Melanie stern is section editor of Families in Business
Carlson Companies has all the right numbers for a truly contemporary business, including $26 billion sales, 40% female executives, and one radical chief. Melanie Stern hears how Marilyn Carlson Nelson has created a place where women are captains of industry
When I tell friends over dinner that I've never voted and don't intend to, uproar ensues from the girls at the table. "How could you not vote? Women fought and died so that you could vote and work – without that you wouldn't be living the life you are now!" is the response. I look despairingly into my meal; my response is that the fight was – and is – about women having the right to do these things, not the obligation. Besides, I resolve, choosing your allegiances in Millicent Fawcett and Emmeline Pankhurt's day probably wasn't about identifying the least corrupt candidate.
The guilt that nonetheless bleats irritatingly from the feminist corner of my conscience is no further salved when I read through the CV of Marilyn Carlson Nelson, CEO and chairman of Carlson Companies. While steering one of the world's largest privately-owned companies through a punishing downturn in its key travel and leisure markets, Marilyn has dedicated herself to facilitating real change in the way hers and other corporations treat and view their female staff. A long-time champion of women executives, Marilyn's company is consistently recognised for its competitive offerings that are heavily geared towards the needs of the ambitious working woman or mother.
21st century corporation
Carlson staff get on-site childcare, emergency back-up care, flexi-time and the opportunity to work from home full-time for mothers, and 12 weeks paid maternity leave (the US Family And Medical Leave Act makes statutory 12 weeks unpaid leave per year for companies with more than 50 employees, but offering paid leave is optional); the company is one of the first and only to offer paid paternity leave; it offers financial assistance with adoption, special office areas for nursing mothers, countless company-wide parent support groups, a MinuteClinic at Carlson's HQ in Minnesota, where a certified practitioner can write prescriptions and take basic medical tests for a flat $5 rate; scholarships for staffs' children, tutoring reimbursements and the intranet-based Carlson University. Believing women have a stronger chance of success when they have suitable mentors, Marilyn has established mentoring circles and an executive leadership system for senior women executives to partner with their junior women colleagues; she represents the cause at federal level as chair of the National Women's Business Council. "While some companies excel in one or two areas of work/life balance, Carlson covers a wider spectrum of offerings and the impact is evident in the family-friendly culture at the company," says Amy DiTullio, senior associate editor for Working Mother magazine, which ranked Carlson Companies a top 100 best company to work for four years in a row. "With the predicted workforce shortage in the US that the retirement of baby-boomers is expected to cause, companies will soon have no choice but to offer these types of work/life programmes in order to both attract and retain employees."
Marilyn concedes: "We think there are ways to keep people connected even if they stop out for a while and [having a baby] doesn't mean you'll be gone forever. Life is long, and our philosophy is that good work in a mission-driven company is satisfying, leading to a lot of happiness if it can be structured in such a way that you aren't forced to make personal sacrifices at too great a cost. I laugh now when my female executives tell me, 'I couldn't leave even if I wanted to because my toddler loves the daycare centre.'"
That doesn't mean Marilyn's attentions have been diverted to the detriment of the bottom line; in March Carlson unveiled 2004 sales of $26.1 billion, a 25% increase on the previous year. It is perhaps because of Marilyn's laterally-minded and collaborative management style – which has infused Carlson's 190,000-strong organisation – that in 2004 her family business clawed back the bulk of sales lost to market paralysis since 2000, the year in which the company hit a $31 billion high (that figure includes sales from Thomas Cook, which was sold later that year). By the close of last year, the company had made a throng of acquisitions facilitating early expansion in emerging markets; as well as owning 730 of its popular TGI Friday's restaurants worldwide, it had 890 hotels in 70 countries, including Radisson, Regent International Hotels, and Park Plaza Hotels & Resorts and is master-franchise partner with Swedish luxury hotels group Rezidor SAS. Carlson Wagonlit corporate travel agency – run in partnership with French outfit Accor – last year swallowed Maritz's corporate travel business, doubled year-on-year profits to more than $11.5 billion and pulled a coup by hiring ex-Vivendi and EDS principal, Hubert Joly, as its CEO. Meanwhile, Carlson Marketing Group, the company's marketing business, serving blue-chip clients, including British Airways, Sony, Hewlett-Packard, General Electric and IBM, got a boost from the resurgence of corporate incentive travel, including the 2008 Summer Olympics in China.
In 2005, Marilyn's focus will be three-pronged: profitability, efficiency, and Asia. The first two have seen Marilyn work to exploit common strategies and needs between her businesses and streamlining shared service contracts to maximise the critical mass Carlson enjoys as one of the world's biggest privately-owned corporations. "Our strategy is to be in the top quartile in each of our business sectors, and while we may not be the biggest in all our various industries, collectively we are large so that each of those businesses could benefit from that almost as if they were bigger than they really are," says Marilyn. "By sharing services and combining all our supplier relationships – our licenses, our telephone contracts and so on – and by using common centres of excellence, we drove up productivity dramatically last year and shaved two percentage points off our margins. We've regrouped, restructured and have enjoyed a record year."
Carlson's interest in Asia is no revelation since so many other Western corporations have long since moved vital operations to countries like China and India, but is timed to capitalise on the region's burgeoning wealth (indeed, one well-known Indian family business scion recently commented how he had seen a visitor to Bombay's newly-opened Louis Vuitton store buy its entire luggage range for his daughter's wedding: in the past, he believed it would have been commonplace to buy just one or two pieces due to the cost) and demand for luxury goods and services.
Marilyn believes the high-end hospitality market across India and the Asia-Pacific Rim is particularly important going forward, forecasting "as steep a growth curve as our first 50 years, in which we grew 33% each year". The company's first president for Carlson Asia Pacific, Paul Kirwin, has been appointed to manage the bringing together of all its activities in the region and to execute aggressive growth plans in the next five years.
The Marilyn Carlson Nelson way is shaped by personal experience with sexism from her earliest days. Her interest in collaborative leadership and board diversity isn't just window-dressing; around 40% of Carlson executives are women and around half of its global staff at all levels are too. "When I joined the company in the 1960s I noticed that only 5% of our executives were women, and I couldn't understand why we had such a large base of women working throughout our hotels, restaurants and marketing companies, but none in our top jobs," recalls Marilyn.
Perhaps not so unusual for the times, she was already used to the status quo having been one of just two female economics students at the Sorbonne in Paris, and later gaining the respect of the testosterone-fuelled corporate finance world as a securities analyst with Paine Webber, where she was told to sign her reports 'MC Nelson' to disguise her gender. "The name seemed to me much less important than the chance to work and learn, and prove myself – I wish I could tell you I was righteously indignant about it, but the ends justify the means," she says.
Just as family relationships are so frequently paradoxical, Marilyn's father Curt, who founded Carlson's progenitor the Gold Bond Stamp Company in 1938 with a $55 loan and revolutionised the way retail goods were marketed across the USA, was both her biggest fan and chief career hurdle.
Curt never missed an opportunity to teach the young Marilyn a lesson in success, pushing her to excel at school, to form and act on her own opinions, and to become a leader; when she decided to drop out of children's classes at the family's church complaining she was frustrated that the kids messed around and that the class had no structure, Curt made her draw up a list of her objections and arrange a meeting with the pastor in which she would present her vision of an effective class. "Curt was tough on Marilyn, but he was trying to prepare her for success," a close confidante of the Carlson family says. "That was his way. But there was always a lot of mutual love and respect between the two." Despite this and Marilyn's potential as a successor – one of her first major contributions to the growth of the company was to acquire and manage the integration into the business of Citizens State Bank in 1971, with her sister Barbara who owns half of the company and runs the Carlson philanthropic foundation – Curt was from the old school and was not comfortable with the idea of a woman running the company. "Curt naturally looked towards a man. He was rooted in a time when women just didn't work or have the rights to fulfil themselves," the family friend adds. As a result, it took three decades before Marilyn took the corner office.
Gender discrimination seemed the only explanation when, after Curt fell ill in 1989, he appointed Skip Gage, Marilyn's brother-in-law and head of Carlson Marketing, his successor (making her senior vice-president of the parent company, Carlson Holdings, that same year). "It was no secret that Curt felt I should focus on raising my family first and foremost," recalls Marilyn, "but getting the top job wasn't my focus anyway."
Carlson PR veteran Doug Cody adds that Curt felt Skip "was the only person he felt he could tap for the job, but it was certainly not the case that Skip and Marilyn were competing for it or that their was any plot". It wasn't to last anyway; Skip was out a year later. The press speculated that he didn't make the grade, though the company insists his departure was down to Curt returning to form and wanting to get back in the driving seat.
Marilyn was admitted to the board the year Skip left. After serving as vice-chairwoman of the holding company from 1991, she became chief operating officer for Carlson Companies in 1997. Finally, at a party in Las Vegas celebrating the company's 60th year (it was also Marilyn's 60th birthday year), CEO Curtis announced his retirement – and selected Marilyn as his successor.
The decision came late, but just in time; a year later, Curt died. Marilyn wasted no time changing the management culture from one of command-and-control to collegial-and-consensus, which led to the company's first recognitions within the esteemed 'great workplaces' lists of Fortune magazine and Working Mother.
Of course, the Carlson juggernaut is equally informed by the wishes of its founder as it is by the sophistication of its chief executive, who strenuously upholds her father's vision for the family business. "So many things changed in 2004, but what didn't change was the credo my dad wrote and presented to me when he retired. He believed in having integrity and caring in everything you do, following your dreams and never giving up.
"We built much of our business philosophy and management tactics around that and we look to be a leader in corporate social responsibility because of it," Marilyn says of the company's corporate mantra – 'building a great place for great people to do great work'. "We have a long-term strategy to build an environment that operates as a meritocracy, listens to diverse ideas, and end up with a more innovative workplace that has the power to attract talented people who can contribute to a business competing on a global stage, form lasting business relationships and make a difference that lasts generations – not just quarter to quarter."
Founder Curt's desire to ensure Carlson remained family-controlled until at least the fifth generation is one Marilyn has already planned for. Her son Curtis joined Carlson's Radisson division in 1989 after management spells at Hyatt and Four Seasons, and has shown promise having worked steadily upwards to become president and chief operating officer of the hotels division, and since promoted to president and COO of Carlson companies in 2003.
No doubt the gender-based trials Marilyn has faced in her career have been turned to advantage, and have amplified those oh-so feminine traits, listening to, caring for and teaching future generations. "All those formative experiences gave me a sense of equal opportunities and the idea that if you can dream it, you can do it. Now I am aware that my position and the network I belong to allow me to ask myself what barriers I could remove for others.
"It isn't so much a question of men versus women: it's a question of men and women taking on the challenges of globalisation. Certainly the US and Europe both have ageing populations and we'll soon be competing to draw knowledge, talent and intellectual capability from the entire labour pool. I believe the corporations that create the right environment for women to thrive as leaders are the ones that are going to win as the 21st century plays out."
Will there come a day when business journalists profile female CEOs without making headlines of their subject's gender? Perhaps, on the day when human nature's taste for the intoxicating marriage of power and beauty wears thin. So here is a possible manifesto to blow those ideas out of the water, both in honour of the Suffragettes, and for sheer kicks: Marilyn for president.