The Corner Office Changed Hands at Walmart, Target, Coca-Cola and Kraft Heinz — All Within Weeks
An unusually dense run of chief executive transitions at America's largest consumer companies concentrated in the first quarter, as boards responded to automation, weak discretionary demand and a decade of slow growth.
American boardrooms have rarely produced this many leadership changes in this short a window.
John Furner became chief executive of Walmart on February 1, succeeding Doug McMillon. Michael Fiddelke took over at Target the same day, following Brian Cornell. Steve Cahillane started at Kraft Heinz on January 1. Coca-Cola's James Quincey handed over to Henrique Braun at the end of March. Workday's co-founder Aneel Bhusri returned to the chief executive role in February. Lululemon's Calvin McDonald stepped down in January, with two executives named interim co-chiefs.
Three patterns
The insider promotion. Walmart and Target both elevated long-serving executives rather than recruiting outside. In businesses defined by supply chain execution and merchandising judgment, boards have consistently concluded that institutional knowledge outweighs a fresh perspective.
The turnaround hire. Kraft Heinz brought in an outsider with a record of reviving packaged food brands. The company's decade of slow growth had already produced a plan to split it in two — a plan the new chief executive paused within weeks of arriving.
The founder's return. Workday's co-founder resuming the chief executive role belongs to a genre technology investors know well, and one that has produced very mixed results.
What the boards were responding to
Consumer companies are navigating a market where the aggregate numbers conceal a split. Higher-income households, supported by record equity values, keep spending. Lower- and middle-income households are absorbing energy costs up nearly 15% from a year ago against wage growth of 3.2%, and they are trading down.
That environment rewards value positioning and punishes anything priced for a middle-income consumer who is no longer there. Several of these transitions can be read as a judgment that the incumbent's strategy was built for a different consumer.
The other factor
Every one of these companies is also working out what automation does to its cost structure and its workforce. Boards making a twenty-year bet on a chief executive are increasingly asking a question that had no place in a search two years ago: how the candidate intends to run a company that needs materially fewer people to do the same work.
