Who’s the manager who will lead Levi’s and why her trajectory issues
- November 28, 2022
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Only 46 Fortune 500 companies are led by women – a mere 9% of the largest corporate companies in the United States by revenue. That too is a record, even if it is depressing.
When you talk about such small numbers, every hiring and firing matters. So last week, with rumors that Michelle Gass would step down as CEO of Kohl’s early next year to become CEO of Levi Strauss, observers lamented the shrinking of this exclusive group of women. With 2021 annual revenue of $5.8 billion, Levi’s is about a third the size of Kohl’s. And while it’s an influential and culturally important brand, it doesn’t make the Fortune 500.
The number of female CEOs is often used as an indicator to gauge the status of women in the workplace. If the numbers go up, we’re talking about progress. If they fall, we are regressing. But in some cases – like this one – the parameter oversimplifies a more complex narrative. Gass’ departure from Kohl’s isn’t bad news.
Yes, the Fortune 500 is going to lose one of its scarce female CEOs. But Gass’s upcoming work reflects a real shift in how women who have reached the top are not interpreted and evaluated.
For one thing, there’s the fact that Gass has a new CEO role to assume. It is very unusual for women to land an executive position in a high profile company.
Since 2004, 22 men have earned that distinction among companies in the S&P 500, according to executive search firm Spencer Stuart. The number of women? Zero. And during the same period, only three women have been repeat CEOs of a Fortune 500 company: Meg Whitman, at eBay (EBAY) and Hewlett Packard (HP); Susan Cameron, who had two separate roles as head of Reynolds American; and Mary Dillon at Ulta Beauty (ULTA) and Foot Locker.
It’s an almost unheard of feat for a struggling female CEO (like Gass at Kohl’s) to be given another shot at being at the top. The retailer cut guidance as its core customer base eased spending, and Gass’ big bets — such as partnering with Sephora and Amazon.com (AMZN) — didn’t help the company. Activists ended up demanding her resignation.
We can surmise what would have happened based on the story: Gass would have retired – probably not by choice – and thereafter become a member of a few boards of other companies, perhaps a venture capital or private equity firm. . Essentially, she would have “disappeared,” as Jennifer Reingold wrote in Fortune in 2016 when she spoke about why so many accomplished female executives have simply disappeared from the corporate world.
The problem is systemic. Women are often appointed to lead companies that are struggling or in crisis – basically things that men don’t want to do. The process is called “glass cliff” – “glass cliff”, in free translation. Reingold’s article cited data from Utah State University, which found that 42% of female CEOs of Fortune 500 companies through 2014 were appointed in times of crisis, versus 22% of male CEOs.
When women end up having difficulties in the position, they are seen as unviable candidates for other opportunities. “There’s not a lot of room for failure for female CEOs,” said Marianne Cooper, a sociologist at Stanford University’s VMware Women’s Leadership Innovation Lab.
Gass was in that position at Kohl’s. What made the difference for her is that the current CEO of Levi’s, Chip Bergh, recognized the difficulty of her job. He said to The Wall Street Journal that Gass’s career at Kohl’s should be seen within the broader context of the difficulties facing department stores.
🇧🇷I’ve come to the conclusion that Kohl’s is in a better place today than if it hadn’t been for the job.”, he told the newspaper. What is rare is that Bergh publicly acknowledged the “glass cliff” and seemed to imply that perhaps having led the company through tumultuous times makes Gass a stronger leader, not a weaker one.
Another unusual thing is how Gass goes to work. She is joining Levi’s as president and will be in that role for up to 18 months before taking over from Bergh. It’s an unusual situation for an existing CEO.
In declaration to Bloomberg Opiniona Levi’s spokesperson said the period would give the two “plenty of time to work together and map out a smooth transition, while also giving Michelle the opportunity to learn our business and get to know our team.”
It is possible to interpret this in two ways. The first is that Levi’s management or even Bergh believes that Gass needs a little more guidance – which I would say probably wouldn’t happen to a man in the same role.
The alternative scenario is that the up to 18-month process is an attempt by Bergh and the company to ensure that Gass doesn’t experience yet another “glass cliff”. I hope it’s the last option – but either way it’s progress.
Source: Bloomberg Linea
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