SHAKEUP AT PENNEY’S: TOP MERCHANTS NAMED, HOUSECLEANING GOES ON
Byline: David Moin
NEW YORK — J.C. Penney Co.’s restructuring swept through the top rungs of its merchandising organization this week.
While three senior merchants and a chief marketing official were named, and several departures were announced, more shifts across the company are expected, as Penney’s seeks to reverse sales and profits declines, improve assortments and build a nimbler team.
The company continues to look for a new merchandising president, among other searches. And with Thursday’s changes, rumors resurfaced that Vanessa Castagna, executive vice president of the corporation and president and chief operating officer for stores, catalog and Internet, might soon leave.
The $33 billion, Plano, Tex.-based moderate department store and drugstore operation has long been criticized as too insular and overloaded with layers of management. To simplify the structure, and match skills and responsibilities with appropriate titles, certain divisional president titles were eliminated, and the general merchandise manager post was implemented. Penney’s said that by doing that, it was following “the industry norm.”
Here are the top changes announced Thursday:
Charles Chinni was named senior vice president and general merchandise manager for home and fine jewelry, confirming a WWD report that day. Chinni replaces Ann Gravseth, who held the title of president of the home division and has shifted to women’s accessories.
William Cappiello has been named senior vice president and gmm for men’s and children’s, succeeding Cathy Mills, president of the men’s division, and Phyllis Schuler, president of the children’s division, who have both left the company.
Edward Mawyer was named vice president and director of merchandising for family footwear, succeeding Lou Lynn, divisional vice president and director of merchandising for family shoes, who retired.
John Budd was named senior vice president and chief marketing officer, succeeding Steve Farley, who left last November.
Chinni, Cappiello, Budd and Mawyer all report to Castagna.
Castagna has been instrumental in Penney’s reorganization and centralization of the buying process. Nevertheless, reports have heated up that she, too, might fall victim to the reorganization and that the board intends to buy out her contract. In an interview Thursday, she responded to the speculation, saying, “I don’t know what more I can say about that. I am here at J.C. Penney and committed to this company. Allen [Questrom] and I are aligned. We are focused. I’ve learned so much from him.”
Questrom, chairman and chief executive officer since September, has already reshaped much of the top management, previously naming Robert Cavanaugh executive vice president and chief financial officer, succeeding Donald McKay, who elected to retire. Stephen Raish was promoted to executive vice president and chief information officer, taking over for David Evans, who retired. John Fesperman, president and chief operating officer of direct marketing, credit and facilities services; Randy Ronning, president of catalog and internet and Ray Pierce, senior vice president and director of special projects, have all retired. Marilee Cumming, who held the post of merchandising president, left the retailer last April.
Questrom also has been scrutinizing stores and last week announced 47 closings.
Despite the speculation surrounding her, Castagna projected a positive perspective, declaring that it’s been “energizing” to be part of a team in formation that’s focused on doing “the right thing for customers and shareholders and energizing the middle market.”
She described Thursday’s changes as part of a reorganizing process that has been ongoing and acknowledged it’s all geared to alleviate what has historically been a cumbersome, slow-moving bureaucratic operation.
“Over the last 18 months, we’ve been trying to tear down the hierarchy,” she said. “The whole purpose is to be a more flexible and dynamic organization.
“There have been advances in cutting lead times to suppliers and getting flexible on delivery times and sourcing,” she said. “That’s the whole point of putting the right people in the right jobs. We’re laser-focused on having the right people in the right jobs. It’s taking awhile, but it is happening.”
In addition to hiring Liz Sweeney, formerly an executive at Kellwood and Wards, about a year ago to run the women’s business, 18 new buyers, 24 associate and assistant buyers and more than 70 distribution and inventory planning managers were recruited, she said.
“We’re constantly looking at this organization,” she noted.
Castagna joined Penney’s from Wal-Mart in 1999. She was the top women’s apparel merchant there. Some in the industry feel Penney’s still needs to recruit additional heavy hitters from strong competitors like Target and Kohl’s, but Castagna defended the most recent recruitments, characterizing them as great merchants with the appropriate skills for the positions they are filling and the company’s new direction.
“They have experience in centralized buying, distribution, understanding stores and a lot of experience in product and brand development,” she said. “They have leadership ability in a very complex retail environment, and bring a lot of broad experience.”
Chinni was chairman and ceo of Strouds, a bed and bath retailer in California. Before that, he was executive vice president of merchandising for Kmart Corp., supervising all home, hardlines and apparel lines. Before that, he was president, merchandise for Macy’s/Bamberger’s responsible for home, cosmetics, fine jewelry and lingerie.
Cappiello was president and ceo of Clicks or Mortar Inc., a consulting firm for e-commerce and the retail industry. He’s held other top jobs, including president of The Sports Authority and president and ceo of Parisian, a division of Saks Inc. Prior to these assignments, he worked for Macy’s as president of merchandising for women’s, president of stores for Macy’s West and Bullocks, and executive vice president for corporate product development.
Mawyer was J.M. Shoe Group’s president. Previously, he was president of S.L.J. Retail LLC, operator of Sam and Libby retail stores; executive vice president of Larry Stuart Ltd., a woman’s footwear supplier; vice president and gmm for Specialty Retailer Inc.’s footwear division; and president and ceo of Mawyer Enterprises, a retail footwear business.
Budd served for many years with The May Department Stores Co. as executive vice president of merchandising at different divisions. He was also once senior vice president of advertising at May Co. in Cleveland. He also spent 18 years with Federated Department Stores at A&S, Jordan Marsh, and, most recently, Macy’s West, where he was senior vice president of sales promotion and marketing.