Trying to change the World Bank

The head of the World Bank talks to On Leadership editor Lillian Cunningham about having both the toughness and the humility to handle criticism. (Lillian Cunningham, Sandi Moynihan, Gillian Brockell & Julio Negron/The Washington Post)

 

Jim Yong Kim has initiated the World Bank's first massive reorganization in nearly two decades, and one that's been met with internal resistance from some of its economists. In addition to announcing the World Bank's new core mission — to end extreme poverty by 2030 — Kim has committed to cutting $400 million in administrative costs over the next three years and to restructuring the organization into 14 global practices, focusing on areas such as energy and agriculture.

In a place stacked with economists, Kim is a physician and anthropologist. He previously served as the president of Dartmouth College, the director of the World Health Organization's HIV/AIDS department and the executive director of Partners in Health.

We spoke ahead of this weekend's spring meetings in Washington of the International Monetary Fund and the World Bank Group. In this interview, which was edited for length and clarity, we spoke about the challenge of reshaping the World Bank’s culture of risk aversion and strained internal collaboration, how Kim stays optimistic about his long-term vision despite short-term pushback, and the leadership lessons he has picked up in the course of his career.

This interview is the first in the new season of our "On Leadership" video series, which pairs personal stories of leadership on video with text Q&As of our longer conversations. Watch Jim Yong Kim's video above, or look through previous video interviews here.

Q. What was your very first job?

A. I was a waiter at the Octagon House restaurant in Muscatine, Iowa.

Q. How have you personally come to define leadership?

A. One of the most important things about leadership is that you have to have the kind of humility that will allow you to be coached.

One of my good friends is the surgeon and writer Atul Gawande. And Atul wrote this wonderful article in the New Yorker about coaching. He basically said, if Tiger Woods — the best golfer in the world — has a coach, why wouldn’t I as a mature physician have a coach? His statistics had flattened out, so he actually had a senior surgeon in the room with him watching what he did and he got better.

Around that time I began my own coaching process. Marshall Goldsmith has coached me free of charge now for about five years. He also coaches Alan Mulally of Ford Motor Company and he coached Mike Duke at Walmart. He’s one of the great coaches, and Marshall has had a huge impact on how I work as a leader.

The things you find when the coach talks to all the people you work with is always incredibly humbling. No matter how good you think you are as a leader, my goodness, the people around you will have all kinds of ideas for how you can get better. So for me, the most fundamental thing about leadership is to have the humility to continue to get feedback and to try to get better — because your job is to try to help everybody else get better.

Q. What’s one change you’ve noticed in yourself and your leadership style in the years you’ve been working at this?

A. One of the things I had to really work on is, when you’re the leader of an organization, people look at the expression on your face. Your mood has a lot to do with how people think the whole organization is doing. I always had a sense for that, but the greatest lesson for me was when I was in Detroit at the end of a six-hour session in which I and my friend Mark Tercek from the Nature Conservancy went to get coaching from Alan Mulally. His last words were: “Mark, Jim, both of you have very nice smiles. I want you to use them more.”

You really need to express your joy in having the job. You need to express your optimism about what is to come. And you need to express your appreciation and warmth for the people who are every day trying to do their work. It’s something I work on.

Q. Since coming to the World Bank, what is one of the hardest days you’ve had there?

A. On my first day of work at the World Bank, my top deputies brought me into a room and said, “Jim, you’re going to have to make a decision. We have a $26 billion project, and it’s for a really critical bridge in Bangladesh. We have evidence that there was corruption in the project. This bridge could be truly lifesaving for millions of people in Bangladesh, but you’ve got to make a decision. Do you cancel this project, or do you go forward?”

Of course we decided that we had to cancel it, because we couldn’t have any tolerance for corruption. But it happens almost every day that we have to make tough decisions that we know will have an impact on the lives of millions of poor people. Every single day we have to think, what are our fundamental principles? How do we balance what we want to do on behalf of poor people, with principles like being against corruption and principles like good governance?

Q. Let’s talk about the culture of the World Bank. It’s full of economists and there’s probably a certain personality type that goes along with that. Given your very different background, how much have you tried to adapt to their culture versus how much have you tried to get the culture to adapt to something new brought by you?

A. When I was preparing to take over this job, I got a call from President Clinton. He wanted me to know that Secretary Hillary Clinton spent a good part of the first few months in the State Department just walking the halls, talking to people, getting to know them.

One of the lessons of leadership worth emphasizing is that you want to get to know other great leaders and take their advice. At some point in your development, it’s only people who’ve been in the seat of having to be leaders who can help you in a deep way.

So I spent the first six months walking all around the World Bank Group. I had heard a lot of the mythology — that this is a place dominated by theoretical macroeconomists, and run by economists, and you’ve got to somehow make peace with the economists.

What I found was something quite different. The people who were in the positions of greatest power were the ones actually helping the roads and health systems get built. This brilliant group of people could have been working anywhere else and probably making a lot more money in the private sector, but every single one of them told me that they’re there because they are passionate about fighting poverty.

I came out of that thinking we share something much more profound than our educational backgrounds. I’m a physician and an anthropologist, but I share with my staff this passion for ending poverty. So I’ve come to deeply appreciate the fact that we have a thousand economists, because on any given issue I can go to my own team and say, “Tell me about water and sanitation in India.” And not only will they be able to tell me about the chemistry of the problem, they can tell me about it in the context of the overall budget of India. They can tell me about it in the context of any given project compared to others. I have come to deeply, deeply appreciate this kind of analytic capacity from our economists.

Q. You are trying to bring about large cultural and organization shifts, though, and obviously there are challenges. What have you wrestled with?

A. In those first few months walking around, I only asked two questions. When were you proudest of being an employee at the World Bank Group? And what’s preventing us from being at our best every single day?

The answer I got back more often than not was: The culture of the institution is broken. So we ended up surveying the entire organization. There was a tremendous risk aversion. There was a sense that if you tried anything that was even a little bit risky, you were going to get in trouble and that you might lose your job. There was a sense that there wasn’t trust in the organization. There were problems with the sense of meritocracy — the people who were the best managers and the best leaders weren’t getting promoted.

Another part of it was people felt that communication across the organization just wasn’t happening. IFC [the International Finance Corp.], our private-sector arm, and our public-sector arm — IDA and IBRD [the International Development Association and the International Bank for Reconstruction and Development], the ones that provide loans and grants to the public sector — just weren’t talking to each other.  Even regions: one region may have been doing fantastic work in a particular area, but those innovations and insights weren’t spreading to other regions. So there was a lot that we needed to do.

Many people told me. “Jim, you can’t do that. These types of bureaucracies are huge supertankers and you can’t ever really change them. The only thing you can ever do is choose the people who will run the silos.” I fundamentally rejected that idea. I understood that if we didn’t make some serious changes, the culture would never change.

I talked to people like Sam Palmisano of IBM and again Alan Mulally, two people who’ve made tremendous organizational changes and been successful. Part of what they did was to ensure that people were really helping each other and talking. So for the first time at the World Bank, we have a set of meetings where we’re actually reviewing the entire business. We’re looking at budget. We’re looking at operations. We’re looking at knowledge work. And we’re looking at them all together on a very regular basis — at least every two weeks — and I’m going to chair those meetings.

We’re going to go from a rules-based bureaucracy to a strategically run, integrated organization. This is hard. It’s never been tried before at the World Bank Group. What our own staff told me in this survey, and in my meetings with them, is that right now we’re not fit for purpose. We're trying to end extreme poverty in the world. If we're really going to address this challenge then we're going to have 
to change, and that's what we're going through now.

Q. Do you worry that you might not have the time you need to pull off the vision you have?

A. I just believe if you know you’ve got to change something, there’s no reason to wait. So we’re moving forward. We’ve announced some of the changes this past week, including in our financial model. I have boundless energy to make this happen. I have so much faith in the staff.

If you were to go back 21 months and ask anyone in the World Bank Group if we could have made this many changes, I think most people would have doubted it. But we’re already well underway in making four really major changes that I had been told by board members would have been thought of as an earthquake in recent years.

Q. Not all leaders who have a long-term vision have the strength to deal with the shorter-term messiness and chaos. It seems to require a pretty thick skin to deal with the initial and inevitable pushback.

A. I think you develop a thick skin over time, but your thick skin always has to be thick in patches. In other words, if you’ve heard the same thing over and over again, and you know that those particular complaints from particular people are really not very insightful or helpful, then you develop a thick skin for that. But the rest of your skin has to be open for criticisms and complaints that are real. You’ve got to be ready to shift your course if someone comes up to you and provides you with really well reasoned, thoughtful arguments.

Over time you do develop a thick skin, and there’s no question that the sort of personal attacks that come your way, you just have to expect those.

Q. You’ve talked a lot about starting a movement to end extreme poverty, and for the World Bank to be the leader of this movement. How do you get employees on board with that? How do you translate the language and vision of a movement to people who are used to crunching numbers? 

A. It’s quite ironic that I’m starting a social movement to end poverty led, in part at least, by the World Bank Group, because I was part of the “50 years is enough” movement. This was 20-some years ago, and we were arguing that on the 50th anniversary of the World Bank and the IMF we should just close the institutions because they were doing more harm than good.

Since then, the bank has been reshaped in really fundamental ways. Twenty years ago our complaints were that the World Bank Group was focused solely on GDP growth and wasn’t as focused on investing in human beings or health, education and social protection. Now we are, because the evidence is so overwhelming that we must be invested in and care about those things.

The very criticisms that were coming from people like me — who knew in our hearts that investing in human beings was the right thing to do — are now supported by the evidence generated by economists. For example, Larry Summers led a study just a few months ago that showed that from 2000 to 2011 as much as 24 percent of the economic growth in poor and middle-income countries was the result of better health.

So I don’t expect that huge numbers of our economists are going to be out on the streets and starting that kind of a social movement, but the interesting thing is that the work they’re doing right now is helping us bring the movement together.

Q. In a time of a major organizational tumult, when people are naturally distracted by what’s happening to their own jobs, how do you make sure that oversight on projects doesn’t slip?

A. There is a lot of uncertainty, and there’s just no way you can avoid it, because we are still making decisions about who’s going to go where. But I think that we’ll be able to maintain the volume and the quality of our business, and then over time we’re going to get better.

One of the things we’re trying to do is decrease the amount of time it takes us to go from conception to delivery of a project. Some people had said, “Maybe it takes that long because you need that much time to have better quality.” We did a study, and it turns out the longer you go, the lower the quality is. And we think we understand why. The long delays are because of churning and uncertainty. So if we can be better at delivering projects more quickly, we actually think the quality will go up.

These are hard things to do, especially when you’re coming in through a political process like the head of the World Bank comes in. But I have in many ways been preparing for this my whole life. Working in the field in places like Haiti and Peru and the former Soviet Union and Siberia and Africa, I have been thinking about this question: How do you get large groups of people to deliver on promises to the poor?

Now I have the opportunity. If you take an organization like the World Bank, with its just extraordinary staff, and actively lead it in a way that forces it to work together, forces it to develop a culture where people really are bringing the best innovations anywhere in the world to anywhere else in the world almost instantaneously, then I think we will be able to end poverty. And we’ll be able to build an organization the likes of which I don’t think has existed before.

Q. What’s the best piece of advice that you ever got?

A. Best piece of advice I ever got from a leader was from Jeff Immelt, the current CEO of General Electric. Jeff told me that when he took the job as head of General Electric, people said to him, “Jeff, you came from the healthcare business. You don’t know anything about wind turbines or appliances, how are you possibly going to do a good job?” And he said, “It’s not how much you know, it’s how quick you learn.”

So I’m trying with everything I can to learn this business as quickly as I possibly can.

 

Read also:

The art of leading scientists

A prisoner's pursuit of democracy in Burma

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Lillian Cunningham is the editor and feature writer for The Washington Post's 'On Leadership' section.
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