Morrisons’ CEO search could cause strain at the top
So the clouds of mist are lifting in Bradford as Dalton Philips exits stage left with his misting machines and finance director Trevor Strain becomes the interim principal boy at Morrisons.
However, quite plainly it’s chairman Andrew Higginson who is calling the shots.
Personalities aside, once a departure such as Philips’ is announced that incumbent becomes the proverbial lame duck and toothless tiger. Often, as in this case, it is better for the business to appoint an interim rather than stick with the incumbent.
The advantage of appointing Strain as interim boss was articulated by The Guardian, which said: “Higginson knows what he wants to do and needs a guy to execute that.”
Strain not only knows Morrisons, but has previously worked for Higginson and can be trusted to implement his chairman’s plans. However, having such a force of nature as a chairman may not sit so well with any incoming chief executive unless they too are a former colleague from Tesco and a known entity to Higginson.
In this case, with Strain’s appointment ahead of the permanent hire, he will be given a clear brief by Higginson on the long-term strategy that Morrisons will need to take, and so can begin the journey while they wait for the new boss to join.
It also gives Higginson an alternative option should Morrisons not be able to find the ‘right’ person externally. Strain is the only internal candidate and this will give him a chance to prove what he can do and give Higginson a good look at him in action.
Effectively it’s a ‘try before you buy’ scenario. On the surface it’s a no-lose situation for Morrisons, or is it? Strain has been acknowledged as the only internal candidate, although it was also stated it was too early for him and an external hire would be preferred.
Making him interim chief executive will give him a taste of the top role and he may not be content to going back to being an understudy if an external candidate is appointed.
Morrisons, incidentally, has a track record of this when Richard Pennycook, then the group’s financial director, laid the groundwork for the turnaround plan that Marc Bolland inherited and ran with when he was subsequently appointed chief executive in September 2006. On Bolland’s departure Pennycook was famously overlooked and Philips given the top job – exit stage left Pennycook after a suitably gracious period allowing to settle in.
Pennycook has recently been in a similar position as the Co-op where he was appointed group finance director, subsequently becoming interim boss on Euan Sutherland’s departure last year. Subsequently the Co-op board showed better judgement than Morrisons in appointing Pennycook as group chief executive in September.
Jamie Zuppinger is co-founder and joint managing director of Barracuda Search
Retail Week, 20 February 2015