Foot Locker on Thursday followed Nike in announcing changes to its organizational structure “designed to foster greater agility and speed-to-act,” according to a company press release.
As part of the restructuring, Foot Locker named Andy Gray, former chief merchandising officer for North America and general manager of Foot Locker U.S., to the role of executive vice president and chief commercial officer; Frank Bracken, former senior vice president and general manager of Foot Locker and Kids Foot Locker U.S., as well as vice president and general manager of Foot Locker Canada, to the role of executive vice president and CEO of North America; and Scott Martin, former senior vice president and chief strategy and development officer, to the role of executive vice president and CEO of Asia Pacific, as well as chief strategy and development officer.
Two longtime Foot Locker execs are also retiring as a result of the restructuring. Lew Kimble, executive vice president and CEO of Asia Pacific will retire after over 40 years with the company, and Jake Jacobs, executive vice president and CEO of North America, will retire following 20 years with the company. Both retirements are effective at the end of August.
Foot Locker said its organizational changes were focused on improving customer experience by connecting consumer-facing functions globally, bolstering its ability to create localized experiences, creating opportunities for future capabilities, and streamlining the company’s expense structure.
“At a time when the world around us is moving and changing at a rapid pace, our new organizational structure positions us to operate more nimbly and develop even deeper connections at the heart of youth culture,” Richard Johnson, chairman and CEO of Foot Locker, said in a statement, saying it builds on the company’s strategic imperatives. “The steps we are taking today more strongly position Foot Locker for both the near- and long-term, and I am confident in our team’s ability to continue driving our business forward in new and meaningful ways.”
However, Susquehanna Financial Group analysts, led by Sam Poser, said the organizational changes “create as many questions as answers.”
“The creation of a new global Chief Commercial Officer position is, in our view, a step in the right direction to further develop Foot Locker Inc.’s ‘consumer-led offense,'” the analysts said in emailed comments. “At the same time, we believe there is a story behind the story of the announced ‘retirements’ of 40-year FL veteran Lew Kimble (CEO and EVP Asia Pacific) and 20-year FL veteran Jake Jacobs (CEO and EVP North America) and the subsequent promotions of Scott Martin to EVP and CEO of Asia Pacific and Frank Bracken to CEO and EVP of North America.”
The analysts noted that both Kimble and Jacobs were on the short-list to replace Johnson upon his retirement. They also questioned whether new requirements from Nike were behind the announcement, and why the company’s changes “didn’t go further up the leadership flagpole.”