Legendary Leadership Lessons with Edward Jones

Diane Brady (00:00):

Hello everybody. Penny. I have to say I love the thumping music coming up.

Penny Pennington (00:06):

I know, we’re in Vegas. 

Diane Brady (00:08):

We're in Vegas. What would be your walkup song? I have to start with that. I just cannot ignore the great music, 

Penny Pennington (00:15):

Anything by Andy Grammar. So we do walk up music at our conferences at Edward Jones and I dance on stage and it's always to, I found joy in my life. 

Diane Brady (00:25):

Excellent. Well done. So note to self, and by the way, I always know it's a great conference when I see sign language interpretation. My sister is deaf, and so I think that I just want to give a shout out to that as well. I think it's very powerful. So I feel like first of all, congratulations for 26 of 26, 27 years you have been on, of course, the Fortune 100 Best Companies to Work For, which we do in partnership with Great Place To Work. So congratulations for that. And every great leader, there's a human being at the center. And my son was texting me as I came on stage. You were the child of two working parents. I'm curious, what did you want to be when you grew up? Give us a sense of the pivot point that took you on this path. 

Penny Pennington (01:12):

Sure. Well, first of all, thank you. Thank you so much for the invitation to be here. Thank you for the ability to be on this list in an enduring way for so many years. It's not the reason that we seek to be a great place to work, but it is nice to be recognized for that. And I feel like we are at the Super Bowl party for great places to work. Just listening to Tony and to the CEO of Delta, such great companies who also have been on this list for a long, long time. And so this question about leadership, how did those two leaders get to be where they are and who they are? My own personal journey has been one of learning to be a leader through observation, through trying and failing, through being mentored by great leaders. My parents both were working parents. 

Penny Pennington (02:05):

My father began his career on the manufacturing floor of a shoe plant, and he wound up as the CEO of a global company in the footwear business. Now you don't do that without putting yourself in the way of all kinds of new experiences. My mother, likewise was an executive when she retired at a utility company, she started teaching primarily homemakers in the 1970s when we had an energy crisis, how to use energy wisely, and she wound up leading a power generation unit, including the guys who climb the poles and string the wires. You don't do that without putting yourself in the way of a lot of unique experiences and learning experiences. So I saw them do that. 

Penny Pennington (02:52):

So it was observed, but I was also fostered in my experiences at Edward Jones. I learned leadership at Edward Jones from the local leaders when I was a financial advisor in a suburb of Detroit, Michigan. I learned it from our local regional leader. I learned it from our managing partners, and I learned it by experience. I will tell you one story that was a hard learned experience about leadership where I made a big mistake and my supporters corrected me on it. It was that mistake about disqualifying yourself based on technical attributes of a particular role. A leader had left our company suddenly, and I was part of the strategy team that needed to make the recommendation to replace that leader. And I had a very clear point of view about what this leader needed to be thinking about and where they needed to be leading to in the future. And I wrote it down. I took it to our strategy team and I said, “This is where I, this is the person that I believe we should choose, but I'm not qualified for this role because I've never led the several hundred. I've never done the job of the several hundred people that I'm going to be leading.”

Diane Brady (04:04):

Sounds like a familiar refrain for a lot of women.

Penny Pennington (04:06):

Doesn't it? I find that this occurs across the genders, but the research says it occurs a little bit more often for women. So here's what happened next. I thought that was a very logical thing to say and do. I went home and I talked to my husband about it. We talked about work a lot, and you remember those moments in your life when time stops, you remember where you were standing, what you were wearing. Time stopped. And my husband looked at me and he said, “I can't believe you did that.” He said, “Our family has sacrificed. We moved our family from Detroit to St. Louis. Our family sacrificed for you to have an opportunity to lean in to leadership at this company that you love, and you just took a step back.” He said, “I don't know what you're going to do about this, but you better fix it.” And he walked out.

Diane Brady (04:59):

So your husband basically put you on that path. 

Penny Pennington (05:04):

He held me accountable for it. So I had to go back to that table and I said, “I made a mistake. I believe in these principles. I believe that I can learn to do this role. If we are aligned around these principles, I'd like to have this job.” And the leader looked at me and he said, “Well, we thought you could do it, but the job is so important. We were afraid you weren't all in when you stepped back.”

Penny Pennington (05:30):

“You're all in, we'll go talk to our managing partner about putting you there.” And had I not gone through that crucible moment, I wouldn't be here. And I kind of like to think that Edward Jones wouldn't be quite on the path that we’re on.

Diane Brady (05:43):

Well, let's talk about those traits and yes, definitely I think the leaning into the opportunity, but the idiosyncrasies of leading a company like Edward Jones, right? I mean, talk, because you have many constituents. The advisors are, of course, you have to convince them every day in the same way their clients. What's different about how you lead? 

Penny Pennington (06:04):

Well, Diane, I think what you just described is the complexity, but the joy of leading in an environment where we have a lot of stakeholders and we seek to have a strategy that encompasses the needs and desired experiences of all of those stakeholders. Let me just give you just a tiny little bit of census about Edward Jones. So we're a North American company. We have 20,000 financial advisors, 25,000 client facing client service professionals in our branches. We have 15,000 locations in North America. And our job is to help 9 million clients turn their life plan into a financial plan and help them achieve possibilities that blow their minds. We do this family by family, but we do it at great scale with the largest number of financial advisors under one roof. So some of the principles that great companies live by, I believe are their values, but for us it's also the principles of Peter Drucker. 

Penny Pennington (07:13):

So Peter Drucker coined this phrase decades ago called “the knowledge worker.” The knowledge worker is not a factory worker necessarily. The knowledge worker is someone who wants to own the means of their own production. They want agency and mastery and autonomy over what they're doing. And here's something really important about the knowledge worker. The knowledge worker, in this case, the 54,000 people that are part of Edward Jones, they know more about our clients than I do, so I need to be learning from them. It's why I've been in Vegas for the past couple of days. We have several regions here. I've met with dozens of our financial advisors and client service teammates to find out what our clients are saying. And by the way, it's a very interesting time for clients right now, isn't it?

Diane Brady (07:59):

I was going to say .

Penny Pennington (08:00):

That's what we've been talking about. Another thing. So I learned from them. 

Diane Brady (08:03):

Another thing Peter Drucker said is “Know what business are you in.” And so this environment, this week, in fact, what are you conveying to people? Because from a financial advice point of view, there must be some interesting conversations. Tell us a little bit about the tone from the top.

Penny Pennington (08:23):

Well, we have been around for 103 years, and the two leaders just before me talked about being a long-lived and enduring company during times of turmoil. The four worst words in the investment and financial counseling world are “this time it's different.” It's not. The context is different. What created the context that we are living through today is different, but we have led clients, seven generations of clients through geopolitical turmoil, chaos in the markets, volatility in the stock and bond market. This time is not different in that sense. So what we are advising people is a good plan is better than a bad prediction all the time. Ensure that you're working with a financial advisor to discover your needs and wants and wishes and get you on a plan to achieve those things. Make sure you have a well-balanced portfolio. So our portfolios are not down. What the media is talking about is happening in the big market. No, but you talk about this Diane. You help us talk about this in really healthy ways. And so this time is no different than that. Stay calm, give perspective, ensure that you're following that plan and know that there is tremendous opportunity during moments like this. I mean, we saw it yesterday with the bounce back up in the market. 

Diane Brady (09:54):

Well, culture is one of those squishy terms that we talk about. I mean, what are some of the things that you've done on a tactical level to create a great culture? 

Penny Pennington (10:04):

Yeah, this word culture is such a loaded word, and I think it's negligently used. My view is that culture is what is rewarded and recognized, especially in the stories that people tell in their companies. What's rewarded and recognized associated with our culture is a spirit of caring, going the extra mile for our clients and for each other. I was with a group of our branch teams yesterday, and in two separate meetings, somebody used the same phrase, “I will go down swinging for this company.” And they told stories about how Edward Jones had fostered their career. They told stories about how Edward Jones had helped them during really traumatic times in their families. So that cultural attribute comes through, not necessarily in the business tactics though it can be seen there, but it comes through in the way that people treat people, the way that we think about how we lead and manage our company into the future. 

Penny Pennington (11:05):

We use a framework that's got purpose at the top. Our purpose is to partner for positive impact, to improve the lives of our clients and our colleagues, and together better our communities and society. That's our purpose. Our culture is about going the extra mile, doing not the status quo, but doing the forward-looking things. That then feeds into our strategy. So purpose, culture, strategy, execution. When all of that comes together, you have an enduring company that meets the needs of its stakeholders. AI was mentioned by a leader just a few minutes ago, and so I'll give you an example of execution that requires culture and strategy. 

Diane Brady (11:49):

You're in an industry where a lot of people would presume AI is going to disrupt a lot of what you do. 

Penny Pennington (11:54):

Well, the phrase that I heard that I use all the time is “automate the ordinary to humanize the extraordinary.” I'll say it again, “automate the ordinary to humanize the extraordinary.” Our business is a people business. It's a business based on trust. And so when we use technology like AI, it needs to be from a place of trust. But here's an example of how we use AI in a culturally congruent way at Edward Jones. We have 20,000 financial advisors, 9 million clients. We love to share with each other what's going on with our clients. Confidentially, of course, you know that. But the insights that we're learning from 100,000 client engagements every day. We are part of, at Edward Jones, we're part of one of the most distinctive knowledge networks in the entire industry. And our financial advisors in analog have always supported each other in learning about their clients and learning to be even better for our clients. Well, we can use technology to do that, to deliver back to those insights dynamically in real time, what's happening locally and what's happening across North America. So because of that, we can with a little bit of humble swagger, proclaim that we are where North America goes for advice. Now, that's a cultural attribute because our financial advisors have always wanted to help one another help our clients better. And when we apply trusted technology over the scale and scope of who Edward Jones is, that's a competitive advantage that comes from purpose, culture, strategy, and great execution. 

Diane Brady (13:41):

Are there any insights you've gleaned about that customer base that you'd want to share to help us see around the corner a bit? What's on your radar you'd put on ours? 

Penny Pennington (13:51):

Well, thank you for asking that. One of the things that we learned during Covid and that we continue to affirm is that North American investors, and that's where we operate, North American investors are looking for more than just investment management and returns. Now, those things are important, but North American investors and families, multi-generationally, and we heard that from the two leaders before, multi-generationally want to talk about their health, their family, their own purpose, and then how to put together a plan that enables all of those things to come to life so that they can build their confidence along with building their wealth. And so the way that we have evolved, that we are evolving as a company, is to ensure that we've got great investment management, but also to ensure that we are tremendous financial counselors. And Diane, you and I were talking in the backstage about what it takes in terms of vulnerability and authenticity and trust building to engender that among our clients. I mean, we're asking our clients, tell me about your needs and wants and wishes. Tell me what you're most afraid of. And you can imagine there have been some of those conversations over the past five days or so. 

Diane Brady (15:05):

And one of the things I think with you about being vulnerable, you've been very public about when you were battling with cancer, for example. How does that impact the way people interacted with you? Those are very private moments. It's so powerful when a leader talks about it. 

Penny Pennington (15:20):

I was a financial advisor. I was a practicing financial advisor when I was diagnosed with breast cancer at 39. And my immediate thought was, “nobody wants to work with a financial advisor that they're afraid is going to die. And so all my clients will leave me.” But I knew I had to tell 'em. And just the opposite happened. They came into the branch with rosary beads, prayer beads, stacks of nutrition books, pink teddy bears and pink roses. And what I realized is that by my sharing my life, they were more willing to share theirs. I cared about them and they cared about me. And I find that reinforced in my leadership journey, in my human journey, in the way that we relate to our clients and to each other. 

Diane Brady (16:08):

You know it was also mentioned in the introduction, you're one of the most powerful women on our list.

Penny Pennington (16:12):

I did not say that. Somebody said that.

Diane Brady (16:13):

You are. I mean, sometimes I think there's no better way to clear a room of men than to put the word women in front of a panel. And so I say this with some hesitation, but of course there are too few women in leadership positions. And what have you learned? Any advice that you would say in terms of how we frankly normalize this? 

Penny Pennington (16:34):

Yeah, I think the statistics are 20% of women are C-suite in financial services or women at our company. We're gender balanced in terms of our leadership and our general partners. Over a third of our general partners are women. I'll tell you a funny story. Right after I was named managing partner in 2019, one day, a very reputable media outlet said “Edward Jones has made a very courageous decision to appoint a woman as the head of their company.” The next day, a slightly less reputable media outlet said, “Well, Edward Jones caved in because in the world that we live in, you had to appoint a woman.”

Diane Brady (17:16):

Caved and courageous. There's a whole narrative flow.

Penny Pennington (17:19):

So I have learned over the years not to listen to a lot of that stuff, but what I have learned to do is to listen to those observations and engagement that I had from great leaders through my nearly 40 year career. It is to raise your hand, it's to have a point of view and to lean in, it is to be with a company, like many of these companies, like your companies, where leadership is emboldened, not based on what has been the right kind of leadership in the past, but what's the right kind of leadership in the future. And to be in a place that really supports risk taking on that leadership. People took a risk on me. Now, it might look now like it was a reasonable risk to take, but terrific leaders who came before me had that risk taken on them and they knew to pay it forward, to provide me and that opportunity, and that's what we do at Edward Jones. 

Diane Brady (18:21):

You mentioned Peter Drucker earlier, and I think mentorship's very important, and sponsorship of course. But as your philosophy as a leader, anything that you think really drives you day to day? You didn't mention the fact that I think on a financial basis, you've created a very equitable work environment, not talked about how people work, but what's your own philosophy in terms of where you get your joy and how you lead? 

Penny Pennington (18:47):

Yeah. Well, where I get my joy is from having fallen in love. I have fallen in love with a problem. Now, this is a little bit of mental jujitsu. Wait, you’ve fallen in love with a problem?

Diane Brady (19:02):

That’s fifty-four seconds for that mental jujitsu. 

Penny Pennington (19:05):

I love this problem so much that I want to spend time with it. It's worthy of solving. Here's the problem. In my experience, talent and ambition is spread more widely than the opportunity to actually use that talent and meet that ambition. I want to close that gap. It's the reason I'm in financial services. It's the reason I'm at Edward Jones. It's the reason that I want to lead this partnership to new heights for the benefit of creating opportunity for more people, millions more clients, tens of thousands of more colleagues. Close that gap. Talent and ambition and opportunity to achieve it. 

Diane Brady (19:47):

I cannot think of a better place to end than there. Please join me in thanking Penny, and again, congratulations and thanks to Great Place To Work. Thank you.