Founder's vision continues to guide strong work ethic
Talk about old-fashioned values.
In a 1951 memorandum on his firm's goals and plans for achieving them, T. Rowe Price wrote “profit must follow a job well done,” which means “happiness in our daily relations with associates and clients.”
The founder's statement is a guiding principle to this day, say employees at Baltimore-based T. Rowe Price Associates (TROW) Inc. (TROW), which now has 6,000 associates and offices in Florida, Colorado and London. “We still use that letter as our gauge,” said Chief Human Resources Officer Deanna Fidler.
Those values “are not just something that we hang on the wall, you see them in action every day with employees,” said one worker responding to Pensions & Investments' Best Places to Work in Money Management survey. “ T. Rowe has one of the strongest moral compasses in an industry that is not looked upon favorably by the public,” said another.
When founding the firm in 1937, Mr. Price had the then-radical idea of charging a fee based on assets under management instead of commissions, because of an aversion to high-pressure sales tactics. He wanted “people who share my fundamental beliefs, and who are conscientious, hard-working and progressive,” his memo said. Today, the firm goes to a lot of trouble to attract and screen for those kinds of people, who often wind up spending their careers at the firm.
Incoming CEO William Stromberg is a good example. The 28-year company veteran currently is head of equity for T. Rowe Price, but in May was tapped to replace retiring CEO and President James Kennedy, effective in January.
“The culture was built piece by piece and has evolved over time,” said Mr. Stromberg. “Now I think it's up to all of us — all the leaders — to defend the culture. It has to be purposeful.”
To keep that message alive, “we put a lot of accountability on our leaders to communicate,” said Ms. Fidler. “At the end of the day, people really want to hear from their immediate manager.” And they do, according to another employee, who said managers “have gone above and beyond” providing support, with even managers in other divisions “never turning down a request” for advice or collaboration.
When people join the firm or are promoted at management levels, they receive training on how to establish a communication plan, along with other leadership competencies and expectations. Twice a year, the firm holds town hall and road show meetings so all offices can hear from the CEO, chief investment officer and chairman in person. “The key for me is to have regular conversations, to be face to face when it's important,” said Mr. Stromberg. “People want to know that there's a real person.”
The firm also uses technology “to a large degree, to have an exchange where all around the globe we can communicate with people,” said Ms. Fidler.
Then there is the physical layout of the two Baltimore offices, with equal-sized rooms and open doors at all levels to foster collaboration as well as the creative thinking that Mr. Price valued. “We cultivate intellectual curiosity and breaking down walls. Humility is what also makes it special,” said Ms. Fidler.
Being old-fashioned doesn't mean getting left behind. Ms. Fidler left a larger corporation “for a chance to work in a company that's really at the crossroads of global growth. It was a way to grow human capital,” she said. “It's a large small company.”
Said Mr. Stromberg: “Most people want to work for a company that's successful. If they can do it a high-integrity place, that's a winning combination.”
In their own words
Founder's 1951 memo
This article originally appeared in the December 14, 2015 print issue as, "Fifth Place (tie) | T. Rowe Price".