On September 12, 2014 I wrote in this column ‘Is Myer Next?’. This was in the context of whether Myer would be taken over as DJs was at that time and whether the then CEO would pursue his liking for public speaking. Now with the new CEO, Richard Umber announcing a 23 per cent slide in first half profits, it seems that the departure of Bernie Brookes was inevitable. In May 2013, I wrote an article entitled ‘Has Bernie burnt his Brooks?’ (misspelling intentional). The openi
ng paragraph read: “There is nothing Bernie likes more than speaking in public. It had to happen. He had to put his foot in it sooner or later but the recent blunder is inexcusable. No amount of apologies or explanations will fix this. Sorry Bernie but you have to go”.
This related to his gaffe about not supporting a Medicare levy to fund the NDIS (National Disability Insurance Scheme), but it was really more to do with his self promotion.
While the departure of Brookes was sudden, if not unexpected, Richard Umbers has been quick to say that Myer has lost relevance with some customers. A fairly strong criticism of his predecessor.
The million dollar question in the DJs case was ‘where was the board?’ Paul Zahra was a victim. The board should have stepped in far earlier. In fact, some say that Zahra was the wrong choice at the outset.
A similar question for different reasons relates to Myer. Has the board been asleep?
How is it that (humble) consultants can see these things coming two years before they happen and yet the board cannot?
The board is there for a purpose – to direct. That is why it is called the board of directors.
In both the DJs and Myer examples, the boards did not act in a timely manner. Sure, the CEOs were the culprits, but there has to be some board responsibility. Perhaps it’s time that shareholders get a bit more vocal.
Stuart Bennie is a retail consultant at Impact Retailing www.impactretailing.com.au and can be contacted at stuart@impactretailing.com.au or 0414 631 702.
