Behind the scenes: Former VP on what happened at Sears Canada
A former Sears Canada vice president says the retailer’s treatment of employees is simply “terrible.”
“It was, in fact, embarrassing to me the way employees were dealt with even when I was there,” David Zietsma told BNN in an interview. “The way we handled people was terrible and it continues to be that way.”
In addition to the roughly 2,900 Sears Canada employees already let go, the company stands to put the rest of its 12,000 workers out on the streets. No plans for severance payments have been disclosed as part of the liquidation process.
Zietsma joined Sears Canada in 2012 and filled the role of vice president of Strategy and Business Improvement from 2013 to 2014. He worked closely with then-CEO Calvin McDonald on key issues including product pricing, company direction and growth targets.
Zietsma says management infighting and distrust from the Board of Directors ultimately led Sears Canada to the precarious situation it finds itself today.
“With a business that once had such strength, letting go of the old ways is very difficult, so not surprisingly there were challenges making change happen,” he said.
“The issue was there wasn’t support from the board or even from the whole leadership team on the direction. If everybody is not working towards the same goal, you’re not going to succeed.”
Zietsma says short-term thinking paralyzed the retailer, leaving it unable to adapt to the changing retail landscape.
“When we came to points of true bold moves, where you really have to do something to make a difference, the board would not be able to see beyond quarter-to-quarter and wouldn’t allow for longer investment,” he said. “I think it was more a lack of faith and ‘let’s capture what we can to keep shareholders happy’ and we’ll worry later about what happens next.”
Sears Holdings CEO and top shareholder through ESL Investments, Eddie Lampert, has often been accused of using the company as a personal piggy bank, preferring to have money flow into the hedge fund rather than reinvest in the retailer.
“I know that on a few occasions, McDonald and I had done some interesting things to free up cash and reinvest, and the decision was made to not reinvest,” Zietsma said. “There were overt signals, not that we dealt directly with Eddie, but that Eddie truly believed in Sears as a going concern for retail, so mixed messages on it but certainly the actions were that they were looking to harvest cash.”
Sears Canada learns its fate Friday when an Ontario court is due to rule on whether it can begin winding down the business and close its doors for good, bringing an end to a demise years in the making.
“I think there are some people that will look back with nostalgia,” Zietsma said. “But for the most part, I’m not sure it’s a brand that’s going to be missed.”