One fine morning, three weeks ago, a colleague visited my office with some startling news.\u00a0 Best Buy had announced the sudden resignation of homegrown CEO Brain Dunn.\u00a0 Another colleague happened by, heard the news and began the natural speculation of just what might have happened to bring this shocker about.<\/p>\n
Having no information other than essentially the headline, we respectively assumed that recent very troubling financials and a few headline grabbing corporate flubs (noted here in recent Discount Insights titled, \u00a0Fright Before Christmas<\/a>, Best Buy\u2019s Fight After Christmas<\/a><\/em><\/strong>, and Best Buy\u2019s Final Frontier?<\/a><\/em><\/strong>) were the prime causes of the CEO\u2019s \u2018resignation\u2019.\u00a0 The most alarming of these severe missteps was the last-minute, prior-to-Christmas delay in announcing the company\u2019s inability in fulfilling online orders made in November and December, beginning with orders placed as far back as Black Friday.<\/p>\n Later that morning the headlines exploded, revealing that indeed Dunn had left under the cloud of an ongoing investigation into his personal conduct involving corporate funds and a personal\/professional relationship.\u00a0\u00a0 Surprise upon surprise as the troubled retailer\u2019s board was tasked to determine who and what were the best drivers to steer the company through its murky near-term gauntlet of a future.<\/p>\n As it turns out, the board\u2019s first decision was to navigate through a seemingly overcrowded minefield of possibilities to determine which courses are best to follow to find the next CEO.\u00a0 Before doing this, this disparate group must consider a multitude of options as to how to strategically right the company\u2019s ship unless they decide to throw all such determinations on the plate of the next CEO.<\/p>\n Brian Dunn was the prototypical American success story.\u00a0 Mr. Dunn began his career with Best Buy as a store sales associate in 1985, when the company operated only a dozen stores.\u00a0 Within four years he became a store manager and a year later he was made a district manager in Minnesota.\u00a0 All this as he was barely thirty without having attended university.<\/p>\n In June 2009, Dunn was named a company director and replaced Brad Anderson as CEO. \u00a0Like many retailers at the time, the company was stung by the horrors of the recession, Best Buy\u2019s only national brick and mortar competitor,CircuitCity had just liquidated and most analysts expected Best Buy to pick up the spoils.\u00a0 However, with chillingly \u00a0typical tone deafness, Best Buy stores did little to overtly attract the throngs of shoppers who no longer had a CircuitCity option.\u00a0 Many of its stores offered meek signage offering CircuitCity ex-pats the obvious option of visiting the service counter for any electronics that required repair.<\/p>\n Shortly after this, expansion minded hhgregg announced they would honorCircuitCityextended warrantees as they began to take over several abandonedCircuitCitylocations while entering new markets in states previously undreamed of by analysts.\u00a0 Thus hhgregg gained the attention of consumers abandoned byCircuitCityas well as by analysts on Wall Street.\u00a0 Much of this upstart glory was gained at Best Buy\u2019s passive expense.<\/p>\n Initially upon hearing of Brian Dunn\u2019s departure and just before word passed of an investigation into the man\u2019s personal conduct, many assumed that Best Buy\u2019s board had decided that it was time to aggressively rethink the future.\u00a0 Those were hopeful moments.\u00a0 As word came out of a possible personal scandal, the company began to almost bleed rumors as what was next.\u00a0 More than indicating what might be likely to come, it seemed confusion reigned.<\/p>\n Stories emerged that founder Richard Schulze, who was believed to be increasing his role in the company, was at odds with several board members as to how to begin the recruiting process and what philosophy to pursue in planning a more positive future.\u00a0 The company promised to issue an impartial, detailed explanation of the Dunn \u2018affair\u2019 after the investigation, which is being led by a formerU.S.attorney and ex-enforcement director for the SEC, is completed. \u00a0This is likely to lead to more embarrassment for Mr. Dunn or \u00a0for the corporation if he is exonerated after allegedly being forced to resign.\u00a0 In fact he may be eligible for a severance package of as much as $3.35 million, depending on the outcome of the investigation.<\/p>\n Meanwhile troubling headlines abound as to the next steps for the troubled company.\u00a0 Best Buy: Search for CEO Could Take Up to Nine Months<\/em><\/strong>, is one troubling headline.\u00a0 Best Buy Appoints CEO Search Committee<\/em><\/strong> sounds innocent enough but is followed by the fact that as part of Best Buy\u2019s commitment to transparency, the board will also publicly announce a selected search firm in addition to its own widespread recruiting efforts and will post the position on the company website. The final search firm selection will be announced in the next few weeks.<\/p>\n The only internal candidate currently under consideration is G. “Mike” Mikan, a former healthcare executive who is serving as interim CEO.\u00a0 Many observers, especially those representing Wall Street worry that not being able to imminently name a permanent CEO suggests either a lack of a succession plan or a managerial breach within the company.<\/p>\n Other recent headlines include, Best Buy’s CEO Succession Circus Continues<\/em>, which raises the questions of many as to the need to take months to conduct the search for a new leader and perhaps a new operational plan.\u00a0 Best Buy\u2019s Dunn May Be Able to Get $3.35 Million Package<\/em>, speaks for itself and portends more drama and embarrassment than even a healthy company should stand.<\/p>\n Meanwhile Best Buy continues with its plan to immediately close fifty stores and try to shrink many of its others.\u00a0 Professional suggestions race across the Internet including radically reducing store size and selection while ramping up its diminutive Best Buy Mobile locations.\u00a0 Some even suggest reviewing a possible acquisition of the ubiquitous but equally troubled RadioShack chain.<\/p>\n Whatever the outcome, this turn of events must be viewed as an opportunity for a retailer that has been coming up short on its sales floor as it tries to build its web presence through serious stumbles.\u00a0 The company momentarily basked in the demise of CircuitCity but now finds itself battling brilliant regional CE chains, CE independents with a strong national web presence and Walmart, Target, Costco and other strong discounters, while it tries to discourage its image as a showroom for Amazon and other efficient web merchants.\u00a0 And the beat goes on.<\/p>\n","protected":false},"excerpt":{"rendered":" One fine morning, three weeks ago, a colleague visited my office with some startling news.\u00a0 Best Buy had announced the sudden resignation of homegrown CEO Brain Dunn.\u00a0 Another colleague happened by, heard the news and began the natural speculation of just what might have happened to bring this shocker about. Having no information other than… Continue reading Best Buy's New Direction?<\/span><\/a><\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"post-template-no-sidebar.php","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[24],"tags":[5],"class_list":["post-172","post","type-post","status-publish","format-standard","hentry","category-retail-technology","tag-insight","entry"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/posts\/172","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/comments?post=172"}],"version-history":[{"count":0,"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/posts\/172\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/media?parent=172"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/categories?post=172"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/tags?post=172"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}