J.C. Penney Needs to Fire Delusional Ron Johnson Now
There's a distinct difference between dogs like those two names and pacesetters such as Amazon.com.
The culture of obviousness helps explain every major Best Buy initiative over the past year or two.
Making stores smaller. Doing their own tablet. Instituting online price matching. Revamping the mobile Web experience. These steps either (A) came a lot too late; (B) were obvious; (C) should have never happened because there was no way they could be effective; or (D) all or some combination of the above.
I feel bad for the rank-and-file at Best Buy. The blame falls squarely on an unimaginative Board and upper management team.
They sat around a table listing where they had their asses kicked by Amazon, refused to seek a partnership and proceeded to make obvious after-the-fact decisions. It would be slightly forgivable if they were even proactively incompetent.
Meantime, Ron Johnson makes Reed Hastings at Netflix (NFLX) look like the most humble CEO in the universe. Johnson lives in his own world. As the late, great Texas Governor Ann Richards said of George H. W. Bush: He was born on third base and thought he hit a triple .
Last August, when I labeled Johnson 2012's Most Delusional CEO, I reviewed his egomaniacal performance at JCP's January 2012 investor day.
For more than a year, Johnson has turned in a pitiful performance at JCPenney. Dig into some of the numbers from Wednesday's earnings report:
- Annual revenue plummeted 25%.
- JCP lost more than a half a billion dollars for the quarter, up from an $87 million loss in the same prior-year quarter.
- Same stores sales were off a shocking 32% during the most recent quarter, which included holiday shopping. Quarterly revenue was down 28%.
A complete disaster, yet Johnson actually had the nerve to talk himself up again on the company's conference call:
This is my third transformation. I want to discuss the repositioning of Target from a discount store to the industry's leading upscale discounter. As you know I worked side-by-side with the leadership team at Apple as Apple repositioned itself from cult brand selling Macs to the world's most valuable company.
Wow. Makes for an apropos adaption of Richards' born on third base line. Who does this guy think he is?