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WWD CEO Summit: Q&A With Robert Kraft, Owner of the New England Patriots

Kraft discussed leadership, 20 years of ownership and coach Bill Belichick with WWD’s executive editor Bridget Foley.

WWD’s executive editor Bridget Foley interviewed Robert Kraft, owner of the New England Patriots, on leadership, 20 years of ownership and coach Bill Belichick.

WWD:
You are indeed a transformer. You took over a team [the New England Patriots] that was last in every category and paid a record price for it. Why?
Robert Kraft:
In life I believe, as I am sure a lot of people in your audience do, in following your dreams and passions. I dreamt about owning my home team in my hometown. I had a greater chance of being a starting quarterback in the NFL, because there are 32 [quarterbacks] than own a team. I planned over many years to figure out a way to do it. Fortunately, I was very successful. In life, when you are doing things you love usually they work out pretty well.

WWD: Is it the same feeling owning a team as it is being a fan? Is one more intense or is it more dispassionate because it’s a business?
R.K.:
First of all, when you own a team your seats are better. I went to four venues [for games]. The Patriots were created in 1960. They played in Fenway Park, Boston University field, Boston College and Harvard Stadium, and then they built a stadium for $6 million in Foxborough in 1971. I used to go there and sit on the five-yard line on the metal benches. And in November, your tush would freeze to the seats. And now wherever I go — I have a lot of commentators. When I go to get coffee at Dunkin’ Donuts or anywhere else, everybody has an opinion. Everyone really believes that they know better than the owner or the coach.

WWD:
How do you deal with that?
R.K.:
It’s great because in the end you want people engaged in your business. We’re living in a world today where technology has taken over in many ways. People are tweeting, texting and e-mailing, and not connecting. There are very few ways for communities to come together. It happens at concerts and at sporting events. It’s pretty cool that every Sunday we have 70,000 people come into the Kraft family home in Foxborough and all pull together. It doesn’t matter what background everyone comes from whether it’s factory workers, hedge-fund managers, greats artists in the design and fashion community — we’re all pulling for the team.

WWD:
Do you think that sense of community is maybe strengthened today when it’s an actual physical community because we talk about community so much as being Twitter, online and social media?
R.K.:
The game of football requires attention constantly. If you miss one play, you can miss a lot of action — unlike some other sports. We’re privileged to have 20,000 parking spaces around our stadium. People come as early as 9 in the morning. Our games are at one, are done at four and people stay until six or seven. For people who have never been exposed to it.…I have a great girlfriend [Ricki Noel Lander] who was never exposed to football before she met me. She couldn’t believe it but then she saw a whole different side of Americana. It’s really captured America every Sunday [afternoon] and Sunday night. We have over 100 million people watching our games by appointment television. There is no other way for advertisers to reach a vast market other than that.

WWD: You had to transform the team on and off the field. What steps did you take to transform the team off the field?
R.K.:
We have to change every year the bottom third of our team to keep up with the other teams that are trying to knock us down every year. The real story lines each year are the teams and what happens off the field. When we bought our team we realized no one was buying our merchandise. We were the lowest in sales. In 34 years, we had never sold out. Our games were blacked out [not shown on local television because of low ticket sales], so I took over and paid a very high price. People thought it was nuts. I tried to figure out, “How can we get people to connect with us?” You put a quality product on the field, but then you want people to brand with the people who are part of your team. We were the first team to put in players’ contracts that they had to do 10 public appearances every year for noncommercial return whether it’s visiting a homeless shelter, a hospital or home for abused women. What’s beautiful about that is a lot of the young men who play for us come from modest homes and they haven’t had a chance to give back. I think people started liking our brand because they thought we stood for good values on and off the field. They bought our tickets and we sold out.

WWD: How big a village does it take to make the New England Patriots function?
R.K.:
As probably a lot of people know, whether you are in retail, fashion or design, how you win and how you generate the sales or profits you like, is about building a sense of team and getting everybody to put the team first. We compete in a business where there are a lot of stars. You probably have that in your business, very creative people but they can’t connect and become part of the team. It just doesn’t happen. The first time we won the Super Bowl, we definitely didn’t have the most talent but we were together from top to bottom. Everyone was on the same page making people understand that there was enough credit to go around if everyone put the team first, does their job, doesn’t look for extra credit or get into the politics of undercutting someone else in the system, we might do well. I personally spend a lot of time not allowing any politics in the system to allow our team, which might not have the most talent, but works together collectively.

WWD: How do you keep politics out? Isn’t that almost human nature?
R.K.:
It is human nature and the more success you get, it becomes a bigger problem. But I like to try to win every year, and to sustain something that’s pretty special you have to work pretty hard at it. You have to set an example yourself. Look, we have a coach Bill Belichick, who with a lot of the success he has is actually pretty modest. I chose him because he is an understated guy. And his sense of fashion is… [laughter] Reebok has the exclusive and my marketing team said, “You’ve got to get Belichick to change what he’s wearing. He’s got the greasy hair and he’s got a gray hooded sweatshirt with cut-off arms. We’ve got all this fancy garb that we put in his locker. He never wears it.” I said, “As long as he wins, he can wear whatever he wants.’ And Reebok’s ceo started calling. I said, “Look, fine us.” Long story short — that gray hooded sweatshirt after we won our second Super Bowl became our number-one seller. Just want to say on the other side of that you know you’ve got Tom Brady and Gisele [Bündchen]. So you’ve got Bill Belichick and Tom Brady and Gisele, so it all balances.

WWD: Does Bill Belichick converse at dinner in sentences that are more than two- or three-word phrases?
R.K.:
Um.…When I hired him, I took so much heat. For those of you who are not fans, he coached at Cleveland for five years and had four losing seasons. Like we talked about, his garb is not going to get him on the cover of GQ. I had people sending me tapes in Cleveland telling me you shouldn’t hire him. Leadership is about having the courage to go against the advice of the so-called experts and doing what your instinct tells you is right. I developed a simpatico with him when he joined us. He spent a year being a coach of our secondary backs. I just really related to him a lot. A year later, when I decided to make a coaching change, I gave up the number-one pick to the Jets, we got Belichick and I got hosed. He went 5 and 11 the first year…our starting quarterback Drew Bledsoe got knocked out by Mo Lewis of the Jets and a young man by the name of Tom Brady came in. Our quarterback coach died, our wide receiver went AWOL. Belichick, when you talk to him, he says what he has to say and no more. I’ve got to tell you, I love him. The media is not as crazy about him.

WWD: You have emerged as a leader among the NFL owners. You were given credit for making the negotiations work and finalizing the collective bargaining agreement. What did you bring to those talks that no one else could?
R.K.:
I think we had a great team of people, the commissioner of the NFL, a whole committee, the New York Giants owner John Mara, we were a team effort. One of my beliefs about leadership is it’s not how many followers you have, but how many people you have with different opinions that you can bring together and try to be a good listener. We could use a bit more of that in Washington. Again, technology has hurt our ability globally in every way to negotiate. I don’t think people build relationships. I think there is a breakdown in trust. We see it in Washington. I had the privilege of Nancy Pelosi calling me yesterday and we spoke for 20 minutes. We talked about the same things we talked about in our NFL bargaining discussion: How do we get the other side that has opposing views to at least feel we’re listening to what they have to say and that their problems are a concern? And [to let them know] we will negotiate where we can and we will draw the line. When I got out of Harvard Business School, I thought I was the cat’s meow being very tough doing deals. Then I realized it’s really good to let the other side have the edge. If you think long term and if anyone who does business with you does well, they’ll keep bringing deals to you.

WWD: The NFL has had its share of controversies. Right now head trauma is part of the national discussion. Was the league too late to acknowledge it and to get on it?
R.K.:
That’s a very good question. We made a settlement of a little over three-quarters of a billion dollars to roughly 13,000 to 14,000 players from the past from before I owned our team. I don’t know how much was understood about it before I got into the league, but I can tell you this there is no higher priority than in players’ safety. We just committed $100 million in research to that area with the union. Our focus on players’ safety is the number-one focus we have. My sons all played football and three of my grandsons do. You really learn life lessons playing football. Teamwork, hard work, preparation, getting knocked down and getting up, surrounding yourself with great people are great lessons for life.…My concern is that mothers today won’t want their kids to play football if they don’t feel we are dealing with this issue properly.

WWD: In your 20 years of ownership, what has been the most wonderful moment for you and the toughest? 
R.K.:
The most wonderful moment happened right down the street here after 9/11 when we played the Jets. We had a player, Joe Andruzzi, whose three brothers were New York firemen and his dad was a police detective. I asked him if they would join the coin toss. That’s the only time I can remember a Boston crowd cheering for New Yorkers. It was just something wonderful. We were a blue-collar team. We weren’t very talented but we were very fortunate to go to the Super Bowl and play the St. Louis Rams, who were the “Greatest Show on Turf.” We were the largest underdogs in that Super Bowl point spreads — not that I’m supposed to talk about or pay attention to point spreads — and we won right at the end with a great kick. For me to accept the Super Bowl trophy having been a fan for 43 years dreaming about that moment and to talk about 9/11 and how our team wears red, white and blue and is named the Patriots. I said, “Tonight we are all Patriots and the Patriots are world champions.” I had goose bumps. The worst moment was another New York connection. We were 18-0 in 2008 playing the New York Giants. We were a minute from winning the Super Bowl…and we lost it, but things happen for a reason.

WWD: Is leadership often a conflict between owner and coach?
R.K.:
Never in public. Sometimes coaches in all sports, and I’m sure it’s proven in fashion with artists who are very great at what they do, they have to have blinders to see things a certain way. Leadership is about having core values and getting everyone on the same page, whether it’s your players or the people in your organization. If the icon leaders aren’t on the same agenda, then you won’t be having success. But the key is to do whatever is the philosophy and to keep it private and of course the ego always likes to get in the middle and cause some problems and competition.