Best Buy Inc. : Managing Information Technology

Best Buy was assimilated in 1966 in Minnesota (“Best Buy,” 2016). The company is a leading provider of products, services, and solutions in technology (“Best Buy,” 2016). In addition to technological goods and services, Best Buy has agents known as the Geek Squad to assist customers with questions in

Best Buy’s History & Main Characters: Best Buy is Minneapolis-based and is North America's leading specialty retailer of consumer electronics, personal computers, entertainment software and appliances. Throughout Best Buy's 37-year history, the company has maintained the tradition of making life fun and easy for customers and employees, while providing a significant return to partners and investors. It has 80,000 employees and over 550 stores in the U.S., in addition to the brands Best Buy Canada, Future Shop and Magnolia Hi-Fi. Their leadership is led by Dick Schulze, Founder and Chairman, Brad Anderson, Vice Chairman and CEO, Al Lenzmeier, President and COO, and Darren Jackson, Executive Vice

Best Buy Co., Inc. is a multinational company in the United States and it deals, with consumer electronics, and accounts 19% of the business. The company also operates in Mexico, Puerto Rico, China, and Canada. Some of the subsidiaries of the company include CinemaNow, Geek Squad, Pacific Sales, and Magnolia Audio Video and operates in both Future Shop label, and Best Buy in Canada. Best Buy Co. Inc and its subsidiaries operate more than 1,150 stores internationally and domestically. The company also operates more than 100 “ZoomShops” or Buy Express Automated retail Stores, operated by the Zoom Systems, in both malls and airports in the entire country of the U.S. The company is headquartered in Richfield, Minnesota, U.S (Scott,

Best Buy is a company that has 40 years of history with a very accomplished sense of success. In 1966 Best Buy was a small electronics store in that originated in St. Paul Minnesota by Richard Schulze and an acquainted business partner. Considering that technology changes so rapidly, Best Buy has had to transform from just being the little electronics store down the way into a competitive, customer-driven, talent-powered company that emphasizes on pleasing the customers as it pertains to the life of technology. In 1993 Best Buy was recognized as the nation’s second largest electronics retailer and was recognized by

A man named Richard M. Schulze and his partner started Best Buy in 1966. The original store was called “Sound of Music” which was an electronics store that specialized in stereo systems. In 1967, Sound of Music purchased Bergo Company and Kencraft Hi-Fi and pulled in about $1 million in revenue. In 1969, Schulze took his partners half and decided to become a public company on the NASDAQ exchange. What started as a single store in Saint Paul, Minnesota became a chain of nine stores by 1978. In the 1980’s, Sound of Music was left with seven stores because of unfortunate accidents caused by a tornado. In 1983, Sound of Music was renamed to Best Buy Company. Along side changing the name of the company they also decided to expand on business by selling other at home appliances such as VCRs.

If we are in a recession or there are a lot of layoffs in the area of a certain store its business is directly affected. Unlike with some corporations such as CISCO systems or Ameritech they are in many way's utility services and aren't directly influenced by the state of the economy. Best Buy's CEO Dick Schulze admitted in an article that sales are down due to the current state of the economy: "We had expected earnings to decline in a decelerating economy," Best Buy chief executive Richard Schulze said in a statement. But, he added, "I remain confident that we are on track to deliver earnings growth of 16 to 18 percent this year," or $2.16 to $2.21 per share, assuming no significant decline in the economy. ‘ this seems to be the case with most retail chains but with the amount of expansion that Best Buy is working towards there is plenty of room to make up for losses.

Best Buy Co., Inc. is currently the world’s largest retailer for consumer electronics. The company has 1,400 brick and mortar stores and is a popular online retailer as well. The stores serve as display room for various online retailers. Best Buy consumers can purchase electronic products such as mobile, corded and cordless phones, televisions, cameras, personal computers, laptops, appliances and more (David & F.R., 2015). Today’s society relies on convenience and technology, forcing companies to implement new ideas and projects in an effort to maintain their ability to compete with other companies. For continued success the company must look at the internal and external issues the company may face as well as their competitors and their best practices that are contributing to their success.

In recent years, Best Buy Co., Inc. has stretched its grasp to the international retail technology industry. Acquisition of Canada’s largest existing consumer electronics retailer, Future Shop, spearheaded the international expansion in early 2001. This paved the path for the official launch of the Best Buy’s independent label, Redline Entertainment. Within the Canadian sector two separate superstores exist, Best Buy (Canada) and Future Shop, both of which target a broad costumer base. Understanding the recognition and loyalty amongst Canadian consumers, Best Buy has continued the use of the Future Shop named superstores. Since the acquisition of the Future Shop, Best Buy Co. has expanded the Future Shop locations to its status of 114 stores across Canada. In addition to Future Shop stores, Canadian Best Buy stores have continued to expand within the past three years; numbering 30 to date.

The retail industry as a whole is suffering with the onslaught of major player, Amazon. More specifically, brick and mortar stores are struggling to keep pace with the changing dynamic of today’s shopper. As consumers look to simplify their shopping experience by taking advantage of the ease of online shopping, the bulk of Target and Kohl’s business models are centered around brick and mortar stores. Target and Kohl’s both suffer from this declining way of doing business. Operational, Market & Economic Risks in a Global Setting

A continued weakness that Best Buy continues to face is their reliance on the brick and mortar store format. While Best Buy has started to offer business through its online website, most transactions rely on their physical stores. According the Star Tribune, “Best Buy, which has 1,360 stores in the United States, has been quietly closing a few dozen a year” “Target, Best Buy and even Amazon among retailers who see new power in stores, 2017”. Best Buy is working on reformatting how they utilize their physical stores in relation to their online store, but to achieve this it requires time and uses

In the operating level, the biggest objective of the Best Buy operating department is to expand its growth domestically and internationally and reduced its operating expenditures in-store. By 2012, the total number of stores in US is 1103, opened 7 and closed 3. In the same year, the total number of stores in Europe, Canada, China, and Mexico are 2393, 256, and 204, 8 respectively, opened 145, 31, 41, and 2 respectively, closed 109, 2, and 3 respectively (United States Securities and Exchange Commission, 2012). However, Best Buy operating department is not able to achieve its second objective until it implements a good strategy to reduce these expenditures.

If the centricity concept is being blamed for not meeting earnings and the decline in Best Buy’s stock price and market capitalization, the question becomes was there a need for this change to the company’s strategy, was the strategy poorly implemented, was there a delayed market response to the change, or was the launch an overly aggressive action of a newly appointed CEO? The Best Buy leadership team first needed to evaluate whether there truly was a need for a (drastic) change and if so, was centricity the appropriate response to the market.

Best Buy has been successful with their web presence; they have found another outlet for customers to purchase products from Best Buy.

It makes sense for Best Buy to worry more about Wal-Mart, which is getting more involved in electronics retailing, and less about Circuit City. The competitors are a diverse lot today, and for them to continue to grow they're going to have to get much better at everything they do and define themselves in clear ways. Best Buy's plan is to revamp its stores according to the types of customers they serve. A strategy previously mentioned, customer centricity, focuses on targeting five prototypical customers, all of whom have been given names: "Jill," a busy suburban mom; "Buzz," a focused, active younger male; "Ray," a family man who likes his technology practical; "BB4B" (short for Best Buy for Business), a small professional employer; and "Barry," an affluent professional male who's likely to drop tens of thousands of dollars on a home theater system. Their most current focus is on a "Jill" based store, the soccer mom who has money to spend but typically hasn't a clue of where or how to find products in the store. According to the data Best Buy has collected, Jill shops a few times a year, usually twice at an electronics store, but she usually spends a significant amount.

Furthermore, they offer to the customer the experience to buy in a physical store, compared with Amazon that is one of the strongest competitor, there’s no doubt that the internet, and the mobile web in particular, have changed the way people shop, but there is strong evidence that consumers continue to value the experience of