Sears: How Disrupters Can Get Disrupted

The retailer was as powerful as Amazon was in its day. The lessons its Chapter 11 filing provides for today's leaders.

It may seem unlikely today, but Sears was, for many decades, as powerful and disruptive of a force as Amazon is now—if not more so. Its nationwide catalog, sometimes containing more than 100,000 items, revolutionized how people shopped in the 19th century. Its well-stocked city and suburban stores transformed it again before Amazon CEO Jeff Bezos was even born.

But Sears Holdings, the corporate parent of both Sears and Kmart, filed for Chapter 11 bankruptcy protection this week. Its troubles, experts say, shows how even the ultimate disruptive organizations can themselves get overwhelmed by other forces. The question now is which disrupters thriving today may face the same challenges as the once king of catalogs—and what skills leaders need to keep moving forward.

“The world is constantly changing, and all businesses have to look at their customers and technology and change too,” says Craig Rowley, a senior client partner with Korn Ferry and a global practice leader for the consumer sector, which includes retail.

Retail itself, of course, has been ground zero for the world’s disruptions, including changing consumer demands and demographics, the ability to shop online, the shrinking of supply chains, or a variety of other factors. Denise Kramp, Korn Ferry’s North America retail sector leader and a senior client partner with the firm, says retailers that want to thrive need to adopt the following characteristics: have a brand that the customer “wants to be a part of,” be available to the customer anytime, anywhere, and create a customer experience, either in stores or online.

But even then, leaders in retail or anywhere else can’t rest on their laurels, says Kevin Cashman, a Korn Ferry global leader, CEO and executive development. “Sears was once the Amazon of its time in the way it reached everyone through its catalog and then its stores,” says Cashman. “But when it came to digital distribution, they were too little, too late.”

Leaders at Amazon and other current giants need to determine where the next innovation is going to come from and what the next operating model will be, Cashman says. “There is always some next thing that is always bigger and better than the current dominating thing,” he says.