Tuesday, May 12, 2015

News Now! | For New Abercrombie CEO, the Succession Progression...

The future's out there, bright; let's seize the light...
Image, Guy Aroch for Abercrombie & Fitch   |   @abercrombie Instagram, May 7, 2015
         IN THE MIDST of a personal interim period after the sudden departure of the founding genius who repositioned it as globally-renowned fashion retailer, Abercrombie & Fitch Co. has become a multi-billion dollar entity carrying on, in full struggle against headwinds and in a phase of unpredecented transition, without the guidance of a titan Chief Executive Officer to singularly be at helm with firm, stable, visionary strength. For the time being, it is the temporary Office of the Chairman - a recently created governance group of top executives comprising of Executive Chairman Arthur Martinez, Chief Operating Officer Jonathan Ramsden, and Brand Presidents Christos Angelides (Abercrombie & Fitch and abercrombie) and Fran Horowitz (Hollister Co.) - who are together at the steering wheel as the headhunt continues on for the new CEO...

Considering the potential of internal candidates, someone at A&F Home Office may be signed up to rise to the occasion: Ramsden, Angelides, and Horowitz are the prime names under heavy consideration. However, Ramsden, of the three, bares a higher favorability for the role in the eyes of investors, analysts, and even A&F devoted customers and associates: he holds the longest tenure and understanding of operations and corporate culture since having joined in 2008 as Chief Financial Officer. But, candidacy is not based on tenure but the vision and potential that can be brought onto the table for the realization of stability and growth for now and the future. Every candidate is being looked into: "We’re looking for a very clear strategic perspective. We’re moving forward as aggressively as seems prudent. And when we’re ready to make an announcement, we’ll do it," stated Martinez to BloombergBusiness for its piece, Abercrombie CEO Search Has Three Executives Duking It Out. The three, on the other hand, dismiss any sense of outright awkwardness: "Fortunately, we all get along well. We all respect what each other brings to the table. Our experience so far has been that we’re very complementary."

And if no one internally is deemed agreeable enough, or should an external individual seem highly more promising, the Company has the reputed American executive-search firm Spencer Stuart on the hunt gathering a list of powerful, promising names it deems most suitable for the industry and leadership needs of Abercrombie & Fitch Co. As Spencer Stuart states, "Leadership requirements continue to evolve, but the need for high-performing executives remains constant. Identifying and attracting this talent requires a rigorous approach, a thorough understanding of different industries and functional roles, unrivaled access to senior executives and impeccable judgment. Spencer Stuart consultants apply real insight into clients’ strategic requirements and proven assessment tools to recruit leaders who have the necessary skill, experience and personal qualities to advance company strategies and achieve outstanding results." Of the individuals, one of whom will be singled-out for the role of CEO for the new A&F.

"Spencer Stuart is one of the world’s leading executive search consulting firms. Founded in 1956 and privately owned, we are the adviser of choice among organizations seeking guidance and counsel on senior leadership needs. We work with clients across a range of industries, from the world’s largest companies to medium-sized businesses, entrepreneurial startups and nonprofit organizations."

Since it's founding, Spencer Stuart (official website) has played a monumental influence in the leadership of some of the world's greatest corporations; its Chairman and former-CEO, Thomas Neff (see profile), has overseen the placement of around 500 CEO searches (this including placing Jim McNerney at Boeing and John Mack at Morgan Stanley), and he also played a role in placing Timothy Geithner as ninth president (2003-09) of the Federal Reserve Bank of New York (which, since the Federal Reserve Act of 1913, acts as fiscal agent for United States). In 2009, after having helped place new key figures in the corporate governance of seven companies which accepted federal bailouts during the Great Recession, The Wall Street Journal stated, "Spencer Stuart has become the go-to recruiter when Uncle Sam wants bailed-out companies to install new directors and other top officials." By that time, Spencer Stuart was working for about half of Fortune 500 companies requiring of its services.

Martinez himself believes that the Office of the Chairman is a great governing group during this interim sans-CEO while the search is on. Furthermore, he also recognizes that there is a risk of loosing Ramsden, Angelides, and Horowitz, in one way or another, if it becomes apparent to them there's no long-term incentive and reward for them to remain: "If one -- or none -- of the three is chosen to become the next CEO, the company risks losing the others to competitors. Abercrombie is aware of that risk, Martinez said. He compared the loss of Angelides, Horowitz or Ramsden to a stool left with too few legs -- an unstable situation," affirmed BloombergBussiness. Even for him, this past April, Martinez was given a handsome further sum of US$625,000 as retainer, along with stock grants, by Abercrombie & Fitch Co.

However, analyst Dorothy Lakner of Topeka Capital Markets suggests that this may create a counterintuitive circumstance. As BloombergBusiness week surmised her take, "The company’s leadership team also makes it harder to attract an outside leader, she said. If the current management figures out a winning strategy, an external CEO wouldn't have much opportunity to craft a vision. Lakner, who has a sell rating on the company, sees Ramsden as the logical choice if Abercrombie sticks with an internal candidate."

Agreeably, overall, the greatest hurdle is to bring together a new calibrated image for Abercrombie & Fitch: one that will be successful in general is the challenge...and an even greater challenge will be, if it even can be done with what's in place, to fill-in the historic, revolutionary, iconic shoes of the one Mike Jeffries had at its glory and more and which can bring the Abercrombie & Fitch name back to the top, unchallenged, of youth fashion retail. That, and most fitting merchandise to drive resurgence. A new charismatic, forward-visionary CEO is in much need...