulnerable, right? You’ve got to be willing to take the really tough questions and answer them honestly. 

Donato Well, you are absolutely correct. In fact, in the book, we talk about, listen to understand, don’t listen to respond. Too many leaders don’t let the other person finish. And so they’re already, you know, five seconds into the conversation, they’re already reacting. And I want to just touch upon the vulnerability. I wasn’t always one that was willing to be vulnerable. I’m a product of having lost my earring. At age eight, 10 years, I had limited to no hearing. I was voted most likely not to succeed in my high school class. I had a speech impediment. You know, all of this has obviously been addressed. I never share that with people because I want them to see me as strong. And you know, I have all the answers. 

Donato When I started to share the story was one I had my my my most significant connections in the organization. In fact, people would come up to me and say, Gosh, you’re more interesting now, you’re not boring. And so you have to be willing to admit when you’ve made a mistake, you have to be willing to say, I have had pain in my life. And I think that that’s changing. I think the pandemic has really for the first time for all of us on the same level playing field. But you’re right. Be vulnerable. 

John I love that, wow, and that speaks volumes to me, I know personally, I’ve been always been attracted to that leader that has been authentic and not trying to be somebody that they’re not. I think there’s so much to that. Your book the double bottom line, how compassionate leaders captivate hearts and deliver results. It’s out yesterday. What are readers going to get from this book? 

Donato I think what readers will and by the way, I want to just say it’s not. Not just for business people. It’s not just for politicians. I think everyone will identify that leading with compassion is not just good for the organization, not just good for your family. You feel better. You feel. And I give the example. One time I had a senior executive, I was on a plane. We were on a conference call. The plane hit not taken off, and the senior executive wasn’t listening and was just really being a bully. And I finally had to shut the person down. And then the doors of the plane closed and I couldn’t finish the conversation. I felt very, very bad at that. The next day, you know what I did, I called that executive and apologized, and we both cheered up on the phone. I felt better when I went home the night that I didn’t have the opportunity to apologize. I couldn’t sleep all night. You’d feel better when you have that connection with the employee, and I think that leaders will get that out of the book that it’s good for your well-being, it’s good for the organization. It will deliver results and profit, and you will feel better in terms of your own mental health. 

John I love it. Absolutely great, and we will have links in the show notes for anybody who wants to get the book. It’s available on Amazon and in bookstores. Is that correct? 

Donato That’s correct. 

John Excellent. And we’ll have all that info in the show notes. This has been terrific. Donato, I’d love to have you back another time and dove deeper into the topic because this is one. Certainly, that means a lot to me. It’s been impactful the concept of compassion in leadership. And you’ve obviously been a tremendous success. And now others get the chance to read and learn from you with this. That just came out yesterday. So I appreciate you joining us today. 

Donato Well, thank you very much, John, and my last point. This is not a book. It really is a movement that we all can be kinder and more compassionate to one another. 

John Excellent. Well, we’ve been here with Donato Tributo, who is a long-term tenured executive philanthropist, and author of the recently released book The Double Bottom Line How Compassionate Leaders Captivate Hearts and deliver results. 

John Appreciate you all joining us today. As always, like, share, subscribe. I’m always interested in your ideas for future guests and content and of course, go down below. Give a five-star review and we’ll see you next time. Thanks for joining us. 

John Thanks for joining us on today’s episode of Tomorrow’s Leader for suggestions or inquiries about having me at your next event or personal coaching, reach me at John@johnlaurito.com. Thanks, lead on!