Best Buy scandal brings lessons about corporate governanceby Cathy Wurzer, Minnesota Public Radio
ST. PAUL, Minn. — Best Buy founder Richard Schulze is leaving the company in the wake of a management scandal at the electronics retailing giant. Former Medtronic CEO and Harvard Business School professor Bill George tells MPR's Morning Edition he thought the situation could have been averted.
Schulze's departure as board chair comes in the wake of a disclosure that former CEO Brian Dunn was forced out after discovery that he'd had an improper relationship with a female subordinate. An internal investigation found that Schulze had known about the matter, but didn't tell the board.
"You know, its sad. I wish, personally for his sake, he'd left a decade ago. Because now, it's like a Shakespearian tragedy. He's had an amazing career. Been entrepreneur of the year, and company of the year in 2004, and you know, he's done everything right until this point," George said. "Buthe was just I think too close to his second successor, Brian Dunn, and didn't take the appropriate action and now put the company at risk."
George says Schulze's departure may give the company a much-needed chance to reexamine its business model.
"They can't go back to where they were before," he said. "They have to move forward to the future. And that's going to be a more digital future. That's going to be more value added services. They can't just sell boxes because you can buy boxes online at Amazon. So someone is going to have to come in and take a whole fresh look. That's where having a very sharp board is, and you're going to have to have a CEO that's willing to ask those questions and totally free themselves of the past strategy."
- Morning Edition, 05/15/2012, 7:25 a.m.