Similar to their mistake in 1988 of obtaining a large bulk of stores, LNT even though they knew they couldn’t support a mass amount of stores by 2001. Between, 2000-2004 LNT opened more than 250 stores, an even larger amount when compared to 1983-1988 with an amount of 210 stores. Even when store closures were occurring LNT was still experiencing mass expansion. After the divestment in 1996 CEO Axelrod should have learned from the company`s mass expansion error. Instead he allowed for not only international expansion (which has supreme high risks) and national expansion even given the weak state of the …show more content…
The first being in 1988 when 155 chain stores were acquired, the second was 2000-2004 which had approximately 50 stores being built each year (Doede & Nickman-Retana, 2010. p. 53). When Kalkin left the LNT, the remaining managers failed to use Peter Drucker’s task of setting objectives. After Kalkin left, the company did not re-state whether or not these goals were still being followed. Not having definite goals could have led to the need to expand. The management type of LNT being a vertical structure would not be able get a full view of the company. The information in a vertical structure would have to travel through various levels of managers in order to reach the desired managers. Thus information takes longer to travel through the