Planning well for a change in leadership is one of the ways a company can maintain its culture, says outgoing JB Hi-Fi chief executive Terry Smart.
Smart announced yesterday that he will retire in August, after 14 years with the electronics retailer. He will be succeeded by chief financial officer Richard Murray.
“Succession planning is absolutely vital for any company, both internally and externally,” Smart told SmartCompany.
“JB Hi-Fi has a unique culture, which we have nurtured from our initial 10 stores to the 182 stores we have now,” says Smart. “A smooth transition helps maintain culture, which is no more than the way you do things.”
“Succession planning is not something you can do overnight,” says Smart, who has worked closely with Murray for more than 10 years. “It’s a long-term process and it’s part of the board’s role.”
However, Smart says it was difficult to make any decision about a succession plan for the business until he had made his own decisions about his career.
“We have a great pool of talent within the organisation and Richard was one of a number of strong candidates,” says Smart. “Based on the timing, he was the perfect fit.”
Smart said in a statement this week that the decision to leave the company was “made easier because the company is in a strong position”.
“Richard has a great knowledge of the business and I have no doubt JB Hi-Fi will be in a great pair of hands,” said Smart. “After a total of nearly 30 years in retail, I now look forward to spending some more time with my family.”
Murray joined JB Hi-Fi as chief financial officer and company secretary in 2003 and joined the board as an executive director in June 2012. He led the company’s initial public offer in 2003 and has played a key role in its commercial division.
“We have many opportunities to grow the business as we continue the store roll-out, expand JB Hi-Fi HOME, further develop our online and digital platform and build our commercial and education division,” said Murray.
JB Hi-Fi has appointed group financial controller Nick Wells to take over Murray’s role of chief financial officer. Wells has worked for the company since 2009, having previously worked for Deloitte.
JB Hi-Fi also issued a trading update this week, reporting a 3% increase in comparable sales for the March quarter and reaffirming its February forecasts that it expects full-year sales to rise by between 6-8% compared to the year before. Net profit is expected to reach as high as $129 million, a 10.8% increase on the year before.