Glitch fails to faze M&S boss

LAUREL Powers-Freeling manages to have it all without any obvious side-effects. She juggles a career as head of Marks & Spencer's financial services arm, the demands of a successful husband, two children and a gruelling commute between Hertfordshire, London and Chester.

A seeming paragon, she 'can't help' waking up at 5am, does voluntary work and even manages to sew her own clothes. Her easy-going confidence has not been dented by last week's regulatory fiasco over the launch of M&S's new credit card.

Powers-Freeling, 46, is an American who embodies that 'can do' attitude and bubbling enthusiasm that we Brits often find hard to muster.

It is no coincidence that many of the top women in business here - Pearson boss Dame Marjorie Scardino and Burberry chief executive Rose Marie Bravo - are transatlantic imports.

'In the US, there is a general assumption that you can be what you want to be. It is all a matter of the energy you put into it,' she says.

'Women in the UK perhaps grow up with different sets of expectations - maybe because there is a bit more history and tradition.'

Powers-Freeling's hectic life may give a clue as to why this is her first interview since joining Marks & Spencer two years ago.

Her diary is so full that she can only fit me in during a break for a sandwich lunch. She doesn't eat much. 'I'm always on a diet,' she admits.

She would not dream of cancelling our appointment, even though it comes at an awkward time when her role is under scrutiny.

As chief executive of Marks & Spencer Money, Powers-Freeling presides over a division that includes home and pet insurance, ISA tax-free savings accounts and loans. It accounts for 11% of group profits, making £86m last year.

Her biggest challenge since joining has been to persuade 66,000 M&S staff that it is an essential part of the fabric of the group.

'In the old days financial services wasn't seen as part of the body of M&S, it didn't automatically strike you as part of the DNA of the place,' she says. 'We were 200 miles away in Chester and Marks & Spencer head office was just happy if we sent a cheque once a year.'

The division has now become 'a fourth pillar' alongside clothing, food and homewares.

Marks' new credit and loyalty card, launched last month, is its key asset. It hopes the points system will lure shoppers to spend more. 'We needed to re-establish the card base we have. We saw a tail off after we started taking other credit cards in store. I guess if we had done nothing, it would have been the beginning of the end.'

The fanfare for the launch has been somewhat spoilt by the regulatory bungle. Marks was publicly humiliated by the Office of Fair Trading last week over its decision to send new cards to existing customers without their consent.

It was deeply embarrassing for Powers-Freeling. She must take the rap for the muck-up - some think it should have been a resigning issue. Sneering rivals say it smacks of the incompetence seen during the 'old M&S days', before the business was revived by chiefs Luc Vandevelde and Roger Holmes.

Powers-Freeling has no intention of being cowed. 'One does not want to dwell on the past too much,' she says briskly, seeming to forget that it happened just last week.

'We were disappointed about how the whole thing was portrayed,' she says. 'A couple of things were misunderstood and blown out of proportion.'

The watchdog did not object to Marks' plans to send its cards out automatically to the 2.6m existing members of its store scheme. But it did not want any of the cards to become 'live' unless a customer specifically requested the service. This scuppered Marks' plans to send out around 800,000 active cards.

'It was not a big deal,' says Powers-Freeling. 'None of the cards had been sent out, so it was not the big push-back that it was portrayed as being.'

She hints that banking rivals were stirring up trouble because, if all goes to plan, Marks will become Britain's seventh largest credit card firm.

Powers-Freeling says: 'I don't want to go into the gory detail. The OFT contacted us. I am sure they were ably assisted by gremlins out there who would be interested in us not being totally successful.'

The regulator appears to have made an example of Marks, to warn other retailers against 'inertia selling'. But Powers-Freeling says Marks acted properly. 'We weren't selling anything, it was an upgrade under the existing contract.'

She points out that no objections were made to the 'live' cards when Marks conducted an 11-month trial in South Wales.

Either way, Marks still reckons about 88% of existing store card holders will sign up for the credit card - plus a host of new members.

The 14.9% APR interest rate, though competitive, is not the main attraction. It is the chance to exchange points for free M&S vouchers and to participate in special offers. The average shopper will get £15 a quarter.

Powers-Freeling waves a £150 wad of vouchers that she earned from her card last quarter - demonstrating that many shopaholic women will get enough points for a new outfit.

'This is not meant to be a party political broadcast for the ''More'' card, but the main differentiating feature from our competitors will be the substantial bonus offers,' she says.

Her composure over the regulatory glitch stems from her days as a management consultant at McKinsey - where instinct takes second place to spreadsheets. Powers-Freeling describes her time there as a 'wonderful experience'.

M&S chief executive Roger Holmes comes from the same stable. 'All people who come from McKinsey are used to fact-based analysis - making sure things are grounded in reality, making sure things are tested,' she says. 'Yes we do all make models. That helps explain why we took so long to launch the credit card.'

She met her husband Anthony at McKinsey, after moving 17 years ago to London from the US. An office romance? 'I suppose it was,' she says cringing. She moved on to become a director at Prudential and then Lloyds TSB.

Anthony, who is British, is now a McKinsey director so they are 'level-pegging' in terms of their careers. 'He is my number one cheerleader,' she says. The couple live in a village in Hertfordshire with their two children Catharine, nine, and 11-year-old Matthew.

Powers-Freeling grew up in Michigan, near the deprived city of Detroit. 'It is not a destination spot,' she smiles.

Her mother was a clothes and textiles designer - hence her interest in sewing. Her father ran a 'heat and beat' metal business that supplied the car industry.

The chances of her moving back seem slight. 'I'm very happy here. My friends and family are here. I guess I've assimilated.'

Her children are unruffled by her high-profile job. 'I get all excited and come home and tell them, 'Mummy's in the paper', but they are pretty immune to it.'

She never wanted to be a housewife and does not feel she has missed out on the children growing up.

'I have been very lucky on the nanny front. We have both always worked. That is just how it is.' There is no sign of her ambition waning. Has she set her sights on being chief executive of a top company? 'Of course,' she says, without pausing for breath.

Though weekends are always kept free for the family, the occasional spreadsheet still creeps into her social life.

'My husband and I probably over-analyse things,' she says, admitting they have used economic models to decide where to live or which job to take.

Embarrassed, she laughs: 'Lets not go there. I'm going to get myself in really big trouble.'