2012 Power 50: No. 3 Steve Burd

Steve Burd is shifting his focus at Safeway.

After 20 years as chairman, president and chief executive officer of the Pleasanton, Calif.-based company, Burd gave up the title of president in April to Robert Edwards so he could devote more time to a variety of strategic initiatives.

It marks the first time Burd has turned over executive-level responsibility for the core food retail business to another individual, observers pointed out.

In announcing the change, Burd said the assumption of the day-to-day oversight of retail operations by Edwards “provides me an opportunity to concentrate more of my time on innovation and a range of strategic initiatives that will drive core and non-core business growth in the long term.”

Speaking to investors during an earnings call two weeks after the announcement, Burd said, “There are a lot of strategic things going on in the business — things I think I’m pretty good at and I really enjoy. This [change] gives me an opportunity to focus on some of those things that I think create some real value.

“Let’s also consider the fact that I’m 62, and while I’m not planning to go anywhere soon, it does make sense to create some logical succession opportunities for the company.”

Asked by an analyst if the change indicated Burd is thinking about retirement, he replied, “Well, you should be making the assumption that I’m a young 62 and that it’s not illogical to prepare for the fact that someday I won’t be CEO. The decision about who succeeds me as CEO is a board-level decision.

“But the more time Robert spends on retail and marketing, the less time I have to spend there and I can do other things to ensure that we have different ways to get [same-store sales] to 3%.”

Among the initiatives Burd will be involved with, analysts said, are Blackhawk, the chain’s gift-card business, and a consultancy business to help other companies reduce their insurance costs by promoting healthier lifestyles among employees.

John Heinbockel, an analyst at Guggenheim Securities, New York, said the change will enable Burd “to spend more time on the ‘bigger picture,’ both in the core and non-core business, which could well drive greater growth and shareholder value over the longer term.”

However, he doubted Burd would totally surrender responsibility for the stores to Edwards. “Given his hands-on approach, we find it hard to believe Burd will not be heavily involved in all major decisions,” Heinbockel said.