Gregg W. Steinhafel: Overcoming Challenges

Becoming the CEO of a company is a big enough challenge in itself. You are now responsible for guiding the company to future growth and prosperity.  It is even more challenging when your predecessor had made huge accomplishments that basically made the company the success that it has become.

This was the situation facing Gregg Steinhafel when he became the CEO of Target the multi-billion discount retail giant which operates in 49 states and based in Minneapolis, Minnesota. His predecessor was largely responsible for growing the company to its prominent position in the retail market.  Yet Steinhafel immediately faced huge challenges when he was promoted to the position in May 2008.

The U.S. economy was faltering and sales were dropping. The company was known for its “Expect More, Pay Less” slogan. They had been putting more emphasis on the “Expect More” part of the message. Target is identified with having taken the consumer out of shopping boredom by offering designer products and a bit of upscale atmosphere as compared to the lowest price approach of Wal-Mart. It was able to differentiate itself even though it was a discount retailer offering low prices.

During crisis time however this strategy was becoming a liability since people were now more focused on low prices. This was especially true to the fortyish moms that had been Target’s main customers.  Given overwhelming data Steinhafel made the crucial decision to change the message emphasizing low prices without ending up looking like a Wal-Mart copycat.

After some time and much hard work the company looks to have pulled it off with sales picking up. Target made new forays in the fresh food segment which has helped to increase overall sales.  Steinhafel was able to execute all this even while a major stockholder who was disgruntled when stock prices were going down was threatening a boardroom shakeup in 2009.  Steinhafel who was appointed board chairman in January 2009 managed to weather the storm and stockholders voted in favor of the current directors.

Target also had a misstep when a civic initiative it supported ended up being as support for an anti-gay politician which dismayed the gay community. Steinhafel managed to repair the company’s relationship with the gay community.

Steinhafel was able to overcome major challenges proving his true worth as a leader.