Strategic Report: Sears Holdings Corporation - BUS 500, Fall 2024

This report provides a strategic analysis of Sears Holdings Corporation, examining its current financial crisis and declining market share. The report delves into the company's strategy, stakeholder analysis, organizational performance, and external factors such as political, economic, and social influences. It also conducts an internal analysis using SWOT (Strengths, Weaknesses, Opportunities, and Threats) to identify key strategic factors. The report proposes a strategic plan, including an implementation plan and recommendations for organizational redesign, focusing on leadership styles and their impact. The analysis covers various leadership styles, including autocratic, democratic, strategic, transformational, laissez-faire, and charismatic leadership, to provide a comprehensive understanding of the challenges and potential solutions for Sears Holdings' revival in a competitive market. The report highlights the importance of adapting to market dynamics, managing stakeholders' interests, and leveraging internal strengths to overcome external threats and weaknesses.

RUNNING HEAD: STRATEGIC MANAGEMENT AND LEADERSHIP
STRATEGIC MANAGEMENT AND LEADERSHIP
Name of the Student:
Name of the University:
Author’s Note:

1STRATEGIC MANAGEMENT AND LEADERSHIP
Table of Contents
Assignment task 1: Strategic Report................................................................................................3
Executive summary:....................................................................................................................3
Introduction:................................................................................................................................3
Strategy:.......................................................................................................................................4
Stakeholder analysis:...................................................................................................................4
Organizational performances:......................................................................................................5
External factors:...........................................................................................................................6
Political factors:.......................................................................................................................6
Economic factors:....................................................................................................................7
Social factors:..........................................................................................................................8
Internal analysis:..........................................................................................................................9
Strengths:.................................................................................................................................9
Weaknesses:...........................................................................................................................10
Opportunities:........................................................................................................................11
Threats:..................................................................................................................................12
Strategy:.....................................................................................................................................12
Analysis of the strategy:............................................................................................................14
Implementation plan:.................................................................................................................15
Recommendation:......................................................................................................................19

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Conclusion:................................................................................................................................19
Assignment Task 2: Organizational redesign................................................................................20
Present organizational structure:................................................................................................20
Leadership styles:......................................................................................................................24
Autocratic leadership style:...................................................................................................24
Democratic leadership style:..................................................................................................24
Strategic leadership style:......................................................................................................25
Transformational leadership style:........................................................................................25
Laissez-faire leadership style:................................................................................................25
Charismatic leadership style:.................................................................................................26
References:....................................................................................................................................28

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Assignment task 1: Strategic Report
Executive summary:
Sear Holdings Corporation, a leading business organization, is facing the problem of the
financial crisis. This report aims to develop a strategic plan for this business organization, which
will help this company to regain its position in the market. To develop the strategy the
relationships between strategies, expectations of the stakeholders, organizational performance
will be analyzed. It will be helpful to identify a strategic plan for this company. To compete in an
intensely competitive market, this company has to use a low pricing strategy. The management
team of this company has to identify the strengths and opportunities to manage threats and
weaknesses. The recommended strategic plan will help this company to manage the crisis within
one year. This company has to analyze economic factors, cultural factors and political factors. To
regain its market position, this company has to utilize its strengths and opportunities.
Introduction:
Sear Holdings Corporation, an American holding business organization, was the parent
business organization of Kmart chain stores and Sear chain stores. Due to bankruptcy in 2018,
the assets of this organization was sold. At present Transform Holdco LLC is the owner of this
company. CEO of this company is Edward Lampert. However, being failed to do business in an
intensely competitive market, this organization is losing its market share, identity and money.
This report aims to develop a strategic report for this company and strategy for the organizational
redesign. An in-depth analysis will be conducted in this report to identify the present scenario of
this company and recommendation will be provided, which can be helpful for this company to
survive in the competitive market.

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Strategy:
The management team of Sears has developed a new strategy to revive the business
organization in an intensely competitive market. The management team of this organization has
decided to lay off employees and shut down many stores for the revival (HURTIBISE 2020).
This organization was unable to manage the pressure of the debt load and faced intense
competition from Amazon and Walmart. This organization has decided to shut down stores,
which are unable to generate profit, and run the profitable stores. Transform Holdco has decided
to operate 182 Stores. Primarily there are five reasons for which this company is facing these
problems.
 This organization was diversifying too much. To diversify its business, the management
team of this organization included insurance real estate banking and Investments.
 To manage the problems of Sears, the management team this company decided to
purchase Kmart, another retailer who was struggling to manage its business. That was a
bad decision.
 In comparison with other retail organization, this company spends a huge amount of
money for the up-gradation both for offline stores and online business.
 For the last ten years, top real estate properties of the Sear holding company were sold.
Rest of the properties are not worth as much the sold property.
 The CEO of Transform Holdco LLC is Eddie Lampert, who is from a finance
background (Loeb 2019). It is difficult for Lampart to lead a retail business organisation
which is in a troubling situation.

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Stakeholder analysis:
The business organization has the responsibility to fulfil the interest and needs of the
stakeholders. The management team of Sears Holding has the responsibility to fulfil the interests
of the stakeholders (Missonier and Loufrani-Fedida 2014). Stakeholders of Sears Holdings are
the employee, management team, suppliers, consumers, competitors, and government.
Among these stakeholders, the management team and government have the most
influence on the business operation of this company. Whether Sears holding is following the
legal regulations or not is the interest of the government. The interest of the management team of
this company is to run the business efficiently. The management team is interested to guide the
company to achieve the business objectives of the company. The influence of this stakeholder on
the business organization is high. Employees are important for this company to achieve business
objectives (Abdollahi, Hosseini and Alimohammadzadeh 2019). However, the influence of the
employee on the business organization is low because they are easily replaceable. Suppliers of
these organization provide the best quality product. However, the influence of the supplier on
business performance is medium. The success of a business organization depends on the
suppliers. The interest of the customer is to receive maximum benefit from lower cost with
maximum quality. The influence of the customer on the business organization is high. The
competitors of Sears Holdings generate huge competition in the market. Competitors create an
impact on the business operation of Sears Holdings.
Organizational performances:
In 2016, the annual revenue of Sears Holding was $5.4 billion. In 2017, the annual
revenue of Sears Holding was $22.1 billion. In 2018, the annual revenue of Sears Holding was
$16.7 billion (HURTIBISE 2020. So it can be said that this organization is not in good condition.

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That is the reason a new strategy must be applied by the management team of this company. The
HRM strategy of this company will be analyzed in this part. For the training and development
purpose, this company spend a huge amount of money in comparison with its competitors. The
aim of this company is to make an efficient workforce aligned with the mission, vision of this
company, which will help this company to accomplish business objectives. To motivate the
employee, this company has been continuing the reward system for the employee. Competence
centered salary for the manager of this company is followed in this company (CIMENT 2019).
The reward system is based on the performance of the employee. By delivering the best
performance, any employee can receive incentives. For the recruitment purpose, this company
follows a soft approach. According to the executive of this company to make a loyal employee
this company choose an employee from the organization and provide adequate training to the
employee so that that employee can acquire the required skills.
External factors:
Political factors, economic factors and cultural or social factors will be analyzed in this
part. These factors have the ability to interrupt the business operation of Sears Holdings.
Political factors:
In this part, political factors will be identified which may create an impact on the chances of
survival of this business organization. To manage this critical situation, this organization can
expand its business at the international level. Sears Holding is exposed to several political factors
which are following.
 The political stability of a country can create an impact on the department stores like
Sears holding.
 Military invention can create a negative impact on the revival strategy of this company.

7STRATEGIC MANAGEMENT AND LEADERSHIP
 If the corruption level of a country is high then it will be difficult for this organisation to
manage the business, which is already in a difficult situation, successfully (CIMENT
2019).
 If the government of a country interferes excessively in the department stores industry,
then it will be difficult for this company.
 Regulations to protect the intellectual property of a company can be beneficial for Sears
Holdings.
 Trade barriers can affect the business operation of this company.
 This company can ensure maximum profits by investing in a country where the low
minimum wage is followed. It will enhance the chances of survival for this organisation.
Economic factors:
This organization is already affected by economic factors. To survive in an intensely
competitive market, the management team of this organization has to analyze the economic
factors which are affecting the business of this company. Those economic factors which are
creating an adverse impact on this company will be analyzed below.
 Before entering a new country this company has to analyze the economic system of the
host country and the stability of the economy of that country.
 Rule of the complement of the host country in the free market and related services must
be analysed by this company before investing in a new country.
 Stability of the currency of the host country must be analysed by this company.
 The quality of infrastructure of this industry, which is available in the host country, must
be analysed by this company before expanding its business at an international level.

8STRATEGIC MANAGEMENT AND LEADERSHIP
 Other economic factors, which must be examined, are economic growth rate, the rate of
unemployment, the rate of inflation and discretionary rate (CIMENT 2019).
 Not only the labour cost but also the productivity of the host country’s economy must be
evaluated.
 As Sears Holdings is facing the problem of bankruptcy, so it can be said that before
investing in a country the management team of this company has to analyse these factors
and develop a strategic plan, which will help this company to implement the survival plan
appropriately.
 At present, the retail sector is in a turbulent environment which must be managed by this
company with a proper strategic plan and extra precaution.
Social factors:
Social factors can influence Sear Holdings because society, in which this organization
will do the business, will influence the business operation style of this company. Social factors
which have the potential to increase the business of Sears Holdings will be discussed below.
 Demographics of a country can influence the business of this company. The success of
certain products depends on the ages and genders of that country's population. The
management team of Sears Holdings has to prepare a strategic plan to manage this factor.
 Class distribution of the targeted market is a significant factor which can influence the
survival plan of this organization. Promoting a premium product in a lower-middle-class
population can be the wrong strategy for this company.
 Interests and priorities of the target market are very important which must be identified
appropriately by this company. The difference regarding educational background

9STRATEGIC MANAGEMENT AND LEADERSHIP
between the population of the target market and the marketers of this company to
accomplish the business objectives (Tarí, Heras-Saizarbitoria and Dick 2014).
 This organization has to change the preferences of the customers towards the experience
related to expending.
 Maintaining the quality, level of health standards and sustainable products can be
beneficial for this company. It will enhance the brand reputation in the target market.
 Cultural differences can influence the survival plan of this company. That is the reason
this company has to relate the cultural differences between the host country and home
country.
Internal analysis:
The SWOT analysis is beneficial for a business organization to identify the strength and
weaknesses, which are the internal strategic factors and opportunities, threats, which are the
external strategic factors (Gürel and Tat 2017).
Strengths:
 This organisation offers a wide range of goods for its customer which is a strength for
this company. Customers of this company get a wide range of products in a store of
Sears Holdings, which is helpful for them.
 Worldwide presence in the Retail Industry is a strength of this company. Do this
organisation is in a critical situation can be said that to survive its business operation
appropriately the management team of this company has to utilise its ward wide presence.
 Multi-channel integration is a strength of this company which must be utilised
appropriately by this company for its survival. This company has been doing its business

10STRATEGIC MANAGEMENT AND LEADERSHIP
in Retail Industry for a long time. As a result of this, a strong distribution network has
been developed by Sears Holdings.
 By utilising automation of activities the management team of Sears Holdings Corporation
not only ensure the quality of the product but also maintain the consistency of the
product.
 These organisation had a successful track record, which can be used to regenerate its
brand reputation.
 This organisation was successful to develop new products. So it can be said that the
product innovation ability of this company can be utilised as a strength.
Weaknesses:
 Sears Holdings was unable to achieve success outside of its core business. Though this
organisation was one of the leading company in Retail Industry yet this company faced
several challenges while moving to other product segments (Hirsch and Thomas 2018).
 Though Sears Holding was the leading corporation in the retail Industry yet there were
gaps in the product range, which were sold by this organisation. Competitor of this
company used these gaps to attract customers and destroy the loyal customer base of
Sears Holdings.
 The organisation is in a critical situation because of the leader and the management team
of this company was unable to get an idea about the market trend (James 2018).
 In comparison with other business organisation of this industry, the attention rate in the
workforce of this company is very high. For the training and development purpose, this
company has to spend a huge amount of money (Hirsch and Thomas 2018).

11STRATEGIC MANAGEMENT AND LEADERSHIP
 Market share of this company is decreasing and competitors of this company like
Walmart and Amazon are capture in the market share of Sears Holdings.
 This organisation is unable to manage the pressure of loan debt. It is a threatening
situation for this company.
 The organisation structure of this company is the expansion procedure of this company.
 The management team of Sears Holding was unable to develop appropriate and efficient
financial planning. That is the reason this company is in a troubling situation.
Opportunities:
 The management team of this company is defining a distinct target market. It can be an
opportunity for this company to survive in an intensely competitive market. This
initiative will help Sears Holdings to analyse the characteristics and demands of the target
market appropriately.
 To enhance brand awareness, this company can utilise the advertisement. Through
advertisement, this organisation can manage its negative reputation in the market.
 To survive in an intensely competitive market this organisation can utilise the strategy of
partnerships.
 The loyal customer of this company is not in good shape. To create a new loyal customer
base, Sears Holdings has to attract potential customers by providing discounts and
coupons.
 At present online sales is the market Trend the management team of this company has to
invest more to develop a smooth online operation. It will help this organisation to
compete with Amazon and Walmart (Forbes 2020).