Instructor: David Schuff, Section 003


Will Payless Survive?

bankruptcy photo

Recently emerged from bankruptcy, shoe retailer Payless ShoeSource announced the realignment of its organizational structure a week ago with goals of becoming a more customer-focused company. The company has made the decision to reduce hierarchical levels between its corporate headquarters and retail stores. As a result, Payless is increasing the number of North American associates working closely to the store level, with company goals to develop a team of strong leaders to guide the store teams. This intended result of this effort is to have a flatter organizational structure will enable the company to reach its customers more directly. However, it remains to be seen whether this reorganization will lead Payless in the right direction. While reducing layers in an organization can lead some companies to certain benefits, including an increase in communication between all levels of associates, other companies may struggle to adapt to the new structure. It will certainly be interesting to see the outcome of this restructure, specifically if it keeps the company from going bankrupt again. Do you think Payless customers will feel the effects of this reorganization? What are reasons that this reorganization could cause Payless to fail?



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