How Sears' Eddie Lampert creates chaos, not profits
He may be a hedge fund billionaire, but as the CEO of a major retailer he has built a dysfunctional corporate culture.
The story paints a depressing picture of life at the company. It argues that Lampert has created a dysfunctional culture in which business units are forced to fight among themselves -- "Hunger Games"-style -- for corporate resources. Lampert seems to be trying to implement the ideas of "rational self-interest" espoused by the philosopher Ayn Rand.
But the reality is that chaos breeds more chaos. To say that Sears is self-destructing doesn't adequately encompass how badly Lampert has messed up the retailer, whose roots date back more than a century.
It's hard to figure where to start. For one thing, Lampert is hardly ever at Sears headquarters. Businessweek says he "hates to fly" and bothers to show up only once or twice a year.
He also thinks all his ideas are brilliant, such as creating a little-used private social network and then establishing an account under a pseudonym that he subsequently used to pick fights with employees. The one inescapable conclusion to be drawn from Businessweek's account is that Lampert doesn't just have a huge ego, he has a titanic one, even for a hedge fund tycoon.
"Although the hedge funder lacked retail experience, he often lectured veterans on the industry's nuances," the story said. "Three former employees say Lampert compared himself to John Wooden, the lauded UCLA basketball coach, citing Wooden's proclamation that he had to teach players how to put on their shoes before he could teach them to play basketball."
Although four executives have been CEO since the Sears-Kmart merger that Lampert pushed, there's little doubt that he's the real power at Sears -- and his track record has been dismal. Sales have plunged from $49.1 billion to $39.9 billion. Sears' stock price has plummeted by 64%, and the company's cash has fallen to a 10-year low.
If Lampert weren't the company's largest shareholder, he would have been fired long ago. Indeed, J.C. Penney (JCP) recently canned another "visionary" CEO, Ron Johnson.
Sears isn't in danger of closing its doors soon, even though its long-term outlook remains bleak. Still, Lampert is part of the problem, not the solution.
Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter @jdberr.
America is doomed, our leaders and politicians are mostly rich incompetent
buffoons, who thing they know everything.
Sears has gone so far down I don't see it being able to pull back up. I LOVED Sears, this past year I have had near every bad experience one can have.
I feel bed for the employee's, they can't help you (some really do want to!)
Employee's pitted against online sales ?!? AND they know they are being forced out...........the online sales suck, wrong items sent, returns taking over an hour at the store for an eight dollar item, argue for MONTHS about not receiving an item (S), ordering items online to pick up in store...wrong item, not all items they say are included are even there.
Last month was the LAST order, in store or online they will ever get from me.
Lying, cheating isn't the way to stay in business. buhhhhh bye Sears, it was nice until the last few years, when it was/is a NIGHTMARE!
Businesses always fail when the only thing on the owners mind is to maximize profits. You have to like the business and you have to want to give your customers a good deal, that's what Sears used to be, but no more, what a shame, it really was a fun place to shop. I've seen the same thing several times in the last few years in restaurants, someone new takes over and they cut all the things that people used to like and they make more profit but suddenly no one goes there anymore. How dumb are some people.
Yes, get rid of Lambert. Instill pride in the workers. Get customer service back to where it once was.
I went to a sears store to look at window A/C's. Couldn't get anyone to come help. Left. Went back and saw two employees talking. One said they were helping someone else. The other did come over and get the A/C I wanted. Shouldn't have to do that. The minute you walk into a store or department, someone should immediately ask you if you need help.
These so called experts are ruining the retail business. All the college types have already managed to destroy our manufacturing business.
Another CEO type that isn't worth the toilet paper he wipes his a$$ with. Assuming he can even perform the task with his over inflated ego causing him to topple over onto his head. I picture Mr. Macky from South Park.
How much longer before and how many more times does it have to be proven that his type are not as rare and valuable as they claim to be, holding no special talents that can't be found elsewhere, and done so at reasonable price that isn't nothing more than a drag on the company and, in short, that they aren't needed or worth it?
At any rate Sears can be saved if something is done but it needs to be now, not later, as time is running out.
Personally, as I've always said, dump Kmart -Between Walmart, Target, and Amazon, its dead man walking.
Then dump the "softer side" and focus on the appliances, tools (includes hand tools to power equipment) automotive to an extent, and maybe some electronics.
Sears isn't the buy all it once was when founded and hasn't been for some time. Drop the areas that have major competition and don't contribute much and focus on the core areas that actually carry the company and are the reasons people go there anymore.
Then they need to update the stores and in doing all this could also reduce store sqft. and reduce overhead costs.
Maybe I'm naive but I sure think this would work.
I think its time
Here is an idea give him a large bonus and even larger salary so that when the company goes bankrupt the chinese will buy them out and take over. ITS CALLED THE AMERICAN WAY. (typical morons)
Having had the best catalog ever, they were a natural to become the biggest online retailer ever. Maybe they can still transition.
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A basic income policy can actually ensure a decent standard of living for everyone.
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