From the moment Ronald B. Johnson arrived at the Plano, Texas,
headquarters of J.C. Penney, some there believed he would not last
long. They were proved right.
Maybe it was the ice sculptures. Or the order to stock slim,
European-style men's suits. Or the swagger of a protege of the
mighty Steven P. Jobs.
From the moment Ronald B. Johnson arrived at the Plano, Texas,
headquarters of J.C. Penney, some there believed he would not last
long. On Monday, the doubters were proved right. After a tumultuous
17 months as chief executive of Penney, Mr. Johnson was pushed out.
He blew into Plano a star, a man who had helped build the
juggernaut Apple Stores. But his Silicon Valley ways -- evident from
a showy party in early 2012 that he threw to celebrate himself and
his plans, complete with a light show, fake snow and flowing liquor -
- jangled from the start.
His pedigree seemed impeccable: his bachelor's degree from
Stanford University in California, his master's degree in business
administration from Harvard University, years building Target and
then, his time with Mr. Jobs. But it all ended Monday when the board
voted to replace him with his predecessor, Myron E. Ullman III, a
move seen as a stopgap measure that did not instill confidence in
the 111-year-old retailer's future.
Shares plunged more than 12 percent Tuesday as investors and
analysts speculated as to whether the company could halt its current
sales collapse or even avoid a takeover.
Mr. Johnson wanted to transform Penney into shopping wonderland
with designer boutiques and stable prices instead of coupons. But
many of his ideas were not tested and soon backfired, and in recent
months the board, including William A. Ackman, the activist hedge
fund titan who had recruited him, grew impatient.
No sooner had Mr. Johnson been named chief executive in 2011 than
he began poking fun at Penney's way of doing business. At a regular
Monday sales meeting, "he was pretty sarcastic about our marketing
and how ridiculous it was," and he asked the chief marketing officer
to count up in front of the group how many mailings were sent each
week, said one former employee who, like others who spoke for this
article, asked to remain anonymous to protect working relationships.
Mr. Johnson dismissed most of the top executives from Mr.
Ullman's reign and brought in his own team, largely from Apple and
Abercrombie & Fitch. Mr. Johnson commuted from California, and
employees said he was a hard worker, decisive and responsive to even
late-night e-mails. But few of the top executives he had hired
relocated to Texas, instead working there a few days a week, staying
"quarantined," as a veteran put it. Penney hands used the acronym
AAPLE to refer to the newcomers -- Apple and Abercrombie Paid to
Lose Earnings.
Mr. Johnson liked to tell employees that there were two kinds of
people: believers and skeptics, and at Apple, there were only
believers. He wanted the same at Penney: When employees pushed back
against Mr. Johnson's strategies, they got nowhere, according to
several former executives. Even when Mr. Ackman urged him to meet
with retail stars like Millard S. Drexler of J. Crew and Philip
Green of Topshop, Mr. Johnson seemed to pay little attention to
their doubts.
Mr. Johnson and Mr. Ackman did not return calls for comment.
