`I Make The Best Pies In Minnesota'by
However powerful the post he has just assumed at American Express Co., Harvey Golub likes to make clear that he remains a gentle and modest fellow. The New York Times, describing his appointment as president of AmEx and joint occupant, with Chairman and CEO James D. Robinson III, of a new "office of the chairman," mentioned his love of baking and quoted Golub's boast: "I make the best pies in Minnesota." Golub playfully asked that BUSINESS WEEK take special care in choosing a photo, apologizing that "the raw material's not great."
A certain humility will serve Golub well. In taking the No. 2 spot at AmEx--vacant since Louis V. Gerstner Jr. jumped ship two years ago to run RJR Nabisco Inc.--Golub will share the work with Robinson in running the company. As president, he reports to Robinson, but AmEx' five operating units and corporate staff will report jointly to the two men. Still, because the two are contemporaries--Robinson is 55, Golub 52--and because Robinson intends to stick around, Golub doesn't harbor ambitions of becoming top dog.
ANALYTICAL SKILLS. "My job is to help Jim," he says. He is described by nearly all as highly intelligent, firm, well-liked, and someone who "doesn't pull punches," as one insider puts it. He is respected for his performance in running AmEx' IDS Financial Services--and his analytical skills and detailed approach are expected to be a big boon in helping Robinson shore up some of the weaker parts of the company. Shearson Lehman Brothers Inc. is still pushing to effect a turnaround, and AmEx' flagship travel-services business is smarting from the recession and heightened competition.
Golub has actually been working closely with Robinson for some time: He became vice-chairman last September and spent recent months shuttling between his home in Minneapolis, where IDS is based, and New York. Now, Golub will move his family and two Dobermans (who are "warm and friendly," he says) to New York. He remains chairman at IDS, but President Jeffrey E. Stiefler will now assume the title of CEO.
One insider says employees are "thrilled" with Golub's appointment. But even if Robinson should leave before expected, Golub would not necessarily succeed him. "Harvey is clearly No. 2, yet we have some very competent and talented people for the board to look at to fill any number of senior jobs," Robinson says. One person often mentioned as a potential successor is Howard L. Clark Jr., now CEO of Shearson and the son of AmEx' former chairman.
Golub says he will be quite happy to finish his career as president of AmEx, thank you, adding that he's held a number of jobs less glamorous. The native New Yorker worked as a ditchdigger, waiter, and in the hardware department at Sears while putting himself through college. He graduated from New York University with a degree in business, and became a systems engineer at IBM after that. Golub also took three years out from a 14-year-career as a McKinsey & Co. consultant to serve as president of a Cherry Hill (N. J.) trucking company. He was fired, he says, because he disagreed with the owner over strategy. The company later filed for bankruptcy.
STAR EARNER. Golub's springboard to AmEx was his work at McKinsey, which included advising AmEx' Travel Related Services Co. He championed the quality-management program, which guarantees cardholders replacement cards within 24 hours, among other things.
When AmEx bought IDS in 1984, Golub left McKinsey to become its CEO. He added new businesses such as brokerage services, and made the unit a star earner for AmEx. When AmEx' second-quarter profits dropped 20% this year, partly because of $171 million in write-offs at Shearson, IDS' net was up 19%.
Robinson says Golub's reputation has excited investors. The day after his new job was announced, AmEx' stock rose 1, vs. a 30-point market drop. Analysts attribute the rise to better-than-expected earnings, but some people think Golub's appointment played a part. Says Robinson: "It was reflecting the fact that we now have a baker as president." If only the new president can make earnings come out as sweet as his pies.