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With great earnestness, Charles R. Rinehart and three of his top female managers trooped onstage last August at the Marriott Hotel in downtown Los Angeles. They were there to tell several hundred executives attending a business speakers' series how H.F. Ahmanson & Co., a $55 billion-in-assets California savings and loan, had pulled off a feat nearly unheard of in Corporate America: gender parity in the executive suite. ''The way to be successful in business is to find a competitive advantage,'' Rinehart told the lunchtime crowd. For Ahmanson, ''one obvious advantage was to recruit women.''

This was a bittersweet occasion, Rinehart knew. In March, Ahmanson had agreed to be acquired. Within weeks, it would exist only in the belly of its voracious competitor, Washington Mutual Inc. (WAMU). In the wake of that $6.4 billion deal, Rinehart, his top managers, and about 3,000 other employees would be out of work. And Ahmanson's diversity strategy--arguably the most successful ever at putting women into top management--would vanish.

Ahmanson's dissolution symbolizes the fragility of diversity efforts in the face of financial and strategic demands. Half of the thrift's top 10 executives were women--a ratio unmatched among large employers. Two were among the company's five top earners. Moreover, over the past two years, the visibility of women at the top had made Ahmanson a magnet for female talent at all levels. In all, women made up roughly half of its 10,300 headquarters and regional managers.

Yet Ahmanson was stuck in a dreary, low-return business and faced competitors that could either buy it or bury it. So Rinehart sold at the market's top and sealed his team's fate. While Washington Mutual, with three women among its own 11 officers, has a respectable record of promoting women, it has seen to it, in almost all if its many recent deals, that acquired management exit.

RAPID MAKEOVER. As of Oct. 1, the Ahmanson execs were out. Rinehart, 51, with a severance package, including options, of about $30 million, plans to teach high school math. Anne-Drue M. Anderson, head of mortgage lending, is volunteering at an east Los Angeles food bank. Jaynie Studenmund, who ran retail banking, traveled to Europe and says she is on sabbatical, spending time with her young kids and working on nonprofit boards. Madeleine A. Kleiner, former head of administration, attends all her daughter's cross-country meets and plays a lot of golf. All three women say they won't return headhunters' calls until after Jan. 1.

The hopeful story that survives them is how Rinehart, a grandson of one of the first female branch officers at Bank of America, rapidly made over his management team, attracting women from outside the company to join the top ranks. ''He was as close to gender-blind as you're likely to get,'' Catalyst's Wellington says. ''He was interested in performance, and he created a culture that encouraged performance.''

Before Rinehart became CEO in 1993, Ahmanson had no great history of diversity, with only a few women above the rank of regional branch manager. The company never had any formal program, such as mentoring or quotas, to promote women executives. Anderson recalls that there wasn't even a women's rest room on the floor where board meetings were held when she joined the company in 1993.

Rinehart ordered headhunters to screen for both women and men who could help him change the thrift's culture. When it came to accommodating the needs of working parents, the CEO led by example, sometimes leaving at 3 p.m. to coach his kids' basketball games and making up the time later. He encouraged execs who reported directly to him, most of whom had young children, to do the same.

More important, Rinehart was willing to take risks on female executives who lacked direct experience for operating roles. Anderson, a former bank analyst at First Boston, was hired as treasurer in 1993, then promoted to head marketing. In 1997, she took over residential lending, the biggest chunk of Ahmanson's business. Less than two years after Kleiner joined in 1995 as general counsel, she was named chief administrative officer, part of a four-member Office of the Chairman.

BOXED IN. Rinehart & Co. brought Ahmanson back from the lows of the California real estate crisis of the early 1990s, producing return on equity of 17% in its last fiscal year and tripling its stock price since 1994. But by this year, Ahmanson was losing steam. It had ceded significant market share to acquisitive rivals. And its deposit-operating system would have required a massive investment to expand. After losing to Washington Mutual in a 1997 bid to take over Great Western Financial Corp. (GWFP), Ahmanson concluded it had little choice but to join forces with the Seattle giant.

The deal was a boon to shareholders, who got a 12% premium on their stock. And if corporate women everywhere lost a beacon of promise with Ahmanson's demise, Ahmanson's women did just fine. Together, the five top officers took away severance packages totaling over $20 million--and those who haven't found new jobs say they have plenty of opportunities. Think of it as five little cracks in the glass ceiling.

By Kathleen Morris in Los Angeles

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Updated Nov. 12, 1998 by bwwebmaster
Copyright 1998, Bloomberg L.P.
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