Tesco CIO becomes chief executive

Philip Clarke, group IT director at Tesco, is set to become the new chief executive after Sir Terry Leahy announced he will step down from the post.

Clarke is expected to see a boost in his salary in the new position, as Tesco's 2010 annual report showed Leahy's earnings at £5.22 million, compared with Clarke's current pay of £2.701 million.

Over the last decade Clarke has overseen a number of large IT changes at the supermarket chain, including introducing systems to improve sales, the supply chain and efficiency across the company. Tesco has an in-house designed supply chain application, running on IBM system p servers based on Unix.

One area in which Tesco has made extensive efforts over the past year is in stock management. The supermarket said it had implemented more efficient ordering systems and introduced better in-store monitoring processes, which helped to increase availability of food in stores and reduce warehouse stock.

In addition, Tesco has invested heavily in self-service checkouts, which now account for a quarter of all its transactions. And the company grew online profits by over a quarter last year to £136 million, as it launched websites selling clothes and DVDs.

Earlier this year, it launched an app for the iPhone which allows customers to store their Clubcard, the Tesco loyalty card, on their phone and swipe it at the till instead of the card.

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Over the years, with the work of former chief information officer Colin Cobain, the supermarket also launched the innovative “Tesco in a box” suite of operating systems, rolled out in new stores around in the world including the US launch in 2007.

Tesco has not faced many negative stories around its IT systems. But in May last year, a “routine IT upgrade” stopped tills from working at 100 stores, as Tesco launched a major loyalty scheme promotion in national newspapers to its millions of Clubcard holders.

Leahy, who is stepping down after 14 years aggressively expanding the supermarket chain, said Clarke has “all the necessary talent, energy and experience” to do the job.

Clarke will take the new post from March next year.