To say the Co-op’s new group chief executive Steve Murrells has big shoes to fill would be the understatement of the retail year.
The incumbent in that role, Richard Pennycook, is credited with saving the mutual from the brink of collapse, ushering in a radically reformed governance structure and returning the business to growth.
It’s fair to say Murrells has a mighty tough act to follow when he officially takes the step up from boss of the Co-op’s food business on March 1. It also looks likely fhe will oversee a sale of the Co-op Bank.
But some of the headlines that seemingly called into question the future of the Co-op in a post-Pennycook era felt hugely hyperbolic and almost disrespectful to his successor.
There is no doubting Murrells’ pedigree and suitability for the position.
Having served in Sainsbury’s buying and trading teams, his first chief executive role came at Tesco in 2004, when he led the One Stop convenience business, before becoming the supermarket giant’s commercial director for fresh food.
He briefly left the grocery world behind during an 18-month stint as chief operating officer of Dobbies Garden Centres and departed the Tesco group in September 2009 to take the top job at Danish meat company Tulip.
Murrells joined the Co-op in July 2012 as chief executive of its retail division and has spearheaded the ‘True North’ strategy to revitalise its food business, focusing on convenience, reinventing its own brand proposition and re-launching its membership scheme.
But for Murrells, there is plenty more opportunity for growth across the group as the Co-op prepares to move from the ‘rebuild’ phase of its plan into ‘renewal’.
“I’m coming at it at one of our most exciting times in terms of the recovery story and the re-birth of the Co-op,” Murrells tells Retail Week.
“As we move into the stage of ‘renew’, it became clear that the board wanted someone to plan ‘renewal’ and be here for that renew period.
“I’m excited about the opportunity to take that forward, with lots of ideas of how we can continue to be successful.”
“One of the important components of ‘renew’ is thinking where else should the Co-op take its way of working? Where else can we demonstrate a different way of doing business?”
Steve Murrells, the Co-op
Murrells sums up his confidence in the Co-op’s direction of travel, hinting that his renewal plan could lead the Co-op to enter new sectors to open up fresh revenue streams.
“One of the exciting things about the Co-op is its breadth,” he says. “It is still a very unique business in funerals, food, general insurance and legal.
“All of those businesses have their own strategies and their own plans, and they will all feature in what renewal looks like.
“But if you take our purpose of championing a different way of doing business, one of the important components of ‘renew’ is thinking where else should the Co-op take its way of working? Where else can we demonstrate a different way of doing business?
“We won’t be constrained by the future opportunities within food or funerals, it’s got to go wider and complement what we are doing in our core businesses.”
Murrells has already made one significant appointment in that drive, handing a “blank sheet of paper” to Co-op group director of renewal Rod Bulmer to set out the creative side of the improvement plan for the food business.
“I want him to have a real creative playing field to come back with the type of opportunities that we’ve seen flow through during ‘rebuild’,” Murrells says.
“I have some views myself, I am going to spend a period of time listening and talking to the board around their hopes and aspirations for the future.
“But a couple of words – ‘together’ and ‘us’ – give you a sense for what I hope will be embedded into our approach going forward.”
Despite the Co-op being on the front foot, Murrells is under no illusions that delivering that vision could be tougher than ever in a constantly evolving market.
“We are getting things right now. We just need to keep building on our uniqueness. If we do that well, the nation will come to us.”
Steve Murrells, the Co-op
Tesco is acquiring food wholesaler Booker, Sainsbury’s is leveraging Argos’ general merchandise business and fulfilment expertise, while Morrisons is playing on its vertically integrated model to supply fresh, frozen and ambient products to etail titan Amazon.
But Murrells is confident in the Co-op’s future prospects across all of its businesses, providing it can build on the values that defined its recovery.
“I think the recipe of success in persuading more customers and, in our world members, to come and shop with you is the same as it has been,” Murrells insists.
“You’ve got to make the shopping trip enjoyable, you’ve got to make sure people see the value in what you’re offering and you’ve got to go about your business in a way that they want to be associated with.
“As we’ve found in the last two years of Co-op Food’s recovery, we are getting things right now. We just need to keep building on our uniqueness.
“If we do that well, the nation will come to us.”