Fresh from a dominating win in a pingpong game at Target Corp.’s summer carnival, Brian Cornell stood on stage last month and took what he joked was the biggest risk of his career.
The CEO who has undertaken a sweeping corporate overhaul fielded 82 rapid-fire questions as employees, eating kettle corn and dabbing at frozen yogurt, listened for insight into a boss many still regard as new.
Yankees or Mets? Mets. (He grew up in Queens.) Favorite musician? Bruce Springsteen. Aisle or window seat? Aisle.
Others questions hit closer to the tension that remains after mass layoffs this spring.
What is the hardest part of being a CEO? “Making tough decisions,” Cornell responded to dead silence.
In just over a year, the first leader to come from outside of Target has given more than a jolt to one of Minnesota’s biggest, best-known and most storied companies.
Target’s 133 stores in Canada: closed. Its pharmacies: sold to CVS Health. Its headquarters staff: 18 percent gone.
“There’s just change, change, change,” said one longtime employee, who asked not to be identified because the company didn’t authorize him to speak. While many within Target say the company is headed in the right direction, he added, “I think some people didn’t realize what we were getting ourselves into by having an outside CEO.”
Cornell has won over investors. Target’s stock is up nearly 40 percent since his arrival and now trades near record highs.
But the swift changes and the fact that Cornell laid out just three years of goals for Wall Street has led to speculation he is the type of corporate leader who sweeps in and moves on. Cornell wanted to put that idea to rest last week.
“I’m not going anywhere,” he said during an interview in his sparse office on the 26th floor of Target’s headquarters. Cornell, 56, said he hopes to end his career at the company.
“There’s been a lot written about, ‘Am I going to be here for three years?’ This is the best job in retail, perhaps one of the best CEO jobs I can imagine anywhere in the world. I’m still young. This is my dream job. So they’re going to have to drag me out of this building.”
At the same time, he acknowledged the changes of the past year have unsettled employees and added he worries about that.
“We’re not transforming because of past data breaches or failures in Canada,” he said. “We’re transforming because in the U.S., the consumer has changed. The way they shop is different. Our competition is completely different than it was 10 or 20 years ago. In fact, the whole retail industry has gone through this massive evolution. We’re transforming because we have to.”
And that’s why, he said, he’s begun hosting town hall-style meetings called the “Q” after every major announcement and monthly meetings of officers from vice president on up. Target also launched a daily internal newsletter, called “Briefly,” to update employees on plans.
Cornell and other executives have also been clear that the next round of layoffs will be in the technology services department, which has been relatively immune to reductions thus far. “I don’t think there are any secrets about it around town,” he said, adding the number would not be large.
Cutting jobs at headquarters allowed Target to clear levels of bureaucracy that often stifled decisions and innovation. Suppliers complained about the issue, and so did people inside Target, Cornell said. Now he’s pushing employees to not only move faster but to take on more accountability and to be more honest about what’s not working.
Target insiders describe the old culture — officially dubbed “fun, fast and friendly” — as one that was so risk-averse and focused on consensus-building that those who were more agreeable often moved up and those with “sharp elbows” did not. By contrast, one of the company’s biggest rivals, Amazon.com Inc., was portrayed in the New York Times last week as possessing a workplace culture that was so cutthroat and grueling that people were sometimes reduced to tears.
Asked about that story, Cornell demurred from talking directly about a competitor but said, “What was written is not the goal that we’re setting, to be really clear.”
In recent months, he’s started an “action meeting” every Tuesday with the top leaders in merchandising, store operations, supply chain and marketing to review weekend performance in stores and order immediate adjustments. One week, that meant putting more marketing behind Target’s revamped denim selection. Another week, after an unusual heat wave in the Pacific Northwest, more supplies of Gatorade, water and fans were shipped there.
Then came the decision earlier this month to change the names of its small stores in urban locations. CityTarget and TargetExpress will soon simply be called Target. Executives realized they were in a bind because a recently opened CityTarget store by Fenway Park in Boston turned out to be bigger than most suburban Targets.
“It probably took us about 45 good minutes” to make that call, Cornell said.
Matt Nemer, an analyst with Wells Fargo, said the changes at Target have all of the hallmarks of a typical turnaround. “I’m expecting new announcements for months to come, maybe every other week,” he said.
The company for years has been one of the most profitable in retail, but its foray into Canada turned into a money-loser and a data breach in late 2013 dented its reputation as cyberthieves obtained financial data on more than 40 million customers. In May 2014, Target’s board ousted its previous chief executive and hired Cornell three months later.
Despite Cornell’s efforts at transparency and openness, another Target employee said, “There is still some ambiguity about what is yet to come.”
Casey Carl, who was elevated to chief strategy officer by Cornell last fall, acknowledged that the push to take risks and take on more accountability has been “incredibly hard.”
“Some people will decide that this is not the place for them long-term, and that’s OK,” he said. “In some cases, we’ll help them understand that as well. But that’s what any organization has to go through when they’re transforming.”
Paul DeBettignies, a recruiter for local tech companies, said he’s seen an uptick in Target employees brushing up their LinkedIn profiles and exploring what other opportunities might be out there. At the same time, search firms and other companies from around the country are swooping in to try to lure away employees.
“You know there’s uncertainty. You know there is some exit of senior leadership,” he said.
Still, Cornell said there has been less turnover than he expected, which he takes as a sign that people are embracing the changes. And he said as the company continues to put out some good sales numbers, there will be more opportunities at Target and more people will want to work there.
One of the big items on Cornell’s to-do list at the moment is finding someone to succeed Kathee Tesija, a longtime Target executive who stepped down earlier this summer as chief merchandising officer. He’s looking at both internal and external candidates. Among his criteria is finding someone who could perhaps one day succeed him. Cornell said that was also a consideration in moving John Mulligan, the company’s chief financial officer, into the newly created chief operating officer position.
“I have a responsibility to the board and the company to make sure we’re developing future leaders who could step into this role,” he said. “Even if it’s 10 years from now.”
At the carnival, Cornell’s responses to the 82 questions hinted at how much more work lies ahead.
What keeps you up? “A long list of things right now.”
What are your hobbies? “I don’t have time for hobbies … Maybe next year.”