The third major senior management shake-up at Apple Inc. since 2012 will see a renewed focus on expanding the company's retail presence in the physical world plus a stronger emphasis on retail personnel.
The sudden exit of Senior Vice President of Retail, Angela Ahrendts, and her replacement by an Apple veteran with vast experience in retail, operations and human resources underscores the company's mantra that its greatest asset is its people. Ahrendts departure takes effect in April.
Deirdre O'Brien, currently Vice-President of People, will take over as Senior Vice President of Retail + People, announced CEO Tim Cook in a letter to Apple staff. Retail + People is apparently new post created specifically for O'Brien. O'Brien will be the first Apple insider to run Retail.
She will report directly to Cook. Before becoming Vice-President of People, O'Brien was Vice-President of Worldwide Sales and Operations.
In his letter to employees, Cook was effusive in his praise of O'Brien and her contributions to Apple.
He said O'Brien will be taking responsibility for Apple's retail teams in her new role. O'Brien brings to the table insight and experience gained during over 30 years at Apple.
Cook emphasized she has spent decades "focusing on the connection between customers and the people and processes that serve them. Working collaboratively across Apple, Deirdre and her teams empower people to lead with purpose and humanity."
O'Brien was also part of the team that planned and launched Apple's very first online and retail stores. She has been a part of Retail's broad expansion and every product launch since.
But more important to Cook, who keeps repeating "Apple's greatest asset is its people," is that O'Brien "knows the value of the deep human connections that retail experiences make possible -- and she knows this is where Apple shows its heart and soul."
He also praised O'Brien and her team emphasizing "how Apple inspires, connects, develops and cares for its employees -- essential efforts that she will continue companywide through the People team in her new and expanded role."
O'Brien will be the third new head of retail since Cook became CEO in 2007. Her predecessor, Ahrendts, took over from John Browett, who was fired in 2012 after only nine months on the job. Among Browett's greatest sins -- slashing the number of employees at retail stores, which Cook didn't like and which he later had to apologize for. All of Apple's former Retail heads were outsiders.
Analysts believe Ahrendts' downfall sprang from her inability to get more people to visit Apple's plethora of retail stores, of which it has 506 worldwide. There are 70,000 employees in Apple Retail.
Ahrendts, the former CEO of Burberry, was also chided for the fact most Apple iPhones are sold online and not at Apple retail stores.
Like Cook, analysts say O'Brien's main role will be to elevate Retail. O'Brien has her work cut out for her since Apple's guidance for the second quarter projects earnings ranging from $55 to $58 billion, which is below analysts' expectations.
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