Target Puts Executives on Same Floor to Fight Bureaucracy

Target Corp. (TGT) interim Chief Executive Officer John Mulligan, who took the helm just over a month ago, is claiming some victories in his fight against bureaucracy.

Mulligan has moved the company’s entire leadership team to the 26th floor of its headquarters in Minneapolis, allowing for faster decisions and more clarity, he said in a memo to employees. Target also is scaling back on its four governance meetings, which have focused on the supply chain, marketing, design and capital expenditures. Mulligan even changed the name of the executive committee to the “leadership team.”

“As we continue to focus on accelerating our transformation, everything matters -- including what we call ourselves,” he said. “All across Target, we need more ‘leadership’ and less ‘committee.’”

Mulligan, an 18-year veteran of Target, became temporary CEO last month after Gregg Steinhafel was ousted -- a move that followed a massive hacker attack and a botched expansion into Canada. Even before the data breach, which exposed the personal information of millions of customers, Target had lost its way by becoming too cautious and bureaucratic, Mulligan said in an interview last month.

At a test store in Minneapolis, Target is reworking the baby, electronics, toys and clothing sections because presentations had become stale, he said in the interview. The changes include opening up floor plans, improving lighting and introducing mannequins, which were used for the first time two years ago with the debut of its smaller CityTarget locations.

Security Executive

Target also announced the hiring of a top data-security executive today. Brad Maiorino, who joins from General Motors Co., will serve as chief information security officer starting June 16. He will answer to another recently hired executive, Bob DeRodes, who was named chief information officer in April.

Maiorino was the head of information security and information technology risk at General Motors. Before that, he held a similar role at General Electric Co.

Target still faces criticism that its board didn’t do enough to prevent last year’s data breach. Institutional Shareholder Services Inc., an investor advisory group, recommended last month that seven of its 10 directors be voted out. The company will hold its annual meeting tomorrow.

More changes are coming, Mulligan said in the memo, which was previously reported by the Wall Street Journal. That includes a plan to dismantle the wall at its headquarters displaying its vision, he said.

“We’re taking a close look at strategy and asking ourselves the hard questions, starting with: Why are we here?” he said. “We’ll modernize that space in the months ahead, and when it’s done, it will reflect the company we’re becoming -- which we’re all creating together.”

To contact the reporter on this story: Renee Dudley in New York at rdudley6@bloomberg.net

To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net Niamh Ring

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