Herb Kohler isn't your everyday bathroom baron. The chairman, president and CEO of Kohler, the Wisconsin-based company his family founded in 1873, has created an empire that includes plumbing fixtures, high-end furniture and the American Club, one of the world's premier golf resorts. His course at Whistling Straits will host the PGA Championship beginning August 9.
How big a deal is it to get the PGA?
Tremendous. It's what you work for.
But we hear you're not much of a golfer.
I'm a hacker. I'm an eighteen-handicap trending toward nineteen. I play maybe fifty times a year—I played in Spain and Morocco just last week—but that hasn't improved my game much.
You own the course. Can't you make some changes to suit your game?
That's never occurred to me. I just play from the forward tees.
How'd you come to own one of the great golf destinations in the country?
That's a funny story. We had an old building that used to be a dormitory for European immigrants who worked at the company. My uncle built it in 1918. I cast around for what to do with it after it had long outlived its use. We decided on a village inn. You know, it took me three board meetings in a privately held company—of which I was CEO—to convince the board members to agree to my proposal. They couldn't imagine that an old-line manufacturer could do this.
But it worked.
Yeah. We opened the hotel in 1981. In 1983 we decided to build a golf course. I contacted our VP of development, who happened to be a two-handicap, and we went out and walked the land. Much of it was in wildlife zones, and we didn't want to encroach on that. We finally picked a pair of designers and walked with them and talked about their philosophy and our philosophy. Then, in our inimitable wisdom, we fired them. I didn't find what they were doing interesting. We brought in Pete Dye in 1984. We were going to open in 1987, and we had just planted our greens and fairways in September 1986 when we had two 100-year floods within a week of one another. That totally wiped us out. We didn't open until 1988.
How involved were you in the construction?
I totally ruined my Jaguar trying to get out to the work site once a day, bounding over huge clumps of dirt and rocks.
Did you and Pete Dye get along?
Do I have to answer that?He and I came very close to parting company on our first course. One day he called me and said he'd completed seventeen holes and needed me to make a decision on the location of the eighteenth. He said I was stalling because I didn't want trees cut down. We had about eight seventy-year-old elm trees that were some of the only trees in the whole state that had survived Dutch elm disease. They were right where he wanted the green. He told me to be at the course by noon. I told him I'd have trouble and called him at 2 p.m. to say I'd be there by five. At 6:15 I was in my Jaguar and made my way to the seventeenth hole. As I came around the bend at 6:20, I could see smoke rising in the distance. I looked closer, and there were five very large piles of timber, each about twenty feet tall. Huge logs. I slumped down and literally cried, because I was one of the world's worst tree huggers. Peter had already left town, so I got him on the phone and told him that Fazio and Nicklaus would jump at the chance to do this course unless we got something straightened out pretty damn quick about who was in control. He came back the next day, and we had a chat. Today he's as close a friend as I have.
Does he still chop down trees?
Yes. But he plants a lot, too.
You are the third generation running Kohler . . .
I know what you're going to say. I'm supposed to be the one who screws things up. I guess I haven't. We've gone from under $300 million when I became CEO in 1972 to about $3.5 billion today. That's primarily because I absolutely love what we do. And we hire good people. We have a single level of quality whether we are making an engine, a piece of furniture or a golf course. We try to live on the leading edge of design and technology. And then we maintain our drive by reinvesting 90 percent of our earnings back into the company.
What kind of a boss are you?
I try to stay out in front strategically and still pay attention to critical details in each of our businesses. I inspect, and that's what people expect. And I'm a creative cuss.