CHAUDHRI: Time for Canadian businesses to make a turn around

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As we settle into an international trade war, Canadian companies are reevaluating everything.

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Having sustained ourselves on a steady diet of doom and gloom, it is hardly the time most would consider reinvestment into or the expansion of Canadian business.

But perhaps that is exactly what a lot of us should be doing.

Since our southern neighbour has threatened our nation with tariffs, I have thought a lot about the critical need for entrepreneurship in Canada. We need leaders to build and sustain businesses, even in the hard times when conditions are far from ideal.

So this week I thought I would share the story of BestBuy CEO Hubert Joly.

Joly is a master of the turnaround. He’s built his career by taking the helm of failing companies and steering them into blue skies of success.

On a recent podcast episode of Wisdom from the Top with Guy Raz, Joly described his rise to the top, including a decade at the consulting firm McKinsey where he became a partner, predominantly working with telecommunication companies.

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Joly was approached in 1996 by Electronic Data Systems to run its French division and eventually became the president of the company leading about 3,000 people at the age of 35.

When he took over as president, EDS revenue was plummeting and Joly immediately diagnosed what wasn’t working and strategized a comeback.

After a successful run at EDS, Joly was then tapped by Vivendi Media Group to be the CEO of its games division in 1999. He went on to join Carson Wagonlit Travel as its CEO in 2004.

At all of these companies, Joly was often thrown into crises, tasked with turning around poor results, declining revenue and low cash reserves.

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He is, however, most well known for his leadership at Bestbuy.

Just before Joly joined the company in 2012, Forbes ran an article describing why BestBuy was going out of business. The company reported a loss of $1.7 billion that year, and its net income slid by 91%. The CEO that preceded Joly, left the organization after engaging in an inappropriate relationship with an employee.

The day Joly joined, BestBuy’s stock tanked 10%.

Within two weeks of joining the company, he determined this was the most dysfunctional company he had ever seen. There were many operational challenges, including the fact that online competitors like Amazon were killing BestBuy’s sales. Customer service and experience was terrible and the brand overall was riddled with leadership gaps and challenges. Morale at the corporate level was awful.

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Within two months of joining, Joly met the board and presented a plan – coined RenewBlue – to turn the company around. His plan was to match competitor pricing and improve the online shopping experience by rebuilding the company website. Instead of trying to take down competitors, Joly took advantage of the company’s assets to convince vendors like Samsung, Microsoft and Google to build shops within BestBuy stores.

To effect the turnaround, Joly recounted that he first needed to ensure he had the right team to lead it. He explained that everyone on the team started with an “A.” He told his team to “erase from your mind what may have happened before” and that “you get to decide whether or not you’re going to keep the ‘A.’”

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For Joly, it was all about what the team was going to do going forward.

Employing these approaches, by the time Joly handed over the reins to his successor CEO in 2019 the stock had soared by 330% to $68.

Joly built his career on learning how to quickly and accurately diagnose what is not working in an organization and identifying and mobilizing talent within companies to switch up momentum. He led companies by being passionate about understanding the needs of customers and believing that the purpose of a company is to “contribute to the development of the fulfilment of the individuals working at the company.”

While we may be in the throes of an unprecedented economic shake-up, are not some Canadian businesses, too, in need of provocative, thoughtful leadership?

It isn’t time to throw in the towel. Canada too, can be the master of the turn around.

Have a workplace problem? Maybe I can help! Email me at sunira@worklylaw.com and your question may be featured in a future column.

The content of this article is general information only and is not legal advice.

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