Penney pinched

Falling sales and claims of sexist, insular management plague Plano-based J.C. Penney. Can a woman -- from Wal-Mart of all places -- turn the troubled chain around?

For consumers, some changes already are apparent. In mid-October, Penney launched an estimated $35 million advertising campaign to alter its image. The ads target a group that Oesterreicher described at an industry convention last spring as "the modern spender." She is a creature that J.C. Penney marketing surveys define as a 35- to 54-year-old woman from a two-income household. The company estimates that demographic group accounts for 47 percent of its department-store sales.

In 30- and 15-second television spots, singer, actress, and one-time beauty queen Vanessa Williams croons as fashion models exult against urban backgrounds or dramatic landscapes. "The Look," a narrator announces. "Look who. J.C. Penney." The company's former campaign, "J.C. Penney, I love your style," has been dropped.

For the first time, J.C. Penney also has begun to alter who chooses what products go in the store. The results have been hipper merchandise, including designs by Evan-Picone and Liz Claiborne. Historically, J.C. Penney has operated with what is known in the industry as a "pull system" versus a "push system." Store managers told corporate buyers if they wanted to "pull" particular apparel into their store. (At Nordstrom, for instance, buyers "push" products onto the shelves.)

Falling sales and claims of sexist, insular management plague Plano-based J.C. Penney. Can a woman -- from Wal-Mart of all places -- turn the troubled chain around?
Hadley Hooper
Falling sales and claims of sexist, insular management plague Plano-based J.C. Penney. Can a woman -- from Wal-Mart of all places -- turn the troubled chain around?
"These chaps were  simply demoted, but you were fired in summary dismissal. Can you make any sense out of this?" Baker's lawyer asked her. "They were men,"  she said.
Hadley Hooper
"These chaps were simply demoted, but you were fired in summary dismissal. Can you make any sense out of this?" Baker's lawyer asked her. "They were men," she said.

Former J.C. Penney buyers say they and their colleagues despised the pull system, which they argued put J.C. Penney out of step. "I remember when broomstick skirts were so hip," recalls one former buyer in the women's division, who didn't want her name used for this story. "They were flying off the shelves everywhere. But I couldn't get them into one store because the store manager's wife didn't like them." When she could get a product into a store over the managers' objections, they would sabotage her efforts, displaying a Halston dress, for example, on a mannequin pushing a vacuum cleaner.

This fall, the company has begun considering giving its buyers the final say-so. "It's being re-examined right now. A whole new team is working on it," says corporate spokesman Duncan Muir, who was the only current J.C. Penney employee willing to speak to the Observer publicly for this story.

But change doesn't come easily at J.C. Penney. Former female employees can tell you about that.


"You mean...the Evil Empire?" Baker said when asked in a telephone conversation to discuss her experience at J.C. Penney.

Initially, Baker agreed to an interview but later canceled the appointment. "I decided I want to close that part of my life," she said in a telephone message.

When the arbitrator's ruling was released in September, Baker told The Dallas Morning News, "I feel that I've won a tremendous moral victory."

But her lawyer, Maloney, says the experience sapped Baker's spirit. "She was completely broken," he says. She now sells residential real estate in the Dallas area.

Several of Baker's former female colleagues at J.C. Penney were sympathetic. They found the male dominance at the company and the resulting disparities insufferable.

Elise Greenberg was formerly one of three senior buyers in the men's division. She left the company 10 months ago out of frustration with a system that she says protected incompetent men. "I couldn't deal with the unethical business practices," Greenberg says. She remembers going to her boss several times with plans to save the company a bundle only to be scolded because she was offending a favored supplier. Once, she dropped a supplier who was charging $1 more for each pair of pants than a half-dozen other suppliers. "I was told, 'Don't ever do that again,'" she says. The problem? Her boss played golf with the supplier's chief executive.

Greenberg bitterly recalls annoying slights during her 12-year tenure that showed women were second-class at J.C. Penney. In one instance, she was the only woman traveling with six male executives. Rather than lease a second car for the large group, Greenberg says, "They decided I could sit on someone's lap." Morning meetings had to be at the break of dawn and could never accommodate working mothers, like herself, who wanted to see their children off to school. Male executives had their suits altered by the company tailor at company expense. Women received no such perks.

Another buyer in the women's division, who was asked to leave four years ago and didn't want her name used for this story, recalls similar slights. She had to tolerate a young, problem employee assigned to her as a subordinate because the employee was the daughter of a retired member of upper management. "I went to my boss, and he said he will do nothing about it because I have dinner with her father once a week," the former buyer recalls.

Sexism wasn't always the issue. Sometimes it was plain old cronyism. The same buyer remembers taking a loss on an order of women's suits that was delivered with multicolored lapels -- a mistake, not a fashion statement -- because the supplier was another frequent dining pal of her boss. "You were told who to do business with," she says. "If the lapels came in different colors, you had to work it out."

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