Critical Thinking Assignment
Edward Lampert generally believes that Sears’ decline is tied to the immense level of competition in the retail industry. From this angle, he’s suggests that a significant competitive advantage or a reliable cash flow could simply make the firm perform better. Lampert also seems to believe that the firm’s long-term success is tied to technology innovations, which could enable it to compete fairly with Amazon, Walmart, and other retail giants. Nonetheless, evidence shows that Lampert’s perception is unidirectional, as he seems to ignore salient aspects like poor decision-making that have progressively led to Sears’ decline.
Sears’ inability to adapt to changing market dynamics in the 80s is the most significant factor for its decline. The firm’s dominance in the retail industry was trumped by Walmart and Kmart merely for introducing discount shopping. Unlike Sears, both firms were flexible enough to implement the cost leadership strategy, attracting more customers to their stores. Contrary, Sears’ management system was crippled by bureaucracy, maintaining high overhead costs and traditional operational frameworks. Further, the corporation was unable to leverage online shopping, and it faced immense competition from Amazon.
Furthermore, Sears’ poor management and leadership arguably caused its demise. Edward Lampert spearheaded several unreliable strategies, like emphasizing on technology and real estate, crippling their dominance in retail. Rather than taking a consumer-centered perspective, Lambert’s main goal was to grow Sears’ profits in the short-term and long-term survival. He segmented the firm into thirty distinct segments, including menswear and home accessories, naming a few. Consequently, there was unhealthy competition within the firm, with each department yearning for solo success. Lambert also thought that Sears was competing primarily with Amazon, and focused on technology innovations to build a competitive edge. As a result, the firm disregarded investing in store layout, gradually languishing appearance, and customer experience.
Sears’ apparent lack of a reliable total quality management framework is arguably the ultimate cause of its demise. Employees and management seemed to always be in disarray regarding various operation protocols. For instance, Lampert championed a policy for issuing of iPads to employees to assist them in the shopping floor, but the approach was received differently by clerks. There seems to be significant bureaucracy in the firm that hinders open communication and participation, and thus, total quality management. Decision-making, in particular, doesn’t seem to include lower-level employees, and Edward Lampert seems to make most of the judgement solely. Implementing a total quality management system requires all levels of stakeholders at Sears’ to brainstorm and find amicable solutions for improving customer experience and values. Also, Lampert needs to be more engaged in running the firm’s operations to save Sears from a permanent breakdown.