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The Detroit Free-Press reports that when Kmart says that becoming “the store of the neighborhood” is a key factor in its reorganization, it means that it will empower store and regional managers to run their businesses.

Kmart CEO Julian Day sent out an email to store managers saying that he was replacing Jeff Smith, vice president of store operations-administration and a 30-year veteran of the company, and creating seven regional vice presidents to oversee specific areas.

"Each of our regions will now have profit responsibility, moving control to where we interface with our customers. Continuing to empower our store managers, the new structure calls for greater store input," Day wrote.

Apparently, restructuring the lines of responsibility and accountability is seen as more important to the company’s future that the “store of the future” that it Smith was developing, which has a new logo, wider aisles, brighter lighting and lower shelves. Analysts also tell the paper that they believe that the Kmart of the future will carry fewer groceries than past versions of the store.

Kmart spokesman Jack Ferry said the store of the future "will not be impacted” by Smith’s departure.
KC's View:
Betcha that warmed Smith’s heart after thirty years with the company…thanks, but we don’t need you anymore and our plans won’t be affected by your leaving.

That said, we think that greater local control makes sense, especially if those employees feel that they have a stake in the company’s success.

We remain dubious. But we’re willing to be surprised.