Last October, Suzy Wetlaufer, the editor of the Harvard Business Review, returned to her Watertown office breathless and giddy after a trip to New York. She had gone down to interview America’s Mogul, Jack Welch. Which, at the time, seemed like nothing more than a score for the Review. “We got along great, we had the best time,” she gushed to one senior editor. To another, she said that, in the charismatic former CEO of General Electric, she had “finally met a man with as much energy” as she had. Then: “Jack says he wants to spend the holidays with me and my family.”
It was a bit over-the-top – but then again, that was Suzy Wetlaufer.
“She was ecstatic,” remembers Harris Collingwood, a senior editor who would, in the months to come, fall on his sword over Harvard’s handling of the affair. “At the time, I didn’t say anything. I know this sounds crazy, but it was just sort of standard fare. It really wasn’t anything out of the ordinary.”
Indeed. Wetlaufer, a vivacious 42-year-old Harvard M.B.A., Baker scholar, novelist, mother of four, and Sunday-school teacher – with a penchant for Prada and Chanel and fabulous shoes – had brought more than a little snap, crackle, and pop to the offices of the stuffy HBR. During her year-and-a-half tenure at the top of the masthead, the magazine – already prestigious and hugely profitable to Harvard – got better and buzzier.
But inside HBR, the best copy was Suzy. And it wasn’t just that wild romance she had with a 22-year-old editorial assistant. From her open corner office, with a photo of Bono thumbtacked to the wall, she held forth like a modern-day Scheherazade, say former and current staff members. She was so well known for regaling the troops with tales of her (let’s face it, much more interesting) life that Collingwood came up with a name for it: “Backstage at the Suzy Show.” Says another editor, “She always saw herself as being in a dramatic production of her own creation. It was fun, at least at first. You know, most of us here are fairly drab, boring editors. Our private lives aren’t that exciting. So it was kinda thrilling to vicariously experience the world through Suzy.”
This time, however, they got more than they bargained for. Wetlaufer’s interview-turned-romance with the mighty (and married) Welch would soon turn into a rapidly unfolding morality play, a drama that tested the ethical underpinnings of HBR, demoralized the staff, embarrassed Harvard, cost Wetlaufer her job, and could end up costing Jack Welch $450 million.
In the end, her forced resignation last Wednesday – after an initial arrangement six weeks ago that would have preserved a role for her at HBR – wasn’t so much a result of the Welch affair but of Harvard’s sheer terror of being mortified by Suzy once again. She’d done nothing new in recent weeks to bring about her downfall. In fact, she wasn’t even there to stir up trouble; she’d been asked to stay out of the office. But reporters asking questions about her earlier romance with the editorial assistant apparently finally led her bosses to believe she had been less than forthcoming with them. By late Monday, they were talking about firing Wetlaufer. A second round of negotiations led to her resignation.
The big surprise is that Wetlaufer may not give a damn. Jack and Suzy are head-over-heels, and are already talking marriage. “She fell in love, what’s the big deal?” says her sister and best friend, Della Cushing, who wondered weeks ago why Suzy even wanted to stay at HBR with “all those big babies.”
“Everything they used to love her for, now they hate her for,” Della points out. “I think she should start a new magazine. Called Jack.”
“Backstage at the Suzy Show” could be wildly entertaining, even if it was sometimes difficult to separate fact from fiction. Staff members recall Wetlaufer telling tales about recently separated Ford CEO Jacques Nasser, for example, including the time she accompanied him to Game 1 of the 2000 World Series and sat in a VIP box “flipping through Vogue.” (Her colleagues were appalled; “I said, ‘Tickets to the World Series are wasted on people like you,’ ” remembers Collingwood.) And there was the time she interviewed Peter Brabeck-Letmathe, the CEO of Nestlé, who “invited her to go fly someplace and land on a glacier,” she told one staff member. The office was inundated with Nestlé chocolates for weeks. More impressive were the huge flower arrangements from Nasser – “top of the line, from the best place in town,” according to a staff member who worked intimately with Wetlaufer. “The flower carcasses around here were immense.”
When Suzy flew to Ireland at Christmastime in 2000, she bragged that Nasser showed up and they rang in 2001 at a pub. “She told me this great story,” says Collingwood, “about being in a bar with a bunch of drunken Irishmen with Jacques and Jacques’s brother, and how everybody got hammered and they were playing rock and roll. So she jumped up on a table and started dancing and took off her shirt and was dancing on the table in her black bra.”
One of the perks of dating a CEO is use of the company jet, especially if he lives in Michigan. According to the colleague who worked directly with Suzy, “she would fly out to see him often,” and he would send “the Ford plane.” Even management “knew that Suzy was dating Nasser, everybody knew,” says one Harvard executive. “We were happy for her,” remembers one staffer; after all, the romance didn’t start until late 2000 and her interview with Nasser had run the previous February.
There’s just one hitch. Through her spokeswoman, Karen Schwartzman, Suzy denies having had any personal relationship with Nasser, as does he. “There was no romance, and there’s no friendship at all,” says Nasser, who was ousted from Ford in October. “I’ve never sent her anything, I don’t even know her! I’ve never been to a World Series,” he adds, laughing, over the telephone from Australia. And the bit about the black bra? “I don’t think I’ve been to Ireland for at least a decade.”
Nasser says that the first he heard about the rumors was when his excellent friend Jack Welch called to tell him “there were rumors going around. He said Suzy had denied it.”
In November, a month after suzy’s interview with Welch, she made another trip to New York for an HBR photo shoot. For weeks, staff members say, she’d been begging her boss, Walter Kiechel, editorial director of Harvard Business School Publications, to run her photograph on the “Editor’s Letter” page. Finally, he’d relented. Okay, he decided, but only with their cover boy, Jack Welch. (Thank you, Walter.)
By this time, plenty of Suzy’s confidants – both inside and outside HBR – knew that Suzy and her famous subject were enamored of each other. And if anyone had any doubts, they were assuaged when the boss landed back in Boston after the photo shoot. “She told me he wanted to make her the next Mrs. Jack Welch,” remembers Collingwood.
Then came the jewelry. Accepting gifts while she’s working on a story? the staff whispered. Can’t we draw the line somewhere? When one editor confronted her about this in a huff – “Did Jack Welch give you a diamond bracelet?” – Suzy smiled and replied, “It wasn’t diamonds!”
Later, the staff would put together the time line of when the sex began, based on what Suzy had come back and shared: After the photo shoot in GE’s offices, where Jack once reigned supreme, the couple repaired to the ‘21’ Club for a lingering lunch. That evening, they went out dancing. Later that evening is almost certainly when they officially crossed the line between reporter and subject. She told at least one editor that she spent some quality time at Jack’s apartment at Trump Tower.
All of which might have gone unnoticed by the world outside Harvard had it not been for The Phone Call. On December 26 – as Wetlaufer’s big interview, titled “Jack on Jack,” was heading to the printer – Jane called.
Jane – the current Mrs. Jack Welch – was none too pleased that her husband was doing more than being interviewed by Suzy Wetlaufer. She reached Suzy at home in Lexington, Massachusetts. A high-powered lawyer who gave up her career at Jack’s insistence when she married him thirteen years ago, she wanted to know: Wasn’t Suzy at all worried about compromising her journalistic integrity by sleeping with her husband?
A friend of Suzy’s tells New York that Jack had confessed the affair to his wife (albeit after “Jane picked up the extension while she was talking to Jack,” the rumor went). The liaison was only a month or two old, but friends say the 66-year-old Welch was already so taken with Suzy that he fessed up. Even more amazing, when the affair was exposed – in the March 4 Wall Street Journal – Neutron Jack stood by his mistress, not his wife. Suzy is “quick” and “funny,” he told the Journal.
Della says the phone call from Jane jolted Suzy. “She was very surprised,” says Della. “And I think it made her nervous. I mean, it was so confrontational.”
It also made Suzy call Kiechel and come clean. Sort of. Staff members gripe that Walter would’ve had to have been on Mars not to have heard about the affair, so rampant was the scuttlebutt. But Kiechel, who is based in New York, claims that while he was aware of the buzz, this was the first time he was hearing that his editor had become involved with Welch. “She called me up and said, ‘Look, I completed this interview, it’s ready to go to the printer, but the nature of my relationship with him has changed. It’s become more of a personal friendship,’ ” remembers Kiechel. “And that ‘in light of that, there may be people who don’t understand, and might think that it somehow has tainted the editorial objectivity of the Review.’ “
Suzy suggested that they pull the piece. But subscribers had been promised a big Welch story in the February issue, and ads had been sold against it. So Kiechel came up with a different solution: They would dispatch two reporters, Collingwood and Diane Coutu, to reinterview Welch. (“Suzy, you starfucker,” Collingwood said when she gave him the assignment. “What happened now?” “Jane called,” Suzy replied.)
The reinterview was set up for New Year’s Eve at Jack’s pad in the tony Lost Tree development in North Palm Beach. The ground rules were that Suzy could have nothing to do with the editing and Welch would be allowed “three changes” to the final copy. This is standard operating procedure at HBR, where stories are considered “learning tools” for the 230,000 subscribers who pay $118 a year. Which prompted the Washington Post’s Howard Kurtz to quip later: Weren’t they already in bed with their sources?
Collingwood, however, was an experienced, well-regarded journalist who had worked at numerous publications and was none too thrilled to be giving up New Year’s Eve with his girlfriend to reinterview his boss’s boyfriend. “It was a terrible position to be in,” says Collingwood. “Finally, we decided to just be professionals and do the best interview we possibly could.”
For two hours, as Harris and Diane talked with Welch on the veranda, they peppered him with weighty “learning tool” questions about his decades as a business leader. The conversation ended when Welch got up and said, “I’m gonna have to kick you guys out of here, I’ve gotta go meet my wife for lunch.”
The grumbling about Suzy and Jack had to this point been kept within the walls of the HBR offices, but that would end in early January, when Wall Street Journal reporter James Bandler began sniffing around. The HBR staff had a great deal of respect for Bandler, which is why they were freaked out. How much did he know? they wondered. “Who’s the mole?” Suzy began to scream. The powers-that-be at Harvard were even less amused.
The damage control began. The Daily News reported that Welch tried to quash the story by calling his friend and Journal managing editor Paul Steiger. Kiechel had the presence of mind to call the photographer who had shot Jack and Suzy together to lock up the rights to his negatives “for another six months.” But how to handle Bandler? So intimidating was the threat of exposure in the Journal that in early January, Kiechel appeared via video conference to address the top editors (excluding Suzy). Kiechel says the main purpose of the meeting was to address whether the interview should run at all. But staff members recall it differently.
“It was this really uncomfortable meeting,” remembers Collingwood. “We were talking about the ethics of our interviews and this had gone too far and this isn’t the first time that Suzy’s been involved with her subjects. And at one point he tells us, ‘Well, you know, when Norm Pearlstine was trying to know Ross Perot, he baby-sat Perot’s kids. And if you know Pearlstine, he doesn’t even like children.’ And we were like, ‘Walter, there’s a difference between getting close to your sources and fucking them.’ ” By the end, Kiechel assured them that he would immediately “form a task force” to come up with an “ethics policy” for the future of HBR. And that if anyone got any media calls, to please refer them to him and the head of P.R.
At a staff meeting on January 10, a few days after the video conference, Suzy apologized for the trauma she had caused. “It started out fine,” remembers one person in attendance. “She just said, ‘I’m sorry.’ But then,” he says, laughing, “she got that ‘onstage’ look, and just went on and on and on.” She talked about how meeting Jack Welch was a “blessed event,” how it was “true love” and “how could she ever have expected it?” But what was she to do? It was fate, and it was “heavenly.” Then she said, “I want you all to be happy for me, I’ve had a really hard year.” Then her voice caught into a little sob.
On January 16, Collingwood put his thoughts in writing to Kiechel. “Dear Walter,” he wrote, “Emulating the brave lady at Enron who sent a warning letter to Ken Lay because she thought he should know the facts, I want to make you aware of what life is like here… . The HBR culture is in shambles.” In a long, anguished e-mail, signed “in sorrow and anger both,” he expressed his concerns about the reputation of the magazine he had come to love and the editor who loved too much. “The undisguised kick she gets from companioning high-profile, powerful men is one of the reasons some of us on the staff swallowed our qualms about the way she mixes her personal and working lives. I mean, who wants to be the killjoy who spoils her transparent sense of fun?”
Suzy Wetlaufer was named editor of HBR in October 2000. Her promotion from executive editor was concurrent with the magazine’s going from bimonthly to ten times a year, and with a million-dollar marketing campaign – the slogan was “Sometimes a magazine opens you” – to boost the Review’s profile.
Even Suzy’s detractors will tell you she’s a stellar editor – smart, quick, and passionate about both the subject matter and her staff. She began to recruit more top talent, including Collingwood and another senior editor, Alden Hayashi. “I was seduced by her,” says Hayashi. “Though that’s probably not the right word in this context. She’s just very energetic, very charismatic, and she had all these great plans.”
Her credentials were sterling: Along with all those Harvard degrees, she had earned her journalist’s stripes at the Associated Press, the Washington Post, and the Miami Herald, and she’d even found success as a novelist. Her 1992 thriller, Judgment Call, tells the story of a female reporter, a “beautiful, fun, sassy-mouthed flirt,” who becomes dangerously involved with her source, a Miami coke dealer. The novel was optioned by Disney.
Being editor of the Harvard Business Review brought a different kind of prestige. Targeted at senior managers at major American corporations, “it has to be useful,” says one editor. Readers “have to be able to make money on it the next day or market better or lead better.”
It’s also a cash cow for Harvard. Most of the pieces, says Kiechel, are written by unpaid outside experts – professors, CEOs, consultants. “These people can’t write,” says a former editor. “So the staff is in the business of taking their ideas and rewriting them.” In exchange for their time and HBR’s $100 honorarium, the experts get the glory of an HBR story – and the green light to distribute reprints of their articles to potential clients. Which is where Harvard really rakes it in: HBR charges $6 per reprint and sells, on average, several million reprints a year – you do the math. HBR funnels its earnings into the Harvard Business School’s general fund. Last year, the figure was $17.8 million.
In mid-March, Boston Globe columnist Alex Beam thought to look up the salaries for HBR executives and editors with the IRS. “Wetlaufer’s $276,000 compensation,” he noted, “makes her look like a piker.” Kiechel pulled down $709,000 in 2001. His boss, Linda Doyle (who is stepping down this fall), made $810,000 in 2001. (Kiechel points out that 2001 was an unusually high year for bonuses.)
And Doyle’s boss? Well, that would be James Cash, chairman of the board of Harvard Business School Publishing and a dean at the B-school, who also happens to be a member of the board of directors at General Electric.
Suzy’s promotion was cause for celebration, so a party was thrown at the downtown Harvard Club, which has a stunning top-floor view of Boston. There was a lavish spread and lots of booze. But the real fun came when executive editor Nick Carr read the “Top 10 articles that Suzy Wetlaufer would like to see in HBR.” Howls of laughter filled the room when Carr got to this line on his list: “Loverboy: The Secret Life of Jacques Nasser.”
But even more exciting was the action on the dance floor. “Suzy and Joe were all over each other,” staffers noted. Joe Maurer was a fresh-out-of-Ohio editorial assistant – tall, athletic, with dirty-blond hair, “cute in an apple-cheeked frat-boy way,” as one staffer puts it – whom Suzy had taken an immediate shine to. Before long, “they were quite openly having an affair,” says one staffer. She told some of her colleagues that Maurer had moved into her basement (something about his apartment being flooded). Others heard how he took vacations with her and sometimes cared for her kids.
“He’s madly in love with me,” she told one editor. But when confronted by management about rumors flying around, Suzy denied the charges. Despite her denial, there ensued a flurry of “management meetings,” and suddenly Joe was gone. (He’s in premed now at Tufts.) Kiechel won’t comment on the terms of Maurer’s exit from HBR, but staffers say he left with a check from Harvard.
Della says when Suzy was seeing Joe, with whom she’s still “very close friends,” her pals were thrilled for her. It was the first “real romance” she’d had since her fifteen-year marriage ended in June 2000. “It was very liberating for her,” says Della. “It wasn’t like she was using him just to get her jollies off. She really, really liked him.
“Suzy has had only two relationships since the breakup of her marriage,” Della adds, pointedly referring to the stories about Jacques Nasser. “Joe, and Jack.”
Kiechel says that when Suzy’s spokeswoman confirmed in the Journal that there was a “close relationship” with Joe, “management was astonished.” Yet perhaps equally astonishing, it wasn’t until New York asked for comment (several of Suzy’s other confidants had also confirmed the affair) that it dawned on Harvard what “close relationship” meant. As for those rumors that Joe was living in Suzy’s basement, Schwartzman says, “That’s ridiculous! Think about it. Would you make your boyfriend live in the basement?”
When the first Journal story hit on March 4, few people had ever heard of Suzy Wetlaufer. But being the girlfriend of Jack Welch – and a compromised editor – meant instant media frenzy. Articles appeared as far away as Dublin (“It is being called the most expensive tryst in history”). The story had everything journalists love: sex, power, and navel-gazing. Quote slut James Carville suggested that Welch, whose painfully boring biography Straight From the Gut was nonetheless a best-seller, should write a sequel called Straight From the Groin. As for Suzy, bless her, she had segued seamlessly from a penniless 22-year-old to a 66-year-old millionaire. Is this a home-wrecker? Or a role model?
Suzanne Rebekah Spring was born in Portland, Oregon, where her father was an architect. She grew up in Princeton, New Jersey, and, later, in Harrison, New York. Her dad was a professor of architecture; her mother, who has a doctorate in education from Columbia, is a painter and sculptor. And there was money – her grandfather, who started as a butcher, bought real estate in New York during the Depression and turned it into a modest fortune. She was the third of four kids – all of whom went to Ivy League colleges. She met her future husband, Eric Wetlaufer, while attending Phillips Exeter Academy; he’s now a money manager with Putnam.
To her friends, Suzy Wetlaufer is a dynamo who juggles a high-powered career, is raising four “incredibly well-adjusted kids,” never misses a school play or sporting event with her children (who range in age from 7 to 12), works out five times a week, and still has time to teach Sunday school at the Hancock United Church of Christ, a liberal Protestant congregation. “She takes her Christian values very seriously,” says her minister, Dan Smith. “Her knowledge of the Bible is really pretty deep.” As for her affair with a married man, “I think that’s an issue that Suzy is working on,” Smith says.
When Suzy first told Della about Jack, last fall, she was already over the moon. “She said it would be like Mick Jagger asking you out. She was flattered that someone as important as Jack felt that way about her,” Della says. “She didn’t believe that he could even like her that way. I think she was wondering – well, I think everyone would question – Why is he doing all this? I mean, this is major-major, much more major for him.”
Suzy lives in a beautiful $1 million home outside Boston in Lexington, where Jack has lately been spending a lot of time. Last month, Suzy brought Jack to meet her sister. It was obvious, says Della, “that he wanted to make it clear that he adores her.”
The next step is for Jack to meet their parents. “They’re 74 and 75,” says Della, “so, yeah, they were concerned that Suzy was seeing somebody who was closer to their age than hers.” A get-together, she says, is being arranged.
Meanwhile, back in Fairfield, Connecticut, Jane Welch filed for divorce days after the news of her husband’s affair hit the press. And three years after their prenup (which would have kept her from much of his fortune) expired. But wait a minute. Wasn’t Jane supposed to be the trophy wife? The much younger woman and expert golfer whom Jack claims to have met six months after the breakup of his first marriage, the 28-year-long one that produced four kids, now grown?
“Marriages don’t break up because someone else shows up,” says one of Suzy’s friends. “He really does love her.” Della, who (conveniently) designs wedding invitations, says she wouldn’t be surprised if her services were needed soon. “That would be nice! But I can tell you one thing. Suzy will never play golf.”
By early March, full-scale meltdown arrived at HBR. For weeks, as Bandler continued to poke around, staffers became more and more disgruntled. Several wrote letters to Kiechel calling for Suzy’s resignation. Soon, Suzy was in negotiations with Harvard about the future of her position. Jack had hired her a lawyer, Boston heavyweight Bob Popeo (who’d done lots of work for GE), and Popeo got her Schwartzman, of Polaris P.R. Staffers were outraged when the Journal reported that Jack was on the speakerphone while Suzy was hammering out her deal.
“Harvard basically cowed to Jack Welch,” says one staffer. Kiechel calls that “absurd,” adding, “We were prepared to fire Suzy Wetlaufer” if she didn’t agree to step aside as top editor. But Kiechel still wondered, “What constitutes a fireable offense?” Suzy’s deal – until last week’s resignation – was that she would remain on staff as editor-at-large. When the terms were announced – first in an e-mail from Suzy herself, then in a meeting with Walter – the staff was furious. Was the message: It’s okay to compromise your ethics so long as you’re not editor-in-chief?
Kiechel – who had taken to reciting the Saint Francis prayer to the staff – told them that one of the reasons they wanted to keep Suzy at HBR was to avoid any potential litigation on her part against HBR staff. Plenty of staffers believe that Suzy had something on Walter. “I categorically deny that,” Kiechel says. The meeting effectively crashed and burned when Collingwood stood up and said, “Walter, you can use my salary to pay the lawyers, because I resign.” Another editor, Alden Hayashi, got up and said, “Me too,” and followed Collingwood out the door. A few days later, Jack and Suzy jetted off to Monaco.
“Look,” Schwartzman said the week before Suzy’s final exit, “Suzy Wetlaufer has a very full and rich life. This is not a woman who needs the Harvard Business Review to make her life a more rewarding experience. She had it going long before she got there, and she’ll have it long after she leaves.”
On the day of her resignation, a photographer finally got a shot of Jack and Suzy together, as he whisked her out of the Harvard Business Review offices and into the next act of the Suzy Show.