View From a Height

A New Commerce Secretary

The Wall Street Journal reports that President Bush has chosen Carlos Gutierrez, chairman and CEO of Kellogg, to be his new Commerce Secretary. Gutierrez's family managed to escape Cuba in 1960, before Castro started strafing people in rafts. Cuba also produced another great CEO, Robert Goizueta, of Coca-Cola. Those who consider Castro a hero to the Cuban people might consider the talent he drove away, and how much better-off that island would be under a different regime and ideology.

is known as a charismatic and approachable executive, widely admired in business circles for reviving a flagging company. Mr. Gutierrez joined Kellogg in 1975, beginning his career in Mexico City as a sales and marketing trainee for the Battle Creek, Mich., cereal giant. Mr. Gutierrez subsequently held a number of jobs at headquarters and ran Kellogg's Canadian and Asian Pacific operations before being named president and then chairman and CEO.

He took over four years ago when Kellogg's cereal sales were sagging and soon acquired Keebler Foods to diversify and boost profits. He also put together an international top management team, which includes an Indonesian, an Italian and two Australians, as well as Americans.

So for those who think that Bush is reaching out to an already-safe Hispanic constituency, Cubans, note that Gutierrez knows a little something about Mexico, too. Gutierrez's management team underscores the international nature of business today - it's not Americans giving orders to docile overseas subsidiaries. Smart corporations have been incorporating foreign operations into management for some time now. Operating on a global scale doesn't imply an imperialist attitude.

This is a terrific choice in another way. Kellogg has done extremely well at a time when the economy was recovering, but their industry sector was struggling, according to the Strib (9/27/04):

Analysts say Kellogg's chief executive, Carlos Gutierrez, has delivered through a strategy of making money with higher-priced products. At the same time, the Battle Creek, Mich., company is reinvesting those profits into brand marketing, innovation and increased productivity.

Sounds like a good plan, but most companies would claim to have those same strategies. The difference is old-fashioned execution, analysts say. Kellogg actually is doing what it says, and in a difficult competitive environment, said Eric Larson, an analyst with Piper Jaffray & Co. in Minneapolis.

"They have found a sweet spot," Larson said. "Having the right products and the right marketing programs can overcome low-carb diets and commodity costs. ... [Gutierrez] is the real deal. He is very methodical, and runs the business for the right reasons. You got to give him credit."

Gutierrez has strong ties to the Republican Party, having been one of the sponsors of the Gran Fiesta Hispana at the RNC in NYC this summer.