01 Aug, 2018

J.C. Penney searches for new CEO

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The retail CEO native, Marvin Ellison, had his start at Home Depot, moved to J.C. Penney in 2014, and this summer, left the retail chain and landed at Lowe’s. Within just one week on the new job,Ellison quickly restructured the executive organization chart. While he did this type of moving around at J.C. Penney, the timeline of events didn’t happen quite so fast. Ellison did help bring the company back from financial struggles, but he didn’t have the apparel experience that J.C. Penney needed. The company is having a hard time finding the right person for the role in order to get back to a successful place.

“The company posted net losses of $795 million in 2012, $1.2 billion in 2013 (the year Johnson left) and $717 million in 2014. Comparable sales in 2012 fell a harrowing 25%. The next year, the company added more than $2.5 billion in debt to its books.” Howland

J.C. Penney is very specific in their search. They are considering former CEO’s with apparel merchandising and big box retail – people who know the ins and outs of online and in store retailing. But after the departure of Marvin Ellison in May of this year, should investors be wary of the future of the company?

What Happens Now

Chairman of the Board, Ronald W. Tysoe, has taken over and the company created an office of the CEO. The team consists of the Chief Financial Officer, Chief Customer Officer, Chief Digital Officer and EVP of Supply Chain. They will share responsibility of day to day operations until a new CEO is in place.

It’s going to be tough to find someone who can successfully get through a retail chain crisis. Some name drops have including Hubert Joly of Best Buy, Patrick Doyle of Domino’s and even J.C. Penney’s two time CEO, Mike Ullman. All we know is whoever takes this job will have their work cut out for them. Ellison left after trying to improve online experiences, signing brand partnerships with celebrities and adding appliances – all which failed. He ultimately had to cut prices to clear out inventory.

“J.C. Penney doesn’t stand for anything but discounting. There’s no identity attached to any of these brands.” Gabriella Santaniello

The number one internal candidate may be the Chief Customer Officer who was previously president of Home Depot’s northern division.

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