One can tell when a CEO is in their death throes when they blame their predecessor. Especially when the predecessor, Mark McInnes in this case, departed over a year and a half ago.
It is not being indulgent to classify the recent financial results at David Jones as disastrous.
Paul Zahra blames Mark McInnes. As I recall Mark left DJ’s in quite good shape when he left in June 2010 and my sources tell me that he isn’t doing a half bad job at Premier. So a score of zero out of 10 on this one, Paul.
Excuse number two is the soft retail environment. In fairness, let’s give Paul a five out of 10 for this one. It has been soft but have a look at The Super Group where Peter Birtles is doing a fantastic job. Or OrotonGroup, which announced a nine per cent increase in profits on the same day as DJ’s revelation – despite aiming for the same target market as DJs. And there are many other retailers who are doing very nicely thank you.
Excuse number three is the internet. Sorry Paul. Zero out of 10. While I am a firm believer in the internet, your DJ customer profile is not going to help you a whole lot when you do eventually get your act together. And certainly this is a trivial excuse when you are looking down the barrel of full year net profit dropping by a massive 40 per cent! Get things into perspective, mate.
Enter the corrective action strategy plan.
Open six new stores. Reminds me of the old saying “Having lost sight of our objective, we redoubled our efforts”. Paul, who heads up strategy at David Jones? How on earth can this make sound business sense with the significant issues you are facing? Some time ago you were offered the services of an expert external strategist. You did not bother to find out what it involved or how much it would have cost. Instead you chose the incestuous path that has led you down the road of this so called strategy.
You want to increase on line sales from about five to 10 per cent! Is this a big deal given where you are and where you are heading ? Five per cent of very little, is very, very little. Again, where is the judgement and perspective?
I never thought I would say this but forget omni-channel and omni-presence for the meantime and take the 200 staff you claim have been put onto this project and put them on the sales floor. You would be far better off.
Stuart Bennie is a retail consultant at Impact Retailing. Email Stuart.
