Yes, You’re Smart, but Can You Make Money?

Published: October 23, 2010      From The New York Times

      This interview with Kenneth Feld, chairman and C.E.O. of Feld Entertainment, was conducted and condensed by Adam Bryant. Feld Entertainment’s operations include Ringling Brothers and Barnum & Bailey circus and Disney on Ice.
Q. How did you get started in your family’s business?
A. In the summers I always worked with my father, and I think my motivation for getting in the business was to work with my dad, because we had an extraordinary relationship. I was fortunate that he was in a business that I loved and had a passion for.
    He acquired Ringling Brothers in November 1967. I was in college, so my summer jobs for the summer of ’68 and the summer of ’69 were going all over the world, primarily Eastern Europe, hiring circus talent.
That was an extraordinary education because, at the time, there were still communist countries, and I spent most of three months in Bulgaria, Hungary, Romania, Poland, East Germany. I would deal with the ministries in those countries because the circus was sort of their art form for the masses. So that was my first exposure to something pretty exotic and unusual.
Q. Can you talk about what you learned from your father?
A. It’s been an interesting road. In 1971 we sold the circus to Mattel. So we operated and worked for Mattel for about 11 years. And then in 1982, my father and I repurchased the circus from Mattel and it became a privately owned business. And it’s been that way ever since. He passed away in ’84, and I was 34 years old and all of a sudden I have this whole company. We had been extremely close. I always say he taught me everything I know and then everyone else taught me everything I didn’t know. What I mean by that is I sort of learned on the job at dinner.
    We’d be traveling four or five days a week, and he would rehash the whole day over a three-hour dinner. And he would smoke two or three cigars and have a Cognac and literally go sentence by sentence about what happened in the day, and what did I think, and here’s why he did what he did. And he would always listen to me, and that was a learning experience.
So when he died, because I had no outside experience, it took me a while to figure out who I was, and that I couldn’t think, “Oh, this is what my father would have done.” I had to take a different path and also create a stronger management team. And I knew what I knew and what my skills were, and I had to bring people in who had skill sets that I didn’t have.
Q. And what were those?
A. My strengths are really in the creative side, coming up with big ideas, knowing how to get them done. But the day-to-day and the administration are something that I wasn’t good at, because I didn’t have the interest. I started restructuring the company around ’94, and I found out that you never stop. And I now have an outside president and chief operating officer who take care of all of the day-to-day, and we have constant communications and meetings. But I don’t get involved in the detail the way I used to.
   As a result of that, I’ve been able to become a lot more objective in looking at the business — what’s happening today, but more importantly, what do I think is going to happen next year and in the next five years.
Q. What else did you learn from your father about leadership and management?
A. I learned, more than anything, to listen. From the time I was a kid he would ask me a question and he would listen to my opinion. I’ve always tried to listen to everyone who works in the company. I think that’s more important than talking.
Q. What else?
A. Another big thing was: make decisions. He said: “You’re a smart guy. You’ll be right 90 percent of the time. But if you don’t make the decision, no one will ever know.”
Q. And now your children work for you.
A. Yes, I have three daughters and they’re all in the business. My role has changed a lot since they’ve come in. It’s shifted from doing to more of a mentor role. So it’s listening. I can offer the experience, but instead of saying, “Why don’t you do this?” I tend to frame advice in the form of questions because it then stimulates thinking, versus, “This is what I want,” because people are going to do what the boss wants. So I’ll throw out three or four alternatives and then let them think about it.
Q. Anything different about the way you work with them, compared with how your father worked with you?
A. Before they joined the company, they had to work elsewhere for two years. I worked for Feld Entertainment my whole career, so the perspective that I had was what I learned inside the company. They’ve all worked different places, so they were able to bring to the company something, a real contribution because they were good at what they did.
    Also, for their own self-confidence, they knew they could go out and make a living and survive and they didn’t need the company. It’s also helped them with the other associates. There’s a different level of respect.
And I made them write papers to tell me: “Why do you want to come into the company? What do you think you can contribute? Where are your strengths and what is your passion — and it can’t be about a paycheck.” And they all had very, very different ideas of what they wanted to do.
   They report to the president and chief operating officer. He negotiates their salary. They will talk to me about creative decisions and we co-produce a lot of the shows together. It’s almost like I’m used as an encyclopedia, which is great because I have 40 years of experience.
Q. Running a circus must be pretty complicated.
A. It is the most complex entity on the planet. Each show may have people from 14 different cultures. We’re their employer but we’re also the landlord. We know the best and worst about everyone because they’re living on our milelong train. I think that understanding people allows you to understand everything, because you can always learn process. The only way you learn about people is to spend time with them and you have to show everyone respect.
    Here’s an example: Every year when we do a new show, we bring down to Florida 130 performers who never, for the most part, knew each other beforehand. About 10 days into our rehearsal period, we have Act Night, where everybody performs their act uncut, untouched by us, for every other performer.
That is the true test of respect. No matter what anyone thought of a person, if they’re doing an act that is so unbelievable and death-defying, the respect level goes way up. You have earned the respect strictly by what you have done — it’s very pure. It is an absolute lesson in earning respect. Respect does not come from a title. It comes from what you do, and how you do it, and how you work with people, and I think that’s a difficult thing for people to understand.
    I may say, “You’re hired in such and such a position and you have this title,” but that means nothing. You can be the smartest person in the world and it means nothing if you don’t earn the respect of the people you have to interact with. I’ve tried to teach that to people — that if you come in and act like you know everything, it doesn’t matter how smart you are, people aren’t going to hear your good ideas.
Q. How do you hire for a position at the corporate office, a direct report?
A. I’ll give you the example of when I hired Mike Shannon, who’s president and chief operating officer. I had been looking for probably 10 months and I walked into the search firm’s office and the guy was sitting there. He was in transition from one position and they said, “Oh, why don’t you talk to this guy?”
So I sat down and talked to him. He said to me, “I don’t know anything about putting on a circus.” I said, “I wouldn’t expect that you would.”
    He said: “I don’t know anything about the entertainment business. I’ve never been in the entertainment business before. What I can tell you is, I love people. I love to mentor people. I love to get the most out of people and I’ll never lie to you. You’ll get the good, the bad, and the ugly.” And about a week later, I hired him and that was it.
   There’s a trust I have with him that is the same kind of trust that I had with my father and that I have with my daughters, and I think that’s the hardest thing to find — people you can absolutely trust. I don’t need people to give me good news. I mean they’re waiting in line to give you good news. I want people who can deliver the unvarnished truth to me so that I can make proper decisions. There’s no good way to deliver bad news, that’s for sure, so you just want somebody that’s straight out — “Here’s what this situation is.”
Q. What about other people where it’s more of a traditional interview?
A. For executives, as opposed to directors and creative people, I’ll read their résumé, and then I’ll say to them: “You’re really smart, but do you know how to make money? Tell me some things about how you made money.” And then they have to really think because the party line doesn’t work. It gets beyond just the typical corporate stuff. That’s really a key thing because you want people to really think like that. It’s hard to find today.
Q. Do some people have trouble answering?
A. Let me tell you, nothing kills an interview like that. So they have to stop and think. “What do you mean?” And I’ll say: “Like when you were a kid growing up, did you have a lemonade stand? What have you done?” And then I try to take them through their career, because I need them to understand that if they’re going to come to work for our company, it’s great that you have all this knowledge, but how can you translate that into something that is absolutely going to make money for us? Can they think unconventionally? Can they think outside the box?
Q. What quality are you testing for with this question of, “Tell me how you’ve made money.”?
A. It’s a drive I’m looking for. I don’t need to hire college professors in my business. We’re grinding it out and I need to know that the people that we have involved in the business are focused on sales, on the bottom line.
    How do you make money? How do you take this crazy idea that somebody has and how can you monetize it? And if you’ve done that before in a couple of situations, then there’s a good chance you’re going to be very successful in our company because we’re demanding. We’re out there day in and day out.
Q. If you could ask somebody only two or three questions to know whether you might hire them, what would they be?
A. It depends, obviously, on the position. But one is: “What is your style of working with people who report to you? How do you work with them? What do you do on a daily basis?” That’s important because you can put the wrong person in a job, and you can take a great department and just decimate it in no time with the wrong person.