Sears the Importance of Strategic Business Decisions

Sears

The importance of strategic business decisions cannot be underestimated in today's fast-paced and competitive market. As economic times resemble recession like qualities, it is even more important that struggling companies find ways to stay competitive in these interesting and troublesome times. Sears Holdings Corporation resembles a troubled company that needs to make strong strategic maneuvers in order to survive and continue to be profitable within its many business interests. The purpose of this essay is to examine Sears holdings Corporatoin. In its current business environment. I will investigate the problems, examine this company's current strategic outlook, and offer recommendations that may help solve the many and troubling problems for this organization. Using the strategic background necessary to describe these qualities will also assist in contrasting between different choices that management often has to use in these types of situations.

According to Sears investor information, "2010 was another challenging year for Sears holdings. Our financial results remain at unacceptable levels, and we are working to drive better performance in both the short- and long-term."As these words originate from the chairman of the board, there is little dispute of the troublesome status of this particular company. Sears has many business interests, it is a retailer in the United States and Canada as it operates Kmart and Sears stores. They manufacture and sell general merchandise appliances, groceries as well as pharmacies. Kenmore and craftsman tools are some of their more famous and recognizable brands. Sears is a very old company originating in 1899, and currently has thousands of retail outlets that provide these products and services to consumers.

Jones (2011) reported that newly appointed CEO Lou D'Ambrosio "cited increased economic pressure on consumers and tough comparisons with last year when Sears penetrated from a government-sponsored appliance rebate program that boosted sales of refrigerators, washing machines and dryers. He also pointed Sears internal problems " as well. The recession, or depression, as in some circles would describe the current economic condition, obviously affected Sears due to the nature of industry. Retail sales usually correspond with new housing sales and the housing market. As the housing problems in America continue to worsen, Sears is expected to follow along with these other indicators. It is time for Sears to evaluate and investigate the different facets of strategy that may affect their business at a larger scale.

Some blame serious problems on other issues. Jones once again pointed out that "the customer experience is at the heart of Sears troubles, and the main reason the company is losing market share to rival retailers. Sears has great investment in stores and instead has pour dollars into buying back stock and building its presence online." The strategic shift to an online retailer model in order to compete with other more leaner and smaller companies, has left this company in a perilous situation. Sears has shrunk in the last few years, which has investors worried about profitability as the economy tends to fall.

D'Ambrosio, appointed by Lambert, comes from IBM and served as that company's CEO for a two-year period. This strategic management change appears necessary to tackle the challenges in the future. This particular tactic is useful when re-shaping a company or corporation while forming a new idea to sell to, not only customers, but the employees as well. Sears is dedicated to continuing to improve its customer relationships as well. Lambert professed " improving our store experiences as one part of becoming the go to place for customers. We have focused much of our investment in emerging areas of retail account online platforms and in our rewards programs. We will continue to invest in and develop business models emerging areas because we believe they have the potential to make a significant difference to our associates, our customers, and our shareholders over time." It is obvious this strategic maneuver to a global, or at least a more expansive scope, seems ideal to partner with its online strategic plan as well.

Sears's marketing strategy has come under scrutiny lately as well. Morrison (2011) reported the change in marketing personnel that will accompany Sears' new idea as reshaping its image, "the struggling retailers are seeking a brand refresh and the tagline from the agency which will likely also handle marketing for the retailer's appliance business." This attempt at developing new markets to penetrate competitors share, seems necessary in the current climate where economic certainty is dubious. Sears may not have the necessary profit margins if they decide to alter their pricing, and their products are top-of-the-line and very recognizable within the market, it seems their only option in marketing themselves as a new store to a new market. This must correspond with the online strategy and a more global and expansive reach towards new customer bases and new markets.

Financial strategy changes also need to occur in order for Sears to become viable in the market again. According to Sears investor relations information letter, Sears "strengthened capital structure by issuing $1.25 billion of eight years senior secured notes at 6 5/8%. " This move towards cash and away from a more conservative investing strategy is necessary in order to save the profitability structure of this company. It is important to remember that change is important in any situation, but especially in financial situations where markets and their stabilities are often attacked by new and unpredicted circumstances that will always become relevant in unknown ways.