Wal-Mart Stores Inc. is restructuring its e-commerce and information technology leadership teams, announcing a number of changes that include the addition of former GE Power executive Clay Johnson as chief information officer.
The reorganization was detailed in internal memos from executives Friday and ahead of the end of the retailer's fiscal year on Jan. 31. Wal-Mart Chief Executive Officer Doug McMillon said in one memo the restructuring is the result of a plan formulated by company leaders to help Wal-Mart "become a digital enterprise and be enabled by a greater degree of technology."
"We're making the changes that will help us win in the short-term and position us to be a winner for years to come," McMillon said in the memo. "I know change isn't always easy. But I'm certain our future success is partially dependent on becoming more of a technology company in our stores and clubs and everywhere else the customer sees us."
Johnson will replace Karenann Terrell, who announced earlier this week that she would be leaving the retailer next month after six years with the company. He will lead a team focused on information systems that "run the enterprise," according to a spokesman. McMillon said in a memo that those efforts will include "lowering our costs, getting benefits of scale, associate experience and cyber security."
Adding Johnson was just one component of Wal-Mart's plan to better align its online and in-store operations as it tries to a create seamless shopping experience for customers.
Jeremy King, chief technology officer of Wal-Mart's e-commerce division, has been promoted to U.S. chief technology officer. He will report to U.S e-commerce Chief Executive Officer Marc Lore and U.S. stores chief Greg Foran, bringing together Wal-Mart's U.S. retail and e-commerce technology teams.
Wal-Mart also created chief technology positions within its other businesses. Hsiao Wang has taken the role at Sam's Club. Kerry Pauling moves into the Wal-Mart International position, according to the Wall Street Journal.
"The goals of these changes are to become more innovative and faster -- win with customers -- by putting these CTOs closer to the business while the Chief Information Officer will lower costs on the technologies that serve needs further from the customer," McMillon said.
Jamie Iannone, the chief executive of SamsClub.com, will oversee the warehouse division's technology efforts online and in stores.
Tony Rogers, chief marketing officer for Wal-Mart U.S., will now lead a unified marketing organization that includes Walmart.com, Jet.com and Wal-Mart's U.S. stores.
"This integrated team will help us communicate in a more consistent way with our customers, regardless of how they choose to shop with us," Lore said about Rogers' new role in a memo.
King and Rogers were included as part of Lore's U.S. e-commerce leadership team announcement, which was unveiled nearly five months after he joined the company after Wal-Mart's $3.3 billion acquisition of Jet.com. The group, which is a blend of Walmart.com and Jet.com leaders, will lead a division that Lore said in an internal memo plans to become more customer-centric.
Two Jet.com executives were moved into new roles. Scott Hilton will be chief revenue officer of all e-commerce operations and Nate Faust will lead logistics and supply-chain operations for Walmart.com and Jet.com.
"Our strategy is about offering more choice, competitive prices -- particularly on food and consumables -- and operating on the strength of the world's most efficient e-commerce supply chain," Lore said in his memo. "We've also talked about building a simpler organization that enables us to work faster and smarter."
Other leadership changes include the naming of Gisel Ruiz as executive vice president of operations for Sam's Club; Ashley Buchanan as Sam's Club's chief merchandising officer; and the announcement that Michael Bender, chief operating officer of global e-commerce, is leaving to "pursue other interests," according to McMillon.
The realignments come as no surprise to analysts as Wal-Mart continues to invest heavily in technology and e-commerce to keep up with the changing demands of consumers, and competitors like Amazon.com. Neil Stern, a senior partner at Chicago-based retailing consulting firm McMillanDoolittle, said Wal-Mart's moves reflect major trends occurring within the company.
"The first is the continued blurring of roles between the on-line and off-line businesses," Stern said in an email. "They can remove some duplication in roles by having one executive oversee both. The second is expected changes as Marc Lore assumes a larger role within the company as both head of Jet.com and Walmart.com operations."
The leadership shuffle also comes as Wal-Mart prepares to cut corporate-level jobs by the end of the month in an effort to protect profits and improve efficiency.
Wal-Mart has not confirmed any layoffs, but McMillon said in his memo to employees Friday that the company has to change inside to deliver the changes it wants customers to see on the outside.
"From time to time, you'll see the company eliminate positions in an effort to stay lean and fast," McMillon said. "In some areas, we'll invest in new positions but in other cases, we'll operate more efficiently and work to change our processes and become more digital to change the work itself.
"These are hard choices. We care about our friends and colleagues and will do our best to handle these transitions smoothly and always with respect."
Business on 01/14/2017