In Conversation with John David Rainey

Jonathon Platt: You’ve gone from earning your BBA and your MBA at Baylor in the early ‘90s to CFO roles at United Airlines, PayPal, and now, Walmart, the world’s largest retailer. That’s a journey that’s taken you from flight decks to Silicon Valley to the Walmart headquarters in Bentonville, Arkansas. When you think back to being a young Baylor student walking across campus, if you were to draw a through line from that young man to the leader you are today, what would it be? What’s the same about these two men?

John David Rainey: Very clear to me is the emphasis on people and how you treat them. I never felt like I was the smartest person in the room or the most qualified, in some cases, but I always placed an emphasis on how you work with people, how you treat people.

I actually worked construction before college and during college, and you work with all walks of life there. There were a couple of summers where I was the only English speaker on the construction crew, and I think that really informed me in terms of how I work with people and notably placing equal value on everyone regardless of your title, or where your parking spot is, or how big your office is. That’s been common from that young man all the way through who I am today. It’s important to me to know the janitor’s name and talk to them and greet them just like any other executive.

You’ve credited professors, like Dr. J. William Petty and Dr. Terry Maness, with shaping your leadership philosophy. Was there a class, or an assignment, or even just a single piece of advice from them that you still carry with you into boardrooms or your office every day?

I was very much an average student in undergrad, and I decided I was going to go straight through to grad school. I didn’t really have anything else going on at the time, so I applied and I did not get in. I remember that rejection letter and the punch in the gut it was like it was yesterday. It was one of those seminal moments in your life where it’s like, “Wow, what am I going to do now?”

I went into the admissions office that afternoon, and I asked them to give me another chance. I said, “I think I’m the type of student that you would want in your program.” And the dean of the department said, “Look, you need to write a formal letter and apply for this.”

And I did. I wrote it that afternoon. About three weeks went by and they said, “We will admit you. We’ll give you that second chance.” And it was that point in my life where I sort of changed my academic trajectory. I decided that I am never not going to achieve something again in life because I didn’t work hard enough. And to be very clear, I was perfectly capable in undergrad, I just didn’t work hard enough. And I went on to make among the highest grades in my graduate class.

Dr. W. James Truitt, who was the head of the economics department, had the capstone class in macroeconomic theory – the class that everyone dreaded in grad school. And I think I made a 4.0 in that class. Because of my performance in that class, he actually asked me to work in the economics department selling Scantrons, and eventually to teach a few classes. I think that set me on a different trajectory.

Dr. Petty, importantly, in grad school was the one that really stimulated my interest in finance. We did a lot of valuation-type work in his classes and that was the first time in my academic career where I felt like I really love this, and I would love to do this for a living. Up to that point, I had switched majors a few times, I didn’t know what I was going to do, and that was the crystallizing moment for me.

I had Dr. Maness in undergrad. We developed a great relationship after I graduated, and I have just huge respect for what he did as the head of the business school.

You rose through the ranks to CFO at United Airlines – which was Continental Airlines when you started – to the point where you were making billion-dollar decisions, while also learning the details of airport operations and aircraft maintenance. You approached it with what you described as a boots-on-the-ground approach. Where do you think you developed that leadership style?

I think there’s an element of servant leadership in there. I’ve never been afraid to roll up my sleeves and get into the details of things.

In fact, one of my favorite moments when I was at United was when I actually went out on the ramp and threw bags with the ramp workers, loaded a plane. I said, “We’re not doing this with cameras, this is not for publicity,” but I want to earn the respect of these people. And in the airline business, you largely have unionized workforces and that tend to have a more of a combative or adversarial relationship with management, and I wanted them to understand that I’m no different than they are and that I want the same thing.

I think that came from my family, my parents, and even my grandparents – having that attitude that nothing makes you above any type of work or more special than someone else, and I think it’s important to demonstrate that with actions.

How do you think young leaders and executives can model your version of servant leadership?

I spoke to a group of students at Baylor several years ago, and I was telling them, “You’re getting ready to embark on this next chapter of your life and people are going to ask you, ‘What you’re going to go do?’” And I told them, “The more important question probably that will influence your career is how are you going to go do it?” It’s not the what, it’s the how, and I still believe that to this day.

I don’t think there’s anything particularly special about me that has enabled me to accomplish this on paper. But the way that I’ve comported myself, the way that I’ve operated with others over the years – I try to lead in a way that brings out the best of others and makes everybody feel like they have a voice. If you talk to my leadership team, they will tell you a common trait that I have is when I’m in a meeting, I want to hear everyone’s opinion, even from the lowest rank in the room.

You mentioned leading by example. How do you balance being an example and also being mindful that they’re watching you all the time?

I think that is one of the hardest things for executives. Every single action that you take, someone is evaluating, and in our worst moments, people are judging us. If you show up to meetings when everyone’s watching and you’ve got the best version of yourself, that’s great. But people are also evaluating you by the water cooler, and how you speak to colleagues, and all of those things, and that’s what develops your brand over time.

Sometimes it’s difficult in a business environment to demonstrate your faith. Certainly, as a leader, I don’t want to push my faith on anyone else that may have a different belief. And the adage that I’ve always held to is a quote from St. Francis, “Preach the gospel at all times, use words if necessary.” And I think regardless of your faith or if you have faith at all, that’s actually a really good way to lead. Let people see who you are through your actions – in all times, at your weakest moments – and you actually don’t need to say a lot if you do that.

You spent nearly two decades in aviation before the opportunity presented at PayPal helped you realize you’d gotten comfortable and that you didn’t want to fear new things. What goes through your head when you’re choosing to make those kinds of leaps, and how do you manage the learning curve of being in a new place – maybe being scared of new things – against losing confidence?

In 2015, I got an outreach from PayPal about becoming their CFO. And like a lot of us do, we list our pros and cons: What if I stay? What if I go? When I really reflected on what was motivating me at United Airlines, they were the wrong things, like what my next title will be, or how much money I’m going to make if I stay here. I realized that’s fleeting, you can go chase that anywhere. I wanted to get out of the car in the parking lot in the morning and be inspired to go into work and be excited about my job, and the idea of learning a new industry did that for me.

When I started at PayPal, the best way I can describe it is it was like learning a foreign language for me. I had become fluent in the airline business having worked there 18 years, and it’s humbling to be a senior executive and go to a new industry and have the lowest level people in the organization know far more than what you know.

Honestly, I felt like for the first six months, I was dragging down every conversation at work because I couldn’t keep up, and I was simply sort of drafting off everyone else. It was about six months in when there was an inflection where I felt like I’m started to contribute a little bit. Then, not only did I learn it, but I also learned it well in a way that I could go out and communicate it to investors and get them to understand why they should buy the stock and things like that. And that experience emboldened me when Walmart called. I knew I can do this. It’s not easy, but I can go to the retail business now and do the same thing.

How are you staying well-balanced, happy, and healthy in life outside of work?

I feel like I bring a better version of myself to work when I have that balance. There have been periods in my career where I’ve just worked ungodly hours and have no balance, and that’s not sustainable long-term. I like to work out, and I realized a long time ago I have to do that in the morning, because if I don’t then something else is going to get in the way later in the day.

The other thing that’s always been important to me is spending the right amount of time with my family. I’ve been fortunate enough that I have been able to prioritize and achieve always having Rainey served on Nasdaq’s board of directors. dinner with my family through the years. I don’t mind working late, and we work all the time with mobile devices these days, but for me, I always wanted dinner time to be that time when devices are down, and we have all four members of the family there. I remember when I first became CFO of United, I was flooded with requests for people to want to have dinner with me. I told my assistant after a couple of weeks, “I’m not going to do it this way.” I said, “Look, I will have two business dinners a month, and that’s it.”

And I don’t care if the president of the United States calls – if they’re number three, then they can get on the list for the next month, because I want to spend time with my family. You have to draw some lines. You have to determine what’s important to you. I think having that balance is really important, and it enables us to bring that best version of ourselves to the work environment.

One of my favorite stories in researching you was when you were at PayPal and you and the other leaders, through a volunteer program, learned that some of the employees at PayPal were visiting and utilizing a food bank. Can you walk us through, one, what you felt in that moment as the CFO, and then how you and the leadership team and the other key stakeholders involved ultimately made the decision to invest millions in raising wages, cutting healthcare costs for employees, and providing stock to every team?

There was somebody that had been running customer service for us – PayPal’s largest group of employees – and when the person leading that group decided to leave the company, I took it in addition to my CFO responsibilities, and I threw myself into that. It was humbling to run a group like that not having that experience.

As I talked to some of my leaders, there were stories about some of our employees that actually were needing to go to food banks, and there was actually one employee that had been sleeping in their car. And I was like, “How can that be?” This individual was in Omaha, Nebraska, and that didn’t seem right to work for a company that was seemingly that successful, but that success wasn’t flowing all the way down through its employees.

So I talked to my leaders in the customer service group. What could we do to make an impact here? And we decided that we could take a couple steps in terms of increasing wages and also giving them stock that would actually have an operational benefit to us. That was a group with a lot of turnover, and you spend a lot of time training an employee like that – all these things cost money. And what we did was take an analytical approach to this to say, “If we spend this amount of money to compensate them more, we actually think that we can reduce attrition and training costs by a certain amount to defray most of that cost.” From there, the CEO basically said, “We’re going to do this for all employee groups. We have an opportunity to pay people more appropriately than what they’re being paid today.” That really caught wings, and I was really happy to be on the leading edge of that.