Best Buy Case - Harvard Business School

Best Buy Case Pre Class Assignment Template

(Please not change font or line-spacing. Try to keep it to one page. Ok to use bulleted response)

What is the central problem(s) in the case?

The Best Buy corporate team did not understand why its initial large rollout of “Centricity” stores failed to produce the results similar to those from the pilot Centricity stores. Was the strategy flawed, was it an issue of poor execution, or did the results lag behind implementation? The company decided to review the pace of the store conversions to determine if this concept was indeed the approach needed to revamp Best Buy and return the company to its historical dominance.

What is (are) your recommendation(s)?

Continue the conversion of stores to “Centricity” stores. Slow down the pace of conversion. Allow for more concentration in each conversion. Identify speed-bumps including disgruntled staff, frustrated segment leaders and merchant groups. Focus more attention on each of these groups to ensure positive relationships in the future.

Why do you recommend what you did above?

- The cycle of conversion became too rapid. The amount of stores converted to Centricity stores went from 67 to 250 in one year. This allows for relationships with vendors, segment leaders, and store staff to become strained and cooperation/morale to be lost.

- Set a target number of store conversions each year. Increase or decrease that amount based on feedback and financial results. Allow time for earnings results to become available.

- A majority of individuals are unsure or dislike the idea of change. They must be sold on the idea at the start and involved in the conversion process to ensure future gains. Allocate plenty of time and opportunities to review feedback from different groups.

- By spending more time on each store conversion, management can make the best decisions available to them. This will enable them to focus on putting the correct segments in...