“Celebration of Fools: An Inside Look at the Rise and Fall of JCPenney,” by Bill Hare (Amacom, 294 pages, $24.95)

Some of the people most knowledgeable about the J.C. Penney Co. see former Chief Executive William (W.R.) Howell’s decision to move the company headquarters from New York City to Plano, Texas, as one of the key mistakes that precipitated the company’s plummet into stagnation and unprofitability in the latter part of the 1990s.

Former Penney executive speechwriter and independent filmmaker Bill Hare is one of them. In “Celebration of Fools,” a riveting narrative history focusing on the people who created the company, made it great and were involved in its decline, Hare focuses at length on the effect of the move on the company’s people, its culture and its future.

Howell dubbed the 2 million-square-foot Plano complex the Home Office. But some of the midlevel managers, according to Hare, referred to it as the Taj MaHowell. Vendors called it the Mall Without Stores, and many members of the news media dubbed it Versailles.

Penney people in other parts of the country, Hare writes, generally called it Plano, and locals usually refer to it as Legacy, after the industrial park it is in.

Hare recalls a superstition about companies that erect monumental structures to honor themselves and reflect the high esteem in which the management at that time holds itself. He cites the Bethlehem Steel headquarters and the Sears Tower as examples of how bad things, according to some historians, follow such exhibitions of corporate hubris.

“The superstition is interesting in view of all the other relocations to the Dallas/Fort Worth area in the later part of the Twentieth Century,” Hare writes. “These included American Airlines, Blockbuster, Burlington Northern, Exxon, GTE (Verizon), Lennox, Nokia – all moving into comparatively modest accommodations. Only JC Penney, the area’s second largest business (a distant second to Exxon), chose to build a monumental headquarters.

Among Plano’s lures for Penney were cheaper real estate, the transportation infrastructure that allowed easier commuting and the convenience of the Dallas/Fort Worth Airport hub, Hare writes. Some members of the Penney board, Hare speculates, were, like Howell, convinced of that by Wal-Mart’s being based in its hometown, Bentonville, Ark., and Target’s being successfully based in Minneapolis.

His answer: “First of all, we are discussing JC Penney, not Wal-Mart or Target. We’re talking about Penney’s roots being in New York, as the other two chains have never left their own roots. And we’re talking about the kind of defining soft-tone business Penney does, which is done in New York more than anywhere else on earth by far. Why did most of Penney’s professional buyers quit and stay there? Because that’s where that particular action is.”

He emphasizes that Wal-Mart and Target have not uprooted themselves and have not lost their talent.

“They don’t have amateurs posing as buyers. Penney still does. The others are booming. Companies are like people – uproot people and bad things can and often happen.”

Howell’s successor, James Oesterreicher, receives scathing criticism from Hare and the Penney people he interviewed for the book for his overall ineptitude and indecisiveness.

He is particularly castigated for his foolhardiness in pushing the acquisition of the Eckerd drugstore chain, a company whose business was incompatible with Penney’s, without doing proper due diligence.

Penney declined so precipitously under Oesterreicher that at a stockholder meeting in May 2000 in Lenexa, Kan., a Kansas City suburb, a former Penney CEO, Gary Nystrom, castigated the board of directors for doubling Oesterreicher’s salary.

Nystrom, Hare writes, was so upset that he started crying and shouted to the shareholders: “Well, do you know what the chairman should be doing today by Mr. Penney’s standards? He should be standing here in his underwear!”

Don’t be misled by the title of this book. “Celebration of Fools” is not just about the fools in the company who contributed to its decline. Most of it celebrates the life of its founder, the principles upon which he founded the company, and the extraordinary people who executed his vision, such as Nystrom, Earl Sams, Mil Batten, Don Siebert, Walter Neppl and the cast of thousands of store managers, first men, buyers and sellers they led.

Hare offers a poignant portrait of James Penney, an elegantly dressed penny pincher who contributed millions to philanthropic causes and prided himself on wearing suits off the racks in his stores. He did not know, Hare writes, that some of his managers had their suits tailored and had the Penney label sewn on.

Penney also did not know that some of those same men went back to tables in restaurants and added dollars to the dimes their leader left for tips.