26 Apr Even Keel
As the first female CEO of a cruise line, Celebrity’s Lisa Lutoff-Perlo has the wind behind her
by Jackie Krentzman
Some 20 years ago, Lisa Lutoff-Perlo was rising through the sales department of Royal Caribbean Cruises. Her dream was to head the department. She wasn’t sure that her dream was going to come true, because historically the leadership in the cruise industry had been male.
Then, after 17 years in sales, her supervisor Dan Hanrahan, who was then president and CEO of Celebrity, told her that he was moving her to the marketing department.
“I was shattered,”she says. “I thought my career was over.”
Today, Lutoff-Perlo is president and CEO of Celebrity Cruises—the first woman ever to be CEO of a major cruise line. The takeaway? Don’t underestimate yourself.
It turns out that Hanrahan had transferred Lutoff-Perlo to marketing because he noticed her high potential and wanted to give her experience in different parts of the organization.
She took full advantage. Over the next 12 years, Lutoff-Perlo rose swiftly through the organization, serving as senior vice president of hotel operations, then executive vice president of operations, before being tapped as president and CEO in December 2014.
“That experience, when I was moved to marketing, was a pivotal moment not only in my career, but in my understanding of myself and leadership,” says Lutoff-Perlo. “I realized you shouldn’t think about your path as linear, because oftentimes it isn’t. Your best career move is probably one when you don’t take a linear path, because you learn so much more than you would have if you had stayed on that one path.
“The other thing it taught me is that I was shooting too low—and that was in part because I am a woman. Frequently, as women, we don’t picture ourselves in the C-suite. I was guilty of that. We need to learn to reach high.”
For his part, Hanrahan says he saw Lisa’s potential—although he never dreamed she would become CEO.
“From the moment I walked into Royal Caribbean, I knew Lisa had a tremendous amount to offer the company,” he says. “She was, and is, one of those go-to people every organization is dying to have in its ranks. Lisa has a great combination of intelligence, pragmatism, and leadership. It was clear that the sales organization relied heavily on her. She has terrific strategic instincts and she is also a great executor. The more Lisa accomplished, the more obvious it became to me that she could handle any tough job in the company.”
Hanrahan says it dawned on him that CEO may be in her future when she was director of national accounts and Celebrity was getting set to launch its biggest venture to date, its Solstice class ships.
“Delivering a new ship is always a challenge,” Hanrahan says. “Lisa delivered Solstice flawlessly. Celebrity hadn’t delivered a new ship in years. There wasn’t a playbook to dust off and just run that play. The work had to be done from scratch. The leadership required to take a relatively new team and deliver a flawless launch was beyond impressive. I found myself thinking during those days, Wow, we found our next CEO.”
Alaska. The Caribbean. Hong Kong, Vietnam, and Singapore. The Baltic Sea. These destinations are some of the places Lutoff-Perlo calls her office. In many respects, running a luxury cruise line is nothing like running other businesses.
The second-largest cruise line in the world, Royal Caribbean has six brands, including Celebrity. Celebrity markets itself as offering a “modern luxury” experience. Founded in 1989 and based in Miami, it has ships that stop at more than 220 ports of call every year. Although Celebrity bills itself as a luxury line, its offerings run the gamut—Celebrity was ranked as the No. 3 overall best cruise experience in the affordable category by U.S. News & World Report, as well as the No. 1 premium cruise line in the Travel Weekly Readers Choice Awards for the last seven years in a row.
Celebrity cruises are experiential and destination-oriented. The sophisticated vacations are for those who care about fine food and wine and want profound experiences of new cultures, within the time constraints of most cruises. Not only does Celebrity sail the seven seas, but it also sails to the seven continents. It markets its destinations nearly as much as it does its ships. This year, Celebrity offers 411 cruise options on its nine ships. They include traveling to seven signature events around the world, such as Rio for Carnival, Scotland for the British Open, and Cannes for the Cannes Film Festival.
“Cruising is much different today than when I began in the industry 31 years ago,” says Lutoff-Perlo. “People want so much more out of the cruise experience. For example, our guests want to vacation the way they live their lives, only better. And today people can afford that. Our industry has evolved the way society has evolved. So whether you’re Mercedes or BMW, you are in the category where you are accessible to more people than previously. Luxury is much more approachable for all brands, including cruise brands.”
Over the last 25 years, cruising has grown at an astronomical rate. In 1990, 3.7 million people took a cruise. In 2015, that figure was more than 22 million on passenger trips.
As a result, the competition has been heating up. Nowadays, there are many more guided-tour options, including luxury travel on land as well as sea. Within the cruise industry, the competition is fierce. In 2015, cruising was a $39 billion industry, a significant increase over 2014. Celebrity accounts for 5.7 percent of that revenue, according to CruiseMarketWatch.com.
Lutoff-Perlo, along with her peers in the C-suite (or should we say Sea-suite?), battles the misperceptions attached to the cruising experience. Some people feel that cruises do not allow them to have an immersive experience, she says. Others worry about seasickness or being confined in a small space. Still others fear the endless buffet.
“But those couldn’t be further from the truth,” she says. “Sailing on one of our ships is like being in a beautiful and spacious hotel. Our ships are so well built and stabilized that 99 percent of the time you don’t even know you’re on a ship.”
Busting through barriers
Lutoff-Perlo has had another misconception to combat as well: that a woman is not capable of leading in the male-dominated ship industry. It’s sort of like a woman being named the head coach of the NFL’s Carolina Panthers.
Running a cruise line means supervising hotel operations, the onboard experience, and partnerships with celebrities, along with having responsibility for shipbuilding, marine regulations, marine ecology, and development of new ships. Currently, for example, Lutoff-Perlo is leading Celebrity in Project Edge, the creation of two new 2,900-passenger ships for its premium line, slated to be delivered in 2018.
Patrik Dahlgren, Royal Caribbean’s vice president of marine operations, says that Lutoff-Perlo has won over the mainly male employees in Marine Operations, in large part by successfully helming the division.
“She is a natural leader—she’s transformative, collaborative, and empowering,” says Dahlgren. “That’s not easy in an industry like this, where there are a lot of male egos. Traditionally our industry is full of men who all view themselves as being the best. I think that sometimes a woman is just searching for the right answer as opposed to being the first one to have that answer.
“So she came into the organization asking, ‘How can we improve?’ The men may have had some reluctance at first, just because they saw a woman up there, but quickly the team respected and responded. In the end, it’s the leadership traits that are important, not whether you are male or female.”
One of Lutoff-Perlo’s first decisions when she became president and CEO was to hire the first woman captain for Celebrity, Kate McCue, who was also the first female American ship captain of a mega-cruise ship in the United States. “I considered it part of my responsibility to use my opportunity to pay it forward and help not only other woman, but other people in a meaningful way,” she says. “That gives me a lot of joy and pleasure.”
Cruising with her family is another source of pleasure for Lutoff-Perlo. At least once a year, she takes her family on a multigenerational trip. She calls last year’s trip, to Alaska, her favorite cruise of all time.
“I remind myself, every day, to think about what we are providing—a service that is all about fun,” she says. “With that comes all the real pressures of business, but I am lucky to work in an industry in which our business is providing an amazing experience that people will never forget. That is special.”
Kimberly Olson is Diversity Woman’s managing editor.