Greg Foran is a Kiwi boy made good overseas who is returning home. The North Island born Foran who became the CEO of Walmart US has just landed the top job at Air New Zealand after the current boss, Christopher Luxon, resigned in June.
It ends a four month search for a CEO and is something of a coup for Air New Zealand. Greg Foran will be taking a pay cut and be working in a much smaller corporate environment but he has said it was time he headed home.
He brings with him an impressive C.V. and is widely credited with turning Walmart’s US operations around. Two years ago, Walmart CEO Doug McMillon called Greg Foran “the greatest retailer on the planet.”
A retailer not an aviator
Mr Foran has no aviation industry experience. He learned the retail ropes working his way up at Woolworths in Australia. In 2011 he made an unsuccessful tilt for the CEO’s job at Woolworths after the incumbent resigned. Greg Foran lost out to rival Grant O’Brien who infamously took Woolworths on its ill-fated AUD$2.6 billion foray into big box hardware with Masters.
Mr Foran left Woolworths soon after, heading to Walmart where he learned the Walmart way of doing things at their China operations. For a time he was Walmart’s China CEO.
In 2014, he was tapped to become Walmart’s US CEO and moved to Arkansas. It was a problematic time for Walmart’s US stores. Its low cost strategy was under attack from new rivals such as Aldi. There was a lot at stake. Greg Foran found himself responsible for over one million employees, 4700 stores, and USD$452 billion in sales.
But the boy from New Zealand’s North Island turned Walmart’s embattled US operations around. Greg Foran cleaned up the stores, improved product availability, cut prices, and raised his employee’s wages. Consequently, sales improved and Mr Foran leaves Walmart after three straight years of quarterly increases.
Greg Foran faces some challenges at Air New Zealand
A big reputation comes with Greg Foran. He’ll need the capital that brings. Air New Zealand is viewed as a decent business within the wider aviation environment. But it is a business that like so many other airlines, is facing an increasingly tough market environment.
Air New Zealand has cut its profit guidance and growth forecasts for the next three years. It has instigated a wide ranging review of its operations and costs following a 31% slump in net profits (to NZD$270 million) in the 2018/19 financial year
If this is concerning Greg Foran, he is not letting it show.
“Customers are customers, whether they’re going into a restaurant, whether they’re going into a store, whether they’re catching a flight.”
Not everyone would agree with that assessment.
In his comments following the announcement of his appointment as Air New Zealand’s new CEO, Greg Foran appeared interested in making the airline a leader in sustainability. Whilst noting traditional aviation metrics were important, he said:
“We need to be taking some positive steps around us, and there are a number of things that fit into sustainability from carbon footprints drive by CO2 emissions to social responsibility around sustainability. I think it’s vitally important that we lead, not just in New Zealand but around the world, in terms of what we accomplish.”
The whole concept of sustainability within the aviation industry is very much in its infancy. It carries with it extra costs and the risks inherent in the early adoption of new strategies and methods. While admirable and probably cost effective in the long term, how this position will fit into the current need to cut costs at Air New Zealand remains to be seen.
Greg Foran is due to take the hot seat at Air New Zealand some time in the first quarter of 2020.
Categories: Air New Zealand