MBTA adopts corporate mindset with GM pick

MBTA adopts corporate mindset with GM pick

Ramirez has strong business skills, no public sector or transit experience

THE BAKER ADMINISTRATION adopted a very clear corporate mindset at the MBTA on Tuesday, hiring a general manager and CEO with strong business and turnaround skills but no public sector or transit experience.

Luis Manuel Ramirez, 50, currently runs a Dallas-based consulting firm called TodoModo Group. He previously ran Global Power Equipment Corp., a design, engineering, and manufacturing firm in Dallas, and served in a number of high-management positions at General Electric and Siemens Global Businesses.

His resume, and particular his turnaround skills, are what attracted the T’s attention. But when he starts at the agency on Sept. 12, Ramirez will know little about the long-troubled transit authority he is heading or the highly political environment in which it operates. His familiarity with Boston is limited to what he has picked up on a few visits to the city on business over the years. And his knowledge of the MBTA is defined by what he learned during the selection process for his job and some time he spent personally riding the various subways lines and the Silver Line.

Transportation Secretary Stephanie Pollack characterized Ramirez’s lack of public sector or transit experience as almost a plus. “Transit expert was not high on our priority list when we launched a search for a new general manager six months ago,” she said. “What we wanted was a successful and seasoned executive with a proven track record at leading complex organizations through transformation and change. Those kinds of private sector leaders who are willing to come into the public sector, and particularly an organization like the MBTA that is under near-daily public scrutiny, are not necessarily easy to find.”

Pollack made clear, however, that Ramirez was part of a leadership package along with Jeffrey Gonneville, the current deputy general manager at the T who oversees the transit authority’s operations. Gonneville, 42, has been at the T for nearly 17 years, and is a graduate of UMass Amherst with a bachelors of science in mechanical engineering.

“Luis is a CEO who has shown in his past positions that, when paired with a strong operating second, he can really make transformative change in organizations, and he has shown that he stays until he gets the job done,” Pollack said. “In MBTA Deputy General Manager Jeff Gonneville, Luis has that strong operating partner and I’m confident that the combination of the two gives the T one of the strongest leadership teams it could possibly have.”

Ramirez signed a three-year contract that pays him a base salary of $320,000 a year, increasing 1.5 percent each year. He will also be eligible for a “success bonus” equal to 32,000 the first year, $48,000 the second year, and $64,000 the third year. Pollack said the contract’s definition of success (an annual series of performance metrics) has not been spelled out yet, but will be before he starts work. His contract can be renewed for a fourth and fifth year by mutual agreement of Pollack (or her successor) and Ramirez.

The contract also provides for as much as $60,000 in moving expenses and allows Pollack to remove Ramirez with or without just cause. If he is removed without just cause, Ramirez will be entitled to three months of salary plus a pro-rated portion of his bonus. If he is removed for cause, he will receive no additional salary payments.

While Ramirez’s pay is high by Beacon Hill standards (the governor is paid $151,800 a year and Pollack makes $161,500), Pollack said he could make a lot more in the private sector. She said the average pay for a transit authority GM nationally is in the low $300,000 range.

The contract itself is a sign of how the T is changing. Joe Pesaturo, the T’s long-time spokesman, said many general managers in the past didn’t have detailed contracts or incentive bonuses. Now those types of contracts are becoming more commonplace. In addition to Ramirez, Gonneville and John Dalton, the contractor hired to oversee the Green Line extension to Somerville and Medford, have performance bonuses in their contracts.

Pollack and Gov. Charlie Baker, who got to know Ramirez over lunch in his State House office, are counting on the new general manager to stay at least three years but hopefully longer. There have been five permanent and interim general managers at the T since Baker took office in 2015, and administration officials say the transit authority desperately needs management stability.

“We need at least three years to build on the changes that we’ve made,” Pollack said. She said the governor has told her that turnarounds run in stages. The first stage is when problems are defined, new people are hired, and revised goals are set. Then begins the middle phase, executing on the newly established goals, which Pollack described as perhaps the hardest. “That’s the phase the T is at now, a lot of progress but not enough,” she said.

According to materials handed out by the T, Ramirez grew up in South Florida, the son of a Cuban refugee father who ran a crop-dusting plant and later a roofing business. He graduated from DeVry Institute of Technology in Illinois with a bachelor’s degree in computer science in 1987.  He then went to work for Unisys Corp., moving to Siemens in 1989, and General Electric in 2000. From 2010 to 2012, he served as a GE vice president and the CEO of the firm’s energy industrial solutions division, a $3.7 billion business with 17,000 employees in 60 countries. In 2012, he was named president and CEO of Global Power, which he left in 2015 to launch TodoModo Group.

Ramirez speaks English, Spanish, and German fluently.

Ramirez adopted a humble attitude in answering questions from the media, but offered few hints about his plans for the MBTA. He said he has always been interested in taking the skills he has learned in the private sector and applying them in the public sector. He said he wouldn’t be able to engineer a turnaround at the T by himself, and said the turnaround at the T is already underway.

Asked whether the T needs additional revenue, he said he is not as familiar with that topic as he needs to be. He also declined to say what short and medium-term goals he has for the agency. He also said he is comfortable dealing with unions.

T officials have set aside $2.5 million for Ramirez to hire staffers of his own choosing.  Once Ramirez takes over, Steven Poftak, who has been serving as interim general manager, will return to the Fiscal and Management Control Board, replacing Lisa Calise, who is stepping down.

Meet the Author

Bruce Mohl

Editor, CommonWealth

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

The timing of Ramirez’s job at the T seems somewhat fortuitious, since his wife, Delia Garced, a vice president for market activation at GE Digital, will be transferring to the company’s new Boston headquarters.

“We’re already looking for a place to live,” Ramirez said. “We plan to be here for a long time.

  • J Powers

    Wow, his wife is already moving here for a job with GE and the T gives him $60k to move, $2.5 million for his new staff, and “success bonuses” for 3 years, not to mention $320k salary a year. Just imagine if the T decided to hire someone with transportation experience. Good luck Mr. Ramirez, your fairing better than the experienced machinists who have been threatened with privatization for the last two years.

    • Good luck

      Just another well paid puppet. What a joke

  • QuincyQuarry.com

    Previous transit careerists have generally foundered to foundered badly at T, so why not let someone with no transit experience follow their leads?

    Seriously, when it comes to most anything, one usually gets what is paid for it.

    As such, here’s hoping that both a better future awaits strap hangers as well as a better ROI for those taxpayers who subsidize the operations of the MBTA.

  • Mhmjjj2012

    The Boston Globe reports Luis Ramirez “resigned suddenly” from Global Power and “shortly after his resignation” the company said it had “misreported financial statements due to accounting errors.” Ramirez “is among several current and former Global Power executives named as defendants in investor lawsuits over the accounting problems” but a spokeswoman for Global Power said Ramirez’s resignation was not related to those problems. So, Luis Ramirez has no public transit experience, no experience working in government, suddenly resigned his most recent chief executive position and his only reported turnaround success is a company that has investor lawsuits over accounting problems in which he’s a defendant. In the meantime, the MBTA has a second in command who oversees operations, has been at the T for nearly 17 years, and is a graduate of UMass Amherst with a bachelors of science in mechanical engineering. I would have promoted the deputy general manager.

    • J Powers

      anybody else EXCEPT the MBTA would have hired him too Mhm !!!