KMART NAMES NEW PRESIDENT

Byline: David Moin

NEW YORK — In a surprise realignment of top executives late Wednesday, Kmart Corp. named Mark S. Schwartz president and chief operating officer, succeeding Andy Giancamilli, who resigned.
Schwartz, a veteran retailer who knows the competition as well as anyone, has been with Kmart only since last September, just three months after Chuck Conaway was named chairman and chief executive officer of the Troy, Mich.-based discount chain. Schwartz joined as executive vice president over store operations and is credited by Kmart with leading efforts to raise customer satisfaction levels, including speeding checkouts. As president, he oversees store operations, merchandising, marketing, supply chain management and real estate, with Cecil Kearse, executive vice president of merchandising, reporting to him.
Before joining Kmart, Schwartz was president and chief executive officer of Big V Supermarkets Inc. Before that, he spent 16 years at Wal-Mart, holding the positions of president and director of supercenters in Mexico and senior vice president for supercenters overall. Kmart said he was an integral player in expanding Wal-Mart’s supercenter business to 400 in 1996 from 10 stores in 1989. Schwartz started his retailing career at age 16, becoming a store manager at age 22 for the former Woolco Department Stores.
In the short time he has been with Kmart, he established “operating non-negotiables” including a goal of having no more than three customers on a checkout line at a time, and making stores cleaner, Kmart said. Schwartz also led the initiative that eliminated more than 15,000 storage trailers and reduced excess inventory by $700 million.
Conaway said in a statement: “His leadership will help drive greater execution discipline throughout the business. Already under his leadership, we have seen improvement, from 40 to 55 percent, in our ‘super service index,’ the percentage of customers who rate their overall shopping experience as excellent. His supercenter experience is invaluable and will serve the company well as we look to increase our competition in our traditional and supercenter businesses.”
For the past decade, Kmart has been struggling to regain market share lost to retailers with reputations for better execution and merchandise systems, notably Wal-Mart, Target and Kohl’s.
Giancamilli was at one time reportedly a top candidate for the Kmart ceo post prior to the appointment of Conaway, who previously ran the CVS drugstore chain. A company spokeswoman said Giancamilli was not on contract.
“During Andy Giancamilli’s six years with Kmart, we improved our pharmacy operations and implemented our strategy to increase frequency with the right consumables and commodities product offerings,” Conaway said.
Kmart also said David P. Rots was promoted to executive vice president and chief administrative officer from executive vice president, human resources. In addition to his human resources responsibilities, Rots will oversee training, legal, communications, facilities and corporate governance functions. Rots joined Kmart in 2000 from Warner-Lambert, where he was vice president of human resources for Parke-Davis.
The $40 billion Kmart Corp. operates more than 2,100 stores.