At Morrisons’ Q1 results in May chief executive Dalton Philips described as “baloney” any suggestion that there were any issues with Morrisons senior team.
He said the feedback Morrisons received from headhunters was that it had “assembled a very fine team”. “We have more stability than any other retailer,” he added.
Despite the recent departure of marketing director Richard Lancaster and the retirement of HR chief Norman Pickavance, it was hard to argue with Philips at the time. This was based on the fact that alongside Philips he had two more than capable lieutenants in the guise of two other Richards - Messrs Hodgson and Pennycook.
With the news today that group finance director Pennycook is to quit the business in less than a year’s time, questions regarding Morrisons’ top table are sure to resurface - especially in light of the retailer’s recent sales slowdown and criticism from Sir Ken Morrison over the current board’s strategy.
Pennycook will stay on to facilitate a smooth transition but there is no doubt that he leaves big shoes to fill. Far more than just a bean-counter, Pennycook has played a major role in the retailer’s transition from a regional supermarket chain to a modern, multi-channel retailer capable of competing nationally with Tesco, Sainsbury’s and Asda. He played as key a role as anyone in getting Morrisons back on track in the wake of the problems it had integrating Safeway.
He has been mentioned in dispatches as CEO material - not just at Morrisons, and not only in retail. Given his statement today that he wished to broaden his career portfolio, it seems likely he’s been mulling over a move away for some time.
Given the buzz around Pennycook, Philips will probably argue that he did well to hold on to him for so long. By the time he steps down next year he will have spent eight years in Bradford.
Morrisons’ shares fell 2% this morning following the news - a testament to the regard with which he is held in the City, where he is seen as a very safe pair of hands.
At a time when Morrisons is juggling a potential move into online grocery, an own label overhaul, a convenience push, a new fresh format and a drive into the south - all while trying to maintain or grow market share in the toughest trading climate in recent memory - Morrisons needs as many of those characters as it can get.