I've been saying for years now that Sears is doomed to fail. I just don't see light at the end of the tunnel. The company's revenues have been dropping for years. Multiple restructurings have attempted to pare costs, but none of these moves have recharged sales. Adam Hartung has a good article for Forbes about the reasons for the decline under CEO Ed Lampert. Two of the reasons cited by Hartung are: "micromanagement in lieu of strategy" and "seeking confirmation rather than disagreement." For more on the latter point, here's an excerpt from Hartung's article:
Seeking confirmation rather than disagreement. Mr. Lampert had no time for staff who did not see things his way. Mr. Lampert wanted his management team to agree with him – to confirm his Beliefs, Interpretations, Assumptions and Strategies — to believe his BIAS. By seeking managers who would confirm his views, and execute rather than disagree, Mr. Lampert had no one offering alternative data, interpretations, strategies or tactics. And, as Mr. Lampert’s plans kept faltering it led to a revolving door of managers. Leaders came and went in a year or two, blamed for failures that originated at the Chairman’s doorstep. By forcing agreement, rather than disagreement and dialogue, Sears lacked options or alternatives, and the company had no chance of turning around.
I would one other key point to Hartung's insightful analysis. The Sears decline began long before Lampert took over. Yes, he has mismanaged the retailer and accelerated its fall toward bankruptcy. However, in many ways, the crisis at Sears stretches back decades. Harvard Business School Professor Jay Lorsch has said that gradual crises are often much more dangerous than sudden crises. When a sudden jolt occurs, firms often mobilize resources and attack the problem with a sense of urgency. However, when a decline occurs over many years, beginning with small decreases in performance, managers often find ways to rationalize the diminishing results. Denial sets in during these crises that unfold over lengthy periods of time. Sears seems the perfect example of what Lorsch calls gradual crises.