Best Buy: Time for a gut check

As if struggling to adapt to consumers' changing needs wasn't enough, today Best Buy's CEO resigned for "personal conduct" reasons. CEO Brian Dunn resigned today, according to The Wall Street Journal, citing "personal conduct" but no details of the conduct were provided.

During the recession, Best Buy won a highly public battle with Circuit City who filed bankruptcy and closed, but now it's losing an even bigger war with Apple. Best Buy is set to close 50 stores, grow its Geek Squad computer support business, and needs to revamp the consumer experience. Best Buy used to be the cool place  to buy electronics, but now it's a "showroom" and Apple wins the battle for cool.

To put it in perspective, Best Buy stores had operating income per square foot of $50.61 in 2006 and just five years later the income per square foot was $18.52 according to estimates by the retail consultancy Customer Growth Partners. By contrast, Apple's retail stores reaped an astronomical $4,700 per square foot last year, (From The Wall Street Journal)

Best Buy is hanging on for dear life, and now its CEO's resignation is likely to humiliate it further. This is a time of great opportunity for Best Buy, if it conducts an honest gut check. What are you made of, Best Buy? Great leaders, which Best Buy was once, are self-aware and adaptable. If it digs deep and finds out what's inside, Best Buy could overcome the embarrassing resignation, create a new customer experience, and position itself for a strong future.

After all, not everyone wants an Apple everything. There is room for competition, but Best Buy has to dig deep to remain part of the conversation. It's time for a gut check.

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What do you think:  Can Best Buy make it?

Has Google lost its credibility?

Google has been held up as the darling of corporate culture and employee engagement during the last five years, often to the point of annoying corporate leaders who can't install slides, fancy phone pods, and free cafeterias for their employees. Sure, they love their people as much as Google does, but without emulating Google, they felt like amateurs when it comes to employee engagement.

My company does not emphasize employee engagement over other stakeholders for that reason, among others.

Google, with their generous free time for brainstorming, time off for volunteering, on-site hair salon and daycare, attracted the best and brightest technically savvy employees as it grew. Now, the culture is different. They still have the premier perks, but they have been losing talented people.

Apparently their emphasis on employee engagement has veered. 

Was it overshadowed by emphasizing customers and customer service instead? According to agency investigations, no.

US and international agencies have been investigating Google for installing cookies on some customers' computers and phones, even when customers set the devices to block cookies. The Wall Street Journal contacted Google about the practice last month and reports that Google has now stopped it. (SOURCE:  Google in New Privacy Probes, Wall Street Journal, March 15, 2012)

Google went behind its customers backs to sneak access where they were not welcome. Clearly, they are not focused on customer relationships. It seems they are not focused on employee relationships any more either.

Has the advertising dollar taken over? Google is trading up at the moment, but unless it aligns its focus on all stakeholders instead of just one, investors, the stock will not remain where it is over the long-term.


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What do you think?
Has Google lost its credibility?