Change at the top leads to new inventory initiatives at J.C. Penney

When PR problems befall an organization, the time it takes to resolve them can become a major factor. As a result, to meet new challenges and reverse the damage caused by unfortunate incidents, the implementation of new business management software may be needed.

Take J.C. Penney for example. The department store is in the midst of a rebranding, as well as a crisis management initiative, after its former CEO made a number of changes that angered several of its customers. Ron Johnson, who found success running Apple retail stores, was brought in as J.C. Penney CEO in November 2011, but a number of unpopular decisions ultimately led to his dismissal, which went into effect last month. Now, Mike Ullman, who led the company for seven years before he was replaced by Johnson, has taken back his old position and is in the process of righting Johnson's wrongs.

One of the more damaging moves made during Johnson's reign was the decision to diverge J.C. Penney's in-store offerings from its e-commerce catalog. According to those who ultimately moved to change CEOs, the process was not managed well and much of the inventory was disorganized. Furthermore, employees who traditionally relied on ordering merchandise from the online store when it was unavailable at any brick-and-mortar location could no longer do that. 

"It was an organizational mistake frankly," Ullman said in a first quarter results conference call, held last week.

The goal is to reorganize the inventory so both the physical and online stores have the same inventory. Doing so could require new inventory management software to ensure the process is clean and efficient. Companies finding themselves in a similar situation can benefit from working with a business software provider to obtain the solutions needed to successfully make appropriate inventory changes.