Why I'm not ashamed of Wal-Mart

I’m getting a little defensive over the Wal-Mart “thing” due to living in the Northeast and Germany, where Wal-Mart has been chewed up and spit out. I have to admit that I hate having the Wal-Mart conversation with many people in both of these places. Most typically, they boastfully say, “Well, Wal-Mart couldn’t succeed here.” I’m not completely sure why that is something to be proud of in itself. I think that folks are saying it because the big company didn’t overrun their town or country and turn everyone into mindless (money-saving) zombies with small businesses left in the wake. But that’s not the point of my post… that’s another conversation that maybe I’ll find interesting enought to write about at some point. My point is that

    • Even though they are a very large corporation and I’m quite sure there are people involved with Wal-Mart that have both deliberately made unethical decisions and mistakenly made bad decisions
    • And yes, turning a ship that big is hard, and they can’t react in the way they used to be able to react
    • And yes, they have lost some of their charm with Mr. Walton gone

… I still respect what Wal-Mart has done and I’m proud they are from Arkansas… my home state.

I’ll give you my top 5 reasons why I respect Wal-Mart:

  1. Before Ben & Jerry’s, Google, and Southwest, Wal-Mart shared success throughout the ranks. Yes, across the South, there are people who were cashiers at Wal-Mart who are millionaires now. Sam Walton believed in his employees and rewarded them with stock in the company through ESOPs and stock grants.
    • Note… The company doesn’t have that leverage for employees now due to their size. This is a law of nature, not something evil they are doing to their employees. 
  2. Sam Walton was a communicator, and he built a company that values communication. Being from Arkansas, I saw examples of this from friends who worked there. I knew about the Saturday morning meetings that drove the business for years and years. I know about the incredible satellite network used for communicating across the country to all the remote places where Wal-Mart was.
  3. Wal-Mart defined relentless focus on execution. An example: Their distribution centers lay out let stores have the minimum amount of space dedicated to storing inventory without risking selling inventory… they used 40% of what most competitors did. Why? They knew that stores were about selling and they wanted maximum space to selling space. Wal-Mart knows what is important to them and then execute with keen focus against that.
  4. Wal-Mart is not a slave to their systems. Their systems are built and bought to support their business. (I was a vendor to them… this one I know keenly.) For example, their retail systems were designed to give local flexibility with centralized control. Stores were allowed to adjust prices as needed to respond to local competition, but only to a certain point, as defined by the business objectives set in Bentonville. In all my interactions with Wal-Mart, I have to say they are the best at being the master of their systems.
  5. Sam Walton set up the company to learn. This is one reason they’ve struggled more in recent years, there are very few people from whom they can learn. Mr. Walton set the company up to be driven by benchmarking themselves across industries and departments. Every single group was expected to benchmark with people that were the tops in their areas… across marketing, communications, HR, retail, distribution/logistics, etc.

I recently learned from the book What I Learned from Sam*Walton that there was an internal rally cry at Sam’s Club, HEATKTE, which stood for “high expectations are the key to everything”. This is how Mr. Walton ran the company. He expected more… all the time… from everyone. He was tough, but inspirational, and he built an outstanding company that has been the most successful company in my lifetime.

Please know I am not saying Wal-Mart is perfect. I don’t think this. I also don’t think they deserve the ire they have stirred up in people. Before you bash them, make sure you know the facts. The company has done a great deal of good and are a model company in many ways, particularly looking at the first 4/5ths of their existence.

OK, I’ve gotten that off my chest. Feel free to hurl insults my way for standing up for the big evil American corporation.

4 thoughts on “Why I'm not ashamed of Wal-Mart

  1. Eva says:

    Hello, I read your comments on WalMart
    excellent right up? I am in Canada Did walMart open in Germany? What happened to wAlMart in Germany? Eva

  2. Jana Eggers says:

    Eva, Yes, Wal-Mart entered Germany via acquisition in 1998 and left in 2006. This Deutsche Welle article provides a good overview.Tobias, Great adds. The NYT article is very interesting and has a similar point about how Wal-Mart is used as “the big evil”, when it doesn’t fit. (IMHO)

  3. Mel Webster says:

    Hey Jana — this is spot on! Great column. I too know that Wal-Mart has issues, but I agree with everything you have written. Wal-Mart has played an important role in the global retailing industry and has led the way numerous times in terms of innovation. Hope all is well with you in Germany!

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