by Nwirika Ndung’u-Achieng
LONDON — In 1999, Hubert Joly was earning $400,000 a year as head of Philips Electronics in North America. That was before he was lured to the American market by then-CEO Brad Anderson, and before he set out to save struggling electronics retailer Best Buy.
Joly, who has just been named CEO of the International Monetary Fund, told the Financial Times that’s he’s now pondering whether to return to a technology industry that’s in a far different place than the one he left in 2000. He didn’t specify, but that could well be the case for him once again. In the late 1990s, for example, his firm Legrand Group was showing off home stereo products. Now, he’s tasked with plotting the course of the world’s largest international monetary fund.
“I’m trying to figure out exactly what I want to do now,” he told the FT. Joly, 53, has been credited with a lot of things: turning around Best Buy (BT), helping lift company profit from a flat line by raising household incomes and prying customers away from Amazon (AMZN), for instance. Most importantly, he displayed an exceptional vision and determination.
At Best Buy, he set out to reinvent the U.S. brick-and-mortar retailer of consumer electronics by making it a more attractive place to shop for gadgetry. He poured cash into e-commerce, grabbed customers by running discounts on TVs in the aisles of the 700 or so stores it owned, and trained workers to handle shoppers and make stores more efficient. All the while, Best Buy’s aggressive expansion into China and Europe distracted management from maximizing profits at home.
Today, Best Buy’s shares are up more than three-fold from a nadir in early 2009 when the company was trying to diversify. The shares have more than doubled the value of Joly’s $12 million pay package, which might be difficult to replicate at the IMF.
Some shareholders have cheered Joly’s efforts at Best Buy, believing they drove Best Buy’s strong growth in the last quarter. But in the first three months of this year, the retailer struggled: sales fell 1.1 percent as the strong dollar took its toll and a now-infamous data breach forced people to shut off their credit cards and leave stores for weeks.
It won’t be the first big transformation Joly has conducted. He was lured from Philips to run Telefonica in 2006 to fix the Spanish telecom giant’s businesses overseas. He moved the company out of its global footprint by selling its Brazilian arm to America Movil. Once there, he focused on growing networks in Latin America as well as improving customer service and investing in broadband across the continent.
Telefonica posted 3.3 percent revenue growth in 2013 and profits of $14.6 billion. Telefonica’s European peers, like Telekom Austria (TELA), were trading at less than half of their $56.75 IPO price of 2001. Joly’s aggressive growth strategy unlocked the company’s upside.
Joly was also a senior executive at a leadership management company, setting up consultancy firms with organizations in 30 countries. In the middle of the dot-com bubble, he signed on as CEO of Vodafone France, the European market’s fourth-largest wireless company. He sold that position to Vodafone for $2.25 billion in 2001, and took up the role of chief operating officer of Vodafone Group, UK, the parent company of Vodafone France.
Those experiences should keep Joly motivated to find the next brilliant entrepreneur to learn from.