Without wanting to tread on anyone's toes...here is my view (and some research to back it up). For the purpose of this discussion my definition of a sight word is one of those small words that don’t respond well to phonics rules and can be taught as a recognisable pattern without having to be decoded, thereby providing some useful building blocks for beginner readers. 

This can be taken further. In those early stages of reading, the reader has very little of the alphabetic code to work with. So when confronted by words it is virtually impossible for them to coordinate different letter sounds into something meaningful. In this instance it is natural for teachers to rely on memorisation of the words to help students ‘read’ the text. 
 
However, if this approach persists (rote memorisation of words) it becomes very inefficient. 
 
Firstly, rote learning of words is very labour intensive and can be intrinsically unrewarding for the learner.  

Secondly, the brain is a master pattern maker, seeking and storing memories based on patterns, or repeated relationships between ideas. Teaching letter sounds and allowing students to analyse words through pattern building is a much more efficient reading process. 
 
Here is some recent research which supports this position.
 
“Beginner readers who focus on letter-sound relationships, or phonics, instead of trying to learn whole words, increase activity in the area of their brains best wired for reading according to new Stanford University research investigating how the brain responds to different types of reading instruction.”
https://news.stanford.edu/2015/05/28/reading-brain-phonics-052815/
 
So while there needs to be a lot of energy expended in repetition and drilling of letter sounds and word families etc to learn the code, I wouldn’t place too much emphasis on the rote learning of word lists where there is no attempt to analyse the letter sound patterns. It sends the wrong message to the learner's brain  - there are an exhausting list of words that have to be remembered rather than ‘read’.
 
I have heard it said that 'all words become sight words, but not through memorisation’ and ’never memorise words you can read’ - nice pithy reminders.