On Thursday, shares of department store giant Macy’s Inc. (M Quick QuoteM - Free Report) are rallying, up almost 5% in morning trading after the company announced that Chief Executive Terry Lundgren will step down from his position next year. Lundgren has held the CEO role since 2003.

Macy’s President Jeff Gennette will assume the role of CEO, which is a move that the company said was part of its succession plan. Mr. Lundgren will remain as chairman.

The department store bellwether has struggled in recent years to adapt to changing consumer demand and shopping style. In May, Macy’s posted terrible quarterly results—its worst since the recession—igniting new worries about the U.S. retail industry as a whole.

“While our company is larger, stronger, and more resourceful than we were 13 years ago, now is the time to reset our business model to thrive in a future that is being driven by rapid evolution in consumer preferences and shopping habits,” Mr. Lundgren said in a statement.

Under the helm of Mr. Lundgren, Macy’s doubled its annual sales to roughly $28 billion, and became a household name after acquiring chief rival May Department Stores Co. in 2005. The company now operates 870 stores under its namesake brand as well as Bloomingdale’s.

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