because it would be too confusing. Each of the four co-presidents oversees
a piece of the company defined by categories of merchandise – shoes,
men’s apparel, women’s apparel and so forth. Within each of these
domains there is an executive vice president, merchandisers, and below
them, buyers. Buyers spend at least one day a week visiting and sellingin
the department they service. They, too, regard sales personnel as the keys
to success. Beyond these generalizations there is no company pattern
except that buying decisions are pushed to the lowest practicable level.
Shoes, for example, are purchased by the department manager. Since there
are typically three shoe departments in each store, this translates into 250
separate department heads who act as shoe buyers in the Nordstrom
system. Each establishes sales targets and makes pricing decisions. At the
other extreme, menswear, cosmetics and women’s sportswear are pur-
chased on a regional basis. There are typically three to seven stores within
a region.
Any characterization of how Nordstrom is organized tends to obscure
more than it illuminates. The main problem is that any description that
conveys a hierarchy and lines of authority is woefully misleading. For
years academics have talked about the obsolescence of the command and
controlmodel of organization and advocated a networkmodel in its place.
In this respect, Nordstrom may be one of the most advanced of Western
companies.
Nordstrom’s top executives share power. With five co-chairmen and
four co-presidents, Nordstrom underscores its strong conviction that no
single leader can ever be broad enough to lead an organization over time.*
States co-president, John Whitacre: ‘The single hero-leader doesn’t have
the benefit of seeing an issue from all sides. They get isolated and are all
too easily buffered from reality.’^22 Whitacre continues: ‘We (the four of us)
have all been developed to be co-leaders since we were store managers.
Because of the high degree of decentralization andoverlapping responsi-
bilities here, you have to manage in a participative fashion. Yes, the
overlap generates heat. But we really believe a little contention spurs cre-
ativity. We’re like an Italian family. We argue, get things off our chest,
everybody expresses their point of view. But we remain a tight, cohesive
family. A lot of organizations never let the differences out. Because retail-
ing is a nitty-gritty environment, we get it out on the table and deal with
it.’^23
A useful building block in conceptualizing Nordstrom’s operating
system is to think of each individual department (e.g. Collections, Town
388 Relationship Marketing
*Prior to January 1991, there were no co-presidents. The company was managed by
five co-chairmen, three of which were members of the Nordstrom family. The
current arrangement with four co-presidents is an interim phase in anticipation of
the retirement of the five men at the co-chairman level.