Isn’t It Time Eddie Lampert Fired the CEO of Sears?

Discussion
Jun 20, 2013

Many failed to see what the big deal was back in January when it was announced Edward Lampert, chairman of Sears Holdings, was taking over as CEO of the company. After all, through leaders both interim and permanent, it is widely believed Mr. Lampert has been calling all the shots since merging Kmart and Sears some eight years back. He certainly has been blamed for failing to invest in the company’s stores. He has jumped from one tactic to another, all the while claiming to have a grand strategy to turn the business around, if not readily obvious to retail industry watchers.

Just last month, as Bloomberg News reports, Mr. Lampert claimed in an interview that his critics just don’t get it. Perhaps the misunderstanding between Mr. Lampert and his critics has to do with how each defines success.

Some, like former chairman and CEO of Sears Canada Mark Cohen, do not seem to believe that words like merchant or retailer should be used in the same sentence as Mr. Lampert’s name.

"Sears is slowly and steadily failing at the hands of a ruthless, methodical asset-stripper," Mr. Cohen told Bloomberg. "Lampert will come up with some cash every quarter or two to make sure the balance sheet is still viable. It’s a tragedy because Sears is a legacy brand that needed to be and could’ve been repositioned."

Mr. Cohen is not alone in his criticism of what Mr. Lampert has done at — perhaps to — Sears. Even Wall Street analysts, who bought in early to Mr. Lampert’s PR that he is a Warren Buffet-like figure, question how long the company can continue to spin-off businesses, sell leases, etc. before a turnaround is no longer possible.

In an interview last month with WWD.com, Mr. Lampert offered a definition of a great company. "A great company grows without sacrificing quality," he said.

During his tenure, Mr. Lampert can neither claim to have achieved growth or avoided sacrificing quality. Perhaps it’s time he looks in the mirror and tells the CEO of Sears Holdings that he’s fired.

Can Sears Holdings get turned around while Edward Lampert is calling the shots? What qualities is Sears’ leadership lacking?

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20 Comments on "Isn’t It Time Eddie Lampert Fired the CEO of Sears?"


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David Zahn
Guest
5 years 11 months ago

What business are they in? What business do they want to be in? At various times: Real Estate, Financial Services, Appliances, Tools, Department Store? Can you figure it out? Pick something and then we can all share opinions on what is the next step. If there is a strategy—it is not clear to us.

Paula Rosenblum
Guest
5 years 11 months ago

The biggest question is, “Can Sears Holdings get turned around, period?”

Kmart and Sears are dinosaurs now. The department store model is tired and old…especially the “low priced spreads.” Five years ago I might have said the company could be turned around by shrinking the store format and getting out of the apparel business (for one). But that concept (Sears Grand) was killed by Mr. Lampert, and the brand equity of Kenmore, Craftsman and DieHard have eroded over time.

I think it’s really unfortunate, but Mr. Lampert has pursued a strategy of finding “stuff” to fill up the physical plant rather than defining a strategy and then finding space to match.

I don’t know if the company was savable even before Mr. Lampert’s reign. Now, I’m quite sure it’s not. The irony is exquisite, since after all, what is Amazon.com but a modern day Sears Catalog? Iconic brands do die.

Bob Phibbs
Guest
5 years 11 months ago

Activist investors are killing retail brands.

Mike Osorio
Guest
Mike Osorio
5 years 11 months ago

Watching the Sears/Kmart debacle has been like watching a slow motion train wreck. These retail brands have been on a road to oblivion since before Lampert took over and if he deserves any credit, it is that he has found various financial tricks over the years to spin the balance sheet to avoid going under.

I mean really…can anyone make an argument as to why Sears or Kmart need to exist? Other than the impact of more empty real estate and the loss of jobs…those are obviously good reasons. But I don’t see a consumer need.

Dick Seesel
Guest
5 years 11 months ago

It doesn’t matter whether Eddie Lampert carries the CEO title or not…as the question suggests, he is calling the shots. The answer is “no,” if the conventional definition of a turnaround is actual improvement in operating results, merchandising and the store experience. But none of these has been on Mr. Lampert’s agenda for a long time, while he is more preoccupied with ways to leverage the company’s assets and come up with farfetched ideas like data storage and disaster recovery. So don’t expect this picture to improve anytime soon—the only question is, what’s the endgame?

David Livingston
Guest
5 years 11 months ago

There will be no turnaround and there never was one expected. Sure there are stories for the press releases, but those are more to keep stockholders, employees, and customers from panicking.

Coming up with some cash every quarter or two to make sure the balance sheet is still viable, stripping assets—THAT THE WHOLE POINT! This is like an old mule; we are not going to make a thoroughbred out of it, we’ll barbeque it. But to spare the feelings of employees, customers, and delusional stockholders, Eddie needs to send out press releases talking about feel-good, grand strategies.

Gene Hoffman
Guest
Gene Hoffman
5 years 11 months ago

Sears Holdings would be turned around to what, with Lampert out? If Eddie Lampert wasn’t the official CEO, would it make any difference? He would still run the show from behind the curtain.

There is no clarity to what Sears Holdings is doing … and Eddie Lampert, never a great retailer will be. Or for that matter, any kind of a retailer.

W. Frank Dell II
Guest
5 years 11 months ago

When Mr. Lampert bought Sears and Kmart, I said this is a real estate deal pure and simple. Nothing has been done to reposition these retailers so they can grow sales. Comp store sales just continue to decline. Costs have been cut and units have been sold.

The problem is, this real estate strategy has also fallen apart. The real estate is not worth anywhere near what Mr. Lampert expected. As online sales increases every year, real estate loses value.

Sears Holding needs a real marketer and a real merchant. Until they define who their customer is and what they want, we will continue to watch this slow death. Mr. Lampert may be a great financial person, but clearly he does not understand retail other than the financial modeling.

Mel Kleiman
Guest
5 years 11 months ago

The real question should be, can anyone really turn Sears around at this point?

Winston Weber
Guest
5 years 11 months ago

The strategy is quite clear. Just look at the number of monthly Sears and Kmart store closings. In the foreseeable future you will not see these banners on brick and mortar. A sad story indeed.

M. Jericho Banks PhD
Guest
M. Jericho Banks PhD
5 years 11 months ago

Savior or impediment? Sports fans have figured it out. Using a baseball analogy, no one can play every position. No one, not even Edward Lampert, can be team owner, and team manager, and ace pitcher. Case in point, a football analogy: Dallas Cowboys owner Jerry Jones, who also is a backstage General Manager and Head Coach. America’s Team hasn’t done well since Jerry stopped hiring strong, independent Head Coaches like Jimmy Johnson, Bill Parcells, and Barry Switzer.

It’s almost too late for Lampert to realize that he must hire competent marketers, merchants, and managers, and then back off and leave them alone. It seems like it’s not in his character to do so. It’s a shame that a single man’s character flaws can negatively affect so many employees and customers.

I’m a huge Lands’ End fan/customer. I hope they’re able to find a lifeboat when Sears Holdings sinks.

Arthur Rosenberg
Guest
Arthur Rosenberg
5 years 11 months ago
As pathetic as the Sears/Kmart situation may seem, I fear that J.C. Penney may have actually sunk lower. Recently my wife and I visited the housewares section of a JCP and were surprised to see how difficult it was to determine prices for many products. Many items were unmarked. Most shelves had signs which mentioned the lowest price of all the items on the shelf and added the words, ‘and up’. In some cases there was no product approaching that lowest price point.One couple could easily be heard noting their confusion on determining prices. Another approached the checkout and asked how to determine prices. They were told to take the item to a pole (there was a single scanner there though this wasn’t even mentioned) or to bring the item to the checkout to be scanned. This clearly had not been properly thought out. Many of these items are bulky. The customer and his wife were elderly. Why should they have to go through an effort simply to determine a price. To determine the best… Read more »
Ed Rosenbaum
Guest
5 years 11 months ago

What a shame that two great retail names of the past continue to flounder with little to no hope of survival. We will be left with more retail real estate on the open market along with too many added names on the unemployment lists. I doubt there is a super hero out there who can save either company.

Ben Ball
Guest
5 years 11 months ago

No!

Lampert HAS to be CEO of Sears Holdings, because he seems to be the only one who has a clue what he’s doing with it!

Cathy Hotka
Guest
5 years 11 months ago

Watching Sears has been downright painful, particularly for those of us who have a family history with the company.

I’ve been saying that the most expensive dollar Sears spends every day is the dollar in compensation they pay to Mr. Lampert. Fire him, please.

Shiney Sage
Guest
Shiney Sage
5 years 11 months ago

The Sears/Kmart odyssey will be studied for years. Mr.Lampert has had to make tough choices and has managed to keep the ship a float. As an ex employee, I doubt that anyone else would have done what he has accomplished and sustained the jobs that he has. Out here on the street of average America, our lives have changed and retailers are making the same, painful adjustments we are. I believe he is constantly making adjustments and is planning for the future. Maybe a little stealth is not a bad thing, maybe it is okay if others don’t see what is coming, what he is building.

Craig Sundstrom
Guest
5 years 11 months ago

The answers, of course, are “no”—or at least “very unlikely”—and “all of them.” (And as others have mentioned, the implied third question is “CAN it be turned around by anyone?”…which is fast approaching “no” as well.)

The more interesting question is whether or not this was simply a real estate play, or if in fact there was a sincere desire to be a retailer. Though many have argued passionately for the former, a look at his background gives evidence for the latter … though probably the true answer can only come with some “Rosebud”-like moment when Citizen Lampert passes on.

Verlin Youd
Guest
5 years 11 months ago

The related question I have been asking myself for many years is what is the real business strategy for Sears and Kmart? Is the business strategy a classic retail turnaround strategy or something else? Based on the retail results over the last ten years, it must be something else. The real question for stockholders is if Mr. Lampert is executing the strategy that is most likely to drive shareholder value and if not, then the shareholders need to make a change.

Mark Burr
Guest
5 years 11 months ago
To almost anyone’s amazement, Sears is still here. No one but Mr. Lampert likely knows what the real objective is, however, there must be one. I believe it was Mark Twain that said “Reports of my death are greatly exaggerated.” Many, if not most of us have predicted its demise. Many of us already think Sears is deceased. It’s not. To the question, can Sears be turned around? To what many of us define as a turnaround, no. All of the objectives or scores we might define as a successful retailer simply don’t apply here. That is because there is an entirely different definition at play. Is there a lack of leadership? Absolutely not! How can there be if they are still alive after all? Nope, they are right where their own expectations dictate they should be. Confounding as it may seem, in this case “ours is not to wonder why….” If you complete that quote, “die” is not the plan. Neither is “do” as we might think. We can just wonder. They haven’t and… Read more »
Ashley Goode
Guest
Ashley Goode
5 years 7 months ago

Kmart and Sears could save a lot of money if they didn’t give so many extra coupons out when printing the receipt. They could also save money if they didn’t print so many flyers for cashiers to pass out. I’ve talked to numerous customers, and they don’t care for so much extra stuff. If the buildings were air conditioned well, people would stay and shop longer also. Just something to think about!

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