Walmart's 'Project Impact' Execs in Transition

Amid ongoing reports that Walmart is re-evaluating the secondary display and SKU reduction components of its "Project Impact" initiative (see "Store Check: Walmart's ..." in Related Articles), two of the program's principal architects have left their related roles.Eduardo Castro-Wright, chief executive officer of Walmart U.S., in June was named ceo of the retailer's Global.com and Global Sourcing businesses, and was replaced by chief operating officer Bill Simon. Castro-Wright also remains vice chairman. At about the same time, chief merchandising officer John Fleming "made a personal decision to leave the company," according to a July 2 statement from Simon posted on the retailer's website. Walmart asserts that both Castro-Wright and Fleming made the moves for family reasons."As we continue to become a truly global company and address the business challenges of a rapidly changing world, it is clear that Global.com and Global Sourcing are critical to our future growth and success," Walmart ceo Mike Duke said in a release announcing the Castro-Wright and Simon moves. "We are fortunate to have someone as strategic and knowledgeable as Eduardo leading the teams to drive these initiatives forward at a faster pace.""My goal is to partner closely with our suppliers and build on the successes of our strategy over the last several years," Simon said in the release. "Together we will bring a sense of urgency in the areas that matter most for the continued growth of our business: increasing customer traffic, ensuring our product assortment is even more relevant, and never ever giving an inch on price leadership."Simon's posted statement said that Jack Sinclair, executive vice president and general manager-grocery, will lead the food and health and wellness merchandising teams until Fleming's replacement is found, while John Westling, evp-planning, pricing and replenishment, will continue to head the general merchandise and replenishment teams.A Walmart spokesperson acknowledged that assortment issues have been a management concern for the past nine months, but said they had no official connection to the personnel moves, according to Advertising Age. Project Impact remains on track, with 500 stores scheduled to be remodeled this year, but is an evolving strategy, the spokesperson said.Secondary display levels have fluctuated throughout 2010 as Walmart works on the Project Impact plan, which originally considered a complete ban on Action Alley merchandising to make navigation easier and steer shoppers into departments with higher-margin products. (See "Inaction Alley?") That may have had more of an effect on sales than the company expected, as comparable-store sales have been relatively lackluster throughout 2010.The chain has already adjusted its SKU-reduction program by reinstating hundreds of products that had been removed in late 2009. Among the other executives who report directly to Simon (according to his statement) are: Stephen Quinn, evp-chief marketing officer; Raul Vazquez, West geographic business unit leader; Rosalind Brewer, South geographic business unit leader; Hank Mullany, North geographic business unit leader; Johnnie Dobbs, evp-logistics; Eric Zorn, president-Walmart Realty; and Tom Mars, chief administrative officer.Business ActivityWalmart in June unveiled a plan to open several dozen stores in Chicago over the next five years as part of a long-term initiative called the "Chicago Community Investment Partnership." The announcement came shortly after the Chicago City Council approved the retailer's application to open a second store within the city. (The first opened in September 2006.) In a press release addressing some of the local concerns that have stalled Walmart's efforts there, the retailer promised to: open stores around the city in various sizes and formats; create approximately 10,000 store positions and 2,000 unionized construction jobs; pay competitive wages at all levels; generate roughly $500 million in sales and property taxes; and develop charitable partnerships worth $20 million.The initiative illustrates the retailer's publicly stated goal of growing in urban areas. Walmart also is negotiating to open its first store in Washington, DC, according to reports.

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