Episode 55: When Good Decisions Have Bad Outcomes

Charlie Harary (0:00)

Remember, I was a kid growing up, I used to play basketball. There were times where I hit a shot and I got pulled, because the coach was like, what just happened? I'm like, but it went in, he's like, who cares? You just did it wrong, the play went wrong, you shot wrong.

This is Crossing the Chasm, your front row seat to how leaders think in real time. My name is Charlie Harary, RXR's Chief People and Organizational Strategy Officer, and I'm joined with RXR CEO and leader Scott Rechler. Join us as we break down what's happening in the world and we pull out the leadership lessons behind the headlines. Scott, thanks for taking the time.

Scott Rechler (0:27)

It's great to be here.

Charlie Harary (0:28)

We are sitting at the end of summer, and I know you a little bit, and I know how much you reflect and how you think. And most people may be taken off at the end of summer. I know you're looking back in your year, and you're in the middle of a crossroads of really the two parts of the year and preparing ourselves for the last few quarters. Do you have any reflections for us as to what you're thinking about maybe as you reflect back to the beginning of the year and as you prepare for the next part?

Scott Rechler (0:51)

I think it's interesting because this is the rush to get as much as you can get done in your 2026 goals and then start thinking about what's going to happen in 2027 And when you think about the goals you set in 26 and what you're trying to achieve, what's worked and what hasn't worked, I try to spend time reflecting on what hasn't worked and why. And what is important to me is that is an acknowledgement that you can't always control what doesn't work, but you can control the playbook as to how you're going to go and pursue different things, how you're going to evaluate investments, how you're going to evaluate initiatives, right? Do your homework, make sure that you're studying everything that could impact that investment, listen to people as they get the feedback, surround yourself with good advisors and good team members that are sharing different views with you, maintain a sense of humility so that you don't have belief that just because you believe it, it's going to be a reality and that you have a bias that may be clouding your vision, and then make the best decision you can make. And then as you've gone through, some of these decisions tend to work out because we did our homework and they're great. Some decisions we did all our homework and they didn't work out because something that we couldn't expect impacted it on a negative way. As long as we really do all our homework, don't be dissuaded by that. Just keep pushing forward with a sense of clarity, a sense of conviction and a sense of creativity to figure out how you're going to ultimately achieve what you need to achieve. And it may not be exactly what you thought, but the outcome likely will be good enough if you are disciplined to that objective.

Charlie Harary (2:27)

Yeah, it sounds and you're right, I see this a lot with sports where either playing or watching and people do the right thing, have the right form, do the right prep, call the right play, and then something happens, right? The ball gets dropped or somebody reads it. And when you look at that play, either you get upset that you called the wrong play or you realize that it was the right play call. And I think what you're getting at, which is so critical is that people don't know how to make that distinction between the right process.

You could have adapted, but you did the right thing. You made the right investment choice. But something came out of nowhere that was really unpredictable. And if you start to question everything, you lose all the wisdom that you built.

Scott Rechler (3:06)

And by the way, you could see the inverse of that. Sometimes you made the wrong call on a play, and you got lucky and it worked. Yeah. And you need to make sure that you distinguish that clearly so that you don't then try to use that play again in that environment, right? So a lot of that self-reflection is critical as you go forward to make sure that you're honing your expertise and make sure you're honing your internal processes. I always have said that preparation breeds confidence breeds success.

And so you just got to continue to prepare. The better prepared you are, the more you understand what's happening, the more you have a sense of humility and understanding of the landscape that you're navigating through, the better you will do. But to your point, we couldn't have predicted COVID, right? We couldn't have predicted a surge of interest rates and inflation. And so investments that we made that didn't expect those types of externalities to impact them are going to under out the questions. When you're in that circumstance, how do you then recalibrate to perform as best as you can under these new conditions and try to outperform what otherwise would be the worst performance by navigating through those new challenges?