October 31, 2013
Defending Ron Johnson
It’s been popular for quite some time to pile on Ron Johnson. After all, the one-time Apple and Target wunderkind botched things badly at J.C. Penney. Sales plummeted, thousands lost their jobs, customers were disaffected, vendors were frustrated and share prices fell during his tenure.
Current and former CEO Mike Ullman has, by all appearances, done his best to lay the blame for all of Penney’s problems at Mr. Johnson’s feet. Recently at the Women’s Wear Daily CEO Summit, he said he identified a long list of things that were wrong at Penney when he returned to lead the company last April.
"Penney’s had 400 days going in one direction. Now we’ve had 200 days going the other direction," Mr. Ulmman told the WWD audience. "If we had two things [wrong] and we couldn’t fix them, we’d be in trouble. We have 30 things wrong. They can all be fixed, and we have the time to fix them."
For his part, Mr. Johnson has been largely silent since leaving the department store chain. He did respond to a Forbes contributor’s e-mail recently by saying he thought analysis of his time at Penney was "lacking in depth, largely inaccurate, and surprisingly uninformed."
As I see it, the biggest operational mistake made by Mr. Johnson was that he didn’t test his ideas before rolling them out chain-wide. The result was that many that needed to be tweaked or abandoned were implemented on a large scale, burning through cash and failing to generate revenues.
He clearly made other mistakes, as well. Most important of these may have been a display of leadership hubris. Namely, he failed to win his fellow stakeholders (employees and vendors) over to his plan. Perhaps they failed to understand it. Maybe they were simply resistant to change or just weren’t sold on the vision. Whatever the reasons, Mr. Johnson was looking to move a mass of people in one direction, without ever giving them sufficient reason to follow.
In the end, there is no way Mr. Johnson comes out of the Penney experience looking good. If the chain fails to rebound, he will be blamed for putting it in such a large hole it couldn’t recover. If the chain returns even to where Mr. Johnson left it, Mike Ullman will get the credit.
Mr. Johnson had some good ideas that didn’t work at Penney. Some may have worked given time, but that was not a luxury they or their creator enjoyed. In the end, he will take the blame. But maybe he shouldn’t take all of it.
BrainTrust
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Discussion Questions
Do you think the analysis of the J.C. Penney period under Ron Johnson has unfairly laid all of the blame on him? Does it appear to you that current management is looking to return Penney to where it was in the pre-Johnson era?
Poll
I think the testing thing is a bit of a red herring, honestly. The chain was in trouble, and it needed refreshing for sure. Returning it to the pre-Johnson era just puts it back into dinosaur status. It’s a breathing dinosaur, but still hasn’t got much of a future.
My own point of view is that his strategy was fine. It’s the execution that was bad. So my own laundry list of problems are:
- One of the worst marketing campaigns of all time. That’s what turned off all the existing customers. No one had a clue what the new pricing strategy was all about.
- Not spending more time with the troops. It has been widely reported that Mr. Johnson and his team never moved to Dallas. If this is untrue, I’d love to be set straight…but if it’s true, that was a very bad decision.
- Not doing the math to determine if he had the money to execute the transformation he’d set in motion
- No contingency plans
As I dug into the numbers, I found out that $900 million had been used for stock buy-backs the year before Mr. Johnson came on board. Another $250+ million was used to by the Claiborne brand. I just don’t see how he possibly thought he’d have the cash to get the job done. Bearing in mind that Mr. Ullman made both those decisions, I think some of his protestations are a bit much. He was publicly embarrassed when the board sent him away before the originally planned date and is now in “payback” time.
Still, no matter how you slice it, dropping comparable store sales by 25% in a single year is a disaster. I don’t know who else you DO blame for that one.
The sad, but immutable, truth is that when a CEO fails, he or she becomes the “sin eater” for all the evils that existed before they got there; everything they tried that failed and even a good deal of what happens after they leave.
Is it fair? Obviously not, but that’s what happens when you don’t survive long enough to write the history.
I wasn’t at JCP, so I have no way of knowing whether or not the widespread negative coverage of Mr. Johnson’s reign was accurate or totally made up.
One final thought. The company wasn’t exactly in the greatest shape when he got there, so returning it to pre-Johnson performance levels isn’t exactly landmark retailing.
It may be a brand whose time has come – and gone, perhaps forever.
First, it’s kind of funny when I read about good ideas that didn’t work. If they were good ideas, they would have worked. Mr. Johnson has gotten unfairly blamed. Walmart, Target and the rest of the 21st century operators have shot down the JCP plane so did we really expect Mr. Johnson to keep it flying? All that talk of a turnaround was just for the press release. In real life, it was his job to keep up the charade of being an ongoing operation. Just like an actor in a movie, he was playing his part.
The blame first has to fall on Ackman, the activist investor who thought he knew better how to run the department store. The rest is all on Johnson. I cannot imagine a worse fit, worse vision or worse execution. As readers know, I was an early fan of the no discounts plan but quickly said he had to go as customers voted with their feet and Penney was crippled — probably mortally.
Johnson seemed to disdain Penney’s and wanted to make it a Bloomingdale’s for the Midwest. Not something they wanted or asked for.
Horrific legacy. Scarey tale of emperor’s new clothes and cautionary tale to other retailers looking to throw the baby out with the bath water.
Maybe if I haven’t done many business makeovers myself I would be more lenient, but the fact remains…
Worst. Makeover. Ever.
Ron Johnson captained the ship during this disaster. Who else would you lay the blame on other than him? Is he totally responsible? No. But he put in place the changes that took Penney’s from bad to worse. One other point: Penney’s was leaking money and losing customers long before Mr. Johnson took the helm.
Let’s not be so quick to praise Mr. Ullman for righting the ship. They are a long way from that.
Let’s keep this in perspective and context. None of these decisions were made in a vacuum! Mr. Johnson’s strategy was sound but there was an arrogance in his execution. There was clearly no regard to the existing corporate culture – certainly a lack of understanding as to its direct relationship and affect on the ability to turn a massive ship! Mr. Ullman set that compass heading and speed!
In the end, Mr. Johnson was the captain and will, and should, carry his share of the responsibility. But the folks on the Board of Directors are all equally culpable! I’m sure they’re all keeping a very low profile and are quite happy to keep the spotlight on Mr. Johnson.
He definitely botched the pricing strategy and can be blamed for not knowing the core customer. I will say after being a few JCPs recently, the store looks great. Not the Penney’s I remember with merchandise everywhere willy nilly. The stores I saw looked modern, great signage, contemporary displays and clean sight lines. And the merchandise looked great. This was a result of Johnson’s strategy and it will be a great foundation for the current management to create better promotions, pricing strategies, and reach advertising. If it works they can take credit for that too.
No, he deserves all the blame. Of the many errors he executed, I believe one to be the most simple but major error he made, a basic in any business: he did not know who his customer was…he had no idea why they shopped J.C. Penney. Either honestly not knowing or choosing to ignore, he set about forcing a complete change on a customer that preferred to shop and buy a particular way.
I have a feeling that many of the people piling on Ron Johnson have never visited a JCPenney store.
The redesigned Johnson stores are bright, shiny, clean, and well-organized. You’ll find no merchandise on the floor, no loud music, no signs competing for attention. (Other department stores: you know who you are.)
I became a Penney’s customer during the Johnson era. I’m backed off a little now that the pricing has become considerably more complicated, but the store experience is pretty great, as is the merchandise. The guy didn’t do everything wrong.
To be fair, Ron Johnson was faced with a problem akin to the “prisoner’s dilemma.” JCP was bleeding out before he took over. He needed to act quickly to transform the company into a sustainable business.
He had a new and different vision of a department store concept. Unfortunately, the JCP shopper was not the base franchise that would support that vision. He wanted to sell the shopper the upscale products he wanted to stock instead of offering them the value products they wanted to buy.
He should have focused on stemming the tide of sales declines in the current formats and done tests on the new visionary concepts to get them right before remodeling the stores.
Remember a few years back: J.C. Penney wasn’t performing like the current Boston Red Sox. Then Penney’s board hired Ron Johnson because it wasn’t totally satisfied with Ullman’s first term as CEO.
Johnson came in and did a quick “Apple-About” and that dug the hole deeper for Penney’s. Desperate and confused, the Penney board then dismissed Johnson and reclaimed Ullman, sending the J.C. Penney’s Merry-Go-Round into further oblivion.
Like good shepherds, it is the board of directors’ responsibility to just shear the flock, not skin it. Meanwhile Mike Ullman is taking the company back to the pre-Johnson era. Is that shearing, skinning or what?
Let me put it this way…if Ron Johnson has said, “Look, I want the job but things are in such a tailspin, if I can’t turn them around, don’t blame me”…do you think he would have gotten the job?! He was paid big bucks to make it happen…no excuses.
Of course it does. Public blame fests are always unfair. And yet, it was a grand mistake that he led. So he certainly deserves the largest share.
Some of the defenses I’ve seen are simply silly. The efforts abandoned solidly understood consumer realities, attempted brand repositioning on a grand scale that have never worked, but did so in ways that theorists (like ad agency creative directors) would absolutely love and embrace.
Perhaps the thing we all need to keep in mind from this fiasco is to focus on what you have to work with – not what you wish you had. And perhaps that’s the biggest flaw he brought from the tech world. Tech companies have always sold “vapor ware” and just often enough it works. In a store like Penney’s, vaporware will never succeed, but Johnson’s team embraced vaporware full force – embraced what JCPenney never has been and really can’t be.
No interest in shopping at J.C. Penney before Ron Johnson and I have no interest shopping at J.C. Penney now.
While mall-anchored department stores were great in the 1980s, we are the 21st century. J.C. Penney has bigger matters to address than sour grapes towards Ron Johnson.
Well, first of all, JCP wasn’t doing all that well when RJ got there! Anybody remember that?
Having said that, Mr. Johnson did surprise me by not relying on his solid Target background and did not apparently look more realistically at JCP’s balance sheet.
If Mr. Ullman is to truly succeed (which means more than getting JCP back to where it was), he will have to right some of the wrongs and drive forward some of the visions that require further development. That is how JCP will differentiate itself in the future and become relevant again.
JCP stores do look better, cleaner and brighter and merchandise is not piled everywhere. Johnson should get credit for that, but he completely missed the target as to who JCP customers were. The hip young customer that Mr. Johnson visualized would never become a JCP customer, no matter how much the store or merchandise changed, simply because of the stodgy uncool image that they have of JCP. Meanwhile JCP’s “real” customers shopped with their feet by going up the mall to Macy’s, Dillard’s, Kohl’s and Target.
When I visited a couple of Penney stores last week, traffic was up. Way up. The associates I spoke with validated my observation and attributed it to the Johnson-era renewal taking hold/gaining awareness and the stores becoming far more shopable.
J.C. Penney is not an island, it is part of the retail ecosystem. “Success” or not, Ron Johnson shook up department store retailing and I think, made others step up their game during his reign. Was it a high price for Penney to pay? Sure, but I expect that an honest assessment a year or so from now will reveal several “always right, sometimes early” elements.
I think Cathy Hotka and Carol Spieckerman’s comments together are absolutely right on!
I was highly critical early on in the transition. That is, until I began to visit. Their stores are free of noise and clutter. They are brighter and greatly improved in their merchandising approach. JCP was nearly beyond repair when he arrived. A decision to return the CEO that put them there was about as intelligent as letting Mr. Johnson go in the first place.
This week we received our first large postcard coupon promotion once again from JCP. Back to the old tactics and guesswork on the part of the customer! Ugh!
Mr. Johnson made JCP a much better place to shop. I can’t say that Mr. Ullman ever did that or based on his previous work there has the ability to keep it that way. He couldn’t before. The whole saga is a head scratching event.
Now, if want still want them, I have to back to guessing how much I will pay for my pants!
Anyone who reads this Wire on a regular basis knows that I was always a fan and advocate of Mr. Johnson.
JCPenney was losing the game before his entrance and, if you take a look at the store and the website just after his exit, you would see a great looking brand.
The problem was that it was not a great ‘acting’ brand. Mr Johnson made some mistakes in the execution. I can’t say it better than Paula so I will simply point you to her post to reread.
My bigger concern now is that Mr. Ullman, in his embarrassment, is now putting everything back the way it was, even the logo. All very costly and certainly not what will take the brand forward. A smart executive would have looked at the job Mr Johnson did and find the executable pieces.
It was a good plan! IMHO!
Unfair? If the analysis truly laid ALL the blame on him, then perhaps it would be, but I don’t think it does, it simply acknowledges the obvious: he was hired to make things better, and instead he made things worse. Is he equally willing to reject credit for Apple’s success?
As for JCP itself, what exactly does “the pre-Johnson era” mean? Is it 2010, or 2000, or 1960? I would hope they eventually realize the year they need to be in is 2013.
I’ve seen many Ron Johnson discussions on this site, and everyone mentions that Penneys was on the decline during Mr Ullman’s leadership.
However, I have yet to see any article that mentions the exact net/profit loss and comp store sales for the past 5 years. Many retailers have had difficult comp store sales figures since 2008.
I’d love to know what the exact figures were during Ullman’s time compared to other retailers during the same period. I wonder if the figures were really as bad as everyone has been making it sound?
Clearly there’s too much emphasis being placed on what Johnson did for ONE YEAR at JCP when it’s apparent to anyone in retail that their problems have been festering for decades before his arrival and will continue to decay way beyond his effects. We’ll all wake up to that pretty soon.
But you know, retailers are notoriously quick to point to something else . . . weather, economy, staff, ‘The Board’, etc., when in fact, as a great retailer once said to me, “The first rule of leadership is; it’s ALWAYS your fault.”
JCP was poorly positioned and under performing when they hired Ron Johnson. He knew he had a short runway to reposition and improve performance, and he didn’t succeed. As CEO he owns that failure.
He certainly isn’t responsible for the performance that put JCP in a position to want to hire Ron Johnson in the first place. As CEO from 2004 to 2011 Myron Ullman owns that one.
Seen this movie before a few times. Reality is that it takes about a minute to lose your current customers with a strategy change and it takes a while to attract and win new ones. A transition plan was called for as part of the execution plan, not a sharp right turn that left current customers still walking straight ahead, and a long path before the new ones joined in. So while the strategy may or may not have been right (will never know now), it was doomed by such an obvious mistake.
The article does a great job of reviewing all the problems of the tenure of Mr. Johnson. I agree with Paula Rosenblum and her comments and also Ryan Mathews, David Livingston, Adrian Weidmann and Bob Phibbs. Mr. Ackman caused so much of the current mess and JCP IS unfortunately a dinosaur. If Mr. Ullman can get it back to “where it was” that’s great but they will STILL need to make changes so that in ten years the average JCP customer will not be “in the grave.” It may be too late. I am still dumbfounded to actually have watched it all happen.
I believe that we are still watching crisis mode and that that will continue for a while, possibly exacerbated by this difficult Holiday season of 2013. The public vetoed Mr. Johnson’s plans, no matter how appealing to observers and analysts, like it or not. The public ultimately decided the analysis, accurate or not, informed or not.
That is now all in the past. The situation and circumstance requires reflection but also leadership is now necessary to save an ongoing concern. JCP was a choice of millions for everyday needs for a ling time, and hopefully can be again. It employs THOUSANDS of people and is ubiquitous across Americas malls. The loss of Kmart would be terrible but the loss of JCP would truly be devastating. Management must understand the past problems but requires forward vision for JCP to continue and to grow. Hopefully they can do this monumental task.
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I think the testing thing is a bit of a red herring, honestly. The chain was in trouble, and it needed refreshing for sure. Returning it to the pre-Johnson era just puts it back into dinosaur status. It’s a breathing dinosaur, but still hasn’t got much of a future.
My own point of view is that his strategy was fine. It’s the execution that was bad. So my own laundry list of problems are:
As I dug into the numbers, I found out that $900 million had been used for stock buy-backs the year before Mr. Johnson came on board. Another $250+ million was used to by the Claiborne brand. I just don’t see how he possibly thought he’d have the cash to get the job done. Bearing in mind that Mr. Ullman made both those decisions, I think some of his protestations are a bit much. He was publicly embarrassed when the board sent him away before the originally planned date and is now in “payback” time.
Still, no matter how you slice it, dropping comparable store sales by 25% in a single year is a disaster. I don’t know who else you DO blame for that one.
The sad, but immutable, truth is that when a CEO fails, he or she becomes the “sin eater” for all the evils that existed before they got there; everything they tried that failed and even a good deal of what happens after they leave.
Is it fair? Obviously not, but that’s what happens when you don’t survive long enough to write the history.
I wasn’t at JCP, so I have no way of knowing whether or not the widespread negative coverage of Mr. Johnson’s reign was accurate or totally made up.
One final thought. The company wasn’t exactly in the greatest shape when he got there, so returning it to pre-Johnson performance levels isn’t exactly landmark retailing.
It may be a brand whose time has come – and gone, perhaps forever.
First, it’s kind of funny when I read about good ideas that didn’t work. If they were good ideas, they would have worked. Mr. Johnson has gotten unfairly blamed. Walmart, Target and the rest of the 21st century operators have shot down the JCP plane so did we really expect Mr. Johnson to keep it flying? All that talk of a turnaround was just for the press release. In real life, it was his job to keep up the charade of being an ongoing operation. Just like an actor in a movie, he was playing his part.
The blame first has to fall on Ackman, the activist investor who thought he knew better how to run the department store. The rest is all on Johnson. I cannot imagine a worse fit, worse vision or worse execution. As readers know, I was an early fan of the no discounts plan but quickly said he had to go as customers voted with their feet and Penney was crippled — probably mortally.
Johnson seemed to disdain Penney’s and wanted to make it a Bloomingdale’s for the Midwest. Not something they wanted or asked for.
Horrific legacy. Scarey tale of emperor’s new clothes and cautionary tale to other retailers looking to throw the baby out with the bath water.
Maybe if I haven’t done many business makeovers myself I would be more lenient, but the fact remains…
Worst. Makeover. Ever.
Ron Johnson captained the ship during this disaster. Who else would you lay the blame on other than him? Is he totally responsible? No. But he put in place the changes that took Penney’s from bad to worse. One other point: Penney’s was leaking money and losing customers long before Mr. Johnson took the helm.
Let’s not be so quick to praise Mr. Ullman for righting the ship. They are a long way from that.
Let’s keep this in perspective and context. None of these decisions were made in a vacuum! Mr. Johnson’s strategy was sound but there was an arrogance in his execution. There was clearly no regard to the existing corporate culture – certainly a lack of understanding as to its direct relationship and affect on the ability to turn a massive ship! Mr. Ullman set that compass heading and speed!
In the end, Mr. Johnson was the captain and will, and should, carry his share of the responsibility. But the folks on the Board of Directors are all equally culpable! I’m sure they’re all keeping a very low profile and are quite happy to keep the spotlight on Mr. Johnson.
He definitely botched the pricing strategy and can be blamed for not knowing the core customer. I will say after being a few JCPs recently, the store looks great. Not the Penney’s I remember with merchandise everywhere willy nilly. The stores I saw looked modern, great signage, contemporary displays and clean sight lines. And the merchandise looked great. This was a result of Johnson’s strategy and it will be a great foundation for the current management to create better promotions, pricing strategies, and reach advertising. If it works they can take credit for that too.
No, he deserves all the blame. Of the many errors he executed, I believe one to be the most simple but major error he made, a basic in any business: he did not know who his customer was…he had no idea why they shopped J.C. Penney. Either honestly not knowing or choosing to ignore, he set about forcing a complete change on a customer that preferred to shop and buy a particular way.
I have a feeling that many of the people piling on Ron Johnson have never visited a JCPenney store.
The redesigned Johnson stores are bright, shiny, clean, and well-organized. You’ll find no merchandise on the floor, no loud music, no signs competing for attention. (Other department stores: you know who you are.)
I became a Penney’s customer during the Johnson era. I’m backed off a little now that the pricing has become considerably more complicated, but the store experience is pretty great, as is the merchandise. The guy didn’t do everything wrong.
To be fair, Ron Johnson was faced with a problem akin to the “prisoner’s dilemma.” JCP was bleeding out before he took over. He needed to act quickly to transform the company into a sustainable business.
He had a new and different vision of a department store concept. Unfortunately, the JCP shopper was not the base franchise that would support that vision. He wanted to sell the shopper the upscale products he wanted to stock instead of offering them the value products they wanted to buy.
He should have focused on stemming the tide of sales declines in the current formats and done tests on the new visionary concepts to get them right before remodeling the stores.
Remember a few years back: J.C. Penney wasn’t performing like the current Boston Red Sox. Then Penney’s board hired Ron Johnson because it wasn’t totally satisfied with Ullman’s first term as CEO.
Johnson came in and did a quick “Apple-About” and that dug the hole deeper for Penney’s. Desperate and confused, the Penney board then dismissed Johnson and reclaimed Ullman, sending the J.C. Penney’s Merry-Go-Round into further oblivion.
Like good shepherds, it is the board of directors’ responsibility to just shear the flock, not skin it. Meanwhile Mike Ullman is taking the company back to the pre-Johnson era. Is that shearing, skinning or what?
Let me put it this way…if Ron Johnson has said, “Look, I want the job but things are in such a tailspin, if I can’t turn them around, don’t blame me”…do you think he would have gotten the job?! He was paid big bucks to make it happen…no excuses.
Of course it does. Public blame fests are always unfair. And yet, it was a grand mistake that he led. So he certainly deserves the largest share.
Some of the defenses I’ve seen are simply silly. The efforts abandoned solidly understood consumer realities, attempted brand repositioning on a grand scale that have never worked, but did so in ways that theorists (like ad agency creative directors) would absolutely love and embrace.
Perhaps the thing we all need to keep in mind from this fiasco is to focus on what you have to work with – not what you wish you had. And perhaps that’s the biggest flaw he brought from the tech world. Tech companies have always sold “vapor ware” and just often enough it works. In a store like Penney’s, vaporware will never succeed, but Johnson’s team embraced vaporware full force – embraced what JCPenney never has been and really can’t be.
No interest in shopping at J.C. Penney before Ron Johnson and I have no interest shopping at J.C. Penney now.
While mall-anchored department stores were great in the 1980s, we are the 21st century. J.C. Penney has bigger matters to address than sour grapes towards Ron Johnson.
Well, first of all, JCP wasn’t doing all that well when RJ got there! Anybody remember that?
Having said that, Mr. Johnson did surprise me by not relying on his solid Target background and did not apparently look more realistically at JCP’s balance sheet.
If Mr. Ullman is to truly succeed (which means more than getting JCP back to where it was), he will have to right some of the wrongs and drive forward some of the visions that require further development. That is how JCP will differentiate itself in the future and become relevant again.
JCP stores do look better, cleaner and brighter and merchandise is not piled everywhere. Johnson should get credit for that, but he completely missed the target as to who JCP customers were. The hip young customer that Mr. Johnson visualized would never become a JCP customer, no matter how much the store or merchandise changed, simply because of the stodgy uncool image that they have of JCP. Meanwhile JCP’s “real” customers shopped with their feet by going up the mall to Macy’s, Dillard’s, Kohl’s and Target.
When I visited a couple of Penney stores last week, traffic was up. Way up. The associates I spoke with validated my observation and attributed it to the Johnson-era renewal taking hold/gaining awareness and the stores becoming far more shopable.
J.C. Penney is not an island, it is part of the retail ecosystem. “Success” or not, Ron Johnson shook up department store retailing and I think, made others step up their game during his reign. Was it a high price for Penney to pay? Sure, but I expect that an honest assessment a year or so from now will reveal several “always right, sometimes early” elements.
I think Cathy Hotka and Carol Spieckerman’s comments together are absolutely right on!
I was highly critical early on in the transition. That is, until I began to visit. Their stores are free of noise and clutter. They are brighter and greatly improved in their merchandising approach. JCP was nearly beyond repair when he arrived. A decision to return the CEO that put them there was about as intelligent as letting Mr. Johnson go in the first place.
This week we received our first large postcard coupon promotion once again from JCP. Back to the old tactics and guesswork on the part of the customer! Ugh!
Mr. Johnson made JCP a much better place to shop. I can’t say that Mr. Ullman ever did that or based on his previous work there has the ability to keep it that way. He couldn’t before. The whole saga is a head scratching event.
Now, if want still want them, I have to back to guessing how much I will pay for my pants!
Anyone who reads this Wire on a regular basis knows that I was always a fan and advocate of Mr. Johnson.
JCPenney was losing the game before his entrance and, if you take a look at the store and the website just after his exit, you would see a great looking brand.
The problem was that it was not a great ‘acting’ brand. Mr Johnson made some mistakes in the execution. I can’t say it better than Paula so I will simply point you to her post to reread.
My bigger concern now is that Mr. Ullman, in his embarrassment, is now putting everything back the way it was, even the logo. All very costly and certainly not what will take the brand forward. A smart executive would have looked at the job Mr Johnson did and find the executable pieces.
It was a good plan! IMHO!
Unfair? If the analysis truly laid ALL the blame on him, then perhaps it would be, but I don’t think it does, it simply acknowledges the obvious: he was hired to make things better, and instead he made things worse. Is he equally willing to reject credit for Apple’s success?
As for JCP itself, what exactly does “the pre-Johnson era” mean? Is it 2010, or 2000, or 1960? I would hope they eventually realize the year they need to be in is 2013.
I’ve seen many Ron Johnson discussions on this site, and everyone mentions that Penneys was on the decline during Mr Ullman’s leadership.
However, I have yet to see any article that mentions the exact net/profit loss and comp store sales for the past 5 years. Many retailers have had difficult comp store sales figures since 2008.
I’d love to know what the exact figures were during Ullman’s time compared to other retailers during the same period. I wonder if the figures were really as bad as everyone has been making it sound?
Clearly there’s too much emphasis being placed on what Johnson did for ONE YEAR at JCP when it’s apparent to anyone in retail that their problems have been festering for decades before his arrival and will continue to decay way beyond his effects. We’ll all wake up to that pretty soon.
But you know, retailers are notoriously quick to point to something else . . . weather, economy, staff, ‘The Board’, etc., when in fact, as a great retailer once said to me, “The first rule of leadership is; it’s ALWAYS your fault.”
JCP was poorly positioned and under performing when they hired Ron Johnson. He knew he had a short runway to reposition and improve performance, and he didn’t succeed. As CEO he owns that failure.
He certainly isn’t responsible for the performance that put JCP in a position to want to hire Ron Johnson in the first place. As CEO from 2004 to 2011 Myron Ullman owns that one.
Seen this movie before a few times. Reality is that it takes about a minute to lose your current customers with a strategy change and it takes a while to attract and win new ones. A transition plan was called for as part of the execution plan, not a sharp right turn that left current customers still walking straight ahead, and a long path before the new ones joined in. So while the strategy may or may not have been right (will never know now), it was doomed by such an obvious mistake.
The article does a great job of reviewing all the problems of the tenure of Mr. Johnson. I agree with Paula Rosenblum and her comments and also Ryan Mathews, David Livingston, Adrian Weidmann and Bob Phibbs. Mr. Ackman caused so much of the current mess and JCP IS unfortunately a dinosaur. If Mr. Ullman can get it back to “where it was” that’s great but they will STILL need to make changes so that in ten years the average JCP customer will not be “in the grave.” It may be too late. I am still dumbfounded to actually have watched it all happen.
I believe that we are still watching crisis mode and that that will continue for a while, possibly exacerbated by this difficult Holiday season of 2013. The public vetoed Mr. Johnson’s plans, no matter how appealing to observers and analysts, like it or not. The public ultimately decided the analysis, accurate or not, informed or not.
That is now all in the past. The situation and circumstance requires reflection but also leadership is now necessary to save an ongoing concern. JCP was a choice of millions for everyday needs for a ling time, and hopefully can be again. It employs THOUSANDS of people and is ubiquitous across Americas malls. The loss of Kmart would be terrible but the loss of JCP would truly be devastating. Management must understand the past problems but requires forward vision for JCP to continue and to grow. Hopefully they can do this monumental task.