Q1

:
Before answering the question few of you please share your views on culture and its definition.
Mike Ullman's decided to change the century-old culture at JCP just after a successful turnaround. Comment whether the
culture change initiatives instituted at JCP help it achieve the goals of (i) reducing turnover of existing employees, (ii)
attracting new talent from outside, and (iii) increasing the effectiveness of the company's coaching program? Give reasons
for your answers.

ANS:
My Views :
Culture in Organizations:
 Culture is an important factor in determining the success or failure of an organization.
 Hence, leaders need to pay considerable attention toward developing and nurturing the right culture and values
for their organization.
 It is important that the entrepreneur monitor the cultural development in the organization and influence it as per
organizational requirements.
 Usually, the organizational culture is a communal culture, where people identify with the organizational values and
work becomes a part of life.
 In course of time, the culture may change and the organization may end up with –
o Mercenary (result-oriented) culture,
o Networked (close ties between organizational members) culture, or
o Fragmented (individualism and freedom) culture.

Definition:

Organizational culture is the personality of the organization. Culture is comprised of the assumptions, values, norms, and
tangible signs (artifacts) of organization members and their behaviors.


Effectiveness of culture change initiatives instituted at JCP:
I would like to analyze effectiveness of initiatives and culture change strategy using balance score card. Three goals
mention in question are highlighted under “objectives”.
CUSTOMER PERSPECTIVE: Ullman said that the associates are the first customers we sell. If it doesn’t ring true to
them, it’s impossible to communicate and inspire the customer
Strategic objectives Performance
Measures
Result
Objectives Actions Measures
1. To build a customer-focused
culture at JCP
1. focus on involving the employees
in making an “emotional connection”
with the customers
Customer Feedback Positive feedback
through increased
Turnover at all stores
2. In early 2007, JCP opted for a
new brand positioning, “Every Day
Matters‟, to spur growth by forming
“Deeper, Emotionally-Driven
Relationships” with customers.
Customer Feedback Positive feedback
through increased
Turnover at all stores
2. To change customer’s
perceptions about JCP
1. Rewarding performance, rather
than activities
Customer Feedback Positive feedback
through increased
Turnover at all stores
3. Culture change to result in
competitive advantage
1. Motivated employees shared the
company’s vision and served the
customers better
Customer Feedback Positive feedback
through increased
Turnover at all stores
FINANCIAL PERSPECTIVE: Ullman thought that there is a correlation between engaged associates and store profitability.
He associated attrition with cost.
Strategic objectives Performance
Measures
Result
Objectives Actions Measures
1. To make JCP a great place
to work in and reduce
turnover of employees
1. fixing a monetary value on
employee turnover.
Reduced employee
turnover to improve
bottom line
The impact on the
bottom line was visible
as JCP posted its 15th
consecutive quarter of
sales gains at the end of
fiscal year 2006. (loss of
US$400 million in 2005
on account of attrition)
Its share prices too
showed significant
growth
company could
strengthen its position
further by reducing the
turnover
As far as the bottom line
was concerned,
operating profit for the
fiscal year 2005 was
US$1.6 billion,
representing a 22.5
percent increase over
fiscal year 2004. JCP‟s
positive cash flow
exceeded US$700
million and it also
opened 18 new stores,
the highest number of
new stores in a year in
close to a decade.
In fiscal year 2006,
JCP‟s operating profit
increased by a further
17.8 percent to US$1.92
billion
2. Attracting new Talent from
outside
1. Providing competitive
compensation
New talent attracted By 2006, JCP was able
to attract enough talent
from the best
professional schools
such as the Fashion
Institute of Technology
and Texas A&M‟s
Center for Retailing
Studies (A&M). A
number of students had
shown an interest in
working for JCP. In
2007, JCP planned to
hire 2000 students from
A&M, which was double
the number it had
recruited in 2006.
Analysts too agreed that
JCP was able to attract
higher quality students
3. Making best place to work a. To address managers by
first names and not formally.
Campaign called “Just call
me Mike!”
b. Relaxed dress code
c. Allow to decorate cubicles
d. Disbanding “Office Police”
e. Employees at the corporate
office could take the
afternoons off on 10 Fridays
in a year, provided they
worked one hour extra from
Monday to Thursday, after
getting it cleared from their
immediate superior
AES score JCP‟s second
“Associate Engagement
Survey‟ (AES) in 2006
revealed that 73 percent
of JCP‟s employees
were “engaged” as
compared to 67 percent
in the 2005
INTERNAL PERSPECTIVE
Strategic objectives Performance
Measures
Result
Objectives Actions Measures
1. Setting up a more
democratic and inclusive
climate
Ceremony for loyal employees
At this ceremony, Penney had
emphasized “The Penney Idea‟ –
the motto of JCP also known as
HCSC, which stood for Honor,
Confidence, Service, Cooperation.
He used to emphasize the
importance of the need for values
such as being agreeable, moral
leadership, and thriftiness, and the
need for JCP employees to conduct
themselves in a particular way both
on the job and at home.
Motivation levels Employees were
motivated and JCP
became one of the best
places to work for
1.Emphasizing the importance
of the employees to the
organization
1. JCP also decided to replace the
various art works on its walls with
photos of its employees and other art
related to the company
Motivation levels Employees were
motivated and JCP
became one of the best
places to work for
2. The employees were provided
with new security ID badges. The
badges laid emphasis on the first
names of the employees, with bigger
letters being used for them
Motivation levels Employees were
motivated and JCP
became one of the best
places to work for
LEARNING & GROWTH PERSPECTIVE
Strategic objectives Performance
Measures
Result
Objectives Actions Measures
1. Increasing the
effectiveness of the
company's coaching
program
1. Winning together principles –
WTP. Updated moral code for
employees
Employees to learn the
company‟s point of
view rather than
someone else‟s.
The key values and
focus of JCP were
internalized by the
trainees as these
messages were
repeatedly reinforced by
different top executives.
This helped the trainees
develop a conviction
regarding the messages,
leading to these
messages percolating
down the line.
This ultimately resulted
in customer satisfaction
and repeated customer
2. It invested heavily in corporate
coaching initiatives and setting in
place a well-oiled coaching
framework throughout the
organization
3. JCP started identifying high-
potential employees, called “hypos‟
in JCP parlance. These employees
were sent to the “Retail Academy‟,
which was run by Hicks.
4. Leadership conference for store
managers and describing Store
Employees had to feel
that they could build a
Attrition reduced
managers as CEOs of store career in the company.



Mike Ullman's decided to change the century-old culture at JCP just after a successful turnaround. Comment whether the
culture change initiatives instituted at JCP help it achieve the goals of (i) reducing turnover of existing employees, (ii)
attracting new talent from outside, and (iii) increasing the effectiveness of the company's coaching program? Give reasons
for your answers.