I look at Best Buy, which recently fired Hubert Joly, its CEO, and say to myself: Really? Do they hate him that much? I’m a fan of Joly’s efforts, and at worst it seems like the divisions of the board might have misjudged him and Joly.
Joly was forced out by the board largely because of disagreements over strategy. In fact, before he got the top job in March 2013, he told The Wall Street Journal he viewed Best Buy as a traditional company with “heavy” retail operations that could put people in physical stores. But after his arrival, he shook up the culture by asking employees to reinvent the company, having one conversation with employees at a time rather than having weekly meetings, and bringing in new talent.
Best Buy needed a shakeup, I thought. I went to Amazon to see if it wasn’t making quite the same mistake as Best Buy. I asked someone from Amazon about selling books, music, movies, and more. I was pleasantly surprised. Amazon isn’t trying to own the whole market the way Best Buy is. It’s looking to specialize. This wasn’t the mass merchandiser of yesterday. It was trading with Apple, iTunes, Facebook, Netflix, Samsung, etc.
To paraphrase David Brooks: I don’t care what Warren Buffett or Larry Ellison thinks. We’re all wrong.
I was skeptical of Amazon’s plans. For one thing, I wasn’t familiar with much of what they offered and didn’t like my experience at Amazon’s first brick-and-mortar bookstore. Plus, it is a war against bookshops: You can buy a book for two bucks and walk out with it or spend $7,000 for the latest issue from the Library of Congress or an unparalleled first edition signed by Will Smith. And Amazon’s people are trying to innovate. Amazon is deeply into streaming music and video. I just couldn’t see that it was profitable.
And on and on it went. I bought a cordless phone. It made me annoyed. I bought a quickie mortgage. I bought a new flat screen. I bought a brand new dress shirt, for Christ’s sake.
I still don’t like Best Buy. It’s a classic example of how capitalist profit-maximization is a war. I think it’s time to rethink it. This recession has confirmed that all businesses are in need of radical innovation and we need to be more appreciative of the field.