Myer's chief executive Richard Umbers has been forced to resign but the board is sticking with his turnaround strategy.
The troubled department store's chairman Garry Hounsell has been appointed executive chairman while a search for a new CEO takes place.
Investors appeared to welcome Mr Umbers' exit with Myer's shares up 5.6 per cent at 56.5 cents by 1306 AEDT.
Mr Hounsell said the board had asked Mr Umbers, who was parachuted into the job three years ago, to step down after the company on Friday flagged a significant fall in first-half profit and warned of an impairment.
"We had discussions with Richard immediately after the half-year announcement and it was a mutual agreement that he should step down," Mr Umbers said.
He said Mr Umbers' resignation was in shareholders' best interest, but he believed the turnaround strategy - dubbed New Myer and which includes a clearance floor - was the right strategy.
"The strategy is not under review ... I think it is all about execution of strategy and that is what I will be looking at very clearly," Mr Hounsell said.
He said the group's financial situation needed an urgent turnaround.
But, he said, there would be people willing to take on the challenge despite fierce opposition to the New Myer strategy from major shareholder Solomon Lew.
"I think there will be people out there who will be incredibly energised by this opportunity.
"I think we will get some very good candidates."
Mr Hounsell declined to say whether Mr Umbers' resignation had been discussed with Mr Lew or whether he thought it would help ease tensions between the company and its key stakeholder.
Mr Lew, who's company Premier Investments took a 10.8 per cent stake in Myer in March 2017, has been highly critical of the department chain's performance and on Friday called for fellow shareholders to "save the company" with a board spill.
His call came after Myer announced its first-half net profit would likely be between $37 million and $41 million, down from $62.8 million for the same period last year.
But that forecast excludes impairments, the size of which is still being calculated.
On Wednesday, Mr Hounsell said he did not believe the impairment would put Myer faced at risk of going into administration.
Myer in the past six months has announced stores closures, shed jobs and written down various investments as Mr Umbers' turnaround strategy failed to gain traction against a backdrop of sluggish consumer activity and increased competition.
The company's 2017 full-year profit was down 80.3 per cent to $11.9 million, partly due to $45.6 million in writedowns against its investments in TopShop and sass & bide.