Josh Pottinger: Welcome to Lightning in a Bottle, the essential podcast for middle market business owners, key stakeholders, and the advisors who guide them. I'm Josh Pottinger and joined by my co-host, Jason Chirogianis, together we lead ATX Wealth Partners, a private wealth management team at UBS here in Austin, Texas.
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Hello, everyone. Josh Pottinger here and I'm excited for our next Lightning in a Bottle podcast episode. And I'm especially excited about our guest today, Admiral Jonathan Greenert. So we are honored to have the admiral here, and even better, he's in person, which is always preferable.
So the admiral, he has been a UBS council member since 2016 and a long-time advisor to our clients on geopolitical risk. Admiral Greenert is a retired four-star admiral and former Chief of Naval Operations, the highest ranking officer in the United States Navy. And over his 41 career, he commanded fleets across the globe, advised presidents and defense secretaries, and help shape US strategy in contested regions like the Asia Pacific and Middle East. And his insights have been especially critical in light of recent global tensions including the war in Ukraine.
And today he brings his deep expertise in leadership and strategy in global affairs to our conversation. So, welcome Admiral.
Admiral Jonathan Greenert: Thank you, Josh. It's my pleasure to be here.
Josh Pottinger: Great, great. So for the audience out there, we're going to be exploring how current global flashpoints from Ukraine to Taiwan to the Middle East are shaping the geopolitical landscape and economic stability. So we will also dive into the admiral's perspective on ethical leadership, how institutions can maintain public trust, and what it takes to develop high-performing leaders in today's complex environment.
Just a side note, how institutions can maintain public trust, that's something that's been eroded quite a bit recently, so I'll excited to get into that one. Admiral, just give us a little, where do you call home and tell us a little bit about your family?
Admiral Jonathan Greenert: I was born and raised in Western Pennsylvania. And high school period, I said I need to find... My dad said to me, "We're out of money, son."
Dad was a steel worker, there was a limited fund, college fund. And my sisters, two of my older sisters, went to nursing school. And he said they used up what I had put aside, so you better get to work. So I was looking for a place to go to school for free. I was looking for scholarships, grants, whatever. And I found... Good guidance counselor brought me to the service academy, so I applied to West Point and Navy never really gave much of a thought to a military career actually. It was a means to a different end, is what I was looking at. So I went to the Naval Academy, I fortunately got in there. And I got myself involved in submarines because submariners got a hundred dollars a month hazardous duty pay. So it's all about money, Josh. So I got into submarines. Actually, no, I was intrigued by it. It looked like to be an elite institution, organization, like a subset within the Navy. And it was. This is the Cold War. Submarines were the silent service and they were doing a lot of things, which as we discussed in a book you just read, about those secret operations, which were quite interesting.
And so I said I want to do that. But again, the idea was to be a limited time. I met my now wife while I was in the Navy. She was coming into the, had been in the Navy just a few years. And we met at a party. I was talking to her. She said, "What are you going to do?"
I said, "Well, I'm leaving."
And she said, "Well, I just came in." She said, "It's not everything you think it is out there."
So that gave me pause. I stayed in for what was going to be one more tour of duty, two years, and 38 years later we retired. We got married, had children, had a great career around the world, great bosses. It was a wonderful experience for us all. We retired in 2015 from Washington. Our last job was as Chief of the Navy, think CEO of the Navy, if you will. And we live in Annapolis now. We've been living in Annapolis since 2016. And we're sitting in a neighborhood there and we have three adult children and four grandchildren and a dog, Maggie, who owns me. And I pretty much do my daily routine around her.
Josh Pottinger: What kind of dog is she?
Admiral Jonathan Greenert: She's a golden retriever.
Josh Pottinger: A golden retriever. Yeah. What do you like to do for fun? What's your hobbies?
Admiral Jonathan Greenert: Well, we bought a boat about three years ago. It's a power boat. So fun, I'd say yeah, but it takes a lot of work. It's a 47 feet twin diesel. It's about 20 years old, so it needs some, needs some care and feeding as they say. And the boats, people talk about it, say, "Okay, your greatest day, your two best days are when you get it and you sell it," and they say a boat, 'break out another thousand,' B-O-A-T. Right? It's probably not far from the truth. But honestly, Annapolis is on the bay. It's a big boating community, both sail and power. So we fit right in there. So we like to go in the upper bay and to the middle bay.
I haven't done the International Waterway. I'm sorry, the Intracoastal Waterway, not the International. I haven't done that yet. It's not really on my list, but we'll see where that takes us. I play golf, keep up with the dog. In my wife's eyes, it's all about the grandchildren. So we try to visit them and spend as much time with them as possible.
Having spent a life in the military, the wonderful part is you travel all around the world, you do all these other things. But you have a sense and a feeling that the service member that you haven't spent enough time with family and so you try to make up with what you perceive as lost time. But the family, a lot of times tells me, "Just relax, dad. We're okay."
Josh Pottinger: Yeah.
Admiral Jonathan Greenert: You were all right. You did your best.
Josh Pottinger: Well, thank you for your service. Dedicating 38 years to the country is quite a feat, and thank you for that. Okay, so let's dig into some questions.
Admiral Jonathan Greenert: Okay.
Josh Pottinger: Let's kick it off with the situation in Ukraine. Last month during the summit, how did that affect the geopolitical situation in the Asia-Pacific region and in particular the China-Taiwan situation?
Admiral Jonathan Greenert: Well, in the Asia-Pacific, the hotspot, the key point there, the leverage for all the stability there, is the China-Taiwan situation. That's the bottom line. The Kim Jong Un in North Korea, that's the Kim regime, and they're happy just being up there in North Korea, frankly, and being left alone.
But Xi Jinping has taken China to levels that he couldn't have dreamed he could reach when he took over as basically the dictator in the 2011 timeframe. And he's dictator for life. And what? He's around 70 and his one last achievement. Too, but one is completely on track, and that is to make China the great power. And they're very close to that. That's the economy. We're all pretty familiar with that. But the number two is to annex Taiwan, bottom line. And if he doesn't do that, then he has not achieved that last piece. So he's very fixated on it. Make no mistake about it.
So with that as backdrop, he doesn't want to do it with the military operation, that is with a lot of conflict. Because, A, he looks at what's going on in Ukraine and said oh my. If I got myself bogged down in something like this, that is a failure. He gets one shot. It'll probably have to be clean and fast, as clean as possible and fast, because they can't have a bog down. They have a middle class now. And although they are communists, and it is an autocracy... Not the whole country isn't communist by any stretch, although a lot of us think it is, it's not by any stretch entirely communist.
So they want to maintain that steady trend and have their middle class life. And so the point is, if that's purtivated like it is in Russia with the Ukraine operation, that's not good.
So he's watching what's going on in Ukraine. And what he sees now is, especially after Alaskan Summit if you will, is how Putin is probing NATO. And he's moving a little more aggressively to see the reaction of both Ukraine, the United States, NATO, EU, everybody.
And he studies that because he is probing Taiwan's air defenses, their maritime defenses. They're in their cyber, they're in all of their networks. He's using social media. He's got agents on the ground. And in a perfect world, he would be able to just get Taiwan to roll over and say, this isn't so bad. This would be Hong Kong, too. And although we would view Hong Kong as poor and a disaster, if you will, for democracy on the other hand, they would look at it and say, yeah. People are still making a lot of money there and they're living okay.
So it is an indirect reflection of what he sees might happen, that is the Ukraine campaign as an indirect reflection of what may happen there. So to the degree Putin is successful at probing and doing this, and there's a NATO reaction, they call it gray operations. If the gray operations is not black, it's not white. Black would be a military conflict. Well, it's just short of that.
To that degree, he's studying it. And the more Putin is successful in doing what he's doing, the more Xi Jinping gains that confidence that, okay, maybe I can pull this off without an invasion, which is really hard, especially an amphibious operation. It's the hardest thing, a military-
Josh Pottinger: Because of the geography.
Admiral Jonathan Greenert: ... Yeah, not only the geography, but to sit offshore in hostile waters and be vulnerable, sitting there moving troops and logistics ashore, and you're vulnerable. In today's world, all kind of undersea, on the sea, in the air drones and mines and torpedoes. At just a... One would call terrorist attacks, however you want to look at it, but it's really a matter of just a resistance.
And so you're an occupying force. And we have a lot of experience, unfortunately, of what it's like to be an occupying force, in our case, in the Middle East. So it is an indirect reflection of what he might do there. And the more successful Putin is, it gives him confidence. And he's moving toward that for what he describes is that by 2027, telling the military, I want you folks to be ready. I want you to have the capability. I want you to have the rehearsals done.
Josh Pottinger: He's telling the troops in China?
Admiral Jonathan Greenert: Yes. Yes.
Josh Pottinger: Be ready by '27?
Admiral Jonathan Greenert: 2027. And he told them this three years ago. So I want to have the military capacity, capability. I want the operations to be tested. You come to me and I want to see how the command and control aspect, and then there's the nonlinear part of any operation. The old Mike Tyson thing, everybody has a plan until you get punched in the face.
Josh Pottinger: Punched in the face, yep.
Admiral Jonathan Greenert: So what are we going to do there? So all of these things that I just described in Ukraine, he says, this is a real-life anecdote, possibly. A microcosm of what I might be up against.
Josh Pottinger: Right.
Admiral Jonathan Greenert: I should caveat it because our US commander of All Pacific Forces, when he talks about it, he uses a nice term. He said, this isn't a use-by date.
Josh Pottinger: Yeah, right.
Admiral Jonathan Greenert: In other words, this is a goal. If Taiwan does something to cross a red line before that and he feels he has to go in, he Xi, then he would. Let's say they declare independence. So they hold a referendum vote, and so they look at that political situation very closely.
Number two, if they're not ready in 2027, well, maybe a little later. But it gets back to what I said in the beginning. He's on the clock for his legacy. This is very important to him.
Josh Pottinger: Yeah, interesting. Thank you for that.
Let's pop over to the Middle East. That's a lot going on over there. What do you see as the keys to geopolitical stability in the Middle East? And can the Houthis continue to effectively shut down or constrain the Red Sea? Or could Iran do something similar in the Strait of Hormuz? What are your thoughts on that?
Admiral Jonathan Greenert: I'll talk about, briefly, about the Houthis. I think they're constrained now. I think the actions of Israel this past summer, with a little bit of our action, a little demo between the B-2, but there was so much more on the air power that could be brought to bear very accurately in mass quantities. We were very defensive in our approach before, on purpose. But that could be changed and they've got that. Number one.
Number two, well, their source of resources is Iran. And they have really suffered a lot of great losses. So to take geopolitical stability, I'll take big geopolitical stability, and I'll take a small and I'll explain why in just a minute.
And the big one, it's all about Iran because they have been the ones that have been tending to upset it. So their activity in getting a nuclear weapon and then their rhetoric on what they're going to do with it or why they would use it, is frightening. And Israel said they're not going to get a nuclear weapon, and so they acted. In the bottom line.
And then we got involved in it, bottom line. So Israel took that action which knocked down Iran in two cases. One, the nuclear weapon program. And that is, by the way, this isn't months. It's quite possibly years. If one looks at the articles that are now on page eight, nine, or 10, not near the front.
Josh Pottinger: Right. It's crazy. That was such front page stuff. And with the news cycle now, I mean, we've had three things since then.
Admiral Jonathan Greenert: Yes. There's been quite a bit of studies that take a lot of time as we know. And you might remember after the bombed, they said, well. We'll give you some time to look this over.
Josh Pottinger: Yeah, yeah.
Admiral Jonathan Greenert: Building a nuclear weapon, just getting, they say, "Well, do you have the uranium?"
They said, "Well, I do." They said, "Okay, can you put it in a condition such that then it can be triggered?" “Well, no."
So you have to have the triggers, then you have to have the electronics to set off the triggers, and it goes on and on. It's quite complicated. If all you want to do is blow up a bunch of radioactive material, called the dirty bomb, they have that. But that's not what they want. And you can't deliver it. It's all localized. So set that aside. They're way behind in the nuclear program. Years.
Josh Pottinger: Because of what we...
Admiral Jonathan Greenert: Because of what we did and what Israel did. A lot of what Israel did. And it gets beyond just those-
Josh Pottinger: Sites.
Admiral Jonathan Greenert: ... centrifuges and those sites. The taunts and et cetera, and all those. It's the scientists. Well, they're still disappearing here and there. They're either quitting or dying, and you need scientists, engineers, et cetera, and it's not going well.
They need resources, and so there's sanctions, and they just got more sanctions because of the snapback sanctions that go all the way back to the joint comprehensive plan of action put in the Obama administration. So that's down. Without the resources, Hezbollah and the Houthis and Hamas don't have nearly the resources they had before.
So that morale is down in the leadership in Iran. So that leads to better stability, bottom line. But then there's this other, I call it, a lesser geopolitical but very important. And that is the situation with Hamas and Palestine and Israel. And right now in the Gaza Strip, when Israel is doing what they're doing and this tug of war going, recognizing Israel and all that's going on here, that tends to send a message to Hamas.
Well, as one guy said, these are the fruits of October the seventh. Well, that sets everybody off in Israel and said, oh no. I could never. How could I ever recognize them? How could I find a two-state solution acceptable? One-state solution? So it appears that Israel is going to occupy the Gaza Strip and be sure that there is no threat vector, for lack of a better term, from the South.
Josh Pottinger: Mm-hmm.
Admiral Jonathan Greenert: Well then if this rhetoric keeps going and they keep picking at this sore point of October the seventh, then they turn to the West Bank. And I don't know what that means. And so my point is, Josh, as long as that is complicated and begets more violence, the Abraham Accords, which would cause a calming effect because an agreement of recognition of Israel by Saudi Arabia and any other, as they say, moderate Arab countries would tend to join in. Now we can build on a economic and diplomatic and just set a peaceful, if not peaceful, stable element in there. And there's a ton of energy. There's a lot of critical minerals also in the Middle East, so there's a lot at risk.
Lastly, I would say, I don't think Iran is a threat anymore in the Strait of Hormuz. They need the Strait of Hormuz because that's where their oil comes, goes out. So I don't think that's an issue. We need to keep our eye on Iran. They're clearly angry. They're clearly do whatever they can. They're trying to get as much aid from Russia as possible, nuclear predominantly, to rebuild that capability. But as a result of last summer, Israel has a pretty good track on all of the elements that Iran was doing covertly before.
Well, they can't do it now covertly. So if they start moving again, it'll be easy to react. So I think their nuclear program is very truncated for a long time.
Josh Pottinger: Mm-hmm. Well, after seeing what they did in Iran and then before that with the whole pager thing, they're clever in their approach and infiltrating covert operations. The social media feeds are just tough to see. I have to constantly remind myself and constantly be skeptical of the algorithms that are feeding me that stuff.
Admiral Jonathan Greenert: Yeah, that a good point.
Josh Pottinger: It's very, very, very difficult to do that. And it's a very effective strategy, and I know that there's Chinese and Russian actors that are pushing those narratives and they know how to push our buttons.
That's another aspect of this, not your traditional military warfare, but it's a psychological warfare that is happening.
Admiral Jonathan Greenert: People would say too, in the case of let's say the UK, France, Australia and others that say, well, we're going to recognize the Palestinian state. Well, first of all, there is really no Palestinian state because any state has an economy. It has some sort of structure, has a governance, not there.
But nonetheless, you say if you were a foreign affairs person say, why would you possibly do that? You have just rewarded Hamas.
Josh Pottinger: Right. That's exactly what they said today.
Admiral Jonathan Greenert: And I think their honest answer would be because we want to be re-elected and we have an electorate. And for the exact reason you described in social media, I want them to vote for me. And so I need this.
Josh Pottinger: Yeah, it's a very complicated world, Admiral. Geez.
Admiral Jonathan Greenert: Yes, it is.
Josh Pottinger: Well, what issues, perhaps not foreign affairs related, concern you right now regarding geopolitical stability, and by extension, global economic stability?
Admiral Jonathan Greenert: Well, I'll stay away from our internal issues, which are actually quite serious. We could come back to that, but our biggest threat is internal as far as being a stable entity and leader for the world. But I think it's energy. Let me get to what I'm saying. It's about critical minerals and critical products. Critical minerals in mining, obtaining them and producing them. That is taking it from ore to something that is useful for batteries, for products for AI, for chips, and getting all that goes with all of that sources of energy that we see as the future.
Right now, China, they mine about 60 to 65% of the critical minerals in the world. Well, that's not probably a good thing. To take that ore and produce it, it's hazardous. We don't do it that much for that reason alone. A lot of other western countries don't. So China does 90% of that. And so if you think about that, that's a problem, I think-
Josh Pottinger: That's a problem,
Admiral Jonathan Greenert: ... for, if you will, stability.
Josh Pottinger: Right.
Admiral Jonathan Greenert: So let's move to AI is data. You have to have a lot of data to have AI. Okay? Data requires data centers. Data centers require a lot of power. We need a lot of power. So a lot of people say, well, let me tell you, you want to get from here to there on power. Until we develop these renewables and the things we really want to use and get off of petroleum and that sort of thing, we're going to have to go with nuclear power for a while and do it right.
We can have modular... Okay. So who's got all the uranium? Well, Russia does, and we buy over 25% of our uranium from Russia. And we have. By the way, so does Europe. And so there are other sources of critical minerals, as we know. Ukraine's got a lot of critical minerals.
Josh Pottinger: Right? I was going to say Ukraine.
Admiral Jonathan Greenert: Part of the deal that we set with them way back in the spring. So it behooves us to get that place stable. It would behoove us to do our due diligence and figure out where we're going to get uranium and get after that. There's undersea mining that we could do. We've just not been compelled to do that.
There's tons of nodules of all kind of critical minerals, including uranium, on the ocean floor. We have not been a signator to the organization that mandates, if you will, and regulates deep sea mining. In other words, in international waters, you have to say, "I would like to go mine this very large area."
So there's an international organization that says, "Okay, well let me see your... I'll get your permit. Let me see your application."
We didn't have time for any of that in the past, and we need to get re-engaged. So to the degree we can buckle down, pay close attention and get on with that, and not try to take shortcuts or do what's politically expedient, I think we collectively need to keep our eye on that ball. It doesn't involve the easy things to talk about, but it's an important part of our future for stability and economic growth.
Josh Pottinger: Right. Well, it's a conversation that we have often here at the office is this whole artificial intelligence wave still feels like we're still in the very early innings of it. And the one common denominator is power or lack of power. Water, too.
And the fact that you cited that a lot of these critical minerals are in hostile territories makes it a little problematic. And I'm sure mining the ocean floor is not exactly a cheap endeavor either.
Admiral Jonathan Greenert: No, it's not. We used to do it, much more than we do now, so we're not starting from scratch. I failed to mention one other thing. We can say, "Atara, I'll tell you what we're going to do. I got a lot of investors. We're going to mine and we're going to build a production facility."
They say, "Okay, we're going to do in this country?
Say, "Yeah, we'll do it."
Southwest has got a lot of materials, minerals, a lot of property. It takes a forever to get a permit. So we need permit and regulation reform in a big, big way. We need it for nuclear power as well. And the president, he's all over that. He's trying very hard to get that going. But there's another side to that regulation and permit stuff. It's going to be not in my backyard. It's going to be...
Josh Pottinger: Tough. Nobody wants a nuclear plant in the backyard.
Admiral Jonathan Greenert: Yeah, it's hazardous. We were fracking. Wow, we have more natural gas than we know what to do with. And it made us independent and then we started shutting it down because we said, I don't like this. It's getting in the water. It's ruining in the aquifer. I have a crazy idea. Make them do it right.
Josh Pottinger: Right.
Admiral Jonathan Greenert: Because it can be done right.
Josh Pottinger: Yeah.
Admiral Jonathan Greenert: Yes.
Josh Pottinger: How far do you think we are from really embracing nuclear?
Admiral Jonathan Greenert: Well, we are not far. Within, let's say, a decade, which may seem like a long time, but I would say within a decade we could have up and built small modular nuclear reactors. So we say, well, I don't know. Is that adequate? Yeah, let's think Three Mile Island. Okay. That was enormous. It was, let's say, 500 megawatts or more. Close to a gigawatt of power.
And that much uranium with that much power on one site makes people very nervous. And I understand that. They say, well, that thing, if it melts down, it'll melt to China and therefore you have the China Syndrome, which was a movie and a book. Austin could probably take care of the city, or a good part of the city, if they had their own small modular.
So you can see, it can be a microgrid, so you can manage your own ebbs and flows and that kind of thing. So that technology can really be moving. Bill Gates is working very hard on that. A lot of it is private money. You know what the problem is? It's permits. Permit reform-
Josh Pottinger: Well, no. If somebody was saying... Gentleman, I know that's very involved in the data center world. I think it was a meeting that I had with him and a couple other individuals, and they said it takes 10 years to get a power plant up and running, just with all the regulatory and red tape that's involved.
So if the administration can start trying to streamline something like that, I mean, I don't think we have a choice. I mean, China's full steam ahead.
Admiral Jonathan Greenert: ... Yes. Well, we need labor, too. And so you need design engineers, engineers, operators. And that labor force was pretty robust when I was going to get out of the Navy in 1982, because that was my plan. I'm going to go to commercial nuclear plant and get a job, be an engineer. It made good money with a nice career track.
Kind of glad it didn't go that way, but we have to rebuild that force and it's competing with everything else.
Josh Pottinger: Well, and the whole a hundred thousand dollars visa surcharge now.
Admiral Jonathan Greenert: Yes.
Josh Pottinger: Is going to make it tough.
Admiral Jonathan Greenert: Yes. But the fact of the matter is yet India, even China, France, believe it or not, Japan. Japan, they had the Fukushima thing, they're back up to one third of the country on nuclear.
Josh Pottinger: On nuclear?
Admiral Jonathan Greenert: Yeah. I mean it's the country that had Nagasaki, Hiroshima, and Fukushima, and they said, "We got to do this."
Josh Pottinger: Right.
Let's switch gears a little bit into the leadership component this episode. How can organizations and institutions keep the public trust, given the political and the cultural dynamics of today? Can we have some civil discourse? We've got the ethics issues, polarization, social media. Give us your thoughts on that.
Admiral Jonathan Greenert: Well, I think the number one piece, especially for a leader, is integrity. You have to be beyond reproach. That leader, and I say that because as we know our leaders of all institutions in the government, they are given great fanfare. Many of them have their own song when they show up here and there. Their own flag for crying out loud. And the companies, they're compensated very well and some say way too much.
But that's not the issue. And I think the system, the process, capitalism and all that goes with it, it does that for a purpose. They are the face and represent so much more of that company than making decisions. And so the point is, when they fail, especially behavior or something like that, you've heard of the Bathsheba effect?
Josh Pottinger: Mm-hmm.
Admiral Jonathan Greenert: Okay. When you do that and you say, well, I'm beyond the rules and regulations. A, it's terrible for morale. B, it ruins the brand and it does all the things that everybody knows. But I think we forget. They forget how devastating it is. So number one, you just have to do that. And it's those that observe, those that monitor the behavior, and those that advise our leaders have a real challenge on their hands.
So one. Integrity, two. Boy, as much as possible be apolitical. Easier said than done, but I think companies have found... Many of them just jumped on ESG, and I'm on a few boards. ESG and the whole concept became very difficult because there's a lot of energy involved. They had [inaudible 00:29:20] to go say, "Oh, we're going to go carbon-neutral."
I say, "Are you kidding me? And our margins can't support such a thing."
And what do we tell the shareholders? They just couldn't get there. Then I was on an advisory board at other companies, said, "Well, okay. We can do this," because what we make is quite simple. There's not energy involved, so we can meet the sustainability and all that other stuff.
Those that got so deeply wrapped around that found it very hard whenever the country or administration says, no. There's no more of that, and that's not looking good for those that invest.
So they don't want to invest all of a sudden if you're heavy in the ESG. Well, change the three letters, do something else. But you get all wrapped around in that, if you see what I'm saying.
Josh Pottinger: Oh no, absolutely. I totally understand. We have a wonderful client base and we have different views, different opinions, and some of those are very strong. And so we have to be very diplomatic in terms of not letting our own views getting in there. It's just understanding what's important to them and then helping guide them towards things that fit their values from an investing standpoint, helping clients work through that.
It's like a four dimensional puzzle trying to match their goals, how much risks we should take, how much risk they can withstand without abandoning the game plan. And then trying to fit their views around that.
Admiral Jonathan Greenert: Exactly. So the good companies, and I'm not an expert in it, I just know what I observe and I watch, stayed away from just grabbing onto anything that was an acrimony otherwise and said, look. We've been here for a long, long time. We're a team. We go as far as our workforce. There's nobody here that isn't a important part of it. We believe in dignity and respect for all of you. We have to be a diverse force because that's where the talent is.
I mean there's a huge stack everywhere of studies that say a more diverse workforce, and diversity is in many different areas. It's ethnicity, it's gender, but it's geographic. It's thought process and approach. And when you can mold that all together as a T-E-A-M and do that, I think you get through the hard times because every company's going to cyclically have those hard times.
Josh Pottinger: Yeah.
Admiral Jonathan Greenert: Know where your resources are going and quit, don't be sloppy about it. People, money and time. A lot of that has stood the test of time is all I'm trying to say. And so I think you have to just re-inculcate the things that you know, the foundation of who you are. You mentioned earlier what social media can do, because it gets us all wound up. A new slang term, a new this, a new that. It'll make things go faster, smarter and be more profitable.
Just calm down and take a look at this before we make the jump. And that's what leadership, as they say, not only get paid to do, but that's why people respect them and depend on them to do that for them.
Josh Pottinger: I think oftentimes it's the marketing of these, whether it's ESG or DEI. I think we can all agree we don't want to be blowing a bunch of black smoke if we have ways to mitigate that. I think we all agree, treat people as human. And there's a lot of fundamental things that we can all agree on, but it gets branded a certain way. And then some of these leaders at the companies, the employees start to say, we need to take a stand. We've got to take a stand. And they're forced into taking a stand.
But I think that's where leadership comes into play and being able to mitigate that, I guess, to a degree.
Admiral Jonathan Greenert: Well, you may recall, I remember some corporate leaders said, "Well, are we beholden to shareholders? Or are we beholden to something bigger and more principled driven?"
And one has to think very deeply, I think, and strategically of that concept because those that were beholden to the shareholders eventually regretted going in the principal's direction whenever those principles weren't really as principal-driven as they thought. They became faddish, if not otherwise. It was what was hot. And their employees were very happy then. And so they took the pressure off the corporate leadership and then some of their investors and others, and things look great and then didn't. When the investors said, "Well, wait a minute, I'm not investing in a company that is oil-driven or renewable-only driven. Take your side."
And then you make yourself, I think, liable to that sort of thing. You just have to be careful and thoughtful in it. And so as long as you're behaving and thinking strategically, you can get yourself through these things, I guess, is all I'm saying. And a lot of folks took quite a beating, we all know, on the street. And then the ones that had a nice foundation recovered.
Josh Pottinger: Mm-hmm. In your observation, what institutions have been successful in keeping the public trust?
Admiral Jonathan Greenert: Well, one, those that are founded on integrity. And I overuse that word, but there's a transparency that allows people to believe that you have integrity. So this is who we are, this is what we do. And then you have to walk that talk, admit your mistakes, be upfront. As I said, be transparent and have integrity. Those organizations keep the public trust. And so, who are they? I'd like to say the military, but man, we're not what we used to be collectively. I'm not in the military now, I'm a retiree. But I stood on the shoulders of people before me, who from the greatest generation World War II, all the way through, these people. Where do we get such men and women that are just citizens and then they go out and give their life or do all these very heroic things, innovative things? Astounding.
See whether they're actually, you and I, put in a situation and thank goodness they're from a country that allows them to innovate and they think like that, and they're willing to do that because they love freedom and all that stuff. So that's still here. It's still in most Americans out there. But the organization has to keep them and allow them to be that way. First responders, your military, your police force and all that sort of thing.
So when you represent them, you can't get out of the apolitical situation. They say, "Well, wait. That's really hard." "Yeah, it is. It is." And they all know that from the Chairman of the Joint Chiefs all the way down through that, and they have to think about how far they can go or will go. Everybody can't get up and resign. Say, "Oh, everybody just resigned."
Said, "Well, that won't work."
That's actually letting down the people that you swore an oath to support and defend.
Josh Pottinger: Yeah. Let's talk about the opposite of that. Maybe share an anecdote of how not to be a successful leader.
Admiral Jonathan Greenert: Yeah. Well, I'll give you mine. So I led an organization, I commanded a submarine. And the subject is empathy. In other words, haven't experienced what you're telling your people to do, goals to meet, et cetera. And if you haven't specifically done it, what's your feedback loop to understand how they're going?
So I took command of a submarine and I concluded that the way to show myself off, if you will, or ensure my success, was to be the number one submarine in a squadron of 10 submarines. If we were ranked number one, there was every likelihood I would get promoted. In fact, it was a shoe-in. About three of the top 10, the top three, we'll make a captain. You come in as a commander. It's like being a lieutenant colonel in the Army or the Air Force. And you want to make a colonel or captain.
All right? So that's number one. Number two, if we're the top submarine, we'll get accolades. Our over the squadron that we're in, the staff that oversees us, we'll think the world of us and they'll leave us alone. We'll get great port visits. We'll be able to set the tempo and the tone of our operations. So I said, "So we're going to do great in every inspection."
I wrote out the way, I had the plan to do that. Laid it all out. And I said, here we go. So we drilled and we worked and we did this and we did that. And we won what's called The Battle "E," which means you are the top submarine of the squadron. You're the best in engineering, logistics, communications, tactics. It doesn't measure what we would call HR, right? Morale and stuff like that.
And that's an important fact because, so at the end of it all, we got all these plaques and we got this big banner about being number one. And we took a picture of the whole crew, about 120 in a crew of a submarine. Got all the officers and all the enlisted. And taking this picture, and I'm smiling brightly and a few others are, but most people are just got this deadpan look on their face.
So my head enlisted advisor, he's called the Chief-of-the-Boat, C-O-B, COB. I say, "COB, how come people aren't smiling?"
He goes, "Because they're dead tired and they're unhappy, Captain."
And I was like, "What? How is this possible?"
So then he explained to me, "You were working them too hard. And the schedules and all that goes with it, it's a matter of balance."
So he gave me a pretty good counseling of that. I was shocked, dismayed. Our morale wasn't good. Our retention wasn't all that good, but that wasn't one of those things that determines you're number one.
So Josh, fundamentally, I said, yeah, I got to get my act together. Had a discussion with myself in the mirror and realize that yeah, you can have integrity. You can have great strategic plans. You can have a plan. You can have straightforward goals, feedback. Oh, I had tons of feedback on how everybody was doing. Measurable. But you also have to have empathy. You have to understand what you're asking people to do and get a test of their morale.
Did they feel like a team? Maybe. I mean, I was certainly the leader. I made that clear. But what kind of a leader was I? One that just said everybody we're going this way. So we were, instead of an excellent, we were above average. That was my first year. I had three years total. So the next two years. But we were happier crew. Our retention was higher. We didn't win The Battle "E" again, but we were very competitive.
And in the end, I also learned, by the way, for what it's worth to close this off, when you evaluate who is the top submarine commander in your squadron of 10, I'm thinking, well, it's got to be the guy that won The Battle "E." Not true. And I eventually got command of a squadron of submarines and I would evaluate the commanding officers, like anybody in a company or other organization would. They'd say, "Well, who's got the greatest return from their people?"
But yet, what's the skill set? What about the succession planning? You know what I mean? What about the degree of difficulty of all of those things? And I didn't see any of that. So that's how to get to The Battle "E" but not be the best.
Josh Pottinger: I think what you just described, just to use in the corporate world, it's ensuring you have the right culture. What's the culture that you're wanting-
Admiral Jonathan Greenert: Yes.
Josh Pottinger: ... to foster and encourage. And having empathy, it was a blind spot for you, right? I mean, you were young. It was your first role and it's something important that you learned. And it's good that you learned it early.
Admiral Jonathan Greenert: Well, that's for sure. Yeah. And it was-
Josh Pottinger: And you could course correct.
Admiral Jonathan Greenert: ... yeah, it was a shocking thing. Because you think you've got it right. We're going to be the best. You say we're going to be the best company, or we're going to be the number one sales. You fill in the blank. How many times have you read or seen that? Well, how are you going to do that?
Well, we're going to do it by doing this. Okay, keep talking. And then how do you communicate? Who is your team? Your team's going to turn over. How's that going to work? It's really hard to do that. But if your people take ownership, and that's what happened later, people took ownership. Because they felt okay, he's leading us and nurturing us and waiting, not constantly just saying, directing us to do it this way.
You can do that with a small unit, and I did it, but you can't do it with a larger unit. You have to delegate, inspire, and have trust.
Josh Pottinger: Phenomenal. Well, as the Chief of the US Navy, you were responsible for the development, for the promotion, and the assignment over 250 admirals. So I think we've got a little insight into your style and what's important to you and how you evaluate people.
But maybe you can discuss your executive leadership program to meet that challenge.
Admiral Jonathan Greenert: Yes, that's a good question. Because when I became the Chief of the Navy, you are in charge of all 250 admirals. And the idea is you have to nurture and bring them along because when a officer becomes either a general or an admiral, it's like being commissioned all over again. It's a whole second career path of being executive. And I think there's an analogy to people when they head out to the C Suite arena or in the Pentagon, as they call it the E ring, which is the outer ring. That's where all the corporate offices are. Because they have windows and all that. But you get my point.
So you find yourself... Somebody said, "Well, you're going to have to give 10% of your time to that."
And I said, "That's nonsense. You mean one hour of every day I'll be spending on executive development?"
Josh, it was more like 20 to 25% if you really take into account and the importance of it. And people will say to any leader of a very large organization, "Well, how do you possibly lead such a large organization?"
And a lot of them will say, "You get good people in there and you delegate to them and you trust them, and you have confidence." "Well, you have to know. How do you know that maybe you've done that?"
So you have to have a program to do that. The means is, what I found, is they have to feel that when they're done being an admiral, whatever, they're a better person. They're ready to springboard out and lead an organization outside the military. So they have to feel like, okay, you're just going to use me for another five years in this government organization and let me go. And then I'll go figure... I'll be 55 to 60 years old. I'm starting over. That's one. So you have to have legitimate means to make them know that they're going to be a better person leader for this.
Two, that has to be transparent to them. It's the worst thing I've seen in companies. Who's going to be the next CFO? The next COO? The next, you fill it out. Chief Technology Officer said, "Well, we may not know exactly, but those that are being nurtured."
So you have a succession plan, but you also have to have a selectivity. And situations vary. Company may meet it a certain type this year, but four years from now, they need something different. So you have to develop and bring that along and always have in your mind. There's an old saying in the government that said, well, you should be training your relief. I mean, God forbid, but if you have a heart attack tomorrow or an injury and you can't perform your job, who is it?
Or better yet, you would like to go on vacation for a week and turn it over to somebody that you say they can keep all the buses running on time, as they say. The trains running on time. So you have to be transparent. They have to know that you have a plan for them. And they'll be all in for you. You have to have a succession plan and a means to bring that along.
Now, the people under you. Let's say your executive leadership team, a lot of them call that. The senior leadership team, the SLT, they have to be part of that. They can't just be looking at you and say, okay, boss, who's next? Because one of them is going to be you. And if you haven't brought them along to see, this is not rocket science but it is a little bit of science and art the way you bring along a group of executives, and you can't one day just be saddled with it or it's not going to be good for the greater good of that cadre of people. So that too is important.
And then gather them together and say, okay. Like I said, you got to spend hours and say, okay, who are up and comers? Why do we think they're up and coming? What is the potential? What am I going to do with them? If they say, "We think Billy should be of three-star General."
I say, "What am I going to do with Billy? I mean, he's a hell of a good guy. Look at that performance. But where do we put him and what do I tell the Secretary of Defense why I want to promote this person?"
So all that has to have some coherency to it from that regard. So it's a fascinating thing. I didn't see it coming per se, the depth and breadth of it. But on the other hand, it was super rewarding to see it, especially if you leave and you see people who are, last point I'd make, enjoying their job. Because there are people looking up and they're saying, I got to tell you, I'm 52 years old. I don't want to be doing that when I'm 55. That guy looks, he's gray. His skin is gray. He's working on ungodly hours. Never looks happy.
Say, well, what is that about? So that's not good.
Josh Pottinger: Yeah. Was there any concluding thoughts or anything that you wanted to add that we didn't touch on?
Admiral Jonathan Greenert: Well, if you don't mind, I'd like to spend just a minute to say how impressed I am with this firm, UBS. And I came in to UBS as a member of the President's Advisory Council. Well, what does that mean? I met Bob McCann a long time ago, almost eight years ago. The president at the time, and turned out we were from the same basic area in the Pittsburgh area. And so we had a similar background.
So we chatted about challenges, a little bit about what today's conversations were like. And he said, "You know, I want to make sure that this firm is on a good track during my time here. Ethically sound. They think about leadership development." The kind of things we talked about today.
And he was looking, referring back to the 2008, 2010, where some firms lost their way. And he said, "I want to be sure that we have a sense of principles in there, and we just keep passing them down. And it's sound business practices, but also I want to be firm with principles."
I was impressed with that because a lot of people, "Hey, what's the next report look like? What do the shareholders have to say? What's the shareholders, the report say?"
And that is important. But he was looking out for beyond. Well, I've been here a long time, and I'd say the leadership, they've walked that talk. And I'm really impressed with that. Just as I go from place to pace and even the questions I get. I hope that your clients understand that, because clearly, if I give all my money to somebody, which is my future, especially now that I'm on the back nine of life, say hey. This is important.
So you want to talk about keeping the trust, and they say, these are people of integrity that listen to me. That's important. And I think this firm does that.
Josh Pottinger: Well, it's good to hear that. Thank you for those kind words. And we've certainly enjoyed our time here. Jason and I have been here since 2008, so we've got a few years under our belt. Each of us have been in the business for a little over 30 years, which is hard to think about sometimes, but I was super young when I got started.
Admiral Jonathan Greenert: I call that being all in.
Josh Pottinger: All in. Yep, absolutely. So it's been a great ride and we've got plenty of gas in the tank. And our podcast here, the Lighting in a Bottle podcast series has been a super fun thing that we've been doing for a couple of years and we get some amazing guests on. And this was a fantastic conversation. I think our people are really going to enjoy this as much as I did, and so I thank you so much for spending some quality time here.
We've got a round-table dinner this evening that we need to scoot off to in a little bit, so we'll go ahead and wrap up. So to all the guests out there, if you're still listening, thank you very much. And if you have any questions or would like to visit with us, feel free to reach out. Otherwise, we wish everybody the best and be well.
Thank you for tuning into Lightning in a Bottle. It's been a pleasure bringing you today's insights from the brightest minds in business. To stay updated with relevant content, exclusive events, and our latest podcast episodes, send us a note to atxwealthpartners.com.
Until next time, keep capturing the lightning of innovation and turning it into success. I'm Josh Pottinger, wishing you a productive and prosperous week ahead. And don't forget. Know your options, be informed, and plan early. Take care, and be well.
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