Just four months ago, analysts suggested that Best Buy's CEO job was G. "Mike'' Mikan's to lose.
The Best Buy board member and interim CEO began acting like a chief executive right after his April appointment. During May's earnings call with Wall Street analysts, he vowed improvements at the troubled retailer, posed strategies and set the stage for partnerships with other key retailers.
But on Sunday, Best Buy's board tapped Carlson's four-year CEO, Hubert Joly, to head the beleaguered Richfield-based electronics retailer.
"I thought [Mikan] was the leading contender," said Colin McGranahan, an equity analyst with Sanford Bernstein Co. "I thought his chances were strong. I would have put better-than-even odds that he would have had the job."
The Best Buy board passed over the 41-year-old former UnitedHealth Group executive vice president and CFO in favor of an executive with global reach and experience as a turnaround CEO.
Mikan declined to be interviewed for this article, according to Best Buy spokesman Bruce Hight.
In hindsight, McGranahan said Mikan didn't have extensive retail experience and did not have experience in the top job. McGranahan acknowledged Mikan's tour as CEO of UnitedHealth's Optum division but said: "That doesn't count. You still have a boss. You are not making the decisions. You are not reporting directly to the board. And I guess this board felt, this is not a situation where you want on-the-job training, or someone learning how to be a CEO for the first time."
Others are not so sure.
"Mike is clearly not a novice to general management. He was clearly a high-ranking executive at UnitedHealth. So he has the full package," said Chris Puto, dean of the University of St. Thomas' Opus College of Business.
Best Buy's CEO pick surprised Puto, if only because Joly also doesn't have the extensive retail experience that Wall Street supposedly craved. Noting that Joly has hotel and hospitality experience but not traditional retail, Puto said: "So if you were to compare him with Mike Mikan, it is not obvious to me that he is a clear choice above Mike."
Best Buy said Mikan will stay on Best Buy's board and become the chairman of the audit committee. In a statement, Best Buy's new chairman, Hatim Tyabji, praised Mikan's efforts.
"Mr. Mikan stepped in as interim CEO at a critical moment for Best Buy, stabilizing the company while making considerable progress on a comprehensive plan to return Best Buy to sustained, profitable growth," Tyabji said. "Under his leadership, Best Buy established relationships with Target, Verizon and AARP, signaling a new focus on services, in addition to the company's traditional retail mission."
According to his pay package when he took the interim CEO job, Mikan was to get the annual equivalent of $3.3 million, but that is linked to his length of stay. The annual salary rate was $1.1 million and the annual bonus was $2.2 million.
Dee DePass 612-673-7725