Media reports are painting the ouster of Target CEO Gregg Steinhafel Monday as primarily the result of a massive data breach that shook customer confidence and hurt the retailer in the heart of the holiday shopping season (see his interview with CNBC about the breach, above).
But two sources with some insight into the board's decision told BringMeTheNews that the board's action was motivated by a number of factors – not just the data breach.
Few would argue Steinhafel had a difficult job in leading the retail giant through a recession in the last six years. But insiders say Steinhafel couldn't rack up enough "wins" during his tenure and has overseen several troubled initiatives that were the subject of public scrutiny.
For example, Target's first expansion outside of the U.S., into Canada, has been a high-profile struggle.
Also, a Target partnership with Neiman Marcus flopped. And in 2011, the store came under heavy fire for its handling of a limited-supply line with upscale Italian designer Missoni, which crashed the Target website and left many customers empty-handed and frustrated.
More broadly, the company also struggled to shift more of its focus to e-commerce, despite big investments in digital tools.
In the end, "now is the right time for new leadership at Target," the board said in a statement.
Steinhafel, in a written statement Monday said, “It has been an honor and a privilege to lead this great brand and work alongside what I believe is the best brand in retail."
As the board showed Steinhafel the door, it praised his leadership, and specifically his work in leading the company after the data breach. "He held himself personally accountable and pledged that Target would emerge a better company," the board said in its statement.
The board appointed Chief Financial Officer John Mulligan as interim president and CEO, and has launched a search for a permanent replacement for Steinhafel. The company has hired a recruitment firm to assist in the search for a new leader, and is considering candidates from outside the company, which would be a first, the Star Tribune reports.