Grainger Chief Leaving Post
Ryan to CEO; Keyser to stay as chairman
W.W. Grainger Inc. said Monday that 65-year-old Richard Keyser will step down as chief executive of the Lake Forest-based company on June 1, and President James Ryan will add the CEO title.
Keyser, who is concluding a 13-year tenure in the top job, will remain Grainger's chairman. Ryan, a 27-year veteran at the company and a director since last year, will become the fourth CEO in the 80-year history of the distributor of maintenance products.
The management handoff, Grainger said, reflects the company's "planned succession process."
Ryan, who joined the company in 1980, has a master's degree in business administration from Chicago's DePaul University. He was named president in 2006 and added the title of chief operating officer in February 2007.
In an interview, Ryan said he sees little need to alter the company's "solid" strategy. Keyser, he said, "has really positioned this company well," and, as a result, his efforts upon taking the reins likely will be focused on "accelerating our growth."
Grainger distributes a broad variety of maintenance, repair and operations supplies to facilities managers. It stocks more than 100,000 items, ranging from janitorial supplies and light bulbs to electric motors, which it delivers through a network of distribution centers and localized stores.
As businesses seek to bolster profit margins by squeezing out inefficiencies, Ryan said, a growing number are deciding to rely on an outside distributor rather than maintaining such supplies in-house.
Grainger, although it has the leading market share in the so-called MRO market, holds a less than 10 percent share of the fragmented marketplace.
In big, mature markets like the U.S. and Canada, Ryan said, most of the gains Grainger achieves going forward will come from claiming market share from rivals. To that end, he said, the company has dramatically strengthened its sales force and increased its focus on customer service.
At the same time, he said, there are "great opportunities for growth outside the U.S.," particularly in Mexico, where Grainger recently has been growing at a rate of more than 20 percent yearly. And in another bid to follow growth offshore, Grainger opened its first facility in China 18 months ago.
Grainger's reputation came under a cloud in late January, when the Justice Department joined a civil whistle-blower case in which a former employee alleged the company had been repeatedly overcharging the federal government. Grainger has said it believes it "has complied with the [government] contract in all material respects," but said in a regulatory filing recently that officials are "unable, at this time, to predict the outcome of the matter."
"We've just started our dialogue with the Department of Justice," Ryan said Monday, at the conclusion of his upbeat review of Grainger's prospects. "These things take a lot of time."
This story, which was written by James P. Miller (firstname.lastname@example.org), appeared in the April 1, 2008 issue of the Chicago Tribune (www.chicagotribune.com).