published Jan 16, 2018, 3:57:24 PM, by Matthew Boyle
(Bloomberg) —
Wal-Mart Stores Inc. will tap Judith McKenna to run its international unit, elevating one of its highest-ranking female executives to a critical role, according to people familiar with the matter.

McKenna, currently chief operating officer of the retailer’s domestic operations, will succeed David Cheesewright on Feb. 1, said the people, who asked not to be identified because the move hasn’t been announced. Cheesewright, 55, has held the job for the past four years.

Running the international unit has served as a stepping stone to the top job: Chief Executive Officer Doug McMillon and his predecessor Mike Duke both once held the role. And it’s seen as a key testing ground for Wal-Mart, which generates about a quarter of sales from its roughly 6,300 stores outside the U.S., spanning from Canada to South Africa and Japan.

Wal-Mart, based in Bentonville, Arkansas, declined to comment.

The job shuffle isn’t the first shake-up at Wal-Mart this month, a time of year when the retailer often makes big moves. The company announced plans last week to boost its starting salary to $11 an hour, on the same day that it moved to close 63 Sam’s Club locations. It’s also removing about 3,500 co-managers from its stores and adding other roles that focus on growth areas like e-commerce. Other changes could be coming as the company cuts costs and looks to spend a tax-cut windfall of about $2 billion.

Growth Slowdown

Wal-Mart’s overseas business isn’t the growth engine that it once was. The world’s largest retailer has grappled with economic slowdowns in Brazil and the encroachment of discount retailers in the U.K., where Cheesewright began his Wal-Mart career in 1999. But one bright spot of late is China, where Wal-Mart just reported its fastest sales growth in four years, fueled by the company’s investment in online retailer JD.com.

Succession Race

McKenna’s promotion puts her among the possible contenders to eventually succeed McMillon, 51, who has run Wal-Mart since 2014. Others in the running include e-commerce chief Marc Lore and John Furner, who heads up the company’s Sam’s Club chain. Greg Foran, CEO of Wal-Mart’s U.S. operations, is also among the retailer’s top executives but is older than McMillon.

Like Cheesewright, McKenna is a Briton and veteran of Wal-Mart’s Asda subsidiary in the U.K., where she served as both COO and finance chief. While there, the 51-year-old helped the chain increase its online sales amid fierce competition from Tesco Plc, J Sainsbury Plc, and German discounters Aldi and Lidl.

In 2014, she moved to headquarters to run strategy and development for the international unit, and a year later assumed her current U.S. role.

McKenna, who’s been named to Fortune Magazine’s list of Most Powerful Women for the past three years, was instrumental in bringing some of Asda’s successful innovations to the U.S. stores. One is the so-called “topstock” system, where excess inventory gets stored above shelves rather than in a back room, reducing the number of out-of-stock items.

McKenna, whose parents were both schoolteachers, also played a key role in helping improve the training of store employees and managers.

To contact the reporter on this story: Matthew Boyle in New York at mboyle20@bloomberg.net To contact the editors responsible for this story: Caroline Salas Gage at csalas1@bloomberg.net Nick Turner, Jonathan Roeder
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