It’s been announced that George Sherman, current CEO of GameStop, will be stepping down from his position at the company at the end of July. He’ll be leaving the company entirely at this time as well.
An announcement from the company outlined its Chief Executive Officer Succession Plan. The plan explained Sherman’s plans for departure on July 31, 2021, but also highlighted that he could leave earlier if a successor is found before that date.
The statement doesn’t provide any details on the reasons behind Sherman’s departure. However, it does add that GameStop’s board of directors has been evaluating the executive leadership at the company. This has been done with a view to ensuring that the company has the correct business skills to meet the constantly changing requirements of the industry.
In addition, the Strategic Planning and Capital Allocation Committee, assembled by the board, is looking for new Chief Executive Officer candidates. The aim here is to help accelerate the company’s next step forward in the transformation that the board has implemented.
The transformation at GameStop appears to be more extensive than first thought. Initially, store closures were planned to help streamline the physical side of the business. Now though, it appears as though the company is shifting to an all-digital business model, selling products online and closing or revamping all physical locations.
GameStop’s board of directors saw a big reshuffle earlier this year. Members were removed, and new ones replaced them. Sherman’s leadership role was reduced, but he remains a part of the company for now.
All of this looks to be part of a larger plan to digitize the business further. For the past few years, GameStop has been struggling, and that could be down to the focus on the physical side of the business. The company can drastically reduce overheads by moving to an all-digital model, though it could cost sales in more remote areas.
While GameStop has seen some success with the launch of the PS5 and Xbox Series X/S, it’s still reporting losses. Change is required to bring the company back from the brink, and this shift to digital could be the only way to help it do that.