Case Code : CLHR001
Publication date : 2008
Subject : Human Resources/ Organization Behavior
Industry : Retail
Teaching Note : Not Available
Length : 05 Pages
Price : Rs. 100
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JC Penney, retail, department store, executive search industry, turnaround, leadership skills, organizational dilemma
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The decision of whether to promote from within or look elsewhere had always been an organizational dilemma. In 2004, JC Penney was faced with this dilemma while appointing the successor for its chairman and CEO, Allen Questrom. JC Penney surprised many by passing over Vanessa Castagna, who was instrumental in turning around the company between 1999 and 2004, in favor of an outsider.
Between 1999 and 2004, a turnaround was orchestrated at JCP by chairman and CEO Allen Questrom (Questrom) and COO, Vanessa Castagna (Castagna). Castagna joined JCP in 1999 as the COO and Questrom joined as the Chairman and CEO in 2000. Both of them were brought in from outside and were the first outsiders to join JCP in their respective positions...
Questions for Discussion:
1. Do you think JCP was justified in appointing Mike Ullman, an outsider, as CEO instead of Vanessa Castagna (Castagna) considering that Castagna was instrumental in turning around JCP in the early 2000s?
2. What are the pros and cons of ‘bringing in an outsider’ and ‘promoting from within’? Discuss the impact of such decisions on the morale of the employees.
The issue discussed in this short case study has been adapted from a sub section of the case study 'Remaking JC Penney's Organizational Culture' [HROB093]