7elven Case

7elven Case

  • Submitted By: kris69
  • Date Submitted: 06/16/2013 9:41 PM
  • Category: Business
  • Words: 9003
  • Page: 37
  • Views: 316

7Columbia Business School

The New 7-Eleven
I’ve got a great opportunity. I’m transforming a brand with 75 years of history. - Jim Keyes, CEO, 7-Eleven

Jim Keyes, the 4-year veteran CEO of 7-Eleven, is flying his Beechcraft A36 Bonanza. He is ascending to 10,000 feet, and despite the good weather he remains vigilantly focused on the instrument panel, and on the bright skies around him. “Flying is a great distraction,” he says. “You can’t think about anything else when you’re in the cockpit.” It is May 2004, and Keyes has a lot to think about. Since 2000, he has been leading a successful transformation of 7-Eleven, the global convenience store retailer with 5,784 stores operating across the United States and Canada and 19,501 international stores in 17 countries. (See Exhibit 1 for a biography of Keyes.) Focusing on what he calls “Retailer Initiative,” Keyes has overseen the transformation of the company’s distribution model, the steady redefinition of relationships with key suppliers, and the incorporation of technology and data-driven decisionmaking throughout the chain. Overall, he is pleased with the successes of his strategies. Earnings have been rising, up 15.6 percent during 2003.1 Same-store merchandise sales have increased for 29 consecutive quarters through the end of 2003.2 As a result, the company’s stock price grew from $9.14 in April 2002 to $16.91 two years later. (See Exhibits 2 to 5 for company financials and stock price history.) “We’ve had quite a rebirth of the company,” Keyes says, “but it’s been a slow, steady rebuilding of the company, basically reinventing ourselves.”3 Despite his many successes, Keyes continues to confront large challenges. He faces strong resistance from some of his largest suppliers to 7-Eleven’s evolving re-stocking and distribution systems. He also worries about people management issues: hiring and managing a workforce in the low-paid convenience store business; and working with franchisees to ensure...

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