Carnegie Mellon University

wl mellon

March 27, 2019

W.L. Mellon: Carlos Morales Paulín Urges Ethical Leadership That Embraces Change

When Carlos Morales Paulín was first appointed head of marketing at telecommunications giant Telefónica, he had a confession to make to his boss: He knew nothing about marketing.

No worries, Morales’ boss told him: You’ll be fine. And he was.

Throughout his career, Morales has taken opportunities to lead in unfamiliar areas. Each time, he follows the same strategy: Research the industry and connect with peers until he is an expert.

The same thing happened when Morales was tapped to head the company’s foray into the Internet of Things. He actually had to look it up so he’d understand what he would be overseeing. But by then, Morales had come to accept an important truth about his career trajectory — change brought him opportunities.

“My career tipping points have been when I have embraced change,” Morales (MSIA 1997) told an audience at the David A. Tepper Quadrangle, where he spoke as part of the W.L. Mellon Speaker Series. “There’s a lot of smart people out there, but not everyone can make things happen... Leadership is what differentiates the work.”

Now the President and Chief Executive Officer of Telefónica México, Morales recalled how he arrived at the Tepper School as a young civil engineer without the personal connections that had smoothed the path for some of his classmates. That sense of being an underdog drove his competitive spirit then, and continues to drive him today.

“I came to Tepper to open my opportunities,” he says, pointing out that he knew nothing about finance or operations prior to business school — so he learned early on to take risks and expand his knowledge base.

An internship at Procter & Gamble led to his first job out of business school, working for McKinsey. Telefónica was a client, and eventually he joined, moving through business development, marketing, operations, and other functions in Spain, Brazil, and Mexico before earning his current position.

Morales also emphasized the importance of ethical and kind behavior, even in a competitive environment, as well as the role of luck. “Luck exists. You can do all the right things, and sometimes it didn’t happen. Your startup didn’t happen, the position you wanted didn’t happen.”

Likewise, obstacles to business success will always exist, he noted. He pointed to the challenges Telefónica faces in Mexico, such as inflation, the devaluation of the peso, and an unsustainable competitive structure. Yet he still sees opportunities.

“Our role has been to challenge the status quo and improve the lives of all Mexicans,” he says. 

To do that, Telefónica is focusing on key urban clusters to effectively deploy its resources, launching new lines of business to capture growth and diversify, accelerating its adoption of the digital world, leveraging third-party innovation and investment, and accelerating its commercial efforts. An alliance with Netflix and an official sponsorship of the NFL are assets he actively promotes.

But he also works hard on cultivating a company-wide bold attitude among his employees. 

“A lot of my time is spent checking the culture of the company,” he said, because culture change is one of the most difficult tasks of a CEO. When he first arrived at Telefónica, its executive committee was all men. Today, it is 30 percent women, and he hopes to grow that percentage further. 

Morales also urged audience members to practice what they preach.

“If you want an organization that is ethical, you have to be ethical. If you want an organization to be hardworking, you have to be hardworking. Everybody is looking at you,” he said. “If you do not stand for something, you will fall for everything.”

While they were in Pittsburgh, Morales and his wife, Ekin Tutek (MSIA 1997), leadership coach and consultant, spent time sharing their insights with faculty and students.

The W.L. Mellon Speaker Series enables students to interact with global leaders, CEOs, and management experts in student forums that encourage insightful and lively dialogue.