BUSINESS OF FASHION | LISA WANG LONDON, United Kingdom — From his humble roots as the son of a house painter from the Bronx, Ralph Lauren (born Lifshitz) grew a start-up tie business into a global fashion empire with annual sales of over $7 billion. The venerable American designer and executive, who appears this month on the cover of Port magazine in a herringbone tweed jacket with its collar casually upturned — the embodiment of the preppy Americana style on which he has made his name — remains at the very heart of the Ralph Lauren corporation.
“We wanted to have a fashion icon on the cover,” Dan Crowe, editor-in-chief of Port, told BoF. “Ralph Lauren’s story is the apotheosis of the American dream: ambition and self-invention, but also of a certain reverence for old-world elegance and authenticity. And on a very fundamental level, he’s a nice human.”
Nearly every major profile of Mr Ralph Lauren in the past decade has remarked on his vitality, including Port magazine’s cover story by Donald Morrison, who describes Mr Lauren as ‘trim,’ ‘tanned,’ and ‘ruggedly handsome.’ In an office adorned by various toys and trinkets, he speaks with a soft voice and youthful candour that belies his 74 years. But there remains the inevitable task of selecting a successor to lead the Ralph Lauren empire into the future, something that’s made apparent when Morrison gently asks Mr Lauren about his own mortality. “If you ask what keeps me awake at night, that’s it,” says Lauren. “How do we accept this terrible thing? We built this life, had these children — and then we won’t see each other again? I try to come to terms with death, but I can’t,” he continues. “When I’m working and busy with my life, I’m happy. When I sit back and try to figure it all out, it’s beyond me.”
“Overall, succession planning has become increasingly complex and varied over the last 10 to 20 years,” Robert Burke, founder of retail consultancy Robert Burke Associates, told BoF. “Through globalisation, emerging markets and commerce, brands are more global and more structurally complicated than ever before.”
Recruitment consultant Karen Harvey agrees. “When planning for succession of leadership, it is crucial to recognise that the requirements for leaders of fashion companies have changed dramatically over the past few years. The dynamics of our industry have made it necessary for fashion company CEOs to be facile across all channels, to understand how to use social media from a branding and consumer connection perspective, while they still have to have the ability to work with a powerful creative director, understand how to develop complex supply chains, from Italy to Turkey to Asia, while being an astute general manager with strong financial acumen,” she said.
Indeed, a look at some of the industry’s recent high-profile leadership transitions highlight the many challenges that companies face. AfterValentino Garavani’s retirement in 2007, the Valentino company stuttered along until it finally found the right creative talent in Maria Grazia Chiuri and Pierpaolo Piccioli. When Tom Ford left Gucci in 2004, the Italian luxury company floundered before Frida Giannini was installed as the brand’s overall creative director. And despite strong sales in licensed categories such as underwear and fragrance, Calvin Klein risked losing its luxury cachet when its figurehead and founder — a neighbour of Mr Lauren back in the Bronx — departed in 2006.
So how do companies transition smoothly between leaders? There is no set formula, but “if new generations of the founding family are vital to the brand’s DNA, their grooming should begin young and be as varied as possible,” said Burke. “Experience is still the most important factor. The Arnaults are a good example, having moved around to different roles and companies under the LVMH umbrella,” he continued. “The Hermèsfamily has proven the value of having family members gain outside experience before joining in order to gain a different viewpoint, while also having close ties to the family brand.”
“The founding family has hopefully been thinking about [succession] for some time and almost always they have some idea of who they would like to step up,” said Harvey. “Putting rigour into the process, such as developing a very specific strategy for the next generation of the brand, should lead to articulating very specific criteria for the next leader.”
For Ralph Lauren — the company and the man — family and business are inextricably linked. Many of Ralph Lauren’s high-ranking employees were promoted from within and have grown with the company for decades. Mr Lauren and his wife Ricky have been married for more than 50 years and have three grown children: Andrew, a film producer; David, executive vice president of advertising and communications at Ralph Lauren; and Dylan, founder of Dylan’s Candy Shop in New York City. Many have tippedDavid Lauren as his father’s eventual successor. Young and charismatic, the younger Lauren was educated at Duke University and began his career at the company in 2000. Since then, he has overseen the company’s advertising strategies and spearheaded many of its digital initiatives, including the development of its e-commerce website and other innovations that blend commerce with content, a mix he has called “merchantainment.” He was elected to the board of directors in August of last year.
On the operational and business side, Mr Lauren has amassed a formidable executive team. “Being a public company, Ralph Lauren has been innovative in recently creating an office of the chairman made up of top executive from across the business,” said Burke. “They’ve been exemplary in how they’ve positioned the company for long-term sustainability.”
Leading headhunter Floriane de Saint-Pierre believes that “it is not just about creative leadership; it is about creative-thinking leadership. A successor must also be an inventor, never an imitator. The reason is simple: all successful fashion firms have been founded by inventors.” Although the company itself will carry on, Mr Lauren’s singular vision and enduring spirit have distinguished his career and remain a crucial component of the company’s success.
“At the start of his career he was told by a large New York store that they would stock his ties, if he took his initials off. Of course, he said no. This gesture ultimately led to global success,” said Port editor Dan Crowe. “That dedication to his vision created a clear and translatable story. People connect with Ralph Lauren because of that clarity of vision. I think a big creative business can only flourish with that attitude.”