The yoga retailer announced today that TOMS president Laurent Potdevin will become chief in January, and founder Chip Wilson will step down from his role as chairman in the Spring
After a months-long search, athletic apparel-maker Lululemon named TOMS President Laurent Potdevin as outgoing CEO Christine Day’s replacement, taking over in January. In a surprise move, the company also said founder and non-executive chairman Chip Wilson will resign from his role in June 2014. Michael Casey — a former Starbucks exec who’s been on Lululemon’s board since 2007 and was a member of the CEO search committee — will become non-executive chair.
The management change had been anticipated for months, and Fortune reported late yesterday that a CEO announcement was imminent.
This year the Vancouver-based retailer struggled through several very public product recalls that seemed to point to profound management issues, which Fortune detailed in August. Day, who left Starbucks to join Lululemon in 2008, announced her resignation in June — just three months after a large batch of the company’s signature Luon pants were yanked from shelves due to sheerness issues. She promised investors she’d stay at the company until it found her replacement, but she hinted that her patience was wearing thin in the Q2 earnings call. “If I could get an end date, I’d be happier to answer that question,” she quipped when an analyst asked about her future plans.
Day and Wilson butted heads, a tension made obvious during Fortune’s stay at Lululemon’s headquarters this summer. Day professionalized the company, scaling the brand and building an infrastructure that could support its fast growth. “Chip planted some amazing seeds, but some weeds were starting to grow,” she said about her early days at Lululemon.
Wilson had a different take, believing the seeds he planted just needed a little TLC. “[Day] did exactly what we asked her to do, and that was to replicate a perfectly set up organization that just needed basically the knowledge of how Starbucks replicated what they did.”
The disconnect between Lululemon’s founder and its CEO was felt by employees, and they were often confused over who they should take orders from. Though Day manned the helm, Wilson would zoom in (especially after the March Luon recall) and out, creating havoc in his wake. The company vehemently denies Day was fired, making it a safe assumption that Wilson was a large reason behind her personal decision to leave Lululemon.
Lululemon’s replacement of Wilson was a necessary and smart move. Though his product genius laid the groundwork for Lululemon’s cult-like appeal, he suffers from a severe case of foot-in-mouth disease, and his confidence often comes across as arrogance. Just last month on Bloomberg TV, Wilson commented that “some women’s bodies just actually don’t work” for Lululemon. His words sparked outrage from curvier fans of the brand, isolating a hugely important sect of its customers and creating yet another PR nightmare. The pants’ sheerness now much less of a problem (Lululemon launched Full-On Luon in July, a new generation of pants that took two years to develop), it seemed that Wilson was the brand’s biggest challenge.
Career-wise, Potdevin and Casey share many interesting similarities with Wilson and Day. Potdevin has been president of TOMS, the shoemaker with a do-good social mission, since May 2011 — but before that, he was President and CEO of Burton Snowboard from 2005-2010.
Wilson got his start with Westbeach, a surf, skate, and snowboard company he sold just before founding Lululemon in 1998. Wilson’s obsession with highly technical yet functional fitness apparel stems from his years outfitting those high-performance athletes. Casey was a longtime Starbucks exec, most recently serving as executive vice president, CFO, and chief administrative officer from 1997-2007. (He then retired but remained a senior advisor.)
Day left the coffee giant to become Lululemon’s CEO almost six years ago, and Wilson is one of Starbucks’ biggest fans. Just before starting Lululemon, he listened to Starbucks’ CEO Howard Schultz’s book Pour Your Heart Into It during long car rides. In his book, Wilson claims he was so inspired that he began “seriously contemplating starting the next act of my life as a Starbucks barista.”
Lululemon’s management shuffles, not its business strategy, are analysts’ and investors’ main worry — and Potdevin and Casey seem like two guys who will successfully execute the vision Day’s been building during her tenure without dramatically altering the brand so many workout enthusiasts have come to love.