The Big Store
In 1972, Sears, Roebuck was a way of life for millions of Americans. It alone generated one percent of the United States gross national product; more than half of all American households had a Sears charge card. The employees, too, were remarkably loyal: Most spent their entire careers with Sears, going wherever they were transferred and content to rise slowly through the ranks, knowing that their profit-sharing stock would continually appreciate and eventually provide for a comfortable retirement.
By 1975, however, this venerable giant was in deep trouble. Buyers bought whatever they could cut a deal on; sellers priced goods without regard to cost. Managers ran their stores like petty fiefdoms. Then recession, increased competition from discount retailers, changing demographics, and a series of lawsuits plunged the company into a sea of red ink. Stock prices plummeted.
That the company succeeded in meeting these challenges is primarily attributable to the leadership of Board Chairman Edward R. Telling. It was he who brought in outside consultants to review personnel and compensation policies, who masterminded the purchase of Dean Witter Reynolds and Coldwell Banker, and who bid for other mergers as well. It was he who created the idea of the “superstore” to meet all the consumer’s needs.
Author Donald Katz is a contributing editor to ESQUIRE. Telling granted Katz virtually unlimited access to board meetings, files, the company archives, and interviews with officers and employees. The result of his five years’ work is a thoroughly researched story of the eight-year struggle to change the course of a leviathan in order to meet changing consumer needs. It is not at all the conventional company history one would expect for the centennial of any business.