Woolworths Ltd (ASX: WOW) has nominated its former shelf stacker and account executive to replace CEO and Managing Director Michael Luscombe on September 30, 2011.

Mr Luscombe headed the retail chain through years of double-digit earnings growth but has lately faced intense competition from Wesfarmers-owned Coles, leading to price discounting and losses on milk and other items.

Paul Xiradis, chief executive of fund manager Ausbil Dexia said "Coles has been far more competitive, and how Woolworths has reacted to that has perhaps not been at their best."

Effective today, Grant O’Brien, 49, leaves his post as Chief Operating Officer Australian Food and Petrol becomes Deputy Chief Executive Officer and CEO designate. He will join the Board as an Executive Director and will work closely with Michael Luscombe until his formal commencement date on October 1, which will be the fifth anniversary of Mr Luscombe’s appointment as CEO.

It has been a long way to the top for Mr O'Brien. He once worked as a night filler stacking shelves at supermarkets in Tasmania. Mr O’Brien has broad experience working across diverse areas of the business, with 24 years of service.

Woolworths said “Throughout his career he has repeatedly conceived and delivered highly innovative, customer-focused growth strategies that have made a significant contribution to the company. From the creation of Australia’s first supermarket loyalty scheme to the development of the company’s liquor strategy and new Home Improvement venture, Mr O’Brien has been instrumental to Woolworths’ performance and future direction.”

Chairman James Strong said: “We congratulate Grant on his appointment. He will be a highly capable successor to Michael and is extremely well regarded at all levels of the company, and known for his tremendous energy and determination. His depth and diversity of experience and strong strategic acumen has given him solid grounding to lead Woolworths into its next phase of growth.”

Mr Strong added: “It is especially pleasing to appoint our 12th CEO from within the ranks of the company. Woolworths’ ability to consistently develop its own talent has long been a defining characteristic of the company. The Board looks forward to working closely with Grant to continue delivering solid, sustainable results over the long term for our customers, communities, suppliers, investors and employees.”