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Carlson Chairman Marilyn Carlson: An Upside-Down Career path To The Top

As chairman of Carlson, the $39.8 billion parent company of Radisson, Country Inns & Suites, Regent, Carlson Wagonlit Travel (CWT) and T.G.I. Fridays, Marilyn Carlson Nelson caps a long but tumultuous career as head of one of the largest private companies in the U.S., employing over 200,000 people in more than 150 countries. Early on …

As chairman of Carlson, the $39.8 billion parent company of Radisson, Country Inns & Suites, Regent, Carlson Wagonlit Travel (CWT) and T.G.I. Fridays, Marilyn Carlson Nelson caps a long but tumultuous career as head of one of the largest private companies in the U.S., employing over 200,000 people in more than 150 countries. Early on she butted heads with her father, Curt Carlson, who, wanting a man to assume control, initially didn’t think she was fit to run the business. When she started her business career as an analyst she had to sign her name M.C. Nelson to disguise her identity as a woman.

Born and raised in Minneapolis and married to Dr. Glen Nelson, now a retired surgeon, Nelson describes her path as an upside-down career, having worked in community service and attaining a number of board directorships before working in executive management and becoming CEO in 1998

In selecting the French-born Hubert Joly, 48, previously CEO of CWT who had earlier led Vivendi Universal and EDS France, to be her successor at Carlson, Nelson recently crossed the succession chasm faced by closely held businesses, as she turned over the reins to an outsider. Recently she found time to compile a lifetime of leadership reflections lessons in a trim volume, How We Lead Matters, co-authored with Deborah Cundy, assistant dean at the Carlson School of Management at the University of Minnesota.

Anne Mulcahy, CEO of Xerox and 2008 Chief Executive of the Year, describes Marilyn Carlson Nelson as “a trailblazer not only as a woman who was among the first to claim her place in the business world, but as an amazing leader who built powerful brands, mapped successful careers for people and prioritized customer needs above fiscal rewards.” CE caught up with Nelson on one of her frequent swings through New York City. 

Is it true your father fired you from the company during an early phase of your career?

He actually fired me at the same time I was being promoted.

The department that I was in wanted to promote me to quite a large job, and I went up to tell him as you can imagine very proud and excited to do so. Instead, he said, “Go home. Your husband’s a surgeon. You can’t both have 24-hour-a-day jobs.” And I said, “Well, I have lots of energy. I can manage this.” I had three children at the time. And he said, “Well, not here,” and fired me. I cried all the way down the back stairs.

In later years he used to joke that if he stopped being hard on me, it was because he stopped believing in me. There were times I was tempted to say, “Let’s give it a try.”

Your father was very old school.

The Great Depression had a deep impact on him, as it did on most of his generation. Even as he became successful in the 1970s and 1980s he carried this 1930s’ mindset with him that money was scarce but employees were plentiful. I’ll never forget the time when we paid a visit to a class of MBA students at the Carlson School of Management. At one point, with much hubris, my father asked if any of the students planned to apply for jobs at Carlson. There was a long silence. Someone finally spoke and said, “No.” My father couldn’t believe what he was hearing and asked why. The student replied that Carlson had a reputation for not valuing its employees. My father went white. It was brutal but true.

Since that time we’ve realized that we are in a war for talent. We have to identify and hire the best, most talented people to ensure a differentiated experience for our customers. At the time I felt sorry for my father, who took great pride in building the business, but he didn’t understand that the rules of the game had changed. But who does when you’ve played the game so brilliantly for so long? 

But Curt Carlson ultimately relented and re-hired you.

Several years later, when my children were nearly grown and my husband was a busy surgeon, I was deeply involved in community affairs I was the first woman to run United Way and was being courted to run for governor of Minnesota. Suddenly my potential as a leader got my father’s attention, and he asked me back. But my career path was neither clear nor certain. I was asked to join several boards in fact I was 15 years younger than the men on those boards and I became deeply involved in governance issues. So when I was offered an executive position, I had an upside-down career. My father never hid the fact that he was disappointed he did not have a son to step into his role. And until the day he announced, in his 83rd year, that I would become CEO, I never assumed I would. 

What did you do to change the culture once you took the helm?

I made a point of creating a meritocracy. I also wanted to change the environment to make it more welcoming to women. When a group of high-performing women created a council to talk about how to do this, my father accused them of trying to form a “pink-collar union.” I told him we needed to overhaul our benefit plan. It was rather antiquated at the time. It’s hard even for me to believe, but insurance companies then only covered men. They didn’t cover women. So, single mothers couldn’t get coverage. And so, we ended up becoming a private insurer, in order to cover these single women that were heading redemption centers, these retail stores at the time. That was indicative of the times. Today Carlson’s CFO, Trudy Rautio, and 40 percent of our executives are women. 

How would you describe your management style?

It’s collaborative. If people fault me, they would say I’m too consensual not the command and control style my father had. During my first executive committee meeting I asked how we should address a certain problem, and no one said anything. Finally, a head of the hotel company at the time said, “Tell us what you want us to do, and we’ll do it.” I said, “Well, that probably isn’t going to work anymore because I didn’t do all of these various jobs, but everyone at this table has a lot of expertise. We’re going to have to work together to deal with an increasingly complex world.” In my book I quote Machiavelli that, “You can lead with love, or you can lead with fear.” Machiavelli thought fear was the most effective, but you can look at me, I didn’t have that option. I’m not very frightening.

It was much more authentic for me to use love. The fact that I had an upside-down career where I started out working for volunteer organizations drove it home that my job was to inspire people. Even if they volunteered for the Super Bowl, people would show up and stand on a corner, even if it was 20 below zero, and help people find their way. I had to do it without paying them. I had to inspire and engage them. I had to build a team and build pride. They had to be committed to something outside of themselves.

My father felt that stewardship of capital was important. So, I’ve tried to keep the stewardship of human capital at the same level. 

And what does your successor bring?

Hubert [Joly] will bring a bit of both, which I think is now the right next step. In addition, he brings a lot of operating rigor. He’s certainly taking over at a challenging time. Our restaurants are in casual dining, and our consumer businesses including travel are hit by high fuel costs. He will be courageous and disciplined, but I think he was also attracted to Carlson because of the culture that we’ve created and our sense of corporate global citizenship.

About Jennifer Pellet

As editor-at-large at Chief Executive magazine, Jennifer Pellet writes feature stories and CEO roundtable coverage and also edits various sections of the publication.