OUT OF THE FRYING PAN INTO THE FIRE

Wow, I didn’t know I was picking on Ron, but I’ve written six posts in ten months on the incompetency of J.C. Penney’s CEO Ron Johnson. Last month (March 1st) I predicted he would be out within a year. I missed it, he was canned yesterday.

Now, I certainly believe he deserves to be fired (he won’t starve, he got close to $85 million for his 17 months of not listening to his customers). You simply can’t disrespect your customers and try to make them into a customer you love (people who will pay substantially more because of brand envy – i.e. Apple consumers) and keep your job.

With that said, Johnson did move in the right direction. He just did it without listening to the customer (25% drop in sales) or his staff. Call it ego. But J.C. Penney can’t turn back the clock, they must move forward (read Chapter 1 of my Powershift Marketing Book).

That’s why it is shocking that J.C. Penney renamed Myron Ullman, who had been CEO for seven years prior to Johnson, the company’s new CEO. Well, at least they are getting a bargain. Ullman will be paid $1 million per year vs. $58 million for Johnson.

The teaching moment: When someone fails to take you into the future correctly, it doesn’t mean you go back to the past. Mr. Ullman acknowledged this and was quoted as saying that it is premature to discuss plans for Penney’s future in a New York Times story, “Some things are working well, others maybe not, but I deserve a chance to be on the ground. Nobody ever wins by going back in retail because the customers’ expectations change all the time.”

That’s good advice. Unfortunately, Mr. Ullman is probably not the man for the job. My next prediction: the Board will find someone to replace Ullman as soon as possible.