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Monday, Mar. 09, 2009

Robert L. Sharp: Corporate life cycle

Just as with plants and animals, it came to mind recently there is a corporate cycle of life -- birth, growth, maturity, decline and death.

Being thrifty (and lethargic), I rarely darken the door of a retail store, but I visited a major department store recently, which shall remain unnamed.

This establishment, which was founded in 1893, brightened rural homes with its mail order "wish book" catalogues, and has been long famed for the quality if its tools and appliances.

The parking lot was barren of cars, as was the interior of customers, and nearly so of service staff.

I was looking for a particular shirt, which I had seen on the store's Web site, and asked the cashier where I might find it.

She didn't know.

An elderly lady and her caregiver, the former of an age to remember when good service was the norm, were looking for handkerchiefs.

The cashier didn't know.

Fortunately, a maintenance man ankled by. He had sufficient tenure with the company to know where things were in the store and pointed me in the right direction.

Back to the cashier. She did know how to promote their credit card. I didn't want yet another piece of plastic in my wallet, but $15 off my purchase persuaded me.

I was impressed however, with the request for electronic feedback noted on the receipt. When I returned home I hopped on the computer to take their survey and vent my experience. When I hit the "submit" button at the end, nothing happened. So I fired off a snarky missive to the survey company.

A gentleman with "Ph.D." and a senior vice president title at the end of his name, answered me. I was also impressed there was a real live human on the other end. He explained, "It's an unfortunate glitch in whatever browser software is on your computer."

I replied, "You should apply for a government job. You have a problem, but you tell me it's on my end."

This made me think of the corporate cycle of life, especially the part near the end.

Someone starts a business and works hard to make it run well and be attractive to the public. They retire and the next generation or the generation after that hasn't the same interest.

They sell to some hedge fund, which tells investors they will "unlock value," which means, they sell store property that has appreciated in price over time and lease it back. They advertise that they are going to "focus on their core competency" and sell subsidiaries. They cut jobs and service to put more money in their pocket. Eventually, the public catches on and they go bankrupt.

Mr. Roebuck would weep.

Robert L. Sharp grew up in Linden (population 1,000) and spent most of the following 30 years as an international banker in Asia, including four years as a naval officer in that part of the world.