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The Peculiarities Of Control Mechanism In Kmart Organization

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Every organization has a number of stakeholders, with a definite purpose as it works in a social framework. Now, Stakeholders are the parties that are interested in a company, whereby, the parties either affect or get affected by the decisions and activities of the company. The common and primary stakeholders in an organization/company are employees, investors, suppliers and customers.

Stakeholders of an organization have their own rights and responsibilities as organizations/businesses have towards its stakeholders. It is important for organizations to consider and balance the interests of their stakeholders to be socially responsible. An organizations responsibility towards stakeholders include responsibilities to the customers, society, employees, suppliers and government body.

In case an organization fails to discharge its responsibilities towards its stakeholders, the organization has to work on ways to improve their “Control Mechanisms.” Control Mechanisms refers to the regulations/control applied to the activities within an organization to get the desired results and optimize performance

To further elaborate on the importance of fulfilment of organizations responsibility towards its stakeholders, I would like to explain the case issues regarding Kmart Corporation.

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Kmart Corporation, a subsidiary of Sears Holdings Corporation, is an American Retail Chain, founded by Sebastian S. Kresge. Kmart had initially and gradually initiated innovative tactics and strong customer loyal, at the turn of century which led to exceptional corporate growth; their business was on the boom. On the other hand, other retail companies like Walmart and Target, were starting to grow bigger and wider, posing great competition to Kmart. Kmart’s sales started dropping consistently with the closure of stores increasing every year, failing to make changes in their supply chain management. It is known that Kmart had bought several other companies under them which made it lose its focus and filed a bankruptcy in 2002.

Kmart’s failure was not only tied to owning many other companies but Kmart also faced other challenges as they were not able to give back or fulfil their responsibilities towards its stakeholders. After losing its focus and getting diversified, Kmart Corporation faced other problems such as Poor Customer Service, Price Competition, Poor Inventory Management.

  • Poor Customer Service: one main reason for Kmart’s failure is due to their poor customer service. Kmart failed to ensure high quality products at an affordable price, rather, Kmart’s prices became too high and unaffordable.
  • Price Competition: with the increasing competition and pressure from Walmart and Target, Kmart failed to adopt and implement the right pricing strategies.
  • Poor Inventory Management: Kmart had executed poor technology projects which mangled its inventory channels. Often products being out of stock. Kmart had failed to change with time.

All these led to Kmart failing to ensure maintenance which hampered their continuous growth. Furthermore, all this led to Kmart losing their employees as the employees were not provided with fair wages and a good working environment.

My recommendation or the appropriate control mechanisms for Kmart Corporation are:

  • Instead of diversifying their business, Kmart should strengthen its resource and capabilities; to compete in such tough economic situation.
  • Kmart should provide its employees with compatible compensation packages, reward them and make them feel valued.
  • Kmart should keep track of the changing aspects; demands, technologies, etc., to be able to satisfy their customers and compete in the market.
  • Kmart should carry out a proper and effective Market Research and strengthen their Market Strategy, to know what it is that their customers want or need.
  • Kmart should create an integrated supply chain.
  • Kmart should collaborate with NGOs and participate in community related projects; to let people know that they care for the society and to gain trust of their customers.
  • Kmart should not compromise on quality and services, rather, strengthen its relationship with its customers by providing high quality products at an affordable price.

In conclusion, it is essential for organizations to fulfil their responsibilities and satisfy their stakeholders, to keep their businesses thriving and to avoid negative backlash. Stakeholders are the integral part of every company, which has to be taken care of and valued at all times. If not, becomes difficult for organizations to grow and sustain in the market in the long run. As such, Kmart Corporation has to improve their strategies and incorporate initiatives to satisfy its stakeholders, for it to be able to compete and position itself again in the ever changing business environment. In short, Kmart should engage and involve with stakeholders, to uncover its potential strengths and opportunities.

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The Peculiarities Of Control Mechanism In Kmart Organization. (2022, February 21). Edubirdie. Retrieved February 5, 2023, from
“The Peculiarities Of Control Mechanism In Kmart Organization.” Edubirdie, 21 Feb. 2022,
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