Profile: Secretary of Commerce Carlos Gutierrez

ByABC News
November 29, 2004, 12:51 PM

-- From selling Frosted Flakes to small stores in Mexico City to President Bush's Cabinet as the secretary of commerce, Carlos Gutierrez has come a long way.

President Bush nominated Gutierrez, the chief executive officer of Kellogg Co., as commerce secretary, calling the 51-year-old business leader "a visionary executive" at a White House news conference.

Gutierrez was confirmed by the full Senate on Jan. 24. He succeeds Donald Evans, who announced his resignation shortly after the Nov. 2 election.

In his confirmation hearing, Gutierrez promised to fight unfair trade practices that impede competition among American companies.

Born in Cuba, Gutierrez fled Havana with his family in 1960, shortly after Fidel Castro took power. He was 6 when his family landed in Miami Beach, Fla., before moving to New York City and eventually settling in Mexico City.

Selected as one of the most powerful Hispanic-Americans in business by Fortune magazine earlier this year, Gutierrez never graduated from college and has previously told reporters that he learned English from "bellhops of a Miami Beach hotel."

But commerce has been a language Gutierrez has been fluent in from an early age. And much of it has been acquired at Kellogg, the floundering cereal giant that he helped revive.

Gutierrez's relationship with Kellogg began in Mexico City at age 20 when the son of a pineapple merchant took a job driving a Kellogg's truck selling Zucaritas (Frosted Flakes) to mom-and-pop stores.

Ten years later, he had worked his way up to general manager of Kellogg's operations in Mexico. He transformed the Mexican plant from the company's least-productive to its most-productive.

Gutierrez was transferred in 1982 to Kellogg's corporate headquarters in Battle Creek, Mich., as a supervisor of Latin American marketing services.

In the early 1990s, Gutierrez returned to Battle Creek as corporate vice president of product development. The cereal market was in a crisis with consumers who increasingly angered by rising prices were moving to smaller, cheaper brands.

But Kellogg continued to stress sales volume so that when Gutierrez was named CEO in April 1999, industry experts say he had a license to bring about a dramatic transformation.

The young CEO did manage to implement changes. In a strategy called "Volume to Value" in business circles, Gutierrez focused on increasing sales by shifting resources to higher-margin products. These included a range of "health" products, including Special K, targeted mainly at weight-conscious women and Kashi, another health-food brand the company purchased in 2000.

As the company's stocks improved, so did Gutierrez's personal worth. In 2003, he received about $7.4 million in compensation, including salary, bonus and incentive payments, according to a Kellogg proxy statement. He owns or has option rights to 2 million shares of company stock.

In joining the Cabinet, Gutierrez gives up his lucrative salary and bonuses. But in a short speech after Bush announced the nomination, Gutierrez said he was proud to accept the post.

"We never imagined that this country would give me this great opportunity," he said. And speaking directly to Bush, he added, "I believe passionately in your leadership and the direction you've set."