With that in mind, I recently sat down with Joly at the Bloomberg’s CEO Summit, where a couple of major topics were discussed. Joly knows a thing or two about getting low hanging fruit out of the company.
1. Should big companies feel pressure to deliver as part of a turnaround?
In the wake of the Great Recession, a lot of corporations are under intense financial pressure and trying to grow faster. Not all companies, however, have the resources to take action so well. Joly notes that the recovery process from a recession will have an extended horizon, giving workers an opportunity to be realistic about their responsibilities and to accept that change is needed.
2. Despite the present challenges, what is it about the U.S. economy that lends itself to a turnaround?
When I visit the CEO of a U.S. company, I ask how they think U.S. companies are adapting to global changes. Most companies believe that their U.S. economic strength is self-evident, so it is easier to concentrate on change in their home market. It is clear, however, that the U.S. economy is in flux. A mistake companies make is to ignore the turmoil in the rest of the world. You are losing your ability to operate in a market place that is dominated by digital revolution. An important factor in the U.S. is the “commoditization” of certain commodities which has shifted jobs from the emerging markets to the developed economies. Because the products are easy to produce, and the labor at a lower cost, U.S. companies that deal in them are enjoying strong profitability, by definition.
3. How does the 2016 “Trump effect” impact business?
The world is behaving very differently as result of the election in the United States. It has consequences for policy. The Trump administration is more likely to move forward on cutting the top corporate tax rate. A company’s response to tax policy is a clear judgment on the President. The removal of federal business risk from the balance sheet would certainly support profits. For example, General Electric, a notable Trump supporter, has announced a re-org of its business organization based on a lower tax regime.
4. Is it possible for governments to address tax, regulatory and trade policy implications of global disruptions as quickly and effectively as business?
The answer is no. It takes a lot of hard work and constant engagement to create a strong working relationship with government and the policy-making community. I believe this is an important part of successful business. Customers, investors and employees, though, all deserve to be part of the policy-making process. When working with politicians and policy-makers, it’s important to engage in “public speaking.” Politicians like to hear what they can do for their constituents, in addition to what will be good for the economy as a whole. The last two years have been incredibly constructive on all fronts. The U.S. is not engaged in a global trade war but rather has opted for one of opening negotiations. I expect the Trump Administration will continue to tackle at least some of the world’s priorities, including energy, climate change and social and economic mobility for youth.
5. What do you like about DC?
Every time I go there, I recognize that it has moved into a better state. The market has come of age. It is a very sophisticated community, and we share much in common. The people are very engaged in society, and I wish every country was at this level of engagement. Some of the best ideas come from actually talking to politicians and policy-makers, and we are lucky that we have the platform to speak to governments and people across the world, daily.
My goal as the CEO of a large public company is to be responsible in solving a lot of global problems. With a company the size of Best Buy, it can be challenging, but so long as we are actively managing shareholder value, progress should be made toward solving some of the most vexing global issues.
Earlier this year, Best Buy announced it had returned to the black for the first time in six years. In the following year, Best Buy and founder Richard Schulze agreed to an agreement for Best Buy to acquire 41 percent of the company’s stock.