Best Buy COO Dunn Assumes CEO Position21 Jan, 2009 By: Erik Gruenwedel
Best Buy Co. Jan. 21 said COO Brian Dunn would become CEO in June, replacing 30-year company veteran Brad Anderson, who is retiring.
Anderson remains vice chairman of the board until his retirement in June.
The Minneapolis-based No. 1 consumer electronics retailer said a decision to fill the vacant COO position hadn’t been made.
Anderson said the timing of his decision to leave was “consistent” with his intentions when he accepted the position. The executive said the company’s recent solicitation for voluntary layoffs from its 4,000 corporate employees in an effort to reduce costs in the current economic downturn prompted his decision as well.
“It’s not a bad time for me to join them,” Anderson said in a call with investors.
He said the current economic downturn presented Dunn with enormous opportunities. Anderson called Dunn “indisputably” the right person for CEO and Best Buy.
Dunn, in the call, said Best Buy had an opportunity to capitalize on rival Circuit City’s cease of operations by specifically targeting its customer base.
“This is entirely about customer acquisition for us as we go through this difficult time,” Dunn said.
He declined to comment on conversations with key vendors regarding Circuit City. Dunn said Best Buy would focus on offering the cheapest TV possible (“for Aunt Louise”) to the most complex networked home theater solution.
Best Buy Co. posted a 6.5% same-store (open at least 12 months) sales decline for the December sales period ended Jan. 3, compared to a 1.5% increase during the previous year period ended Jan. 5, 2008.
With 500 corporate employees accepting voluntary severance, filling the COO position might not be a top priority for Best Buy.
Navarre Corp. last week let go COO Brian Burke, who was among 50 staffers terminated by the distributor due to the recession. Software manufacturer Datatrak, in a growing corporate trend, recently eliminated the COO position entirely.
The COO position in corporate America is a relatively recent trend. Of 433 companies surveyed in 1964 by Palo Alto, Calif.-based executive search firm Egon Zehnder International, not one had a COO. In 1994, 67% of the companies surveyed had added a COO position. Last year, about 25% of those companies had a COO and only two of the top 10 U.S. high tech companies employed a COO.
“The COO position appears to be more of a short-term function created to respond to the requirements of contingencies, rather than an institutionalized role,” Egon Zehnder said in a report.