LONDON (Reuters) - Walmart’s (WMT.N) British supermarket arm Asda has promoted head of operations Roger Burnley to become CEO, replacing Sean Clarke after just 18 months and tasking him with building on the firm’s nascent recovery in the face of brutal competition. U.S. group Walmart, the world’s largest retailer, said on Monday that Burnley, a 51 year old Yorkshireman, would succeed Sean Clarke as Asda president and chief executive on Jan. 1. Burnley is currently chief operating officer and deputy CEO.
Analysts had expected Burnley to succeed Clarke as Walmart had identified him as “a future CEO” when he re-joined Asda last year. However, some were surprised by the speed of his elevation to the top job.
“A good deal earlier than we thought ... but not a surprise that Roger is the man,” said Shore Capital analyst Clive Black.
Of Britain’s big four supermarket players - market leader Tesco (TSCO.L), Sainsbury’s (SBRY.L), Asda and Morrisons (MRW.L) - Asda has been hurt the most by the rise of German discounters Aldi [ALDIEI.UL] and Lidl [LIDUK.UL], as its traditional price advantage has been eroded.
Walmart has said Asda was too slow in responding to that competition and brought in Clarke to speed up change. In August, Asda reported its first quarter of underlying sales growth in three years and said the back-to-basics turnaround plan devised by Clarke and Burnley was working.
They have re-established Asda’s price competitiveness in key areas such as fresh meat and vegetables, have improved the quality and availability of product ranges and have made its stores more attractive to shoppers.
“Turning what seems to be tentative stabilisation into a genuine recovery and actually regain some of the ground they’ve lost over the last few years is going to be a big challenge,” said Bryan Roberts, global insights director at TCC Global.
He said Burnley was likely to evolve Asda’s strategy. “Longer term they need to work out what they are going to stand for in the market - is it around fun, is it around service, is it around being a family destination?”
Black expects productivity, cash conservation, improved marketing, staff engagement, store merchandising and product ranging to be the key areas of focus for Burnley’s regime.
Burnley, a former Sainsbury’s executive, re-joined Asda in October 2016, three months after Clarke moved from Walmart China to lead the UK business.
Asda said it was always intended that Clarke, a 21-year Walmart troubleshooter who has also worked in Japan and Canada, would step aside after around 18 months in the top job.
“Roger was purposefully brought back to Asda to partner with Sean ahead of the transition to Roger taking up the position of CEO,” said Dave Cheesewright, CEO of Walmart International.
“He and Sean have worked as a great team and I’m really confident in Roger’s ability to continue building upon our returning momentum,” he said.
Clarke will steer Asda through the key Christmas period before stepping down. After taking some time out he will remain with Walmart serving as an advisor.
Burnley, who first worked for Asda between 1996 and 2002, said the business was starting to realise its potential again.
“Sean’s focus on serving customers and simplifying the business has established a firm foundation on which we can build,” he said.
Editing by Mark Potter, Greg Mahlich