Academic journal article Journal of Leadership Studies

The Sears X-Y Study

Academic journal article Journal of Leadership Studies

The Sears X-Y Study

Article excerpt

In the aftermath of a sharp but temporary downturn of sales in 1949, the national personnel department of Sears, Roebuck undertook a study of how representative store mangers were coping with the problems of falling sales and profits and what could be learned from their experience. One of the specific problems the study addressed was that of payroll expense. Of special concern was the tendency observed in some stores to increase the number of persons in staff and supervisory positions.

In order to secure factual information on this question, two groups of midsize stores were selected for study. They were carefully chosen for comparability in all respects but one. They were of similar size, carried the same lines of merchandise, and were located in communities of comparable size and demography. In number of employees they ranged from a low of 96 to a high of 113. They differed in only one important respect: structure of organization.

Because in Sears terminology all stores in both groups were "B" stores, for purposes of the study one group was labeled "X" and the other "Y." Stores in the X group had a simple type of organization structure with a minimum number of staff and supervisory employees. There was a store manager at the top, a single assistant manager, and approximately thirty (actual range: twenty-seven to thirty-two) heads of selling departments ("division managers" in Sears parlance). There were, in addition, the usual non-selling or "service" activities such as shipping and receiving, customer service, maintenance, and unit control (the auditing and credit functions reported up separate lines of authority independent of the store managers).

All division managers (heads of selling departments) reported directly to the store manager, with the assistant manager typically responsible for the non-selling activities. The manager and his assistant usually worked as what might be called a "management team." There was a sharp difference in status between the two but generally speaking the latter functioned as alter ego of the former. There was always a division of responsibility between them, but the term "management team" best described their relationship and the entity to which the (approximately) thirty selling division managers and the four or five people heading the non-selling activities reported; this, in other words, was a very broad span of control.

Stores in the "Y" group had more limited spans of control with an intervening level of supervision between the heads of the selling departments and the "management team." Instead of reporting directly to the top, the thirty-odd division managers were divided between two merchandise managers, one for soft lines and the other for hard lines. In these stores, the assistant store manager typically served as "operating assistant" to the store manager, responsible for the non-selling functions and for administering in a "staff" capacity the operating controls (payroll and so on) for the entire store, selling as well as non-selling.

In separating out these two groups of stores for purposes of study, the investigators had been prepared to find differences between them, but not for the range of differences discovered. As anticipated, there was a difference in payrolls as a percentage of sales, in favor of the more simply organized stores in the X group. This difference was not as great as might have been expected because the added cost of the two merchandise managers was offset to some extent by lower rates of pay at the division manager level.

The more interesting difference was that the X stores tended to be superior to the Y in sales and profit performance. Beyond this, employee morale, particularly at the division manager level, was generally higher in the X group, and a review of the records of the two groups of stores going back over a period of several years disclosed that more people had been promoted out of the X stores to positions of higher responsibility in the company than had been promoted out of the Y stores. …

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