Target Board of Directors Chose a New CEO – The Hardest Decision for any Board
Yesterday Target announced they have hired Brian Cornell from Pepsi as their new CEO. This is the second hardest activity that a board of directors must do for a public or private company.
The first was to fire it’s long time CEO Greg Steinhafel. Target board of directos had to fire Steinhafel because of two significant problems under his watch. The huge security breach in late 2013 and the poor performance of the company’s expansion into Canada. The board of directors took quite a bit of heat on waiting so long to fire the underperforming CEO. Institutional Shareholder Services (ISS) called for the removal of 8 of the company’s 10 board members for their governance of the company and it’s CEO.
Now comes the second hardest part. Hiring a CEO that will be able to get the public company back to iconic performance. The biggest risk in hiring the next CEO is for an outsider to the company to culturally fit. Cornell is one person and there are 366,000 employees at Target that already live the Target culture. One of the best quotes in business is “culture eats strategy for lunch everyday!”
Cornell looks like a very good fit with a strong background around retail as being the CEO of Michael’s stores, SAM’s club and senior positions at Safeway and Pepsi. In addition Brian has served on the board of directors for Polaris Industries which is also located in Minneapolis. He has familiarity with the community and the people who work in it. Cornell has seen the industry from both sides of the table and has worked for Target’s biggest competitor, Walmart.
The board of directors will be under continued pressure as they have made the two biggest decisions a board has to make and now the outcome will tell how smart their decisions were. For more information on how Cardinal Board Services can help your board of directors call or click here to contact us online.