Strong management can help companies 'change their stripes,' Jim Cramer says

A company like Costco is able to successfully respond to changing consumer demand month-by-month.

Strong management can help companies 'change their stripes,' Jim Cramer says

Jim Cramer, CNBC's Jim Cramer, said that strong management can be the key to a company "changing their stripes" when it comes to a corporate pivot.

Cramer stated that "while it is very difficult, it happens".

Cramer cited Costco as an example of how capable management can make a difference. Cramer said that Costco is used to changing its strategy and stock from month to month, so a poor report shouldn't discourage investors.

Cramer explained that this is because Costco's leadership team adheres to the company's philosophy and "always strives to bring in the best products and charge the lowest price," he said.

He continued, "We've heard this story before." Cramer believes that management is too experienced to wait more than a few months before executing a successful turnaround.

Cramer pointed out that a pivot is not a foregone conclusion, and cited Gap's high-end Banana republic line as a prime example.

Cramer said that while the Gap renovated some of its Banana Republic shops that "look amazing", these improvements would not be enough to stop the "disappointing performance" at the flagship Gap brand. The retailer has struggled with management, as the changing chief executives have made it difficult to maintain a consistent message.

Cramer pointed out that a number of non-retail firms are also suffering, such as the medical-technology company Medtronic, and the industrial concern 3M. Cramer said that both companies had lost control over their futures.

Cramer said that there is hope for the food industry, citing JM Smucker's and Campbell Soup's dramatic shifts towards snack foods. Cramer noted that General Mills has also found success, having "fully embraced" pet food after acquiring its Blue Buffalo brand. Cramer says that management who can implement a clear vision, and are in a "constant reinvention mode" will be able to make pivots such as those.

It's easier said than done. Cramer is unconcerned about the management of a company such as Costco. "The sellers usually end up regretting their actions."