Branching Out
Wells Fargo’s Chip Carlisle considers relationship building a full-time job
Chip Carlisle emerges from his genteel wood-paneled office suite in Wells Fargo’s gleaming green skyscraper in Downtown Houston. A towering Texan with a broad smile, a firm handshake, and a greeting that reveals just a trace of his Beaumont accent, Carlisle is a study in contrasts. His banker blue pinstripes and Hermčs tie are accompanied by a plastic sports watch; his shirt’s French cuffs are fastened with gold cuff links decorated with stagecoaches — Wells Fargo Bank’s iconic emblem — snared on eBay for $3; American impressionist paintings share space on his office walls with framed photos of his four cherubic grandchildren; he is a man who deals in vast financial sums — overseeing $26 billion of bank assets — but is not impressed by dollar signs. “It’s not the money,” he says, smiling when queried about the cufflinks. “It’s the thrill of the hunt.”
It’s no wonder he’s smiling. Now Wells Fargo’s president of the Texas Region, Carlisle is apparently a very strategic hunter. “Wells Fargo is proud of the fact that we lead the industry in share of the wallet. A customer usually uses about 16 banking products, and the national average share is three; ours is five. People want to know our strategy. It’s involved, but really very simple: We are focused on growing relationships with our existing customers.”
Carlisle speaks with the wisdom gained from three decades as a banker at Wells Fargo and its predecessors. It was a strong personal relationship that helped Carlisle and Allied Bancshares come through the Texas financial crisis of the 1980s, which wiped out the state’s savings and loan industry and left only two major banks standing in Houston. At the time, Texas law forbade both branch and interstate banking. “We had gotten the law stretched to the point of allowing an unconnected drive-through as far as four miles from the bank building,” Carlisle remembers. “But it took two more legislative sessions to first allow the bank to own branches within the county and then statewide.” When the industry finally achieved the latitude it needed, most of Carlisle’s competitors were in such deep financial trouble that they couldn’t take advantage of the new rules. But in 1987 a new deep-pocket owner from California helped Allied Bancshares weather the storm. “First Interstate brought us the resources to survive, along with the knowledge of how branch banking worked.”
Carlisle was quick to capitalize on that advantage. When Texas law changed to allow branch operations, it was his inspiration to approach the Onstead family — good friends who owned Randall’s Grocery — and negotiate prime teller locations in 35 Randall’s stores. Overnight, First Interstate in Texas increased its locations by 50 percent without laying a brick. When Randall’s bought the Tom Thumb chain in Dallas and Austin, First Interstate went along too. That alliance alone catapulted the bank past its competitors, enabling First Interstate to capture a dominant share of Texas’ retail banking market. When First Interstate was acquired by an even larger California bank, Wells Fargo, in 1996, “they brought us to a whole ’nother level.” Carlisle recalls.
Relationship building is a full-time job for Carlisle, and he considers his high-profile civic and charitable activities to be part and parcel of his work for Wells Fargo, which is now the nation’s fifth-largest bank in assets. “I would say to any executive who achieves prosperity from the health of the region, to help make that happen,” he says. “It’s a never-ending circle that the work you do within the community comes back to you at the company — there’s no separation between the two.”
Carlisle has just finished serving a term as chairman of the Greater Houston Partnership, during which the group launched a strategic plan to build a $40 million economic development war chest. He left the partnership in excellent shape, with $21 million already in the coffers and a high profile among state legislators and employers.
Carlisle is particularly proud of the partnership’s work in education. “We brought together a level of support to help the legislature, the governor, and the Sharp Commission [a bipartisan task force appointed by Governor Rick Perry to recommend a new tax structure to pay for Texas public schools] move forward a plan to keep our schools open and fix a broken tax code. The Greater Houston Partnership was the first business community to endorse it, and then we encouraged other Texas cities to follow suit.”
Call it relationship building.
In order to create strong relationships with customers, Carlisle believes that a company needs strong relationships among its own team members. “As a leader I get my greatest joy from watching people around me develop and grow in their career and life,” he says. “I have had years of experience; that eventually becomes wisdom. I benefited from people who imparted wisdom to me early on, and now I get to do that for others.”
Relationships, strategic vision, and team building will continue to be priorities for Carlisle in the future. “Good or bad, most trends develop on the West Coast, and Wells Fargo helps us gain a lot of insight into what’s coming down the road,” he says. “But Wells Fargo remains a locally managed organization, which allows a local boy to feel very good about getting to call the shots,” he says, smiling.
— Gracie Cavnar
(Executive Travels)
Chip's Choices
Favorite city for biz travel: Because I am a proud Texan and have some truly wonderful family memories there, I’d have to choose Austin as the city I most prefer to travel to for business.
Favorite restaurant there: Hudson’s on the Bend
Most important travel accessory: BlackBerry (but I also enjoy bringing along a packet of Peanut M&M’s)
Most important hotel amenity: Although most hotels do not have them, I really love unwinding in front of an outdoor fireplace. I always enjoy a good campfire, and sometimes this is the closest thing to it when I’m traveling on business. It’s a great place for people to congregate, relax, and talk.
Team Player
Leadership — in baseball, business, and life — drives Houston Astros owner Drayton McLane Jr.
December 15, 2006, was a bittersweet day in the busy life of Drayton McLane Jr. The Houston Astros owner bid farewell to the most beloved player in franchise history, first baseman Jeff Bagwell, whose arthritic right shoulder forced him to retire after 16 years in Major League Baseball, all spent with Houston.
“It was a sad occasion, but also a happy one,” says McLane, 70, who still fondly recalls meeting Bagwell when he purchased the Astros in 1993. “It is sad to see him retire, but Jeff has been the heartbeat of the Houston Astros, not only with his great play, but also his manner. When I bought the team, it was easy to see that he was a leader and a great athlete who would make a difference.”
This month, while embarking upon his 15th season at the Astros’ helm, McLane might be tempted to wax nostalgic on the success the team enjoyed during the Bagwell era. A perennial disappointment before billionaire McLane ponied up $119 million of his family fortune for the club, the Astros had won their division only twice (1980, 1986) since joining the National League in 1962 as the Colt .45s. But under McLane’s leadership, Houston captured the NL Central flag four times in one five-year stretch (1997–99, 2001) and has gone to the playoffs in six of the past 10 seasons. “The highest point by far was the end of 2005, when we won the National League Championship and went to the World Series for the first time,” he says, assessing his tenure. Notably omitted is the result of that series: a four-game sweep by the Chicago White Sox. (Continental is the official airline of the Houston Astros.)
Instead of dwelling on the past, however, McLane sticks to the present. “I don’t really focus on legacies,” he says. “I am very focused on where I am today and on making the team better for 2007.” While disappointed to lose pitchers Andy Pettitte and Roger Clemens, McLane is excited about their likely replacements, Jason Jennings and Houston native Woody Williams. The team has also added power-hitting left fielder Carlos Lee, who hit 37 home runs in 2006 with the Milwaukee Brewers and the Texas Rangers. “We think we have the chance to be one of the best teams in baseball,” McLane contends. “I talk every day about being a champion — and being a champion is winning the World Series.”
McLane works closely with General Manager Tim Purpura on player comings and goings, regularly huddles with President of Business Operations Pam Gardner, and attends all but a handful of the Astros’ 81 home games at Minute Maid Park. “From the middle of the third inning until the middle of the seventh, I wander all over the ballpark, talking to the fans,” he says.
Still McLane wears many other hats besides his Astros cap. He grew up in Cameron, Texas, learning more than just the family’s grocery-distribution business from his father, Drayton Sr. “He taught me discipline and responsibility,” says McLane, who grew McLane Company into an international giant, sold the U.S. divisions to Wal-Mart in 1991, and now devotes the majority of his time to running McLane Group, a multifaceted private holding company. “He taught me about integrity and values, about respecting people and being a person of your word. I’ve worked hard to convey those same messages to everybody I come into contact with.”
However, developing leaders — in the clubhouse or the boardroom — may be McLane’s greatest passion. Whether they’re sales executives, team managers, or first basemen, he seeks out individuals with personal integrity, clear-cut goals, and good communication skills. That brings him back to that bittersweet day last December.
“Leadership is one of the really terrific roles that Jeff Bagwell has played,” McLane says. And Bagwell will continue to be a leader — even off the diamond. The four-time All-Star and 1994 MVP has signed a personal-services contract with the team. “He’s going to continue to be deeply involved with the Astros for years.” In McLane’s world, that’s a huge win.
— Bob Woods
The Power to Tame IT
Bob Beauchamp: In his own words
Bob Beauchamp is leading a revolution in the way IT departments are managed. Beauchamp (pronounced Beecham) is president and CEO of BMC Software in Houston, a pioneering IT company that was founded in 1980 and went through some tough years after the Internet bubble burst. Beauchamp, 47, is jazzed up about giving corporate leaders an integrated tool that enables them to drill down and truly understand what is happening in IT departments. In so doing, he is giving far larger competitors like IBM a serious challenge. This Houston native and former software and hardware salesman envisions a world where well-managed IT helps corporations to prosper, and he’s going to continue to “evangelize” that idea to every CEO he can find. — Nancy Shepherdson
In the past decade, almost every well-run large corporation has invested in integration to manage their financials, their sales force, their employees. The thing that they haven’t built is an integrated way to tie it all together. I say this to hundreds of customers every year and have never had one disagree with me: IT is the least automated department in most corporations today in terms of the way it manages itself. They manage the rest of the company in a very automated fashion, but IT departments manage themselves very manually.
As far back as 10 years ago, consultants and IT gurus [were] writing that someday somebody would develop an integrated database to manage all of IT. Business Service Management (BSM) is what came about when the cobblers finally got around to putting shoes on their own kids.
Four years ago, BMC decided to be the company that built an integrated way of managing IT. Our product, Atrium Configuration Management Database, is the secret sauce that made BSM possible. It’s the glue that connects all the technology that a company buys — all the hardware, the software, the people — to what they are doing with these computers, so that you know what you’ve got and how it’s performing.
When we first developed this strategy, we hired Geoffrey Moore, the author of Crossing the Chasm and Inside the Tornado. One of his recommendations was that we interview visionary CIOs and test our ideas with them. So I flew to Zurich to interview the CIO of one of the world’s largest banks, who I knew had a similar vision. In the opening minutes of the meeting, he said to me that he had over 50 different vendors who had sold him tools to manage IT, and that none of those tools told him anything he cared about but only gave his technical people the tools they needed to say, “Whatever’s wrong, it’s not my fault.”
He said, “We run a bank, not a technology company. Why can’t somebody put all these 50 tools together and present it to me the way I run my business?”
What our business customers have demanded is that IT needs to be managed like a business, not IT for IT’s sake. Forrester Research says that companies that implement BSM can save 25 percent of their total IT budget. I believe we are really at a tipping point in the industry, [moving] from point products to suites to platforms. BSM has transformed the entire sector we are in. We invented it, we evangelized it, and we are now leading the market in a market that didn’t exist only four years ago.
(Executive Resume)
The Beauchamp Basics
Title: President and CEO, BMC Software
Education: BA business administration (finance, 1978), University of Texas at Austin; MS management (1987), Houston Baptist University
Career experience: Software and hardware sales for various Houston IT companies; joined BMC in 1988; became president and CEO in 2001
Quick fact: BMC was named one of America’s Most Admired Companies by Fortune magazine in 2006.
It Takes Two
Together, entrepreneurs John Nottingham and John Spirk can tell what products you need
John Nottingham and John Spirk still share an office, just as they did when they launched their industrial design firm out of a tiny carriage house in 1972. Today, they and the 70 employees of Nottingham-Spirk Design Associates operate out of a 57,000-square-foot renovated church in Cleveland where there’s more than enough space for separate workrooms. But the two like working side by side.
“We’ve grown every year for the past 35 years,” says Nottingham, 57. “By solving problems together,” Spirk chimes in, “and coming up with things that are better than what’s already out there.”
The two-heads-are-better approach has helped Nottingham and Spirk build their business into one of the country’s leading product invention and development groups. Together the two men hold 465 commercialized patents. And their ideas have also spawned a dozen Ohio-based start-up and spin-off companies. A new line of innovative yard and garden tools the pair conceived for GroWorks, a spin-off company they established in 2005, hits stores this spring.
GroWorks embodies Nottingham’s and Spirk’s entrepreneurial philosophy to a tee: find a need, invent products, test them with consumers, and then take them to the public. In this case, the pair recognized an increasing interest — especially among baby boomers — in gardening. They designed tools that addressed this demographic’s desire for easy-to-use, ergonomically designed products, such as a water-powered outdoor broom. The line debuted at the 2006 National Hardware Show and was very well received.
“Instead of trying to convince an established company to take an interest, we’re launching this ourselves,” Nottingham explains. “But our intention is not to keep GroWorks forever. Once it’s successful, we’ll offer it to a larger organization. This is what we call the ‘ship before we flip’ model.”
To provide seed capital for the development of their concepts, as well as ideas from outside, Nottingham and Spirk helped start Consumer Innovation Partners — a $20 million private equity investment firm — in 2002. But the old college chums, graduates of the Cleveland Institute of Art, still make time for their first entrepreneurial effort.
They find their inspiration on the shelves of major retail outlets. “We’re trying to figure out what consumers will want two years down the road,” explains Spirk, 58. “So we look for what’s not there,” Nottingham adds.
Notable products born at Nottingham-Spirk Design Associates include the Crest SpinBrush, an inexpensive battery-powered toothbrush purchased by Proctor and Gamble; and the bright red, plastic Dirt Devil, a vacuum with onboard tools that helped Royal Appliance go from just under $5 million in annual revenues to $428 million. But as the stakes get higher, the duo is still doing things their way.
As Spirk says, “It’s still about me and John, sitting around having fun together.”
— Laura Taxel
(More Ideas)
Other Entrepreneurs
Digg it: A former host for cable network TechTV, Kevin Rose started Digg.com in 2006. The latest version of the 30-year-old’s brainchild allows users to rank news content by uploading links to stories from blogs and online media sources. Digg.com currently has 1 million daily viewers. — L.T.
Making connections: Twenty-four-year-old Sumaya Kazi was named one of BusinessWeek’s Top 10 Entrepreneurs Under 25 for co-founding the CulturalConnect, an online media publisher that includes four online magazines for young ethnic professionals: The DesiConnect, The MidEastConnect, The AsiaConnect, and The LatinConnect. A new magazine, The AfricanaConnect, launches this year. theculturalconnect.com
— Erin La Rosa
Linen lady: Barbara Davis founded Cloth Connection in 1980 in her New York garage. Today her company — which rents napkins, chair covers, and tablecloths — has offices nationwide. Often cited as an industry trendsetter, Davis has provided wedding linens for celebrity clients like Donald Trump and Star Jones and has dressed events like the Grammy Awards. clothconnection.com — E.L.
