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Best Buy Lightens Management Structure To Grow Nimble

In an effort designed to make the company more responsive to business opportunities and challenges, Best Buy has announced a new leadership organization plan that removes the senior-most management layer from the operation in the United States. As a result, the retailer said, Best Buy will proceed with a leaner organization that should improve the company’s agility.

“One thing I have learned in helping turn companies around is that a business needs to have a nimble organization,” said new Best Buy president and CEO Hubert Joly. “Our new organization will help build a closer connection to our customers and front line employees, as well as accelerate our transformation.”

Best Buy will structure operations in the U.S. around two essential elements, the Online and Retail channels, overseen by Stephen Gillett, president of Digital and Marketing, with Shawn Score appointed to lead the U.S. retail channel, and the Connectivity, Home and Services business groups, overseen by Jude Buckley in the case of the Connectivity group, Mike Mohan in the case of the Home group and George Sherman in the case of the Services group. The retailer stated that it envisions no leadership changes in Human Resources, Finance, Legal or Marketing.

In the current phase of Best Buy’s transformation, senior management will report directly to Joly, the company declared. The current president of Best Buy’s U.S. business, Mike Vitelli, will retire from the company at the end of the fiscal year, the retailer said, and executive vp/U.S. Operations Tim Sheehan will leave the company at the end of the month. Earlier this month, Best Buy announced CFO Jim Muehlbauer would leave the company at year’s end and that it had initiated a search for his replacement.

The channel and business group changes announced today will take effect on January 1, 2013, Best Buy said, as the retailer focuses more immediately on the holiday selling season. The company recently has launched initiatives to attract more consumers to its e-commerce platforms and physical stores, it noted as it announced the leadership changes, as well as investing in sales force training to improve customer service. For the holiday season, Best Buy has given its Blue Shirt sales associates the authority to match online prices in key categories, it noted.