Inside This Issue - Opinion
Canning got things done — the right way
July 20th, 2009
by David Pinto
Fred Canning was almost certainly the most effective operating executive chain drug retailing has ever seen.
Canning, who passed away earlier this month at age 85, was president and chief operating officer at Walgreens during the drug chain’s halcyon years between 1978 and 1990.
In that 12-year period, Walgreens passed such rivals as Eckerd, Skaggs, Revco and Thrifty Drug of Los Angeles to emerge as America’s leading drug chain, a position it has continued to occupy for most
of the two decades since his departure.
Canning changed the Walgreen Co. in ways that virtually defy description. Before Canning became its president, Walgreens was a multichannel retailer, with a considerable presence in discount store retailing, restaurants and drug store franchising. Its retailing empire extended to Mexico, where it operated discount stores in partnership with a local retailer. Declaring that Walgreens’ business was operating drug stores, he removed the company from its ancillary interests and set it firmly on the path of opening drug stores, something his company mastered to a degree and with a precision and frequency unsurpassed in chain drug store retailing before or since.
Disdainful of acquisitions during a period when Walgreens’ major competitors each grew by buying up smaller drug chains (“You’re only buying someone else’s headaches,” he once famously said), he committed Walgreens to organic growth. Thus, in the years of his presidency, Canning set Walgreens on a growth orbit that had the drug chain opening as many as 500 new stores every year, a pattern that continued well into this decade and one that has the drug chain on the verge of operating 7,000 drug stores in 50 states, a milestone no competitor approaches.
At Walgreens, Canning developed the strongest top-management team chain drug retailing had ever seen. He brought Vern Brunner to the chain’s Deerfield, Ill., offices to run merchandising after scanning a list of potential merchants submitted to him and declaring, simply, that “the man I want isn’t on the list.”
He put Glen Kraiss in charge of operations and named John Brown to head distribution. Both are still spoken of with a respect that borders on reverence in the building on Wilmot Road that is Walgreens’ headquarters.
Canning could not have accomplished what he did had he not been enabled to do so by Cork Walgreen, the retailer’s chief executive, who picked Canning as president, then allowed him to run the company on a day-to-day basis, asking only that he not be surprised by anything his new appointee did. Canning honored that pledge, with the result that Walgreen and Canning became the most effective tandem chain drug retailing has seen.
In the end, Walgreens became as much Canning’s creation as it was Walgreen’s. Indeed, he dedicated every day of his working life to the drug chain he joined in 1946 as a stock clerk. He gained his pharmacy degree in 1955, the year he was promoted to store manager, then followed the traditional Walgreens path — district manager, regional director, marketing director, vice president of drug store operations, senior vice president — to the president’s office.
One time Sam Walton called Canning to ask him to join Wal-Mart’s board. Though it was a time when Walgreens and Wal-Mart were not yet direct competitors, Canning, though pleased and flattered to be asked, turned Walton down. Asked why, he said simply: “I work for Walgreens.”
And indeed he always had Walgreens’ interests at heart. Once, late for a flight, he asked Tom Steadman, the head of Walgreens’ extensive and efficient transportation system, to drive him to the airport. On the way, Steadman tentatively spoke up. “Mr. Canning,” he said (everyone always addressed Canning as Mister during business hours, though Vern Brunner always used his first name when the two traveled to the Orient together on business and once called him Freddie during a retirement dinner), “why don’t we buy an airplane?”
“That’s an interesting idea,” Canning responded, apparently intrigued. “How much does one of those things cost?”
When told, Canning said simply, “Tom, you just worry about getting me to the airport. I’ll worry about making my flight.”
That’s who Fred Canning was. With him, life and business were always simple. And there was only one way to get things done — the right way.
Of all his considerable strengths, perhaps his greatest was his ability to put the right person in the right job, then step aside and allow him to do it. He managed that feat even as he retired, suggesting that Cork Walgreen name Dan Jorndt as his replacement. It was a suggestion that Walgreen accepted. Under Jorndt, Walgreens didn’t skip a beat, maintaining and accelerating the programs Canning had put in place.
And Canning, convinced that Walgreens was in good hands, simply stepped aside, as so many executives try to do — and so few succeed in doing.
Fred Canning was one of the few — a legendary retailer who shaped a company and changed an industry.