Carl Liebert, president and CEO of 24 Hour Fitness, San Ramon, CA, announced a dozen layoffs and other moves within the corporate office today in a major organizational shakeup.
In memos to 24 Hour employees obtained by Club Industry, Liebert wrote that the changes are "intended to improve the effectiveness of the organization and increase the focus on supporting our members and guests."
The employees laid off by 24 Hour were Dan Benning, senior vice president of club operations; Jim McPhail, chief development officer; Mark Foley, chief people officer (human resources); Art Morris, vice president of benefits and wellness; Dick Colbert, vice president of taxation; Ingrid Owen, vice president of group fitness; Steve Datte, vice president of youth performance; Allison Lewin, vice president of marketing; Sidney Griffin, vice president of community marketing; Harry Reo, vice president of membership sales; Wendy Yellin, vice president of communications; and Damion Clanton, regional vice president in charge of clubs in Oregon, Washington state, Hawaii and Las Vegas.
Although it was not announced in the memos obtained by Club Industry, Randy Drake, senior vice president of fitness and business development, also has left the company. Drake told Club Industry that he resigned this week and that today was his last day as a 24 Hour employee.
On Twitter, Owen wrote yesterday that a "19 year journey comes to an end." Today, she wrote, "I'm unemployed. Trying to get my arms around that."
McPhail was among several executives promoted by 24 Hour last year.
Along with the restructuring, Liebert wrote that 24 Hour has transitioned its span of control from seven to five regions of clubs.
Included in some of the restructuring moves announced by Liebert, Patrick Naaman, most recently the chief information officer (CIO), will replace Benning as senior vice president of club operations. Tim Segneri, vice president of applications management, will serve as the interim CIO. Fenn Hall, vice president of design, construction and facilities, will serve as the interim chief development officer.
A source told Club Industry today that the moves made by 24 Hour reflect a consolidation trend in the industry.
"24 Hour is finding themselves stuck in the middle of the market," the source says.
Late last year, Forstmann Little, the New York-based private equity firm and parent company of 24 Hour, withdrew the company from a private sale process that was initiated earlier in 2012. Forstmann Little said that moving to a final sale under the market conditions at the time "was not in the best interests of the shareholders."