Customer Reviews

Celebration of Fools: An Inside Look at the Rise and Fall of JCPenney

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Celebration of Fools by Bill Hare is a narrative about the people and events at JC Penney that contributed to the company's growing success and about those that led to its decline in the 1990s when business and the economy were soaring. The company and its leaders lost, or forgot, the company's vision to bring value to customers and communities. Once the descent began, no one, not even the board, seemed to question that critical decisions were not being made for good business reasons.

The company's story is told through an organized collection of stories, remembrances, personal accounts, archival data and the like. This approach gives the book a very human feel for the people who built the company and those who failed it.

As for lessons to be learned from the book, major flaws seemed to infect the company. The decision to move the company to Dallas did not appear to have been made for any solid business reasons. The move took its toll on the quality of the company's leadership, its connection to the clothing industry and consistent merchandizing. The company lost its ability to select the right employees, which seems to be another major shortcoming. There didn't seem to be any thought to succession planning or how performance should be rewarded. The Penney focus on bringing value to the customer and communities seem to disappear.

The book covers the "rise and fall" of JC Penney from around 1900 to 2000 when new management took over for a turn-around attempt. It will be interesting to see if the ground lost in competitive positioning, financial health and market image can be regained. But, as the author states in the Introduction, that will have to be another story altogether.

I liked the book. It was well-told and clearly written. I appreciated the writer's perspective. It made me think about people in companies and how their decisions affect customers, other employees and communities they touch.

Hare suggests that CEOs W.R. Howell and James Oesterreicher as well as their associates were fools to abandon the cultural values and operating principles which enabled the J.C. Penney Company (JCP) to become the most profitable and highly-regarded retail merchandiser in the world. With all due respect to Wal-Mart's executive leadership, JCP's decline was the result of self-inflicted wounds.

The "inside look" Hare provides is less the result of any privileged access he had than the willingness of those who did have such access to share their reactions to (and explanations of) their beloved company's deterioration. These insiders felt betrayed. More in sadness than in anger, they shared with Hare directly or through other sources their thoughts and feelings about JCP which "had shifted from being a company of merchants to an organization of managers, with its focus changing from serving customers and communities to maximizing sales and profits. Finally [during the regimes of Howell and Oesterreicher], the actions of its leadership became both soulless and silly."

To appreciate what JCP had lost, Hare carefully explains what JCP once had. Rather than glorify James Cash Penney himself, Hare duly acknowledges the founder's importance while suggesting -- with all due respect to him, "The Body of Doctrine" (page 36), and "H.C.S.C." (page 37) -- that others deserve most of the credit for leading JCP to greatness, both as a retail merchant and as a human community. They include Jack Maynard, Earl Sams, Don Seibert, and Walt Neppl.

In this context, I am reminded of David Glass and Lee Scott. When Glass became CEO of Wal-Mart in 1992, the company was doing $43.8 billion in sales. Just three years later, under his leadership, sales hit $100 billion. According to Robert Slater, Glass "took Wal-Mart out of Middle America and made it into a global brand." Glass and his colleagues stayed true to Walton's idiosyncratic management style while investing in the technologies and logistics operations that a multibillion-dollar company needs. After succeeding Glass as CEO while also remaining faithful to Sam Walton's core values, Scott was the driving force behind Wal-Mart's adoption of various advanced technologies which continue to provide a decisive competitive advantage.

In this volume, Hare carefully traces a process of deterioration which began when Howell became CEO and he does so with a combination of sadness, anger, and dismay. The historical information and personal accounts which Hare provides leave little doubt that principles and profits are not mutually exclusive. On the contrary, they are interdependent. Mr. Penney knew that in 1902 when he opened the door to his first store, "The Golden Rule." We would be well-advised to keep that in mind 102 years later.

Good, interesting tale of Penney's during the 20th century. My dad was with Penney's in a number of positions including store manager; I bought the book as a gift for him, then got hooked and read it first. His impression was that the parts he knew about personally were well portrayed (he was with the company from ~1953-1963, and from ~1975-1980).
The story is from the point of view of a speechwriter in the company, and even the climax of the book is a speech. Much of the book is historical, so that viewpoint doesn't detract from that part. There are likely other perspectives that would be more interesting for the more contemporary phases of the story, though (_e.g._ a member of top management). On the other hand, a speechwriter would have access to the company and its top personnel in varied and candid settings, without having so much a stake in the action that relating the action is colored by the author wanting to appear in a favorable light. So the author did have a unique vantage point, and the story ended up being a pretty interesting portrayal of the company's spectacular successes, and some failures, too.

Of all the business books I have read none have worse timing than 'Celebration of Fools'. To begin with, JC Penney is currently looked upon as being one of the best managed retail companies in the world. If Mr. Hare would have done his due diligence, he could easily have added chapters chronicling the extraordinary turnaround JC Penney has undergone since the reigning CEO Allen Questrom took over in 2000. Furthermore, ignoring the impact that Vanessa Castagna, Executive Vice President, Chairman and Chief Executive Officer of JC Penney Stores, Catalog and Internet, has had on the recent success of JC Penney was a big mistake. If anything, concluding the book with a chapter dedicated to Ms. Castagna would have been appropriate for the simple fact that she will more than likely replace Allen Questrom as the leader of JC Penney, and rightfully so. The title of the book may leave some readers thinking that JC Penney is somehow on its death bed as a company when in fact it is in superb operational and financial condition. As someone who has spent the last four years working in retail, earning an MBA in Industrial Management and a Masters in Logistics and Supply Chain Management where a large portion of my research projects were related to the retail industry, I can personally attest to the great strides JC Penney has made.

Having said all of the above, I do find the book has some merit in its exploration of JC Penney. However, Mr. Hare is rightfully being taken to task for his use of "creating" dialogue that he cannot back up factually. Had Mr. Hare simply stuck with the facts he would have written a much more acceptable book. As I read through the chapters, I found myself comparing `Celebration of Fools' with `Kmart's 10 Deadly Sins'. Both books chronicle the inner workings of two very well known companies and the bad decisions that were made along the way. If anything, `Celebration of Fools' reinforces the need for companies to have well thought out plans in place to identify talent and leadership in external and internal personnel as a way to ensure that only the best qualified individuals are in top management. Yes, JC Penney had some executives who made very poor business decisions but the experience of JC Penney is not unique in business as a study of Coca-Cola will attest.

I also must scold Mr. Hare for suggesting that moving JC Penney from New York to Dallas, actually Frisco, TX, was a mistake. Moving from New York to Frisco created a financial position of such magnitude that JC Penney was able to pay cash for the land and building it currently occupies. Moreover, if the physical location of a company's headquarters is truly relational to the success or failure of the company, how does Mr. Hare explain Wal-Mart's success even though it is located in Bentonville, Arkansas?

So what then is my recommendation? The book is worth reading but in order to truly have an accurate understanding of JC Penney, I suggest reader's research articles written about JC Penney after 2000 to truly understand the magnitude of the recovery JC Penney has made.

One last thing, don't be surprised if Sears does everything they can to lure Allen Questrom away from JC Penney in the next year or two.

I've worked at JCPenney for over 25 years before reading this book. It is currently making its rounds through my store.

It's a great book of JCPenney history for anyone who wanted to know or to remember where we were and where we're headed. It is current up until the time that Q & V took over, which is now another chapter to be written by another writer someday.

P.S. I bet Mike Ullman, current CEO, has read it.

Amazon:
Please note that Mr. John is totally biased, as he admittedly knows several of the players in the book, ie very senior execs at JCPenney, which are blamed in the book for very nearly destroying the company.

Also, Mr. Lindsey is currently the senior corporate communications exec at JCPenney! He should disclose this. He was ordered to write that strange review -- his job probably depended on it.

You should delete both these reviews -- they are totally biased, and unfair to your customers.

Everybody's a critic, which's fine when the criticism isn't malicious or sleazy. Sadly, "G. Lindsey"'s review of my book a year ago was both. Worse, Lindsey didn't reveal himself as an executive at JCPenney (which would have suggested questionable objectivity and the possibility of writing at the behest of uneasy bosses). Even worse was his accusing me of lying---particularly about James Cash Penney and his beloved first wife marrying when she was pregnant. Well, that's a fact, sourced and verified from the Penney archives right under Lindsey's very nose---as were many other facts in the book questioned by him. I did create dialogue (as carefully explained in the Introduction) when research yielded clear lines of character and situation. Ah, well, at least Lindsey said the book might be a good "beach read" (high praise from him!). -Bill Hare

If you want an entertaining novel for the beach, this may be your book. But if you seek a responsible piece of business history and analysis, look elsewhere.

In an effort to make his narrative entertaining, Bill Hare employs a deeply flawed historical method. He adopts the dubious practice of creating speculative dialogue and action, claiming that "I am confident that the situations depicted are responsible reflections of those days and people." In many cases, however, the depictions appear to be outright fabrications, with no basis in actual history.

Two examples will demonstrate my point. Hare alleges that Mr. Penney's first son, Roswell, was born five months after his parents' marriage. On this basis he depicts Mr. Penney's courtship of his wife, Berta, as an affair which scandalized the town and Berta's family. Having read extensively on the life of Mr. Penney, I had never heard of this fact, so I contacted the JCPenney Archives to verify the allegation. The Archives staff reported that according to family records, Roswell was born on January 24, 1901, a full 16 months after his parents' wedding. Census records in June 1900 confirm that, noting that James and Berta Penney had no children. Hare's depiction of the courtship appears to be nothing more than a Hollywood fantasy.

Another example: Hare alleges that before her death, Berta had a long deathbed conversation with Earl Sams (later second chairman of the J.C. Penney Company) in which Sams promises to care for her beloved Jimmy (Mr. Penney.) Again I asked the Archives to verify. The staff found a letter from Sams written to Mr. Penney on the day of Berta's death in which Sams reports that he is out of Salt Lake City but will return to the city as quickly as possible. Again there appears to be no historical basis for Hare's deathbed scene. I say "appears" because Hare has no footnotes that would allow the reader to verify his sources.

In other cases, Hare recounts conversations among JCPenney executives in great detail, including the hand and facial gestures of speakers and their movements in the room. How does he know this level of detail? There were no video cameras in the room. The reader suspects it's all made up.

Fabrications like these undermine the credibility of everything else Hare says in the book, especially in the second half which focuses on the company's decline in the 1990s. If Hare could get the picture so wrong in the instances I've cited, how many other times has he distorted the truth by engaging in what he calls "narrative nonfiction." He should have said "narrative fiction," for one never quite knows where fact ends and speculative fiction begins.

A responsible study of why JCPenney stumbled in the 1990s would provide welcome insight for students of American business, but Hare's book is not that study. One must read everything in it with a healthy dose of skepticism.

This probing look into the inner workings of the JC Penney company is one of the richest reads about the business world I've encountered since "Barbarians at the Gate." Hare tells the story with the drama of a screenwriter, the research of an historian and the insight of a novelist. It's a book I couldn't put down. And it's especially appropriate in these times of corporate chicanery, deceit and executive greed.

Everybody's a critic, which's fine when the criticism isn't malicious or sleazy. Sadly, "G. Lindsey"'s review of my book a year ago was both. Worse, Lindsey didn't reveal himself as an executive at JCPenney (which would have suggested questionable objectivity and the possibility of writing at the behest of uneasy bosses). Even worse was his accusing me of lying---particularly about James Cash Penney and his beloved first wife marrying when she was pregnant. Well, that's a fact, sourced and verified from the Penney archives right under Lindsey's very nose---as were many other facts in the book questioned by him. I did create dialogue (as carefully explained in the Introduction) when research yielded clear lines of character and situation. Ah, well, at least Lindsey said the book might be a good "beach read" (high praise from him!). -Bill Hare