Patrick and Ron: Hey Ron, welcome to Disruption Lab. I'm really glad you're here today.
Ronald Johnson: I am too. I'm so excited to meet you and talk with you and your audience.
Patrick and Ron: So you're I am excited to meet you as well. Your career, you know, Ron, it's really one of the most interesting in business. You helped transform Target. You reinvented the retail experience at Apple. You led one of the most talked-about transformations in American retail at JCPenney. And today you're continuing to build, invest, and teach others your new through your new book, called Shop Different, How Retail Revealed Apple's Genius in Stores September 22nd, So congratulations on that.
Ronald Johnson: Well, thank you for that. No, it was really fun to write the book because you it forced you to look back and think deeply about what you did, what worked, what didn't. You know, as you know, life has a lot of curveballs it throws you. And
Patrick and Ron: Sure does.
Ronald Johnson: sometimes you get fastballs, you can hit hit well, like my time at Apple and Target. And sometimes you get a fastball you miss, like at JCPenney. And, you know, it's fun to talk about, but it was fun to reflect on all of those experiences.
Patrick and Ron: Yeah, I I'm glad you're open to talk about the experience because I think we can help listeners think about whether it's their career or their personal walk in life, some practical ways they can kind of think about these things and learn from somebody who's who's kind of done it all. I mean you've sit in some really positions of consequence and and taken on some big transformations. But let's start with a little bit about you. You know, before the titles and the companies, like who is Ron Johnson?
Ronald Johnson: Well, I just I'm just a pretty normal kid who grew up in the Midwest. I grew up went to public high school in Edina, Minnesota. And looking back, it had a huge impact on my life. I had the blessing of two amazing parents who were dedicated to me, my brother, my sister. I grew up learning a lot about kindness and generosity and hospitality. And as I look back, you know, at what I did in my career. It's hard to separate my personal geography, my lived experience as a child with what I did at work. And that's most profound at Apple, where we created a place people belong. But it's really a reflection of the neighborhood I grew up in. You know, the store became this unbelievably welcoming place where we tried to, you know, improve people's lives. And that's kind of what my parents did for me and my siblings and for the neighborhood we had. And So I grew up there, I went to Stanford, Harvard Business School and then be decided to become a retailer.
Patrick and Ron: It it is amazing how experiences earlier in life can really shape so many things for us. And I think you and I were talking previously before we started recording that in in the process of writing a book, some of that is kind of revealed. What do you think are some of the things specifically that may have shaped you along the way?
Ronald Johnson: Well, I think there was, you know, a couple of experiences. I was a pretty shy kid. You know, I grew up, like I said, elementary. I was just in a neighborhood where everybody knew me. I went to middle school and I felt like sought a place. I didn't know anybody. I had to take a bus instead of walk to school. And I I I kind of wanted to be, I was a great athlete, wanted to be like one of the cool kids, but I really didn't have the cool factor or whatever. And I found it was easier to Befriend people I saw like me, who were kind of quiet, didn't feel like they fit in. And I began to establish all these relationships with kids that I felt, you know, just needed a friend, like I needed a friend.
Patrick and Ron: Mm.
Ronald Johnson: And somehow through that, I became a very popular guy and a leader. I was able to captain both my high school baseball and soccer teams. They were very good teams at a good school. Went on to Stanford, but I think a lot of it comes back to how you establish connections with other people. And I was forced to do that really with my shyness. And but I found it easy, you know, my dad said, you know, people like to talk about themselves. So don't worry about what you have to say. Just go ask some good questions. And as I got to know people, you know, they just love that they were seen.
Patrick and Ron: I I know I'm I'm a bit introverted myself and it's it's it's it is so easy to get overwhelmed in certain situations, but on the other hand it's like just ask people about themselves and they're happy to tell you. And you probably I would imagine you probably then had situations where You had this network of people where people like Ron, how'd you even know that person? You know, well, because I talked to
Ronald Johnson: Exactly.
Patrick and Ron: them, I saw them, all all those type of things that other kids may not have overlook may have overlooked along the way. So you
Ronald Johnson: Well, the biggest yeah, the biggest surprise me, I was in eighth grade and I was at I went to Lutheran church my family, everyone went to church in Minnesota. I remember we had a big church and they had to we had to pick a confirmation class president and they said, Well, this week we're gonna vote and next week we'll announce your president. You just had to write in a name. And we had about 250 people in the class. And the next week I get there. And I mean, I'm this super shy kid. I'm like holding my windbreaker, you know, always looking down. And they go, and the president is Ron Johnson. And I'm going, I didn't even know people knew my name, let alone writ wrote it down. But it was honestly,
Patrick and Ron: You're like I didn't know there was another Ron Johnson in this group.
Ronald Johnson: it was such a revelation. I was like, how did that happen? And you know, I it was just It was a life-changing observation. Because I think, you know, in the best situation, you don't think about yourself, you think about others. And when you're thinking about others, you just assume, you know, nobody really thinks about you. But they do. They notice that. And my whole career, I just love like I love being in stores. I love meeting customers. I love helping people. And all that is a function and it's a very simple way to live, but it's all a function of my childhood.
Patrick and Ron: So what what do you think okay so take us to Target. We'll go to Target. Tell a little
Ronald Johnson: Yeah, yeah.
Patrick and Ron: bit about what you did there and tell about maybe how that experience about people and seeing people helped you create something that people
Ronald Johnson: Yes.
Patrick and Ron: really wanted.
Ronald Johnson: yeah. For example, I you know, I was I left business school, I unloaded trucks at a Mervyn store, I got to ring on the cash register, work my way up, but I really learned a lot about retail, became a very good merchant. The merchant's the one who picks the products and gets to market those. And and at a very young age, I had a chance to lead several divisions, but I led the home area in my Like 35 years old, huge area for Target.
Patrick and Ron: Yeah.
Ronald Johnson: And and I was just gotten married building a house. And I realized that Target had all these functional items, but nothing that you would really look at and go, wow. And I traveled to these stores and see these beautiful objects. And I I had this question. I said, Well, why does good design have to be so expensive? The tea kettle I wanted to buy for my house was $150. But the top price we sold at Target was 999. And I remember thinking, why is that? And so I I I really care deeply about how do you take merchandise and improve someone's life? How do you make shopping fun? How do you discover incredible things? And so rather than just carrying products that were in the marketplace, I found an architect named Michael Graves to design products for Target. And It was actually the first retail collaboration ever. You know, they're so common today. But Michael did the design. We took Target's sourcing capability and sourced the products. We launched with 140 products for the home. And it was just wildly successful. And Target became known. It was already Target, but it really reinforced the image. It put Target on the map. The stock price went up a dozen times during the 90s when I was there. And today Target's had 25 years of design that's really impacted them. And that was all because I had this little idea, like I grew up, of spending a lot of time observing what do people really need that they don't know they need. And that's what design was, because it wasn't available. But a product can really lift your spirits. You know, just like and as we know today, putting your first time you touch an iPhone, you just go, wow. And you realize what a product can do for you. And but that came back to really having an astute ability to understand what people need that they might not know they need yet. Right.
Patrick and Ron: What would you say to folks who they hear they hear what you're talking about? 'Cause I I I can I can im I can remember going into Target many years ago and just seeing the beginning of those type of collaborations and I didn't know the hand that was kind of moving behind the scenes, but it
Ronald Johnson: Mm-hmm.
Patrick and Ron: it became known for Target plus someone doing something really cool, especially in the in the home area. So There's lots of people probably who who may have an instinct or they they say something, they see something but they don't say something, or they don't make the move, or they don't feel like they're the one willing to take that risk. Can you give them some advice from your target experience that kind of
Ronald Johnson: Yeah.
Patrick and Ron: taught you about, hey, sometimes you gotta make that bolder move?
Ronald Johnson: You got well, I just feel like, you know, most things in business, it's easy to improve. It's really hard to innovate. You know, and what happens is most people are really comfortable. They'll see something someone else has done before, like another retailer, and
Patrick and Ron: Mm-hmm.
Ronald Johnson: you'll say, I'll do my version of that. And that's a good thing to do. It's good to pay attention to the marketplace, but it rarely breaks through the clutter. So if you want to do something great, you got to do something that nobody's ever seen before. And that takes courage. And you have to be willing to take risk. But there's always a way to mitigate risk. You know, like in my case, I really want to do design. I got so inspired by design. I talked to my buyers, they're little nervous. So I went out with my daughter at the time, and my daughter, you know, just had a baby back in July, you know, just a couple of months ago. And but I remember walking her through a Walmart store and I said, Well, we have. 30 toasters. I wonder how many Walmart has. And Walmart had 24. And I counted every item in their assortment and Target had more SKUs. And I said, they're our big competitors. So as long as 24 of our products are priced for a Walmart customer and a Target customer and they meet that need, I've got six that I can do whatever I want with, and it won't even matter if they sell. I can just have fun. And
Patrick and Ron: Yeah.
Ronald Johnson: I told my team, let's push the envelope, let's do that in every category. Let's bring design to the world. And we're gonna have a tent poll being Michael Graves, but we'll get every one of our partners to take their best elevated products and bring them to Target. And that was a way to get people at the time who were shopping at these emerging specialty stores like Crate and Barrel and William Snowma in Pottery Barn as part of their Target run to say, well, what if, wow, I can find stuff like that at Target? And it really put Target on the map. And I guess you just have to, if you really believe in something, you got to have the courage to figure out how to do that. And a lot of that is just having the courage to do it, but you got to think really deeply about how you mitigate the risk. And in that case, I did it by knowing we had a bigger assortment and I could manage that. and it's just really fun to do things that have never been done before. You know, Steve famously created that Think Different ad. You all have probably here's the crazy ones. You know, the people who, you know, are crazy enough to think they can change the world are the ones who do. You know, so you gotta have a little courage, to do something great. And but it's easier in my career to get people to rally behind a big idea than a little idea. 'Cause people Yeah.
Patrick and Ron: Well usually but usually both of take a s a similar amount of effort. The big ideas and little ideas. Yeah.
Ronald Johnson: They take the same effort, but the big idea becomes you're part of something meaningful. You know,
Patrick and Ron: Yeah, that's so true.
Ronald Johnson: and that's really what you wanna that's really what you wanna happen. You know, you see it now, you know, just again, two months ago, the World Cup was taking the US by storm all over US, Mexico, and Canada. But you watch those teams, how meaningful it is to play for a world championship. Well, you can do that every day in work if you choose to play for a world championship. Now, how do I make my company the absolute best in the world at what our category is? And to do that, you have to dream. You gotta use your inner voice. You've got to trust your intuition. You gotta think different. But you know, that's really how you make a difference. And I I was always comfortable doing that.
Patrick and Ron: So y yeah, you worked at one championship team in Target for sure. Dom you know, very dominant in the space, at the top of the co kind of competitive ladder, and then you went and worked at another one. at Apple and you mentioned Steve and you mentioned the the phone and Apple products. I mean I'm I'm holding an iPhone right now for those who are watching us on screen and and there's just something like intuitive that I could pick this thing up and just knew when I first got it how it worked. There was a time in my life where I didn't even want to get a new computer because I was like, it's gonna be a big problem. I'll lose my contacts or whatever or a new phone, a new device of any type. And now I I've been using Apple products for a long time, but now it's just like plug and play it just moves over to the next thing. So in
Ronald Johnson: I don't know
Patrick and Ron: hindsight I could see you look back and say, you know, why would Why would Ron go join Steve Jobs? He was doing already great at Target, but what what was the thing that kind of convinced you to make that move
Ronald Johnson: Yeah.
Patrick and Ron: then?
Ronald Johnson: What what made it, you know, and it was a risky move because Apple wasn't doing well at the time.
Patrick and Ron: Yeah.
Ronald Johnson: You know, Apple is a you know, kind of had lost the computer wars and all we had were four computers. But when I met Steve and I had a three hour interview with him one day, and he found me because of the design work I did at Target. And I said, Who's that guy doing all the design stuff? I want to meet him. He knew that Apple had to, he believed that Apple had to control the customer experience if it was gonna win. Because for 25 years, Apple had made better computers with a better operating system. Everyone believed that, but they had 5% market share because their go to market was weak. Well, you have to then take control of that opportunity. So he wanted to open stores. And for me, at Target, I was only doing merchandising. And if I went to Apple, I'd have a chance to create everything from scratch. You know, I was 40 years old, but you know, where do you put the stores? Where do you locate? How big they should be? What is the design? What are those services? How do we hire people? Who do we hire? You know, I got a chance to imagine everything, obviously with Steve with the team. And I was just inspired by the chance to go do that. And so I took a risk, went to Apple, joined their leadership team. And, you know, everyone thinks the stores were an overnight success. It took us three years to get to profitability. It took the iPod going to Windows to really. Give us a product at enough volume. We couldn't do it on the computer alone at that time. but the stores ended up working great. And
Patrick and Ron: It it it sounded like Steve must have given you Steve Jobs must have given you enough runway. And if
Ronald Johnson: He gave me total well, I told him, you know, when I first met him, he said, it goes back to one of my big philosophies. He said, Ron, I really want you to do this. My board's approved a four-store test. I said, Well, good for you. I hope you can find someone to do this for you. And
Patrick and Ron: Ha ha.
Ronald Johnson: he said, What do you mean? I thought you'd want to do this. He said, I said, I'm not going to give up my career for a test. I said, tests really don't work, Steve. Because when you test something, there's no belief. Because you're testing it. When you do something that's critical, you've got to have a will to make it work. And you got to believe. And so if you want to go open, you know, a hundred stores, I'll come. But I need that commitment, because then I can recruit great people to come help us do a hundred stores. And he said, Ron, I've got four billion dollars in the bank. We've got that at Apple. And if I could write a billion dollar check today and have a hundred stores, I would write it. And I shook his hand and said, I'm in. You know, so once yeah.
Patrick and Ron: You know, it's it it's yeah, it's so interesting. When when Patterson and I were working on our book together, James Patterson, he we were talking to a par a a partner and they said, Well let's let's let's crawl and then let's walk and let's run. Let's let's do this thing and then we can scale it from there and go from and see see how it works. And he goes he goes, I don't crawl, I don't walk, I just run and his idea his thinking
Ronald Johnson: Mm-hmm.
Patrick and Ron: was like if the idea is big enough and we're gonna go after it, we gotta go hard. Because oftentimes
Ronald Johnson: Exactly.
Patrick and Ron: if we if we just dip our toe in the water, A we might not get enough data to make a better decision on anyway. And B we're showing that we're not that committed to it. And C, it's really easy to go, C we knew it wasn't gonna necessarily work out anyway.
Ronald Johnson: Yeah, no, but like for us, you know, we, you know, I I could argue we crawled, walked, and run. We we opened 25 stores the first year, which is two a week. But I
Patrick and Ron: Mm-hmm.
Ronald Johnson: said to Steve, let's just methodically open two store air store every two weeks, start building them out across the US, we'll go to other countries, we'll adapt as we go. But if we're committed to controlling and influencing the point of sale, we've got to believe in it. So let's put that. So we we learned, we got better all the time, we made changes. You know, our first stores were 6,000 square feet. Our second year we went down to 4,000. We cut
Patrick and Ron: Mm.
Ronald Johnson: the size by a third, offered all the same features, just in smaller ways. And then we had to build them big again because the stores got really busy. But I I really do think there's something about a commitment. When it's important to what you're trying to do, it's strategic. You got to go do it. You know, and Apple always did that. You know, Steve, you know, when he did the phone, we had to be all in. We didn't test a phone. We spent years making that iPhone. And and even there, Steve said, We've got to play to win. And, you know, at the time everyone was on Blackberries and they're getting into, you know, using their phone as a communicator and they had keyboards. And you know, we did the
Patrick and Ron: Mm-hmm.
Ronald Johnson: iPhone without a keyboard and people thought there's no way that's gonna work.
Patrick and Ron: you took away the home button at one point. I thought I I couldn't know I wasn't gonna live. I didn't know what was gonna happen. Yeah, yeah, yeah.
Ronald Johnson: Yeah. But it all worked, you know, and that's because but we had the courage to to figure out what is it customers would really love and go build that. You know, and so we yeah, go ahead. No, no, no, you didn't yeah.
Patrick and Ron: What do you think? I'm sorry, I'm sorry, man. I didn't mean to step on you there, but what what what what do you think made Apple stores kind of fundamentally different? Because when I think of other electronics retailers, so I can think of like what I would consider more like big box, and I don't know the right terminology in the space, but no kind of more big box-ish type of retailers' electronics, and then obviously ones that are a little bit more bespoke or very brand oriented. And then I remember stores like Gateway and I remember think, you
Ronald Johnson: Mm-hmm.
Patrick and Ron: know, Microsoft still has some stores out there and things like that, but it's just something about Apple stores that made them fundamentally different.
Ronald Johnson: Yeah, I think it it it it's like anything, it's a lot of things. I'll just tell you a few things and I'll tell you the most important thing. First, there were located malls. You know, why would you put a computer store in a mall? You're gonna buy one every four years. Malls have frequency, but boom, there was a change. Instead of all these apparel and home stores, there was a technology store. So people had a reason to come in. It was the only one in the mall. Right? Then the space was designed that was very spartan. There was only two things you could do. Put your hands on a product and they were all connected to the internet so you could try them. Or talk to an employee. There was nothing else. There was no boxes on the floor, just products to try. You know, that was a big deal. But the most important thing was the people we hired. You know, we hired people and we didn't put them on commission. You know, anybody selling a high ticket product had commissioned salespeople. We had people that were people people first, technology people second. People, people first, never a salesperson. You know, we believe that the Apple product, if someone really got their hands on it and knew what it could do, they would buy it. And we wouldn't need a salesperson. And so the stores became these inviting places to belong. And then we had half the space devoted to owners, even though we didn't have many owners. We had a few Mac people out there, but we created places like the Genius Bar to get help, theaters to go to classes, tables to get training. You know, places for kids. You know, we just created a place that was quite different and created a place you could belong. And people connected with it. you know, and and you know, a lot of people have tried to copy the Apple store, but copies rarely work because they miss the secret sauce. And that was our culture to really, you know, enrich the lives of customers. You know, back to my neighborhood. How do you How do you take a person, approach with a warm welcome, find out what they need, present a solution that really is going to change your life? And if they buy it, say thank you and we're gonna support you. And they don't, you know, hope you come back someday. You know, just
Patrick and Ron: Yeah.
Ronald Johnson: a really friendly place. you know, the stores are
Patrick and Ron: What what
Ronald Johnson: still like that. I'm still proud of the stores.
Patrick and Ron: What did that teach you about scaling something like that? Because one store every two weeks type of thing and just in growing like like you're you're building like you're building like that, all of a sudden there's just more and more people in the party and trying
Ronald Johnson: Yeah.
Patrick and Ron: to keep them all focused. I would imagine there's some fundamental differences, and I could be wrong, you could tell me no, then going into the in existing infrastructure of a target and changing some products on the on the shelves, which are changing things over time, but you're not kind of controlling the entire experience.
Ronald Johnson: Yeah.
Patrick and Ron: what did that teach you about scaling that?
Ronald Johnson: Well, the scaling, you know, the the what I learned is that when you do things on a steady rhythm, scaling is pretty easy. So for example, I wanted to meet every store leader before they started. And I told every store leader, I want you to meet every employee before they start. Because whenever I've had an interview, even like this podcast, it's an important moment. You and I will remember this conversation the rest of our lives, you know? And the same when you interview someone. And so that's a big moment. And I found, well, if we're opening two stores a week and I want to interview interview every store leader, once every two weeks I have to meet somebody for a half hour or an hour, I can do that. And if I do that, and the store manager leader does that, every employee in Apple store, no matter where they are in the world, will know somebody well who has spent time with me well. So there's one
Patrick and Ron: That's so smart, yeah.
Ronald Johnson: one person. And I was in a store. Back in July in Nice, France, and 15 employees came up to me. And I left Apple, you know, 15 years ago. And there were still 15 people there who had been part of the opening in 2010 when you opened that store and they wanted to come talk to me. And they felt like they knew me. And I think that just shows how you can be big. You know, when I left Apple, we had 60,000 retail employees. Most of them felt highly connected to me as a person. And it was just because of a few intentional decisions about staying small. And so when you're doing something on a regular rhythm, you can build scale. You you go, okay, if we're gonna open 25 stores next year, we can hire 25 people at headquarters. What are the positions we need them for? If we're gonna open 25 stores, you know, it it really is I don't know. I I th I know.
Patrick and Ron: It it's it's like it's a it's like it's a you figure out the right lead measures or lead behaviors and it it it's like a math equation to some extent.
Ronald Johnson: Yeah, yeah.
Patrick and Ron: Right? It's not that the heart isn't in it 'cause it's in it the whole time, but it's the idea of like, okay,
Ronald Johnson: No, it's a whole time.
Patrick and Ron: it's insurmountable thing all of a sudden, really all I have to do is do this thing well over the next couple of weeks.
Ronald Johnson: Right. Yeah, but yeah, but then but then you have to view, you know, and Steve was great. Steve taught me this. You're only as good as your next product. You know, for him, you're only as good as your next movie. You know, Pixar would do one movie a year in the nineties. He said, We can't do more of high quality. If he had done two movies, they could hired a few more animators and doubled their movies and double their revenue, but the quality might suffer. Steve said, you know, you do one thing great, you're in the right to do the next. So every store was like a child to me. You know, I went out and looked at the real estate. I helped design the store. I helped pick the team. Everyone was involved. We were one big team. I delegated great. But I was involved because everything we did mattered. We never let ourselves just sit headquarters and go, wow, aren't we good? Look at all these stores and all the volume.
Patrick and Ron: Yes. Sit back on what we sit back on our laurel. Look what we did.
Ronald Johnson: No, we just enjoyed the art of creating stores, of serving customers. And we live for that. And and so you never you're not managing a you're not managing a business. You're you're building relationships with people all the time. And that for me, that was the store leaders, it was the teams. They they were doing that with the customers. But it became this beautiful thing where everyone was out to serve somebody else. And and that's I think what makes great businesses. And I learned that growing up at even at business school, you know, people like Sam Walton, they're famous for their relationship to their store employees. You know, the cost co-founders, the Nordstrom family, all these great retailers really have a passion for what they do and their customers.
Patrick and Ron: So let's talk a little bit about JCPenney, 'cause I think there's some lessons there that anyone trying to create change in a company, in a family, even in theirselves can learn from it. Can you can you take us back a little bit to your time at JCPenney and kind of what did you understand
Ronald Johnson: Yeah.
Patrick and Ron: correctly about what needed to change there?
Ronald Johnson: I did everything. I understood so here's what happened is I had had 25 uninterrupted years of success in retail. Some were better than others, but from my time at Target to my time at Apple, we were just flying. And I was 50 and I I just missed doing that something really hard. And I had a chance to go to JCPenney first as a board member, but then they decided they wanted me to be a CEO. And I said, why don't I do this for the next 10 years? And I got there and you know, I had become accustomed to really using my imagination. So I developed a big vision for pennies. And I just told the board, you know, if you want me to come, here's where we want to end up. You know, we have got to get this company that's a hundred years old with an aging customer, with an outdated business model, you know, running sales all the time when everything's going to everyday price, all this stuff. I said, we've got to get to the other side and get a younger customer to want to shop at pennies. And that will get it, let us live for the next hundred years. And the board got very excited about it. And when I got there, you know, I developed that vision because I didn't want to go do the job unless they were willing to do something big. Because that was my nature. I'm a transformer. I'm not an just an improver. but then once I got there, they said, Well, Ron, we should go. And I said, No, but this is a big change. I said, we can either change. This January, next January, I said, what do we got to lose? Let's go. And I made the decision to go way too fast. And like we talked about scaling with Apple, it was two stores a week. You know, the team built the strategy together. I went to Penny's and I told the team, here's my vision. Here's what we're going to do. Trust me, let's get on board. And nobody understood it. The board wasn't ready for it, the employees weren't ready, the customer wasn't ready. We went way too fast. And everything I had done to build credibility at Apple, that didn't carry with me. The pennies people didn't know me. They thought I was a tech guy. They didn't even realize I'd spent more of my career in apparel like at Target doing like kids' clothes into all these categories Penny does. They saw me as an Apple guy. And so I just really failed. On mainly the timing and building the culture within pennies for the transformation. Because I hadn't done turnarounds. And even going back to my target time, I kept 90% of the merchandise the same. We changed 10% because we could do that without a risk. When
Patrick and Ron: Yeah.
Ronald Johnson: I went to Pennies, I changed 100% the pricing, the products, everything without building the case for the team for the customer. So it was a disruption that failed miserably, that I own more than anybody. There are a lot of people that, you know, could have helped it. but it that's what was fun about writing the book is I went into that pretty deeply and tried to share the lessons of, you know, failure as much as the lessons of success, which I had at other points in my career.
Patrick and Ron: Well, you when I'm preparing for a conversation like this, there's different questions I'll write down. I'm thinking I'll ask these if they
Ronald Johnson: Yeah.
Patrick and Ron: come up. And I I had literally had this question down and I think you hit on it, but I just wanted to put it back up again to see if there's anything else you want to add to it 'cause 'cause I I think I was my mind was fortunately my mind was going to the place you went to. I said, What did that experience teach you about the pace of change and bringing
Ronald Johnson: Yeah.
Patrick and Ron: people along?
Ronald Johnson: Yeah. I I think the pace of change correlates to the age of a company. Is if I had to put my if I had to do it rule of thumb, you know, like Apple, technology Apple was twenty-five years old, but it was a young company, a young spirit. Apple was accustomed to doing new things, like new products all the time. There weren't lot of products. So newness was a big part of the culture. Winning by being different was a big part of the culture. Pennies was a Hundred years old. It was had very established business model, ways to work. I mean, the CEO, I should have known this. When I came out to visit the CEO, he would write everything down on paper. I don't think he used his computer at all. And he would give notebooks to his team, different colors. The more senior people had yellow pages, and the next one had blue. And if he got a note from someone, he'd only read the yellow ones. You know, it was just a Completely different culture. And I should have seen that and said, Ron, you got to be very careful going in here about how you lead. Because you're walking into a place, you're going to be a fish out of water here. You know what I mean? And so
Patrick and Ron: Yeah.
Ronald Johnson: I think your pace of change has to relate to the age of the company. If you're a startup, you're moving really quickly, you're learning, you're adapting, you're trying to find product market fit. When you're an established company, you've got a product market fit that you've built over a hundred years, you wanna protect that as best you can while you find the next way to improve your fit. You know, and I just yeah.
Patrick and Ron: Do you think do you think Ron do you think that like I don't know, sometimes for myself i I'll see yellow flags or I'll see yellow pages in your case, right? I'll but I but I I'm so driven at that moment by what I'm trying to do that I'll I'll I'll ignore them a little bit or I'll think I can take
Ronald Johnson: Yeah. Yeah.
Patrick and Ron: care of them or I'll underestimate what that really means. Do you think there was a could there have been a little bit of that going on in your mind when you were moving into the role?
Ronald Johnson: I had so much arrogance. I had, I'm not a just like a shy. I was situationally shy in high school. I wasn't dispositionally shy.
Patrick and Ron: Mm.
Ronald Johnson: My nature isn't to be shy, but in that situation I was. I was situationally arrogant with pennies. I'm not an arrogant person. I'm actually quite humble. but at that time, from a retail perspective, with all my experience, I believed I knew what was best. And once we started, I said, we're gonna get there. And I'm gonna will this to success, just like I did genius bars and other things at Apple that started slow. because that was my experience. And and and I think I was I I I didn't see or address the opportunities to change as we went because I was so had such a clear vision of where we wanted to end up and how we were gonna get there. You know, does that answer your question?
Patrick and Ron: No, it totally does. It totally does. You know, I've really enjoyed the conversation as we've gone through. I think people can pick up just the you wealth of experience and perspective and successes and challenges and all of those things you've gone through. why was this the right time in your mind to r to write shop different? How retail revealed Apple's genius. Why was this the right time for it?
Ronald Johnson: This was well, was the right time. It's the 50th anniversary for Apple, 25th anniversary of Restores. I've been gone for over a decade. I've had time to digest my lessons and put something together thoughtful. And I think I've done that. And I spent three years doing that with my co-author, Xander. And I think we've written a beautiful book. So I had the time to do it well. I had the time to reflect. But we're also at a big trance technology moment of disruption. And that's AI. And the last big disruption, arguably, was the internet. And that's when we launched the Apple stores. You know, and people, when you launch the Apple stores, people like Mark Andreessen were saying, you know, stores aren't going exist. Who would go to a store when you can just conveniently order online and have it brought to your house? But you look today, stores have thrived and survived, and they're better than they ever were. And now we're entering a new technology age with. Potential disruption that people are fearful of. Well, I thought it was a good time to really address the Apple stores and how they navigated the technology changes and have people think about how this next phase could be better if embraced. You know, I'm a technology
Patrick and Ron: Yeah, I love that.
Ronald Johnson: optimist, I'm an AI optimist. I think it's going to create jobs long term. There'll be different jobs. It's going to improve retail. It's going to improve online shopping. It's going to improve everything. but we have to learn how to navigate this. And the book kind of helps people through that.
Patrick and Ron: Yeah, I was gonna ask you, the y on this podcast, we we believe disruption on disruption lab isn't just about, you know, changing industries or even the latest technology necessarily. It's about helping people build better futures for themselves
Ronald Johnson: Yeah.
Patrick and Ron: and and those around them. When someone finishes listening to this conversation that we just are having here, what's one thing or one action you hope they'll take?
Ronald Johnson: Yeah, the most important thing I think is that you will become increasingly in touch with your own inner voice. Okay. So what I mean by that is like with AI General knowledge is a query away. The only thing unique I bring to the workforce, anybody can ask AI to help them solve a problem. But what I bring uniquely to the workforce is my personal geography. It's my lived experience, where I grew up, who I worked with, whatever. And I've got a unique perspective on any problem. And that's the contribution I get to make. And unfortunately, in today's world, we're all caught up in a lot of group think. You know, we don't, you know, we watch the same news shows all the time. And in politics, we get a point of view based on listening, this echo chamber, right? A lot of people run around all day with headphones in their ears listening to music or listening to podcasts. You need to take time to think because the most important conversation you have every day is with yourself. Right. And that's where you form
Patrick and Ron: Yeah.
Ronald Johnson: your inner voice. That's what I ought to bring to work. And so I think people should slow down, get in touch with who they are, what they truly believe, and have the courage to bring their point of view to work. Not to
Patrick and Ron: How about that?
Ronald Johnson: provide answers based on what an agent offers and think you're smart, not to tell people what you think they want to hear. Tell people what you believe with every bone in your body based on your lived experience. That'd be my advice.
Patrick and Ron: That's great advice. All right, so here here's a question about what you believe with every bone in your body. So as we were doing this podcast, my my producer Jess would say to me, Patrick, you talk about disruption. You write about disruption. You you're encouraging people to sometimes look for ways to change and sometimes look for a way to go towards stability, because sometimes the most disruptive thing you can do is actually go towards stability, is what we argue as well. Everything you don't change everything necessarily. And and she said, But I watch you and you drink the same coffee latte from the same place for as long as I've known you. And she's so true, so true in what she says. I'm brand loyal to certain things. But I said, okay, I'm gonna step out of my comfort zone. And I've been pursuing what I would consider the pursuit of the best vanilla latte. So my question
Ronald Johnson: Mm-hmm.
Patrick and Ron: for you is, is there any t drink or food that you are currently pursuing the best version of in your mind? Or have you already found it and if you had enlighten us?
Ronald Johnson: No, I I think I'm looking for the best rose. No, I spend a lot of I you know, I I love I love the south of France. And in the US, you know, rose is becoming more popular, but it's like three percent. But it's just a really light, happy beverage that's not very strong on the alcohol side. But the clearer the whiter the the better it is. And I enjoy trying a different rose. periodically. So that'd be my choice.
Patrick and Ron: All right. Well, when you get the perfect one in your mind, if the if you find one, you're like, this is the quintessential, let us know so we can share it with the listeners. Well, hey Ron, thanks so
Ronald Johnson: I will do that. I will do that. I will go.
Patrick and Ron: much for joining us. Congratulations on on the new book. I'm sure you and your co author are gonna have tremendous success with it. folks, pick up a copy. I think as you learned from the conversation today, Ron just has a lot to share with us that's a lot of people just talk for the purposes of talking. You're not that guy. You're the guy who's talking because clearly, hey, I want to share some ideas that'll be helpful to you and I wanna be vulnerable in moments and say, Here's some things that didn't go as well as I'd hoped they would and what I learned along the way. And I I appreciate your willingness to do that, Ron, and thanks so much for joining us.
Ronald Johnson: And thank you.
Patrick and Ron: All right folks, that's all we have for today's episode. Big thanks to Ron Johnson for joining us today. And please pick up a copy of his book, Shop Different, How Retail Revealed Apple's Genius, I'm sure you'll enjoy it. It'll be something that'll sit by your nights then. You'll probably pick it up in triple kit for your friends and family too, as you enter into the holidays. That's all I have for today. Thanks so much for joining me. My name's Dr. Patrick Ledden. Now go make it a great day.
Ronald Johnson: I am too. I'm so excited to meet you and talk with you and your audience.
Patrick and Ron: So you're I am excited to meet you as well. Your career, you know, Ron, it's really one of the most interesting in business. You helped transform Target. You reinvented the retail experience at Apple. You led one of the most talked-about transformations in American retail at JCPenney. And today you're continuing to build, invest, and teach others your new through your new book, called Shop Different, How Retail Revealed Apple's Genius in Stores September 22nd, So congratulations on that.
Ronald Johnson: Well, thank you for that. No, it was really fun to write the book because you it forced you to look back and think deeply about what you did, what worked, what didn't. You know, as you know, life has a lot of curveballs it throws you. And
Patrick and Ron: Sure does.
Ronald Johnson: sometimes you get fastballs, you can hit hit well, like my time at Apple and Target. And sometimes you get a fastball you miss, like at JCPenney. And, you know, it's fun to talk about, but it was fun to reflect on all of those experiences.
Patrick and Ron: Yeah, I I'm glad you're open to talk about the experience because I think we can help listeners think about whether it's their career or their personal walk in life, some practical ways they can kind of think about these things and learn from somebody who's who's kind of done it all. I mean you've sit in some really positions of consequence and and taken on some big transformations. But let's start with a little bit about you. You know, before the titles and the companies, like who is Ron Johnson?
Ronald Johnson: Well, I just I'm just a pretty normal kid who grew up in the Midwest. I grew up went to public high school in Edina, Minnesota. And looking back, it had a huge impact on my life. I had the blessing of two amazing parents who were dedicated to me, my brother, my sister. I grew up learning a lot about kindness and generosity and hospitality. And as I look back, you know, at what I did in my career. It's hard to separate my personal geography, my lived experience as a child with what I did at work. And that's most profound at Apple, where we created a place people belong. But it's really a reflection of the neighborhood I grew up in. You know, the store became this unbelievably welcoming place where we tried to, you know, improve people's lives. And that's kind of what my parents did for me and my siblings and for the neighborhood we had. And So I grew up there, I went to Stanford, Harvard Business School and then be decided to become a retailer.
Patrick and Ron: It it is amazing how experiences earlier in life can really shape so many things for us. And I think you and I were talking previously before we started recording that in in the process of writing a book, some of that is kind of revealed. What do you think are some of the things specifically that may have shaped you along the way?
Ronald Johnson: Well, I think there was, you know, a couple of experiences. I was a pretty shy kid. You know, I grew up, like I said, elementary. I was just in a neighborhood where everybody knew me. I went to middle school and I felt like sought a place. I didn't know anybody. I had to take a bus instead of walk to school. And I I I kind of wanted to be, I was a great athlete, wanted to be like one of the cool kids, but I really didn't have the cool factor or whatever. And I found it was easier to Befriend people I saw like me, who were kind of quiet, didn't feel like they fit in. And I began to establish all these relationships with kids that I felt, you know, just needed a friend, like I needed a friend.
Patrick and Ron: Mm.
Ronald Johnson: And somehow through that, I became a very popular guy and a leader. I was able to captain both my high school baseball and soccer teams. They were very good teams at a good school. Went on to Stanford, but I think a lot of it comes back to how you establish connections with other people. And I was forced to do that really with my shyness. And but I found it easy, you know, my dad said, you know, people like to talk about themselves. So don't worry about what you have to say. Just go ask some good questions. And as I got to know people, you know, they just love that they were seen.
Patrick and Ron: I I know I'm I'm a bit introverted myself and it's it's it's it is so easy to get overwhelmed in certain situations, but on the other hand it's like just ask people about themselves and they're happy to tell you. And you probably I would imagine you probably then had situations where You had this network of people where people like Ron, how'd you even know that person? You know, well, because I talked to
Ronald Johnson: Exactly.
Patrick and Ron: them, I saw them, all all those type of things that other kids may not have overlook may have overlooked along the way. So you
Ronald Johnson: Well, the biggest yeah, the biggest surprise me, I was in eighth grade and I was at I went to Lutheran church my family, everyone went to church in Minnesota. I remember we had a big church and they had to we had to pick a confirmation class president and they said, Well, this week we're gonna vote and next week we'll announce your president. You just had to write in a name. And we had about 250 people in the class. And the next week I get there. And I mean, I'm this super shy kid. I'm like holding my windbreaker, you know, always looking down. And they go, and the president is Ron Johnson. And I'm going, I didn't even know people knew my name, let alone writ wrote it down. But it was honestly,
Patrick and Ron: You're like I didn't know there was another Ron Johnson in this group.
Ronald Johnson: it was such a revelation. I was like, how did that happen? And you know, I it was just It was a life-changing observation. Because I think, you know, in the best situation, you don't think about yourself, you think about others. And when you're thinking about others, you just assume, you know, nobody really thinks about you. But they do. They notice that. And my whole career, I just love like I love being in stores. I love meeting customers. I love helping people. And all that is a function and it's a very simple way to live, but it's all a function of my childhood.
Patrick and Ron: So what what do you think okay so take us to Target. We'll go to Target. Tell a little
Ronald Johnson: Yeah, yeah.
Patrick and Ron: bit about what you did there and tell about maybe how that experience about people and seeing people helped you create something that people
Ronald Johnson: Yes.
Patrick and Ron: really wanted.
Ronald Johnson: yeah. For example, I you know, I was I left business school, I unloaded trucks at a Mervyn store, I got to ring on the cash register, work my way up, but I really learned a lot about retail, became a very good merchant. The merchant's the one who picks the products and gets to market those. And and at a very young age, I had a chance to lead several divisions, but I led the home area in my Like 35 years old, huge area for Target.
Patrick and Ron: Yeah.
Ronald Johnson: And and I was just gotten married building a house. And I realized that Target had all these functional items, but nothing that you would really look at and go, wow. And I traveled to these stores and see these beautiful objects. And I I had this question. I said, Well, why does good design have to be so expensive? The tea kettle I wanted to buy for my house was $150. But the top price we sold at Target was 999. And I remember thinking, why is that? And so I I I really care deeply about how do you take merchandise and improve someone's life? How do you make shopping fun? How do you discover incredible things? And so rather than just carrying products that were in the marketplace, I found an architect named Michael Graves to design products for Target. And It was actually the first retail collaboration ever. You know, they're so common today. But Michael did the design. We took Target's sourcing capability and sourced the products. We launched with 140 products for the home. And it was just wildly successful. And Target became known. It was already Target, but it really reinforced the image. It put Target on the map. The stock price went up a dozen times during the 90s when I was there. And today Target's had 25 years of design that's really impacted them. And that was all because I had this little idea, like I grew up, of spending a lot of time observing what do people really need that they don't know they need. And that's what design was, because it wasn't available. But a product can really lift your spirits. You know, just like and as we know today, putting your first time you touch an iPhone, you just go, wow. And you realize what a product can do for you. And but that came back to really having an astute ability to understand what people need that they might not know they need yet. Right.
Patrick and Ron: What would you say to folks who they hear they hear what you're talking about? 'Cause I I I can I can im I can remember going into Target many years ago and just seeing the beginning of those type of collaborations and I didn't know the hand that was kind of moving behind the scenes, but it
Ronald Johnson: Mm-hmm.
Patrick and Ron: it became known for Target plus someone doing something really cool, especially in the in the home area. So There's lots of people probably who who may have an instinct or they they say something, they see something but they don't say something, or they don't make the move, or they don't feel like they're the one willing to take that risk. Can you give them some advice from your target experience that kind of
Ronald Johnson: Yeah.
Patrick and Ron: taught you about, hey, sometimes you gotta make that bolder move?
Ronald Johnson: You got well, I just feel like, you know, most things in business, it's easy to improve. It's really hard to innovate. You know, and what happens is most people are really comfortable. They'll see something someone else has done before, like another retailer, and
Patrick and Ron: Mm-hmm.
Ronald Johnson: you'll say, I'll do my version of that. And that's a good thing to do. It's good to pay attention to the marketplace, but it rarely breaks through the clutter. So if you want to do something great, you got to do something that nobody's ever seen before. And that takes courage. And you have to be willing to take risk. But there's always a way to mitigate risk. You know, like in my case, I really want to do design. I got so inspired by design. I talked to my buyers, they're little nervous. So I went out with my daughter at the time, and my daughter, you know, just had a baby back in July, you know, just a couple of months ago. And but I remember walking her through a Walmart store and I said, Well, we have. 30 toasters. I wonder how many Walmart has. And Walmart had 24. And I counted every item in their assortment and Target had more SKUs. And I said, they're our big competitors. So as long as 24 of our products are priced for a Walmart customer and a Target customer and they meet that need, I've got six that I can do whatever I want with, and it won't even matter if they sell. I can just have fun. And
Patrick and Ron: Yeah.
Ronald Johnson: I told my team, let's push the envelope, let's do that in every category. Let's bring design to the world. And we're gonna have a tent poll being Michael Graves, but we'll get every one of our partners to take their best elevated products and bring them to Target. And that was a way to get people at the time who were shopping at these emerging specialty stores like Crate and Barrel and William Snowma in Pottery Barn as part of their Target run to say, well, what if, wow, I can find stuff like that at Target? And it really put Target on the map. And I guess you just have to, if you really believe in something, you got to have the courage to figure out how to do that. And a lot of that is just having the courage to do it, but you got to think really deeply about how you mitigate the risk. And in that case, I did it by knowing we had a bigger assortment and I could manage that. and it's just really fun to do things that have never been done before. You know, Steve famously created that Think Different ad. You all have probably here's the crazy ones. You know, the people who, you know, are crazy enough to think they can change the world are the ones who do. You know, so you gotta have a little courage, to do something great. And but it's easier in my career to get people to rally behind a big idea than a little idea. 'Cause people Yeah.
Patrick and Ron: Well usually but usually both of take a s a similar amount of effort. The big ideas and little ideas. Yeah.
Ronald Johnson: They take the same effort, but the big idea becomes you're part of something meaningful. You know,
Patrick and Ron: Yeah, that's so true.
Ronald Johnson: and that's really what you wanna that's really what you wanna happen. You know, you see it now, you know, just again, two months ago, the World Cup was taking the US by storm all over US, Mexico, and Canada. But you watch those teams, how meaningful it is to play for a world championship. Well, you can do that every day in work if you choose to play for a world championship. Now, how do I make my company the absolute best in the world at what our category is? And to do that, you have to dream. You gotta use your inner voice. You've got to trust your intuition. You gotta think different. But you know, that's really how you make a difference. And I I was always comfortable doing that.
Patrick and Ron: So y yeah, you worked at one championship team in Target for sure. Dom you know, very dominant in the space, at the top of the co kind of competitive ladder, and then you went and worked at another one. at Apple and you mentioned Steve and you mentioned the the phone and Apple products. I mean I'm I'm holding an iPhone right now for those who are watching us on screen and and there's just something like intuitive that I could pick this thing up and just knew when I first got it how it worked. There was a time in my life where I didn't even want to get a new computer because I was like, it's gonna be a big problem. I'll lose my contacts or whatever or a new phone, a new device of any type. And now I I've been using Apple products for a long time, but now it's just like plug and play it just moves over to the next thing. So in
Ronald Johnson: I don't know
Patrick and Ron: hindsight I could see you look back and say, you know, why would Why would Ron go join Steve Jobs? He was doing already great at Target, but what what was the thing that kind of convinced you to make that move
Ronald Johnson: Yeah.
Patrick and Ron: then?
Ronald Johnson: What what made it, you know, and it was a risky move because Apple wasn't doing well at the time.
Patrick and Ron: Yeah.
Ronald Johnson: You know, Apple is a you know, kind of had lost the computer wars and all we had were four computers. But when I met Steve and I had a three hour interview with him one day, and he found me because of the design work I did at Target. And I said, Who's that guy doing all the design stuff? I want to meet him. He knew that Apple had to, he believed that Apple had to control the customer experience if it was gonna win. Because for 25 years, Apple had made better computers with a better operating system. Everyone believed that, but they had 5% market share because their go to market was weak. Well, you have to then take control of that opportunity. So he wanted to open stores. And for me, at Target, I was only doing merchandising. And if I went to Apple, I'd have a chance to create everything from scratch. You know, I was 40 years old, but you know, where do you put the stores? Where do you locate? How big they should be? What is the design? What are those services? How do we hire people? Who do we hire? You know, I got a chance to imagine everything, obviously with Steve with the team. And I was just inspired by the chance to go do that. And so I took a risk, went to Apple, joined their leadership team. And, you know, everyone thinks the stores were an overnight success. It took us three years to get to profitability. It took the iPod going to Windows to really. Give us a product at enough volume. We couldn't do it on the computer alone at that time. but the stores ended up working great. And
Patrick and Ron: It it it sounded like Steve must have given you Steve Jobs must have given you enough runway. And if
Ronald Johnson: He gave me total well, I told him, you know, when I first met him, he said, it goes back to one of my big philosophies. He said, Ron, I really want you to do this. My board's approved a four-store test. I said, Well, good for you. I hope you can find someone to do this for you. And
Patrick and Ron: Ha ha.
Ronald Johnson: he said, What do you mean? I thought you'd want to do this. He said, I said, I'm not going to give up my career for a test. I said, tests really don't work, Steve. Because when you test something, there's no belief. Because you're testing it. When you do something that's critical, you've got to have a will to make it work. And you got to believe. And so if you want to go open, you know, a hundred stores, I'll come. But I need that commitment, because then I can recruit great people to come help us do a hundred stores. And he said, Ron, I've got four billion dollars in the bank. We've got that at Apple. And if I could write a billion dollar check today and have a hundred stores, I would write it. And I shook his hand and said, I'm in. You know, so once yeah.
Patrick and Ron: You know, it's it it's yeah, it's so interesting. When when Patterson and I were working on our book together, James Patterson, he we were talking to a par a a partner and they said, Well let's let's let's crawl and then let's walk and let's run. Let's let's do this thing and then we can scale it from there and go from and see see how it works. And he goes he goes, I don't crawl, I don't walk, I just run and his idea his thinking
Ronald Johnson: Mm-hmm.
Patrick and Ron: was like if the idea is big enough and we're gonna go after it, we gotta go hard. Because oftentimes
Ronald Johnson: Exactly.
Patrick and Ron: if we if we just dip our toe in the water, A we might not get enough data to make a better decision on anyway. And B we're showing that we're not that committed to it. And C, it's really easy to go, C we knew it wasn't gonna necessarily work out anyway.
Ronald Johnson: Yeah, no, but like for us, you know, we, you know, I I could argue we crawled, walked, and run. We we opened 25 stores the first year, which is two a week. But I
Patrick and Ron: Mm-hmm.
Ronald Johnson: said to Steve, let's just methodically open two store air store every two weeks, start building them out across the US, we'll go to other countries, we'll adapt as we go. But if we're committed to controlling and influencing the point of sale, we've got to believe in it. So let's put that. So we we learned, we got better all the time, we made changes. You know, our first stores were 6,000 square feet. Our second year we went down to 4,000. We cut
Patrick and Ron: Mm.
Ronald Johnson: the size by a third, offered all the same features, just in smaller ways. And then we had to build them big again because the stores got really busy. But I I really do think there's something about a commitment. When it's important to what you're trying to do, it's strategic. You got to go do it. You know, and Apple always did that. You know, Steve, you know, when he did the phone, we had to be all in. We didn't test a phone. We spent years making that iPhone. And and even there, Steve said, We've got to play to win. And, you know, at the time everyone was on Blackberries and they're getting into, you know, using their phone as a communicator and they had keyboards. And you know, we did the
Patrick and Ron: Mm-hmm.
Ronald Johnson: iPhone without a keyboard and people thought there's no way that's gonna work.
Patrick and Ron: you took away the home button at one point. I thought I I couldn't know I wasn't gonna live. I didn't know what was gonna happen. Yeah, yeah, yeah.
Ronald Johnson: Yeah. But it all worked, you know, and that's because but we had the courage to to figure out what is it customers would really love and go build that. You know, and so we yeah, go ahead. No, no, no, you didn't yeah.
Patrick and Ron: What do you think? I'm sorry, I'm sorry, man. I didn't mean to step on you there, but what what what what do you think made Apple stores kind of fundamentally different? Because when I think of other electronics retailers, so I can think of like what I would consider more like big box, and I don't know the right terminology in the space, but no kind of more big box-ish type of retailers' electronics, and then obviously ones that are a little bit more bespoke or very brand oriented. And then I remember stores like Gateway and I remember think, you
Ronald Johnson: Mm-hmm.
Patrick and Ron: know, Microsoft still has some stores out there and things like that, but it's just something about Apple stores that made them fundamentally different.
Ronald Johnson: Yeah, I think it it it it's like anything, it's a lot of things. I'll just tell you a few things and I'll tell you the most important thing. First, there were located malls. You know, why would you put a computer store in a mall? You're gonna buy one every four years. Malls have frequency, but boom, there was a change. Instead of all these apparel and home stores, there was a technology store. So people had a reason to come in. It was the only one in the mall. Right? Then the space was designed that was very spartan. There was only two things you could do. Put your hands on a product and they were all connected to the internet so you could try them. Or talk to an employee. There was nothing else. There was no boxes on the floor, just products to try. You know, that was a big deal. But the most important thing was the people we hired. You know, we hired people and we didn't put them on commission. You know, anybody selling a high ticket product had commissioned salespeople. We had people that were people people first, technology people second. People, people first, never a salesperson. You know, we believe that the Apple product, if someone really got their hands on it and knew what it could do, they would buy it. And we wouldn't need a salesperson. And so the stores became these inviting places to belong. And then we had half the space devoted to owners, even though we didn't have many owners. We had a few Mac people out there, but we created places like the Genius Bar to get help, theaters to go to classes, tables to get training. You know, places for kids. You know, we just created a place that was quite different and created a place you could belong. And people connected with it. you know, and and you know, a lot of people have tried to copy the Apple store, but copies rarely work because they miss the secret sauce. And that was our culture to really, you know, enrich the lives of customers. You know, back to my neighborhood. How do you How do you take a person, approach with a warm welcome, find out what they need, present a solution that really is going to change your life? And if they buy it, say thank you and we're gonna support you. And they don't, you know, hope you come back someday. You know, just
Patrick and Ron: Yeah.
Ronald Johnson: a really friendly place. you know, the stores are
Patrick and Ron: What what
Ronald Johnson: still like that. I'm still proud of the stores.
Patrick and Ron: What did that teach you about scaling something like that? Because one store every two weeks type of thing and just in growing like like you're you're building like you're building like that, all of a sudden there's just more and more people in the party and trying
Ronald Johnson: Yeah.
Patrick and Ron: to keep them all focused. I would imagine there's some fundamental differences, and I could be wrong, you could tell me no, then going into the in existing infrastructure of a target and changing some products on the on the shelves, which are changing things over time, but you're not kind of controlling the entire experience.
Ronald Johnson: Yeah.
Patrick and Ron: what did that teach you about scaling that?
Ronald Johnson: Well, the scaling, you know, the the what I learned is that when you do things on a steady rhythm, scaling is pretty easy. So for example, I wanted to meet every store leader before they started. And I told every store leader, I want you to meet every employee before they start. Because whenever I've had an interview, even like this podcast, it's an important moment. You and I will remember this conversation the rest of our lives, you know? And the same when you interview someone. And so that's a big moment. And I found, well, if we're opening two stores a week and I want to interview interview every store leader, once every two weeks I have to meet somebody for a half hour or an hour, I can do that. And if I do that, and the store manager leader does that, every employee in Apple store, no matter where they are in the world, will know somebody well who has spent time with me well. So there's one
Patrick and Ron: That's so smart, yeah.
Ronald Johnson: one person. And I was in a store. Back in July in Nice, France, and 15 employees came up to me. And I left Apple, you know, 15 years ago. And there were still 15 people there who had been part of the opening in 2010 when you opened that store and they wanted to come talk to me. And they felt like they knew me. And I think that just shows how you can be big. You know, when I left Apple, we had 60,000 retail employees. Most of them felt highly connected to me as a person. And it was just because of a few intentional decisions about staying small. And so when you're doing something on a regular rhythm, you can build scale. You you go, okay, if we're gonna open 25 stores next year, we can hire 25 people at headquarters. What are the positions we need them for? If we're gonna open 25 stores, you know, it it really is I don't know. I I th I know.
Patrick and Ron: It it's it's like it's a it's like it's a you figure out the right lead measures or lead behaviors and it it it's like a math equation to some extent.
Ronald Johnson: Yeah, yeah.
Patrick and Ron: Right? It's not that the heart isn't in it 'cause it's in it the whole time, but it's the idea of like, okay,
Ronald Johnson: No, it's a whole time.
Patrick and Ron: it's insurmountable thing all of a sudden, really all I have to do is do this thing well over the next couple of weeks.
Ronald Johnson: Right. Yeah, but yeah, but then but then you have to view, you know, and Steve was great. Steve taught me this. You're only as good as your next product. You know, for him, you're only as good as your next movie. You know, Pixar would do one movie a year in the nineties. He said, We can't do more of high quality. If he had done two movies, they could hired a few more animators and doubled their movies and double their revenue, but the quality might suffer. Steve said, you know, you do one thing great, you're in the right to do the next. So every store was like a child to me. You know, I went out and looked at the real estate. I helped design the store. I helped pick the team. Everyone was involved. We were one big team. I delegated great. But I was involved because everything we did mattered. We never let ourselves just sit headquarters and go, wow, aren't we good? Look at all these stores and all the volume.
Patrick and Ron: Yes. Sit back on what we sit back on our laurel. Look what we did.
Ronald Johnson: No, we just enjoyed the art of creating stores, of serving customers. And we live for that. And and so you never you're not managing a you're not managing a business. You're you're building relationships with people all the time. And that for me, that was the store leaders, it was the teams. They they were doing that with the customers. But it became this beautiful thing where everyone was out to serve somebody else. And and that's I think what makes great businesses. And I learned that growing up at even at business school, you know, people like Sam Walton, they're famous for their relationship to their store employees. You know, the cost co-founders, the Nordstrom family, all these great retailers really have a passion for what they do and their customers.
Patrick and Ron: So let's talk a little bit about JCPenney, 'cause I think there's some lessons there that anyone trying to create change in a company, in a family, even in theirselves can learn from it. Can you can you take us back a little bit to your time at JCPenney and kind of what did you understand
Ronald Johnson: Yeah.
Patrick and Ron: correctly about what needed to change there?
Ronald Johnson: I did everything. I understood so here's what happened is I had had 25 uninterrupted years of success in retail. Some were better than others, but from my time at Target to my time at Apple, we were just flying. And I was 50 and I I just missed doing that something really hard. And I had a chance to go to JCPenney first as a board member, but then they decided they wanted me to be a CEO. And I said, why don't I do this for the next 10 years? And I got there and you know, I had become accustomed to really using my imagination. So I developed a big vision for pennies. And I just told the board, you know, if you want me to come, here's where we want to end up. You know, we have got to get this company that's a hundred years old with an aging customer, with an outdated business model, you know, running sales all the time when everything's going to everyday price, all this stuff. I said, we've got to get to the other side and get a younger customer to want to shop at pennies. And that will get it, let us live for the next hundred years. And the board got very excited about it. And when I got there, you know, I developed that vision because I didn't want to go do the job unless they were willing to do something big. Because that was my nature. I'm a transformer. I'm not an just an improver. but then once I got there, they said, Well, Ron, we should go. And I said, No, but this is a big change. I said, we can either change. This January, next January, I said, what do we got to lose? Let's go. And I made the decision to go way too fast. And like we talked about scaling with Apple, it was two stores a week. You know, the team built the strategy together. I went to Penny's and I told the team, here's my vision. Here's what we're going to do. Trust me, let's get on board. And nobody understood it. The board wasn't ready for it, the employees weren't ready, the customer wasn't ready. We went way too fast. And everything I had done to build credibility at Apple, that didn't carry with me. The pennies people didn't know me. They thought I was a tech guy. They didn't even realize I'd spent more of my career in apparel like at Target doing like kids' clothes into all these categories Penny does. They saw me as an Apple guy. And so I just really failed. On mainly the timing and building the culture within pennies for the transformation. Because I hadn't done turnarounds. And even going back to my target time, I kept 90% of the merchandise the same. We changed 10% because we could do that without a risk. When
Patrick and Ron: Yeah.
Ronald Johnson: I went to Pennies, I changed 100% the pricing, the products, everything without building the case for the team for the customer. So it was a disruption that failed miserably, that I own more than anybody. There are a lot of people that, you know, could have helped it. but it that's what was fun about writing the book is I went into that pretty deeply and tried to share the lessons of, you know, failure as much as the lessons of success, which I had at other points in my career.
Patrick and Ron: Well, you when I'm preparing for a conversation like this, there's different questions I'll write down. I'm thinking I'll ask these if they
Ronald Johnson: Yeah.
Patrick and Ron: come up. And I I had literally had this question down and I think you hit on it, but I just wanted to put it back up again to see if there's anything else you want to add to it 'cause 'cause I I think I was my mind was fortunately my mind was going to the place you went to. I said, What did that experience teach you about the pace of change and bringing
Ronald Johnson: Yeah.
Patrick and Ron: people along?
Ronald Johnson: Yeah. I I think the pace of change correlates to the age of a company. Is if I had to put my if I had to do it rule of thumb, you know, like Apple, technology Apple was twenty-five years old, but it was a young company, a young spirit. Apple was accustomed to doing new things, like new products all the time. There weren't lot of products. So newness was a big part of the culture. Winning by being different was a big part of the culture. Pennies was a Hundred years old. It was had very established business model, ways to work. I mean, the CEO, I should have known this. When I came out to visit the CEO, he would write everything down on paper. I don't think he used his computer at all. And he would give notebooks to his team, different colors. The more senior people had yellow pages, and the next one had blue. And if he got a note from someone, he'd only read the yellow ones. You know, it was just a Completely different culture. And I should have seen that and said, Ron, you got to be very careful going in here about how you lead. Because you're walking into a place, you're going to be a fish out of water here. You know what I mean? And so
Patrick and Ron: Yeah.
Ronald Johnson: I think your pace of change has to relate to the age of the company. If you're a startup, you're moving really quickly, you're learning, you're adapting, you're trying to find product market fit. When you're an established company, you've got a product market fit that you've built over a hundred years, you wanna protect that as best you can while you find the next way to improve your fit. You know, and I just yeah.
Patrick and Ron: Do you think do you think Ron do you think that like I don't know, sometimes for myself i I'll see yellow flags or I'll see yellow pages in your case, right? I'll but I but I I'm so driven at that moment by what I'm trying to do that I'll I'll I'll ignore them a little bit or I'll think I can take
Ronald Johnson: Yeah. Yeah.
Patrick and Ron: care of them or I'll underestimate what that really means. Do you think there was a could there have been a little bit of that going on in your mind when you were moving into the role?
Ronald Johnson: I had so much arrogance. I had, I'm not a just like a shy. I was situationally shy in high school. I wasn't dispositionally shy.
Patrick and Ron: Mm.
Ronald Johnson: My nature isn't to be shy, but in that situation I was. I was situationally arrogant with pennies. I'm not an arrogant person. I'm actually quite humble. but at that time, from a retail perspective, with all my experience, I believed I knew what was best. And once we started, I said, we're gonna get there. And I'm gonna will this to success, just like I did genius bars and other things at Apple that started slow. because that was my experience. And and and I think I was I I I didn't see or address the opportunities to change as we went because I was so had such a clear vision of where we wanted to end up and how we were gonna get there. You know, does that answer your question?
Patrick and Ron: No, it totally does. It totally does. You know, I've really enjoyed the conversation as we've gone through. I think people can pick up just the you wealth of experience and perspective and successes and challenges and all of those things you've gone through. why was this the right time in your mind to r to write shop different? How retail revealed Apple's genius. Why was this the right time for it?
Ronald Johnson: This was well, was the right time. It's the 50th anniversary for Apple, 25th anniversary of Restores. I've been gone for over a decade. I've had time to digest my lessons and put something together thoughtful. And I think I've done that. And I spent three years doing that with my co-author, Xander. And I think we've written a beautiful book. So I had the time to do it well. I had the time to reflect. But we're also at a big trance technology moment of disruption. And that's AI. And the last big disruption, arguably, was the internet. And that's when we launched the Apple stores. You know, and people, when you launch the Apple stores, people like Mark Andreessen were saying, you know, stores aren't going exist. Who would go to a store when you can just conveniently order online and have it brought to your house? But you look today, stores have thrived and survived, and they're better than they ever were. And now we're entering a new technology age with. Potential disruption that people are fearful of. Well, I thought it was a good time to really address the Apple stores and how they navigated the technology changes and have people think about how this next phase could be better if embraced. You know, I'm a technology
Patrick and Ron: Yeah, I love that.
Ronald Johnson: optimist, I'm an AI optimist. I think it's going to create jobs long term. There'll be different jobs. It's going to improve retail. It's going to improve online shopping. It's going to improve everything. but we have to learn how to navigate this. And the book kind of helps people through that.
Patrick and Ron: Yeah, I was gonna ask you, the y on this podcast, we we believe disruption on disruption lab isn't just about, you know, changing industries or even the latest technology necessarily. It's about helping people build better futures for themselves
Ronald Johnson: Yeah.
Patrick and Ron: and and those around them. When someone finishes listening to this conversation that we just are having here, what's one thing or one action you hope they'll take?
Ronald Johnson: Yeah, the most important thing I think is that you will become increasingly in touch with your own inner voice. Okay. So what I mean by that is like with AI General knowledge is a query away. The only thing unique I bring to the workforce, anybody can ask AI to help them solve a problem. But what I bring uniquely to the workforce is my personal geography. It's my lived experience, where I grew up, who I worked with, whatever. And I've got a unique perspective on any problem. And that's the contribution I get to make. And unfortunately, in today's world, we're all caught up in a lot of group think. You know, we don't, you know, we watch the same news shows all the time. And in politics, we get a point of view based on listening, this echo chamber, right? A lot of people run around all day with headphones in their ears listening to music or listening to podcasts. You need to take time to think because the most important conversation you have every day is with yourself. Right. And that's where you form
Patrick and Ron: Yeah.
Ronald Johnson: your inner voice. That's what I ought to bring to work. And so I think people should slow down, get in touch with who they are, what they truly believe, and have the courage to bring their point of view to work. Not to
Patrick and Ron: How about that?
Ronald Johnson: provide answers based on what an agent offers and think you're smart, not to tell people what you think they want to hear. Tell people what you believe with every bone in your body based on your lived experience. That'd be my advice.
Patrick and Ron: That's great advice. All right, so here here's a question about what you believe with every bone in your body. So as we were doing this podcast, my my producer Jess would say to me, Patrick, you talk about disruption. You write about disruption. You you're encouraging people to sometimes look for ways to change and sometimes look for a way to go towards stability, because sometimes the most disruptive thing you can do is actually go towards stability, is what we argue as well. Everything you don't change everything necessarily. And and she said, But I watch you and you drink the same coffee latte from the same place for as long as I've known you. And she's so true, so true in what she says. I'm brand loyal to certain things. But I said, okay, I'm gonna step out of my comfort zone. And I've been pursuing what I would consider the pursuit of the best vanilla latte. So my question
Ronald Johnson: Mm-hmm.
Patrick and Ron: for you is, is there any t drink or food that you are currently pursuing the best version of in your mind? Or have you already found it and if you had enlighten us?
Ronald Johnson: No, I I think I'm looking for the best rose. No, I spend a lot of I you know, I I love I love the south of France. And in the US, you know, rose is becoming more popular, but it's like three percent. But it's just a really light, happy beverage that's not very strong on the alcohol side. But the clearer the whiter the the better it is. And I enjoy trying a different rose. periodically. So that'd be my choice.
Patrick and Ron: All right. Well, when you get the perfect one in your mind, if the if you find one, you're like, this is the quintessential, let us know so we can share it with the listeners. Well, hey Ron, thanks so
Ronald Johnson: I will do that. I will do that. I will go.
Patrick and Ron: much for joining us. Congratulations on on the new book. I'm sure you and your co author are gonna have tremendous success with it. folks, pick up a copy. I think as you learned from the conversation today, Ron just has a lot to share with us that's a lot of people just talk for the purposes of talking. You're not that guy. You're the guy who's talking because clearly, hey, I want to share some ideas that'll be helpful to you and I wanna be vulnerable in moments and say, Here's some things that didn't go as well as I'd hoped they would and what I learned along the way. And I I appreciate your willingness to do that, Ron, and thanks so much for joining us.
Ronald Johnson: And thank you.
Patrick and Ron: All right folks, that's all we have for today's episode. Big thanks to Ron Johnson for joining us today. And please pick up a copy of his book, Shop Different, How Retail Revealed Apple's Genius, I'm sure you'll enjoy it. It'll be something that'll sit by your nights then. You'll probably pick it up in triple kit for your friends and family too, as you enter into the holidays. That's all I have for today. Thanks so much for joining me. My name's Dr. Patrick Ledden. Now go make it a great day.
