Dive Brief:
- J.C. Penney cut 300 of its 3,400 headquarters jobs in Plano, Texas last week, the Dallas Morning News reported.
- Some of the cuts are the result of new systems installed this year from information technology vendor Oracle, according to the Dallas Morning News.
- The cuts come as the retailer works to crawl its way back to profitability after years of losses.
Dive Insight:
These job cuts reflect the first bold-stroke move by Penney’s new CEO Marvin Ellison, who took the top spot at the chain in August, succeeding Mike Ullman.
Ellison is on a mission to restore profitability at the $13 billion retailer with initiatives such as improving the performance of lagging product categories such as home and kids — which took a hit under ousted CEO Ron Johnson — and by reducing costs.
“As J.C. Penney works to achieve its financial growth targets, it is essential that our operations align with the strategic priorities of the company,” said Penney spokeswoman Daphne Avila, in a prepared statement, the Dallas Morning News reported. “Over the last several months, the company has been evaluating its home office structure to identify opportunities for greater simplification and higher productivity.”
Ellison is known in retail circles for his operational savvy honed during a 20-year retail career at Home Depot and Target.
It’s a discipline he’s now leveraging at J.C. Penney, as it works to accelerate the turnaround strategy launched by the now-retired Ullman. In 2014, Penney outlined a three-year plan to grow sales by $2 billion by the end of 2017 and generate earnings before taxes and other items of $1.2 billion.
Under Ellison’s leadership, the retailer is also focused on improving Penney’s omnichannel capabilities, where the company lags competitors; refreshing its stores with updated in-store salons rebranded by InStyle magazine; and playing up its proprietary offerings, from expanding its Sephora beauty chain to growing its private-brand assortments with new lines such as the Michael Strahan menswear collection.
