How an Ayn Rand-Loving Libertarian Destroyed The Company He Runs With His Cultish Objectivist Theori
http://www.alternet.org/how-ayn-rand-loving-libertarian-destroyed-company-he-runs-his-cultish-objectivist-theories?paging=offEvery year the presidents of Sears Holdings’ (SHLD) many business units trudge across the company’s sprawling headquarters in Hoffman Estates, Ill., to a conference room in Building B, where they ask Eddie Lampert for money. The leaders have made these solitary treks since 2008, when Lampert, a reclusive hedge fund billionaire, splintered the company into more than 30 units. Each meeting starts quietly: When the executive arrives, Lampert’s top consiglieri are there, waiting around a U-shaped table, according to interviews with a half-dozen former employees who attended these sessions. An assistant walks in, turns on a screen on the opposite wall, and an image of Lampert flickers to life...
In January, eight years after Lampert masterminded Kmart’s $12 billion buyout of Sears in 2005, the board appointed him chief executive officer of the 120-year-old retailer. The company had gone through four CEOs since the merger, yet former executives say Lampert has long been running the show. Since the takeover, Sears Holdings’ sales have dropped from $49.1 billion to $39.9 billion, and its stock has sunk 64 percent. Its cash recently fell to a 10-year low. Although it has plenty of assets to unload before bankruptcy looms, the odds of a turnaround grow longer every quarter. “The way it’s being managed, it doesn’t work,” says Mary Ross Gilbert, a managing director at investment bank Imperial Capital. “They’re going to continue to deteriorate.”
Plagued by the realities threatening many retail stores, Sears also faces a unique problem: Lampert. Many of its troubles can be traced to an organizational model the chairman implemented five years ago, an idea he has said will save the company. Lampert runs Sears like a hedge fund portfolio, with dozens of autonomous businesses competing for his attention and money. An outspoken advocate of free-market economics and fan of the novelist Ayn Rand, he created the model because he expected the invisible hand of the market to drive better results. If the company’s leaders were told to act selfishly, he argued, they would run their divisions in a rational manner, boosting overall performance.
Instead, the divisions turned against each other—and Sears and Kmart, the overarching brands, suffered. Interviews with more than 40 former executives, many of whom sat at the highest levels of the company, paint a picture of a business that’s ravaged by infighting as its divisions battle over fewer resources. (Many declined to go on the record for a variety of reasons, including fear of angering Lampert.) Shaunak Dave, a former executive who left in 2012 and is now at sports marketing agency Revolution, says the model created a “warring tribes” culture. “If you were in a different business unit, we were in two competing companies,” he says. “Cooperation and collaboration aren’t there.”
= new reply since forum marked as read
"Now we're down 3 at the half, and that's unacceptable to me. C'mon, you guys are better than that. So I'm proposing a new strategy for the next two quarters - instead of playing football against the opposing team, I want you to start playing football against each other. That will ensure that the spirit of competition, and the invisible hand, will make us the team most likely to win. The weak point of the other team, you see, is the way they all collaborate with each other, instead of competing with each other...."
That coach didn't last long.
The CEO needs to read some conspiracy theories in my opinion. Conspiracy - latin for "to breath together" - the implication is a collective of organisms united through their mutual breath to form a single larger organism, a larger body, or if you prefer, latin 'corpus', as in 'corporation'. The foundation of civilization.
(Image from Leviathan by Thomas Hobbes)
Sears used to be a wonderful company to work for. My mom worked there for 30 years when they had a wonderful profit sharing plan and seemed to care about their employees. However, those days are long gone and I believe Sears will eventually be a fond memory.
