Walmart’s Insider Advantage and Target’s Cautious Turn: A Split in Retail Leadership

Walmart’s approach to CEO succession has been commended for its decisive shift away from outgoing chief Doug McMillion, while Target’s handover to Michael Fiddelke has met with doubt, illustrating contrasting philosophies on leadership changes in the retail sector. The different paths taken by these two companies highlight ongoing discussions about promoting CEOs from within versus hiring externally, as well as the importance of organizational experience in overcoming industry obstacles.

Doug McMillion, who became

CEO in 2015, will leave his post in February 2026 and fully depart from the board by June 2027, . John Furner, his replacement, has been with Walmart for 30 years and most recently managed the U.S. operations, which generate $600 billion in yearly sales. Experts attribute Walmart’s readiness for AI-powered retail to Furner’s leadership, which has helped the company compete with Amazon on technology. “This was a well-planned and deliberate leadership change from a position of strength,” a Walmart representative stated, emphasizing the company’s strong leadership pipeline and reliable performance.

By contrast, Target’s selection of Michael Fiddelke, who currently serves as COO and previously as CFO, has prompted doubts. Brian Cornell, Target’s CEO since 2014, will stay on as executive chairman, a decision some believe maintains the leadership responsible for recent setbacks. Since the news broke, Target’s stock has dropped 15%, with detractors saying Fiddelke may not bring the new perspective needed to fix supply chain problems, lackluster product offerings, and customer service issues. “This may not solve the entrenched groupthink,” commented Neil Saunders of GlobalData.

The different results point to larger patterns in CEO handovers.

that CEOs promoted from within tend to outperform external hires, with insiders adapting more quickly and delivering better stock performance in their first year. “Internal candidates are often judged harshly because their history is well known, both successes and failures,” said Professor Jeffrey Sonnenfeld, who co-authored the study. The findings support Walmart’s choice, as Furner’s extensive company experience fits the research conclusions.

During McMillion’s leadership, Walmart’s stock climbed 300%, far outpacing Target’s 60% increase under Cornell. Walmart’s emphasis on artificial intelligence and online sales has strengthened its market position, while Target’s difficulties after the pandemic—such as inventory shortages and changing shopper habits—have shaken investor trust. Analysts like Oliver Chen of TD Cowen view Walmart’s leadership continuity as a positive: “We anticipate that Furner will maintain the current strategic direction,” he noted.

Investor responses to these leadership changes further illustrate the contrast. Walmart’s shares are trading close to their yearly highs, with investors praising its strong profit forecasts and effective pricing strategies. Target, on the other hand, is under pressure to present a clear recovery plan, as activist shareholders push for changes on the board. “Fiddelke brings fresh concepts to restore Target’s brand value,” said John Zolidis of Quo Vadis Capital, “but these need to be clearly communicated.”

The question of whether to promote CEOs from within or hire externally remains unsettled. While the Yale research challenges the idea that outsiders are always the solution, some experts warn that relying solely on insiders can lead to stagnation. Target’s experience has highlighted the potential pitfalls of extended internal transitions, especially when longstanding issues remain unresolved.