JC Penney's People Strategy: Setting the Right Climate for Human Resource Development

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Case Details:

Case Code : BSTR274
Case Length : 16 pages
Period : 2004-2007
Pub Date : 2008
Teaching Note : Available
Organization : JC Penney Corporation, Inc.
Countries : USA

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Setting the Right Climate Contd...

It had run into trouble in the late 1990s and early 2000s, but under the able leadership of chairman and CEO Allen Questrom (Questrom) and COO, Vanessa Castagna (Castagna), it witnessed a dramatic turnaround by the end of 2004.

When Ullman joined the company, he found that the organizational culture at JCP was very formal and rigid, in some ways very similar to what it had been in its initial days. Employees addressed their managers formally, and not by their first names. They were expected to dress formally and to desist from decorating their cubicles. A band of "office police" reporting to the Human Resource (HR) department ensured that the employees complied with the rigid rules.

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Moreover, due to the recent turnaround, the mood of the employees was not "forward-thinking" as they were pleased that a major disaster had been averted. Ullman realized that this mood and the rigid culture were not conducive to attaining the ambitious plan set by the company. Though the company believed in coaching its employees at all levels in the hierarchy since the 1970s, it was still not considered to be a great place to work for by the employees and potential employees.

He felt that the rigid culture at JCP was intimidating new recruits, resulting in a high turnover, and acting as a hindrance in attracting talent. So in conjunction with the newly appointed HR chief Michael Theilmann (Theilmann), Ullman started an initiative to redefine the culture at JCP.

"The business isn't just about store managers any more -it's more complicated than it used to be, and I need to motivate employees from the entry level to the officers. If I had a choice to honor the past and lose, or move forward and win, I pick winning,"7 said Ullman. Various symbolic changes were made in 2005.

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7] Ellen Byron, "'Call Me Mike!'," www.wsjclassroomedition.com, April 3, 2006.


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