Holliday, Chad 1948–
Chairman and chief executive officer, DuPont
Education: University of Tennessee, BS, 1970.
Family: Son of Charles O. Holliday Sr. and Ann Hunter; married Ann Blari, 1970; children: two.
Career: DuPont, 1970–1974, engineer; 1974–1978, business analyst; 1978–1984, various manufacturing assignments in Fibers Department; 1984–1986, manager of Corporate Plans; 1986–1987, global business director for Nomex; 1987–1988, global business director for Kevlar; 1988–1990, director of marketing for Chemicals and Pigments; 1990–1992, vice president and then president of DuPont Asia Pacific; 1992–1995, senior vice president; 1995–1998, chairman of DuPont Asia Pacific and executive vice president; 1999, CEO; 1999–, chairman and CEO.
Publications: Walking the Talk: The Business Case for Sustainable Development (with Stephan Schmidheiny and Philip Watts), 2002.
Address: DuPont, DuPont Building, 1007 Market Street, Wilmington, Delaware 19898; http://www.dupont.com.
■ Charles O. Holliday Jr., well known as "Chad," parlayed a summer job that he obtained while in college into a 30-plus-year career at DuPont, the largest chemical company in the United States and the developer of such products as Lycra and Teflon. In January 1999 Holliday was named DuPont's CEO, and he added the title of chairman later in the year. Holliday's success in overseeing DuPont's Asia Pacific operations in the 1990s played a large role in his being appointed over several others who had been higher up in the corporate chain of command and in line for taking over the company. With extensive experience in such key areas as manufacturing, marketing, finance, planning, and business, Holliday set DuPont's primary mission as one of achieving sustainable growth. Known as a strong negotiator who liked his subordinates to take new and untraditional approaches to improving business, Holliday was also recognized as a leader who emphasized providing strong customer service and meeting shareholders' expectations.
EARLY LEARNING EXPERIENCES
Holliday was born and grew up in Nashville, Tennessee, the home of country music. As a boy he performed yard work for a Grand Ole Opry singer who lived nearby in exchange for guitar lessons. When Holliday enrolled at the University of Tennessee, he planned to take over his father's industrial-supply business, where he had helped assemble parts when he was younger. His father called him during his junior year at college, however, to say that he had sold the company.
Holliday was a member of the University of Tennessee chapter of the national Pi Kappa Alpha fraternity, where he gained some of his first experiences in leadership. In 1970 he attended the fraternity's national convention, where attendees were discussing issues such as the upsetting prevalence of discrimination and other prominent social issues of the time. He later recalled that as chapter president he was tested by many tough situations, often needing to bring his fellow fraternity members together to decide where the chapter stood on important social issues. He helped the chapter face tough financial times, an experience that prepared him well for his business career after college.
No longer looking to follow in his father's footsteps, Holliday took a summer job with DuPont. The job led him to accept an engineering position with the company, in Old Hickory, Tennessee, after graduating from college with a degree in industrial engineering. Over the next two decades Holliday would hold a wide range of marketing and business positions, primarily in the company's fibers and chemicals businesses. As he rose through the ranks, he held a number of managerial po sitions, including manager of Corporate Plans; global business director for Nomex, a fire-retardant aramid fiber; and global business director for Kevlar, an aramid used for its durability in such objects as tires and bulletproof vests. Holliday also served as director of marketing for Chemicals and Pigments.
HEADS ASIA PACIFIC OPERATIONS
In 1990 DuPont sent Holliday overseas to run its Asia Pacific operations. Although some company insiders were skeptical of Holliday's ability to handle the job due to his youth and limited foreign experience, others saw the appointment as a testing ground where his performance would indicate just how far he was capable of advancing within the company.
Holliday often noted that his experience overseas taught him a great deal. During the years he spent in Japan he learned much about the Eastern approach to business, which was very different from the typically Western approach. He said that he learned an especially large amount from key Asian business leaders who had used their management and leadership skills to succeed despite tough times. As Holliday told Peters, "Many CEOs in Japan took me under their wings and tried to help me along the way" (May 21, 2001).
Holliday proved himself to be a quick study. Business analysts gave Holliday much of the credit for helping to double DuPont's Asia business during his nearly eight-year stint there. In part through his initiation of joint ventures in several countries, including Japan, annual sales increased to $4 billion. Over the course of Holliday's stay in Asia Pacific, the number of joint ventures in the 15-country region grew from 12 to 37, dramatically expanding DuPont's global reach. In 1995 Holliday was named chairman of the region.
When the DuPont president and CEO John A. Krol announced that he would retire at the end of 1998, many analysts observed that Holliday was apparently being groomed as his successor. Many within the company recognized that DuPont's former chairman and CEO Edgar S. Woolard Jr. had taken note of Holliday early in his career, even before Holliday had reported to Woolard as head of the Asia Pacific businesses. Nevertheless, many were surprised by the announcement that Holliday would immediately take over the post of president and was slated to become CEO in the beginning of 1999; he would also assume the chairmanship before the year was out. Susan Warren wrote in the Wall Street Journal that many Wall Street analysts were calling up the chemical giant and urgently asking, "Who's Chad?" The vice president of investor relations John Himes told Warren, "He's probably the least known of our senior management" (November 12, 1997).
Despite his relative anonymity among DuPont's upper ranks, Holliday had been growing ever more visible over the preceding years. Many noted his potential to be the future leader of the company when he began appearing at analysts' meetings and news conferences in 1996. The meetings in question were associated with a number of company acquisitions in which Holliday had been involved and which had cost approximately $6 billion. Holliday had gained further favor within the company when he helped DuPont beat out rivals in negotiations with Pioneer Hi-Bred International, a seed company that DuPont wanted for its strong market potential in the field of genetically engineered plant products. Analysts gave Holliday credit for helping to strike the unique co-venture in which the companies' marketing and research efforts were combined and DuPont purchased 20 percent of Pioneer for $1.7 billion.
Through his appointments to the top posts Holliday indeed leapt over several more senior operating executives within the company, including two highly touted executive vice presidents who were leading DuPont's Conoco unit and its European division. Many analysts held high hopes for Holliday. Jeffrey Cianci, the analyst with Bear, Stearns & Company, told the Wall Street Journal 's Warren, "Chad plays well. He's young, energetic, charismatic, shareholder oriented, good-looking. And as long as he plays well, he'll go over with investors" (November 12, 1997).
LAYS OUT HIS PLANS
Holliday understood some of the concerns about his taking over the company; in addition to his relative anonymity, he was DuPont's third-youngest top executive at the time. As the company approached its two-hundredth anniversary, Holliday became the 18th executive to take the reins and lead the venerable and successful corporation.
Holliday quickly announced that he was committed to maintaining double-digit earnings growth, a standard that had been set by his predecessor. He would focus on creating a leaner, faster, and less capital-intensive company. The Merrill Lynch analyst John Roberts summed up Holliday's challenges when speaking to Joseph Chang of the Chemical Market Reporter : "The primary task will be integrating the $7 billion of acquisitions underway, but there will also be continued focus on asset productivity, operating-cost control and more aggressive pricing in selective markets" (November 17, 1997).
By the time he addressed the annual shareholders' meeting in April 2000, Holliday was able to better outline his ambitious growth plans for the company. He acknowledged that the core of DuPont's revenues were still tied to the company's products, such that developing new products would remain a top priority; he noted that 20 percent of the company's revenues came from products developed over the past five years. Nevertheless, Holliday outlined other strategies that he would pursue, such as attempting to increase DuPont's e-business efforts and make its operations more "knowledge-intensive"; Women's Wear Daily reported that he told shareholders, "We're trying to get paid for what we know, not only for the products we sell" (April 27, 2000).
Analysts noted that in terms of action as well as words Holliday was fast out of the box as DuPont's new leader. He quickly spun off the company's massive Conoco oil and gas unit and then pumped large sums of money into a biotechnology seed company. According to some industry watchers Holliday hoped to transform DuPont into an industrial-growth company, rather than allowing it to remain solely a producer of cyclical commodities. By late 2000, however, he was facing major disappointments.
Holliday had set a goal of generating 30 percent of the company's income from agriculture-biotech and pharmaceutical units by 2002. However, a public backlash against genetically modified crops, brought about by the popularization of the belief that they could be harmful to both humans and the environment, hindered the company's progress in ag-biotech. In addition Holliday proved unable to forge an alliance with another pharmaceutical company, thus threatening to derail DuPont's undersized pharmaceutical business. Further adding to the mound of troubles were higher oil and gas prices and a weakening economy that had harmful effects on DuPont's older chemicals and fabric businesses. Analysts became disenchanted with Holliday and were unsure as to whether he had a coherent strategy for getting DuPont back on track. By late 2000 DuPont's stock had fallen 28 percent since Holliday's appointment as president in February 1998. The investment-portfolio manager John B. Fields told a BusinessWeek correspondent, "They are stumbling around looking for a growth engine and have clearly not found one" (October 20, 2000).
STICKS TO HIS GUNS
Holliday admitted that he might not have been clear enough about the length of time he had expected it would take to transform DuPont; he insisted on sticking to the strategy of attempting to firmly place DuPont in the emerging biotechnology sector. Industry analysts, however, believed that the $7.7 billion Holliday had eventually paid to acquire 80 percent of Pioneer Hi-Bred International had been too much. Yet Holliday remained confident in the company, noting that DuPont was holding off on introducing certain genetically modified products until more was learned about the manner in which they would be accepted by customers. He emphasized that DuPont's researchers were working on important new products, such as crop-protection chemicals and a new polymer dubbed Sorona that would be used in making a more resilient form of polyester. Holliday also instituted a manufacturing efficiency program in the hopes of reducing the company's annual pretax costs by hundreds of millions of dollars.
In 2000 Holiday recruited the American West Airlines CEO Richard R. Goodmanson to be his right-hand man at DuPont. Goodmanson's appointment would be one of many as Holliday continued to endeavor to shift DuPont's operations. Industry observers noted that in spite of his early stumbles Holliday was slowly making changes and showing a new willingness to reach outside of headquarters for expertise—such as when DuPont formed a partnership with the longtime customer Unifi to produce polyester filament yarn. G. Allen Mebane, the chairman of Unifi, told BusinessWeek, "This alliance would never have happened years ago" (October 30, 2000).
By mid-2001 Holliday had made two major decisions: to get rid of DuPont's pharmaceutical unit and to negotiate a merger or alliance with another crop-protection company in order to build its existing product pipeline in that area. Some analysts noted that DuPont's lack of breadth in terms of crop-protection products indicated that the company was not achieving the desired returns on its research and development spending. Nevertheless, many industry watchers were encouraged by Holliday's aggressive focus on growth.
Much of Holliday's approach to expansion centered on the forming of new alliances with other businesses. He formed one alliance with General Mills to produce and market a new soy-milk product and another with MIT to help identify major businesses/markets on which to focus as well as leading industrial partners with whom to work; conclusions drawn with MIT led to deals with Ford and Merck, strengthening DuPont's involvement in the fields of automotives and human health, respectively. Meanwhile, Holliday was aware that, while pioneering in new areas, DuPont needed to continue to be successful with the products it had been making for decades. Holliday told Technology Review, "The key in innovation is to keep taking old products and finding new uses for them, different adaptations, while you bring in new things" (November 2001).
FACES TOUGH ECONOMIC CLIMATE
The year 2001 brought further difficulties for Holliday and DuPont: Consolidated sales totaled only $24.7 billion, as compared to the $28.3 billion of the year before. Furthermore, full-year segment sales had dropped 10 percent and full-year income excluding one-time items was $1.251 billion, as compared to the $2.878 billion of 2000. Overall the company had significantly lower earnings in all segments of its business, due primarily to lower worldwide sales volume and margins.
DuPont was forced to cut jobs, close plants, and shift operations to include joint ventures in the company's textile business. While DuPont had dominated the fiber business for half a century, many began to question Holliday's commitment to that particular traditional revenue earner, noting that DuPont had slashed nearly 7,500 staff and contract workers since 1999. In response Holliday spun off all of the company's fiber operations into DuPont Textiles & Interiors, a $6.5 billion unit. In Women's Wear Daily Scott Malone quoted Holliday as saying, "Now our long-term commitment is clear" (February 12, 2002).
Holliday continued to work to align costs, introducing several new programs in his efforts to foster growth. In January 2001 Holliday had given all of DuPont's businesses an "eightquarter challenge": essentially, if individual businesses wanted to remain a part of the DuPont company, they would have to meet specific growth rates for revenues, earnings, cash availability, and capital intensity by the end of 2003.
Despite his efforts, by 2004 DuPont had been unprofitable for several years. Holliday sold the subsidiary INVISTA, which made nylon and polyester fibers, including Lycra and Stainmaster, to Koch Industries for $4.2 billion in an April 2004 deal. He outlined plans to further cut DuPont's workforce by 3,500 people and made a substantial shift in management in January 2004, creating the post of head of global sales and rearranging leadership in the Far East. Holliday pointed out that high natural-gas prices put DuPont and other U.S. chemical makers, who used natural gas as well as crude oil to make their products, at a disadvantage, as compared with those elsewhere who had access to more moderately priced natural gas.
Holliday stated that the moves were part of an overall plan to cut $900 million and to focus DuPont's efforts on fastergrowing markets, including South America, Eastern Europe, and Asia. Holiday pointed out that the high energy costs were prompting DuPont to shift its focus on investments and jobs overseas. Holliday told Thaddeus Herrick of the Wall Street Journal, "These are difficult but necessary decisions" (April 13, 2004).
MANAGEMENT STYLE: YOUR WORD IS YOUR BOND
Holliday often referred to a conversation that he had had when he was still a young manager at DuPont in the 1980s. He was talking with the company's CEO at the time Dick Heckert. In an interview with Carol Hymowitz of the Wall Street Journal, Holliday recalled that Heckert told him, "'This company lives by the letter of its contracts and the intent of those contracts'"; Holliday added, "I still remember the expression on his face when he said those words, and I've lived by that philosophy ever since" (July 9, 2002).
Analysts noted that Holliday's management style involved looking within the company for leadership candidates who did not necessarily follow the norm. When recruiting prospective leaders, he focused on enthusiasm and desire. With respect to his own motivation to keep going everyday, he told Peters for the profile on the Pi Kappa Alpha Web site, "Well, I love interacting with people and I love a challenge. I love tough problems. If my job here was routine, it might be harder for me to get up in the morning" (May 21, 2001).
Holliday placed a high priority on one's ability to listen and favored those who shared this trait with him. He informed Peters, "Where I have learned the most has been from that walk through the plant with someone who is 10 or 15 years older than me who is not afraid to tell me about how things should be done" (May 21, 2001).
Holliday was commended for improving DuPont's standing on environmental issues, taking such steps as pledging to reduce the company's greenhouse-gas emissions. He cowrote a book with Stephan Schmidheiny, the chairman of Anova Holding, and Philip Watts, the chairman of the committee of managing directors of the Royal Dutch/Shell Group, entitled Walking the Talk: The Business Case for Sustainable Development. Therein, the three corporate leaders outlined their belief that businesses should operate in a humane fashion. Malcom McIntosh wrote in the Journal of Corporate Citizenship, "The authors say they were nervous of using this title, and well they might be; but they should be applauded for recognizing the fundamental issues at the heart of sustainable development—social justice and corporate responsibility for environmental degradation" (2002).
By mid-2004 Holliday remained optimistic about the future of DuPont and about his strategy of aligning DuPont's businesses by market-growth platforms in order to increase speed and effectiveness in meeting customer needs. The platforms into which the company was broken down were Agriculture and Nutrition, Coatings & Color Technologies, Electronic and Communication Technologies, Performance Materials, and Safety and Protection. Holliday upheld his commitment to DuPont's efforts in biotech and genetic engineering, as exemplified by the company's purchase of Verdia, a wholly owned subsidiary of Maxygen; in 2004 he sealed a deal to purchase the plant-sciences company for $64 million in cash. By purchasing Verdia, Holliday ensured that DuPont would have worldwide, royalty-free, exclusive rights to use Maxygen's MolecularBreeding gene-shuffling technology for applications across its Agriculture and Nutrition platform.
In addition to his duties at DuPont, Holliday served on the boards of directors of HCA and Catalyst, was a senior member of the Institute of Industrial Engineers, and was also a member of the board of Winterthur Museum & Gardens. In September 2002 he was appointed by President George W. Bush to serve on the national Infrastructure Advisory Council. He was elected chairman of the Business Council in 2002. He served as chairman for the World Business Council for Sustainable Development and for the American Section of the Society of Chemical Industry.
See also entry on E. I. du Pont deNemours & Company in International Directory of Company Histories.
sources for further information
"CEO Describes DuPont's Growth Plans," Women's Wear Daily, April 27, 2000, p. 12.
Chang, Joseph, "DuPont CEO Seeks Internal Improvement," Chemical Market Reporter, November 17, 1997, p. 1.
"A Company Life Who Wants to Be a Maverick," BusinessWeek, October 20, 2000, p. 88.
"DuPont's Big Remake May Need a Remix," BusinessWeek, October 30, 2000, p. 84.
Herrick, Thaddeus, "DuPont to Eliminate 3,500 Jobs as High Gas Prices Take a Toll," Wall Street Journal, April 13, 2004.
Hymowitz, Carol, "In the Lead: CEOs Must Work Hard to Maintain Faith in the Corner Office," Wall Street Journal, July 9, 2002.
Malone, Scott, "DuPont Plans Fiber Unit IPO," Women's Wear Daily, February 12, 2002, p. 2.
McIntosh, Malcom, review of Walking the Talk: The Business Case for Sustainable Development, in Journal of Corporate Citizenship, Winter 2002, p. 123.
"New Life for DuPont: Chad Holliday," Technology Review, November 2001, p. 77.
Warren, Susan, "DuPont's Choice of Holliday as Chief Catalyzes Chain of Curious Phone Calls," Wall Street Journal, November 12, 1997.