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At Sears, Eddie Lampert's Warring Divisions Model Adds to the Troubles

To revive the retailer, Chairman and CEO Eddie Lampert introduced an unorthodox strategy: Every executive must fight to win. So far, the biggest loser is Sears
At Sears, Eddie Lampert's Warring Divisions Model Adds to the Troubles
Photo Illustration by Justin Metz for Bloomberg Businessweek; Photograph by Peter Morgan/Reuters

Every year the presidents of Sears Holdings’ 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.

The Sears chairman, who lives in a $38 million mansion in South Florida and visits the campus no more than twice a year (he hates flying), is usually staring at his computer when the camera goes live, according to attendees.