Although Arnold Donald has served on the Carnival board for years, he's never run a cruise line. Carnival needs the perspective of a relative outsider to bring about some real changes.
It’s been 12 days since Arnold Donald took over as CEO at Carnival Corp. and he’s been making the rounds at company operations in Miami and the United Kingdom to get onboard quickly.
Donald, who assumed the role July 3 after longtime company CEO Micky Arison stepped down from the position after 34 years, has been all ears.
“My first few weeks are going to be about listening,” Donald said in an interview with the Sun Sentinel Wednesday at Carnival’s Miami headquarters.
Donald has met with key company executives, corporate staff and employees to hear about their priorities and receive input on what’s working and what’s not.
“Getting a first-hand view from the people who know it everyday is my first task.”
Donald admits he’s not an expert on Carnival’s operations and that’s why listening is key.
“It’s the common-sense thing to do,” he said, noting that being on the board and being in charge of operations are two different things.
But making the transition from board member to company CEO does have its advantages.
“You do have familiarity,” he said. “I have a working knowledge after 12 years of the business and I know a lot of the players, so I can get up to speed faster.”
Donald, 58, isn’t a novice when it comes to the cruise industry. He’s served 12 years as a Carnival board member and participated on several of its committees including the Health, Environmental, Safety and Security Committee during the period.
He’s also no stranger to cruising, having taken many cruises with his wife and family before joining Carnival. He’s taken several other cruises since, including voyages on competitor’s cruise ships.
Donald was Arison’s first pick for CEO.
“I believe Arnold is the best person for this job,” Arison told analysts in late-June during an earnings call as he addressed the appointment and split of the CEO and chairman role. “He has been an asset … and will be an asset to the future of this organization.”
Donald’s career has included leadership roles in private equity firms, not-for-profits and a large publicly-traded company. He’s also served on boards of directors of companies in various sectors, including banking and agriculture.
He spent more than 20 years at Monsanto, a St. Louis, Mo.-based developer of agricultural products and consumer goods and it was during an early career stint in Canada leading its agricultural business that he learned how to work “through other people.” That meant not only telling them what to do, but also helping them tell him what needed to be done, Donald said. He views that period of realizing he couldn’t do the job all by himself, as his “single-most transformational managerial experience.”
Donald is taking over as CEO at a time when Carnival is working to restore the image of some of its cruise brands following a handful of high-profile incidents involving ships from Carnival Cruise Lines and Costa Cruises in the last 18 months.
Carnival is the world’s largest cruise operator with 10 cruise brands, which also include Princess Cruises, Holland America Line, Seabourn and Cunard.
Consumer confidence in the Carnival brand took a hit after an engine room fire aboard Carnival Triumph in February left it without propulsion, stranding thousands of passengers and crew at sea for days in the Gulf of Mexico under unsanitary and unpleasant conditions.
In March, at least three other Carnival ships — Dream, Legend and Elation — also had either technical or mechanical issues that disrupted their cruises. The company also faced scrutiny following the January 2012 shipwreck of the Costa Concordia off the coast of Italy. The ship, operated by Carnival’s Italian unit Costa, ran aground after hitting underwater rocks, killing 32 people.
This year’s ship mishaps have put a dent in company earnings and slowed bookings for Carnival, forcing the cruise line to lower prices and boost marketing to fill its ships.
In the earnings call last month, Carnival officials said advisers have told them the brand’s recovery will be gradual and will take two to three years to fully recover.
Donald sees guest satisfaction as a top priority and plans to help in that process to ensure the company’s brands can more “profitably” and “consistently” deliver the promise of “an exceptional, joyful vacation experience.”
In the Triumph incident, a number of guests were “inconvenienced,” he acknowledged. “That’s not what we’re about.”
Several corporate initiatives have already been undertaken to improve conditions and circumstances aboard ships should a loss of power, though rare, happen again, Donald said.
The global cruise company announced in April it expects to spend $600 million to $700 million on operational and technological enhancements to its 101-ship fleet, including more than $300 million at Carnival Cruises Lines.
Those who know Donald professionally outside of Carnival say Arison picked the right guy for the job.
Some have likened his skills to that of a troubleshooter .
“He assesses things quite well,’ said Ronald Parker, president and CEO of The Executive Leadership Council, a forum for current and former African-American CEOs and senior executives at Fortune 500 and equivalent companies. “He has the vision to look at a corporation and anticipate what [it] is in need of and I’m sure he’ll do that with Carnival.”
Parker served on the council’s board of directors when it recruited Donald as its president and CEO, a position he held from 2010-2012.
“He’s a visionary,” said Marie Davis, executive director of Greater Missouri and Southern Illinois chapter of the Juvenile Diabetes Research Foundation International, who’s known Donald for 10 years. Donald was president and CEO of the foundation from 2006-2008. “He can find trouble spots and fix them.”
Source: Arnold Donald; Carnival Corp.
About Arnold W. Donald
Position: CEO, Miami and London-based Carnival Corp. & PLC
Residence: St. Louis, Mo.
Personal: Married 39 years to Hazel; 3 children and 5 grandchildren
Education: Bachelor of Arts in economics Carleton College; Bachelor of Science in mechanical engineering, Washington University; Master of Business Administration in Finance and International Business, University of Chicago
Hobbies/interests: Music, dancing, reading, New Orleans Saints fan
Professional experience includes: Chairman of the board of sugar substitutes’ producer Merisant Company (2000-2005) and CEO (2000-2003); senior vice president of Monsanto Company and president of its nutrition and consumer sector (1998-2000) ___
Photo credit: In this Wednesday, July, 25, 2012 file photo, the cruise liner Carnival Fantasy calls in Charleston, S.C. Passengers remain hesitant to book cruises, despite deep discounts. Bruce Smith / AP Photo