Through a special arrangement, presented here for discussion is a summary of a current article from the LIMA (Licensing Industry Merchandisers’ Association) retail blog.
In a major departure from the past, retailers aren’t just layering fresh talent onto conventional configurations, but are purging legacy players, re-jiggering traditional reporting structures and, in some cases, leaving top posts vacant for extended periods of time until the right people come along. The moves promise to accelerate what I believe is a shift by major retailers from a defensive position to an offensive one in the fight for connected customer engagement.
Breaking the Mold
J.C. Penney’s June announcement that former Apple retail chief, Ron Johnson, will take over as its new CEO has retail pundits pondering whether he will reinvent the department store as we know it. A more immediate possibility is that the more-than-a-century-old company will reinvent its entire leadership structure. Since the announcement, longtime Penney CMO Mike Boylson has gone into early retirement, while extended advanced retirement packages were offered to an undisclosed number of additional headquarters employees. Candidates for the program must be over 55, have more than 20 years of employment experience, and be participants in the company’s pension program. While touted as a cost-cutting measure, Penney is clearly seeking to transform its personnel prototype. The company’s corporate address on Legacy Drive could soon become something of an inside joke to suppliers who call on the account.
Sears Holdings Corp has tested the limits of executive-level absence in retail ever since hedge fund manager Eddie Lampert took over in 2005. This month, the company announced the appointment of Monica Woo as VP and chief marketing officer, a post that had remained vacant since January 2010. Lou D’Ambrosio joined the company as CEO in February, ending a three-year search for a new chief executive. Ms. Woo’s background as chief marketing and strategy officer of U.S. online grocer FreshDirect and Mr. D’Ambrosio’s previous stints at Avaya and IBM are additional indicators of retailers’ newfound penchant for techy types. In the interim, Sears resisted any pull toward homegrown solutions.
From Site-to-Store to Site-Reports-to-Store
In mid-August, Walmart announced a major reorganization of its global online operations, which will see e-commerce managers in the U.S., U.K., Japan, and Canada reporting directly to store executives, rather than to its global e-commerce team. Walmart’s California-based global e-commerce unit was just created in 2010, with Eduardo Castro-Wright appointed to head it up after being replaced as president of the U.S. store business. In effect, Mr. Castro-Wright left the Bentonville-based stores unit for online, only to have online report back to the stores. Two e-commerce executives departed in the wake of the realignment: Raul Vasquez, who had been in charge of developed markets, and Steve Nave, who oversaw Walmart.com. In the wake of the shift, Walmart.com may finally evolve from a set-apart anomaly to a synergistic unit whose site-to-store scale puts something over on Amazon.
Retailer organizations are starting to look as shiny as the gadgets they’re selling to shoppers. Are you ready for the change?
How would you rate the value of bringing in new players versus hiring from within when it comes to filling executive vacancies at retail? How critical is a “technology” background in retailing today?