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Co-op CEO blames problems on previous management


Richard Pennycock, the CEO of the Co-operative group, claims bad management in the past has caused the problems the group has battled with over the past few years.

Richard Pennycock said to the BBC that he believes the Co-op has been let down by its former management, and that the organisation has gone through periods of “undermanagment” in the past. He has now claimed that recent changes to structure and governance should amend the situation.

Pennycock said that the Co-op needs to become “better at business” if it is to return to making profits. It has also been necessary for the bank to go through “painful” processes of selling parts of the business to get them into a better position. The groups revised business plan had it heavily concentrating on both the food and funeral side of its business, and they believe the quality of its convenience food market is good enough to rival Tesco. The Co-Operative group now owns only 20% of the Co-op bank.

The group faced a record £2.5 billion loss in 2014 that was mostly caused by the crisis in the groups banking business.

Richard Pennycock said:
"We let the co-operative movement down in a fairly significant way, after 150 proud years where the Co-op had a reputation for doing the right thing.
"Just applying good management disciplines and taking out costs can improve profitability.
"We can absolutely compete with the best."

Mr Pennycook was appointed as the Co-op's interim chief executive early last year before assuming the role permanently.

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