Burlington, Vermont
April 11, 2022
Im pretty sure I have never bought anything at JCPenny. In fact, I have probably only be in one by mistake.
I like Ackman’s observation that it is important to learn how to recover from failure/mistakes. I believe that is the wonderful thing about sports - especially selective, competitive sports.
Too bad Johnson (walked away from $50 million of restricted stock??) and Ackman didn’t ask me about this idea. Sounds to me the new JCPenny was unrecognizable to its core customers. Given that, why wouldn’t you change the name of the company?
I do agree a national rollout without testing was an unnecessary risky move.
I bet HBS and Darden turned this flop into a helluva case study!
Much of my business career was spent working with major retailers. Ackman was correct when he made the statement that when the founder goes, the business typically goes down hill. The reason is mature businesses are typically run by hired professional managers, not visionaries. Professional managers tend to make "safe" moves and tend to manage costs not products. They forget that the magic of brands and stores is the excitement, and consumer loyalty, unique and innovative products generate. From my observation JCP, Sears, Kmart, and other retailers died in the 1980's and 1990's because they became homogenous. There was nothing innovative or exciting about the product. People could go somewhere else and find newer stores, better prices, better inventory.
Hence…