Tips from the Top Presents an Interview with Timothy Ling (MBA 1989): Unocal Corporation President and COO
Vik Bhatia, MBA2, and Yasmin Zarolia, MBA2
Issue date: 5/5/03 Section: News
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Mr. Ling openly shares some wonderful stories and lessons learned over the last few years, including his transition from consultant to operating officer and why a factory in Philadelphia taught him more about leadership than any popular business book.
TFTT: You went from being with McKinsey for 8 years (including 3 years as a partner) to being the CFO of Unocal in 1997. Could you describe the transition from being a consultant to holding an officer position in an operating company?
Ling: My view of what the transition would be while still at McKinsey was different than my view of the transition when looking back. The transition was a lot more significant than I originally thought it would be. There were certain things I was prepared for as a consultant, but there were a myriad things I was unprepared for. A consulting experience is characterized by lots of tangible relatively well-defined problems that you solve. Not understanding the entirety and complexity of a large organization, it's easy as a consultant to oversimplify what makes the company tick. But when you actually land as a senior executive in one of these large companies, you realize quickly how complex and interrelated the issues facing the company are.
For example, when I left McKinsey in 1996, we didn't do much with respect to capital markets. There wasn't a lot of opportunity to get involved in market related issues and we as consultants tended to shun acquisitions as a strategy. All of a sudden, I am CFO of a $11 billion enterprise with operations in four continents and lots of financing needs. Your company is dependent upon these public markets...your equity is traded every day; you need public debt, you have to manage acquisitions and divestitures. I think it's very difficult for consultants to realize how big this dependency on the markets is.
Second, as a consultant, I never really understood the enormity of the inter relationships, dependencies and multiple constituencies which exist at big corporations like Unocal. To me, running a business was like solving problems - you put some smart people together to figure out the issues, come up with solutions and implement them. But the reality is that these large corporations are like big, complicated organisms where effecting change requires extreme thoughtfulness, not only about what the change is that is required but more importantly, how you can effectively enact this change. You're dealing with employees, governments, customers, shareholders, regulators and they all play off of each other and have a distinct point of view about any change. All these constituencies have to be managed such that the change can happen in a coordinated fashion across the entire organization without too many unintended consequences. It's a lot different than putting together a presentation as a consultant. . Finally I tended to believe that success was mainly a function of strategy and smart ideas. I learned those things have their place, but they get overshadowed by issues relating to organizational capacity, people motivation, and constituent alignment. It's more about people and execution than big ideas. It has always surprised me that my company's challenges are generally not from a lack of understanding of what has to be done, but more how to actually do it.