Monthly Archives: March 2015

Target in Transition: A Case for Organizational Agility

Network Analysis @ Target

Target 2006 – 2010 by classification (super-cluster view)

via “Network Explorer”

target 2006 - 2010 v2

(1)  “Target to cut Minnesota jobs while expanding in New York / California” (3/3/2015)

As Target sharply downsizes in Minnesota, it is expanding its corporate footprint in Silicon Valley and New York.

The restructuring will be concentrated at Target’s corporate locations and focus on driving leaner, more efficient capabilities — removing complexity and allowing the organization to move with greater speed and agility.

New Target CEO Brian Cornell has found the corporate culture in Minneapolis too plodding and cautious. Cutting complexity at the corporate level will make Target more competitive. Retail specialist Dave Brennan at the University of St. Thomas sees a real cultural change underway. Cornell’s background includes experience at Sam’s Club and he is operating with the same kind of dispatch as the Walmart organization.

(The Walmart culture is typically more action-oriented — they analyze opportunities comprehensively, but faster than Target.)

Target intends to make large investments in mobile and digital technologies. It has already made some large strides in those areas, but it needs to do more. Because omni-channel customers are so profitable, Target needs to be ready as U.S. consumers become more tech-savvy. Digitally-connected shoppers who interact on more than one channel generate three times the sales and two-and-a-half times the margin as customers who shop only in the store.

Target is one of many retailers and manufacturers, including Best Buy, that have recently opened innovation centers on the tech-heavy West Coast.

(2)  “Target starts tearing down corporate walls” (3/12/2015)

An organizational concept called “centers of excellence” will encourage cross-functional collaboration and decrease redundancy.

Target is one of few retailers that can combine data about what individual customers buy in stores with what they buy online to develop product recommendations for those customers.

(3)  “Target layoffs will hit 1,700” (3/12/2015)

Chief executive Brian Cornell said that the cuts were necessary to speed up decisions and projects at the nation’s fourth-largest retailer.

Though cutting staff will save money, Cornell and other Target executives focused more on speeding up an organization in which decision-making had become bogged down.

In order to compete today, speed and simplicity are critically important – they are looking at every opportunity to eliminate complexity.

(4)  “Firms reach out to ex-Target workers” (3/12/15)

(5)  “Highly skilled / highly paid target jobs probably gone forever” (3/11/2015)

Having smart young people come here — and stay — is how the Twin Cities became a metro area that’s among the leaders in median income, educational attainment, and other economic measures.

Target executives said last week that the company will continue to hire people with unique skills, such as data science.

Some will stay put and bring their skills to other top companies or kick-start their own businesses.

A layoff of this magnitude is something that our vibrant and diverse economy will mostly shrug off.

Cutting jobs at headquarters makes the work simpler; some tasks get done faster, some don’t get done at all.

(6)  “Hundreds of Target workers cut all at once” (3/11/2015)