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Leadership Attrition: Mitigating the Impacts on Retail Transformation


Leadership attrition can have a significant impact on transformation efforts. As leaders leave, they take with them their knowledge, skills, and experience, leaving a gap that can be difficult to fill. This can cause disruptions in implementing transformation initiatives and lead to a loss of momentum. In this blog, we will examine the impact of leadership attrition on transformation efforts, provide statistics and case studies, and discuss best practices for mitigating the impact.



The Impact of Leadership Attrition on Transformation Efforts

The loss of leadership due to attrition can considerably impact transformation efforts as departing leaders take with them institutional knowledge, strategic vision, and critical relationships. Such departures can lead to delays in implementation and loss of momentum, causing missed opportunities, increased costs, and a decline in sales and profits. Harvard Business Review states, "The departure of a leader can leave a strategic void that takes a long time to fill, creating uncertainty and impacting the ability to execute strategies." This disruption can result in a significant loss to the organization's success and competitive edge.

In addition to the impact on institutional knowledge, strategic vision, and critical relationships, leadership attrition can also lead to a loss of talent and experience. When a leader departs, their team members may also choose to leave, leading to a brain drain of knowledge and skills. This loss of talent can be costly and time-consuming to replace, further delaying transformation efforts.

Furthermore, leadership attrition can have a negative impact on employee morale and engagement. Employees may feel uncertain about the company's direction and may be less motivated to contribute to transformation efforts. This can further slow progress and make achieving desired outcomes more difficult.

Five Ways Attrition Can Affect Transformation Efforts:

  1. Loss of knowledge and expertise: When employees leave, they take their knowledge and expertise with them. This can be particularly detrimental when new processes, tools, and approaches are introduced during a transformation effort. Losing key employees who have experience with the old way of doing things can slow down the adoption of new ways of working.

  2. Decreased productivity: When employees leave, there may be a temporary decrease in productivity as remaining employees may need to take on additional responsibilities or fill in gaps left by the departing employees. This can slow down the pace of the transformation effort and make it more challenging to achieve transformation goals.

  3. Delayed timelines: When employees leave, it can create delays in project timelines as new employees need to be hired and trained. This can be particularly problematic in transformation efforts where timelines are already tight.

  4. Cultural impact: Employees leaving can impact the organization's culture. If the employees who are leaving are high performers or key influencers, it can impact the morale of the remaining employees and create a negative perception of the transformation effort.

  5. Recruitment challenges: Attrition can make attracting new talent to the organization more difficult, particularly if the organization has a reputation for high turnover. This can make building the team needed to execute the transformation effort challenging.

It is also worth noting that not all leadership attrition is negative. Sometimes, new leadership brings fresh perspectives and ideas that accelerate transformation efforts. However, it is essential for companies to have a solid succession planning process in place to ensure a smooth transition and minimize the negative impacts of leadership attrition.

Overall, leadership attrition is a complex issue that can have far-reaching impacts on a company's transformation efforts. It is important for companies to proactively manage leadership transitions and minimize the negative impacts to ensure continued success in today's fast-paced retail environment.

Best Practices for Mitigating the Impact of Leadership Attrition

To minimize the negative consequences of leadership attrition on transformation efforts, companies should prioritize building a strong organizational culture, providing opportunities for professional development, and maintaining effective communication with employees throughout the transformation process.

In addition, companies should implement strategies to retain top talent and establish contingency plans to address unexpected departures. To achieve this, organizations must have a comprehensive succession plan, a robust knowledge management system, and retention strategies in place.

According to EY, "Retailers need to focus on talent development and retention to ensure a steady supply of leaders who can successfully execute transformation initiatives." Meanwhile, McKinsey & Company emphasizes that "Succession planning is a critical part of any organization's overall talent management strategy. It enables the identification and development of potential successors for key positions in the organization."

Here are additional best practices to mitigate the impact of leadership attrition on transformation efforts:

  1. Building a culture of innovation and collaboration: Companies should foster a culture that encourages employees to share ideas and work collaboratively. This can help mitigate the impact of leadership attrition by ensuring that knowledge and expertise are distributed throughout the organization.

  2. Investing in leadership development: Companies should invest in leadership development programs to build a strong pipeline of future leaders. This can help ensure that there is a pool of qualified candidates ready to step into leadership roles when the need arises.

  3. Conducting regular talent assessments: Companies should regularly assess their talent pool to identify high-potential employees who could potentially fill leadership positions. This can help ensure that there is a robust pipeline of candidates ready to step into leadership roles.

  4. Communicating openly with employees: Companies should communicate openly and transparently with employees about leadership transitions and the impact they may have on transformation efforts. This can minimize uncertainty and maintain employee engagement during times of change.

  5. Collaborating with external partners: Companies can collaborate with external partners such as executive search firms, consultants, and industry associations to identify potential candidates for leadership roles and stay up-to-date on best practices for managing leadership transitions.

By implementing these best practices, organizations can mitigate the impact of leadership attrition on transformation efforts and ensure continued success in a rapidly evolving industry.

Case Studies - Apparel Retailers Impacted by Leadership Attrition

Case Study 1: Target Corporation In 2015, Target Corporation's CEO, Brian Cornell, announced a five-year plan to transform the company's business model, which included investments in online sales, supply chain improvements, and store renovations. However, in 2020, Target's chief merchandising officer, Mark Tritton, departed to become the CEO of Bed Bath & Beyond.

According to Forbes, "Tritton's departure is a significant blow to the transformation efforts, as he had played a key role in the company's turnaround over the past few years." Tritton's departure left a leadership gap in the company, and it remains to be seen how it will impact Target's transformation efforts in the long run.

Case Study 2: J.C. Penney In 2011, J.C. Penney hired Ron Johnson, a former Apple executive, as its CEO to lead the company's transformation efforts. Ron Johnson announced a transformation plan that included a new pricing strategy, store design changes, and partnerships with high-end designers. Johnson planned to eliminate discounts and coupons, revamp the store layout, and bring in new brands. Johnson's leadership style and lack of retail experience led to a decline in sales and profits. However, Johnson's tenure was short-lived, and he was fired after only 17 months on the job and replaced by former CEO Mike Ullman in 2013. Johnson's departure left J.C. Penney in a state of flux as the company struggled to find a new direction for its transformation efforts. According to Forbes, "The company's transformation efforts suffered a significant setback under Johnson's leadership, resulting in declining sales and profits." The loss of Johnson's leadership and the company's inability to successfully execute the transformation plan resulted in significant losses for J.C. Penney.

Case Study 3: Walmart Inc. In 2018, Walmart Inc.'s CEO, Doug McMillon, announced a transformation plan that included investments in e-commerce, store renovations, and employee training. In 2020, Walmart's Chief Merchandising Officer, Steve Bratspies, announced his departure to pursue other opportunities. According to Retail Dive, "Bratspies played a key role in Walmart's transformation efforts, leading the company's push into online grocery and private label brands." While Walmart has a solid succession plan and was able to promote from within to fill the vacancy, the loss of Bratspies' leadership and expertise could potentially impact the company's ability to continue its transformation efforts successfully.

Case Study 4: J.Crew: In 2018, J.Crew experienced a wave of leadership departures, including the CEO, CFO, and chief merchandising officer. The departures were attributed to disagreements over the company's transformation strategy, which included a focus on cost-cutting and reducing inventory. The sudden loss of leadership resulted in delays in implementing the transformation plan, which had a negative impact on sales and profitability. J.Crew has since implemented a new leadership team and strategy, but the company still needs to regain its footing in the highly competitive apparel market.

Case Study 5: Abercrombie & Fitch: In 2014, Abercrombie & Fitch experienced a leadership shakeup that saw the departure of its long-time CEO and the appointment of a new CEO who was tasked with transforming the struggling retailer. However, the new CEO resigned abruptly in 2017, citing "disagreements with the board" over the company's transformation efforts. The sudden loss of leadership caused a setback in Abercrombie's transformation plan, which had included a shift away from its logo-centric branding and a focus on digital channels. The company has since hired a new CEO and continued with its transformation efforts. Still, the loss of momentum caused by the leadership departure has impacted the company's performance.

Case Study 6: Gap Inc.: In 2019, Gap Inc. announced that its CEO would be stepping down after more than a decade in the role. The company had been struggling to keep up with changing consumer preferences and increased competition in the apparel market. The loss of leadership created uncertainty about the company's transformation efforts, which had included a plan to spin off its Old Navy brand into a separate company. The departure of the CEO delayed the spin-off plan and caused a decline in Gap's stock price. Gap has since hired a new CEO and continued with its transformation efforts, but the disruption caused by the leadership transition has significantly impacted the company's performance.

The Stats:

  • According to Deloitte Insights, "87% of organizations rate succession planning as an important or urgent priority, but only 50% say they are effective at it."

  • According to Society for Human Resource Management, "Only 14% of organizations have a fully integrated succession planning process."

  • According to Korn Ferry, "In the retail industry, CEO turnover reached a record high of 23% in 2019, compared to the 14.5% average for all industries." (3)The study also found that CEOs in the retail industry had an average tenure of 4.6 years, which is lower than the global average of 6.9 years.

  • According to a study by EY, "Only 31% of retailers have a formal succession plan in place, and only 8% have a plan for the CEO role."


Leadership attrition can have a significant impact on transformation efforts. When leaders leave, they take with them institutional knowledge, strategic vision, critical relationships, talent, and experience, which can slow down progress, cause delays in implementation, and result in missed opportunities and increased costs. However, by implementing best practices such as having a solid succession plan, investing in leadership development, conducting regular talent assessments, communicating openly with employees, and collaborating with external partners, retail organizations can mitigate the impact of leadership attrition and ensure continued success in today's fast-paced retail environment.

The ability of an organization to successfully continue its transformation efforts following leadership attrition often depends on the strength of its talent pipeline and its capacity to promote from within or attract top talent from outside the organization. To mitigate the impact of leadership attrition on transformation efforts, companies should focus on developing their internal talent pool and fostering a culture of innovation and collaboration.

To thrive in the retail industry, organizations must prioritize managing leadership transitions and establishing a robust pipeline of future leaders. By doing so, they can secure the necessary talent, knowledge, and expertise to drive successful transformation efforts and stay competitive.


About the Author: Ilka Jordan

Ilka Jordan is a passionate and experienced transformation executive with a proven track record of success. Specializing in business strategy, innovation, and technology, Ilka is a strategic thought leader in her field. With her collaborative approach and talent for identifying opportunities for improvement and designing effective solutions, she has helped guide companies through successful transformations across retail value chains.

As the founder and CEO of Jordan Alliance Group, a boutique management consulting firm, Ilka is committed to delivering exceptional results for her clients. Her team of experts specializes in process optimization, change management, and technology implementation. As a minority-owned, women-led firm, JAG is one of the first of its kind in the industry, and Ilka is proud to lead a team that shares her commitment to excellence.

Ilka is also a DBA student, continually developing her craft and staying at the forefront of her field. Her expertise has benefited many high-profile enterprises, and she is dedicated to ensuring the success of your company's transformation efforts. Contact Ilka today and experience the transformative power of her strategic thought leadership.


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