As it embarks on its corporate Restock initiative, The Kroger Co. is shaking up its executive ranks. Mike Donnelly is ascending to the role of EVP and COO Nov. 1 and Fred Morganthall, EVP of retail operations, will retire on Nov. 30.
The move elevates the company’s top merchant to oversee both operations and merchandising as the Cincinnati-based retailer executes its “Restock Kroger” initiative announced earlier this month. Donnelly is currently the retailer’s EVP of merchandising.
"Mike and his team will help us redefine the food and grocery experience for customers and drive sales," Rodney McMullen, Kroger’s CEO, said in a release. "By bringing merchandising and operations together under Mike's leadership, we will build synergies between our teams and accelerate our efforts to establish a truly seamless customer experience.”
The departure of Morganthall and the expansion of Donnelly’s role will leave three executives to drive the Restock program: Donnelly; chief financial officer Mike Schlotman; and Chris Hjelm, chief information officer.
The Restock initiative will devote $9 billion in the coming three years toward better pay and training for associates, improvements in store experience, online shopping expansion and technology, the company said. The moves come as Kroger’s performance had been curtailed following a similar multi-billion service-and price initiative at Wal-Mart Stores, as well as growth in the online channel and the expansion of hard-discounters like Aldi and Lidl resulting in additional share of industry sales.
Donnelly has served in his current role since 2015. He began his career at Kroger in 1978 at its Fry’s Food Stores division in Arizona. Donnelly was named VP of merchandising at Fry’s in 1995 and president of the division in 2000. He also previously served as president of the Ralphs division, and SVP of merchandising.
Morganthall came to Kroger as part of its transformative Harris Teeter acquisition in 2013. He was named senior vice president in June of 2015 and promoted to his current role that September. After the 2013 merger of Kroger and Harris Teeter, Mr. Morganthall was named Kroger's senior vice president in June 2015. He was promoted to his current role, executive vice president of retail operations, in September 2015.
Morganthall's professional life began at Procter & Gamble in 1973. His career in grocery retail began in 1978 at Spartan Stores in Grand Rapids, Mich., where he was responsible for grocery, frozen and dairy purchasing as well as general merchandise and beauty care. In 1986, he joined Harris Teeter as director of grocery merchandising. With Harris Teeter, Morganthall served in a number of executive management positions, including vice president of merchandising, vice president of distribution and vice president of operations before being named president in 1997. Under his leadership, Harris Teeter established its identity as a retailer that provides exceptional customer service and in-store experience.
"There are few people in our industry as widely respected as Fred," McMullen said. "He worked tirelessly to establish the Harris Teeter brand and, after our merger, to help position Kroger for future success. We've all benefited from Fred's passion for grocery retail and operational excellence. We are grateful for Fred's distinguished service and many contributions to Kroger and Harris Teeter, and we wish him and his family all the best."