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April 7, 2010 5:54 PM

Business, Retail

The Big Q: Questrom Out at Wal-Mart

Being a corporate board member can be a great gig. It's prestigious and is a chance to exert your influence, put your experience to work and help a company grow. And considering how infrequently boards typically meet, maybe quarterly, it's...

Being a corporate board member can be a great gig. It's prestigious and is a chance to exert your influence, put your experience to work and help a company grow. And considering how infrequently boards typically meet, maybe quarterly, it's good compensation. Outside directors can get annual retainers, fees per meeting or stock grants, plus travel expenses.

But it's not always a cakewalk, as the case of Allen Questrom illustrates. When the former chief executive officer of J.C. Penney, Macy's, Barneys New York and Neiman Marcus joined the board of Wal-Mart in June 2007, there were great expectations. You had to figure the giant discounter and, in particular, its lackluster apparel department, would benefit from Questrom's track record overhauling store presentations and his ability to see the forest through the trees. He said he came to Wal-Mart because he wanted to learn more about the company. He also joined the board believing that one man could make a difference, and had no intention of being passive like so many other board members in corporate America can be.

Apparently, Questrom hit the brick wall known as the Bentonville bureaucracy. "He was fed up," said one source who initially disclosed Questrom would not seek reelection to the board this June at the annual meeting of Wal-Mart. "I don't think they used him. If I had Questrom on my team I would use him every day. I would have him running around the stores, working like a consultant. He would be Mr. Walton."

This week, Questrom confirmed he was vacating the board, but had mostly kind words for Wal-Mart, calling it "a wonderful organization." He did characterize the 15-member board as big, and suggested (in his own way) that, after three years of being a director, he had enough. "What I got out of the experience and what they got out of me in three years was probably the best of it," he said.

Still, the departure seemed abrupt. Something just didn't click. It will be interesting to see who Wal-Mart picks to fill the void on the board. Finding someone with a background in apparel retailing that rivals Questrom's poses a challenge. The $400 billion-plus company is innovative and ahead of the game when it comes to technology, operating at low costs, offering the lowest prices, overseas expansion and green initiatives. But it is also sometimes regarded as insular and in its vastness, lumbering on certain fronts.
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