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Business

What’s Old is New Again at JCPenney

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At JCPenney it’s a case of what goes around, comes around. As Jason noted earlier, Ron Johnson’s out the door as CEO at the Plano-based retailer. And the company’s previous chief executive, Mike Ullman, will be taking over as the interim CEO. Ullman and Johnson, you might recall, both had starring roles in Joseph Guinto’s 2011 story in D CEO about Ullman’s legacy at Penney, and what lessons Johnson—a former Apple executive—might learn from it as he set out to remake the legendary department store.

As Joe pointed out, it was investment guys like Bill Ackman of Pershing Square Capital Management and Stephen Roth of Vornado Realty Trust who really wanted Johnson in the corner office in the first place. After months of miscalculations by the new regime, however, Vornado dumped 10 million shares of Penney stock last month. Then, just last Friday, the previously supportive Ackman publicly blasted Johnson’s “big mistakes,” and said the Texas company was courting disaster.

And, that was sort of the writing on the wall. As Joe predicted in his story, the investors gave Johnson a year-long honeymoon period, then started holding his feet to the fire as the losses continued to mount. So now, to close this circle, what lessons might Mike Ullman learn from Johnson’s tenure? How about this, for starters: The folly of an outsized, unchecked ego believing he had all the answers based on prior unrelated experience, the customers at his new venture be damned. But you can be sure Ullman knew that one already.

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