Morrisons has announced David Potts as its chief executive – will the former Tesco Asia boss be able to turn the struggling grocer around?
Speculation proved to be on the money as this week brought the coronation of David Potts as Morrisons’ new chief executive.
His appointment means that with the exception of Asda, there has been leadership change at the top of every one of the biggest grocers over the past year or so – change stimulated by dramatic industry shifts as discounters Aldi and Lidl have grown to account for about 10% of the market.
The scale of food retail transformation has prompted some to ask whether Potts – seen as ‘old school’ by some – is the right person to steer Morrisons to recovery.
His arrival reunites him with former Tesco colleague Andy Higginson.
While the finger of blame for Tesco’s travails has not been pointed at either, the grocer’s fall from grace shows that Tesco experience on its own does not guarantee a Midas retail touch.
But equally, despite what’s happened, Tesco was the outstanding retail success story of recent decades. It led, others followed. And Potts played a central role.
At the height of his powers, Sir Terry Leahy used to say that people could have all the good ideas in the world, but they were all but worthless unless backed up by executional excellence.
That may be one crucial difference that Potts can make at Morrisons.
The grocer has some strengths it can play to.
It has moved on price, potentially rekindling its reputation for value, and could make more of historic strengths such as its fresh food and advantages that come from its vertically integrated supply chain.
Yes, Morrisons has felt the heat as Aldi and Lidl have grown. But enhanced operational verve and laser-like customer focus – characteristics Tesco in its heyday epitomised – could allow it to return to form if the prices are right.
It is unclear how exactly Potts has spent his time since leaving Tesco in 2011. Morrisons’ statement read: “Since then, he has acted as a retail expert to several international advisory and private equity businesses.”
Now he is no longer an adviser, but back in the fray.
Needless to say, that’s quite a different thing. Morrisons’ future success rests on the decisions he and Higginson make in a food retail market that has changed almost beyond recognition since Potts last held an executive role.
But lessons picked up from overseas experience, a career that – like so many retail greats – started on the shopfloor, and intimate knowledge of supply chains could prove invaluable as Potts bids to put Morrisons back on track.
The hope must be that Morrisons’ combative founder, Sir Ken, can resist the temptation to meddle and allow the new team to get on with the job and ride out the turbulence.
A seasoned retailer such as Potts should have Sir Ken’s blessing – to begin with at least.
Potts’ challenge will be to adapt the evergreen disciplines that are the traditional basis of successful retail to the particular challenges of now.
- Chris Brook-Carter, Editor-in-chief
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Comment: Morrisons’ David Potts must combine best of old school and the new