Someone’s Knocking At The Door

Kenneth Chenault's appointment as president and COO of American Express threatens to shatter one ofthe final barriers to corporate America's top spot

of a Fortune 500 company, the message to corporate America will be that we can do an outstanding job when these selections are made,” says Howard University Business School Interim Dean Barron Harvey. “To the black community, this will ignite hope and desire. It’s never been that we can’t handle these positions but rather have been denied access. And when that day comes, it will be a great day. I just hope it comes soon.”

Others are watching Chenault carefully. While he plays down the role of trailblazer, many say his rise can only help those who seek to follow him up the ladder.

“His appointment signals what the possibilities are for African Americans,” says David Hinds, president of the Executive Leadership Council. The council, whose members include Chenault and Kraft Foods President Ann Fudge, provides African American senior executives of Fortune 500 companies with a professional network and forum on business and public policy issues.

“There always has to be a first, then a second and third,” says Hinds. “But breaking that barrier and being first is always the most difficult. His appointment can only help pave the way for others.”

Ann Fudge, president of Maxwell House Coffee Co., and the first black woman to permeate corporate America’s top tier, agrees wholeheartedly. Interviewed for BE’s 25th Anniversary Issue, Fudge said at the time that if large corporations wanted to outdistance their competitors, they would have to open the executive doors to African Americans. “All of this corporate reengineering has forced people to look at their performers with a lot more scrutiny. That gives talented people– regardless of their race or gender–an opportunity to make an impression, the kind that counts when it’s time to se,e who m
oves up.”

“We’re in this race like everybody else, and everybody’s not going to win,” said Fudge. “But when that first breakthrough is made, it’ll be terrific for a lot of reasons, and largely because I’ll know what they had to go through to get there.”

If Chenault is to ascend to the CEO’s chair in the next several years, then his advancement will depend heavily on how well American Express fares over the same time frame. According to sources, Chenault has his work cut out for him.

Earlier this year, the company announced it would be laying off 5% of its workforce and taking a restructuring charge of $125 million, largely because American Express has sustained heavy hits from competitors such as Visa and MasterCard over the last several years. Its share of total U.S. card transactions slipped from 22.9% in 1990 to 15.9% last year. And most of its lost business went to Visa, which now has 10 cards in circulation in the U.S. for every AmEx card.

American Express is currently going head-to-head with Visa and MasterCard as it attempts to forge links with U.S. banks in the distribution of AmEx cards. The vast majority of banks are already in binding agreements with Visa and MasterCard and are prohibited from shopping AmEx. But the

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