Walmart Strategy

Sam Walton, a leader with an innovative vision, started his own company and

made it into the leader in discount retailing that it is today. Through his savvy,

and sometimes unusual, business practices, he and his associates led the

company forward for thirty years. Today, four years after his death, the

company is still growing steadily. Wal-Mart executives continue to rely on

many of the traditional goals and philosophies that Sam's legacy left behind,

while simultaneously keeping one step ahead of the ever-changing technology

and methods of today's fast-paced business environment. The organization

has faced, and is still facing, a significant amount of controversy over several

different issues; however, none of these have done much more than scrape

the exterior of this gigantic operation. The future also looks bright for

Wal-Mart, especially if it is able to strike a comfortable balance between

increasing its profits and recognizing its social and ethical responsibilities.

Why is Wal-Mart so Successful? Is it Good Strategy or Good Strategy

Implementation? -- In 1962, when Sam Walton opened the first Wal-Mart

store in Rogers, Arkansas, no one could have ever predicted the enormous

success this small-town merchant would have. Sam Walton's talent for

discounts retailing not only made Wal-Mart the world's largest retailer, but

also the world's number one retailer in sales. Indeed, Wal-Mart was named

"Retailer of the Decade" by Discount Store News in 1989, and on several

occasions has been included in Fortune's list of the "10 most admired

corporations." Even with Walton's death (after a two-year battle with bone

cancer) in 1992, Wal-Mart's sales continue to grow significantly. Wal-Mart is

successful not only because it makes sound strategic management decisions,

but also for its innovative implementation of those strategic decisions.

Regarded by many as the entrepreneur of the century, Walton had a

reputation for caring about his customers, his employees (or "associates" as

he referred to them), and the community. In order to maintain its market

position in the discount retail business, Wal-Mart executives continue to

adhere to the management guidelines Sam developed. Walton was a man of

simple tastes and took a keen interest in people. He believed in three guiding

principles: 1. Customer value and service; 2. Partnership with its associates;

3. Community involvement (The Story of Wal-Mart, 1995). The word

"always" can be seen in virtually all of Wal-Mart's literature. One of Walton's

deepest beliefs was that the customer is always right, and his stores are still

driven by this philosophy. When questioned about Wal-Mart's secrets of

success, Walton has been quoted as saying, "It has to do with our desire to

exceed our customers' expectations every hour of every day" (Wal-Mart

Annual Report, 1994, p. 5). Walton's greatest accomplishment was his ability

to empower, enrich, and train his employees (Longo, 1994). He believed in

listening to employees and challenging them to come up with ideas and

suggestions to make the company better. At each of the Wal-Mart stores,

signs are displayed which read; "Our People Make the Difference."

Associates regularly make suggestions for cutting costs through their "Yes

We Can Sam" program. The sum of the savings generated by the associates

actually paid for the construction of a new store in Texas (The story of

Wal-Mart, 1995). One of Wal-Mart's goals was to provide its employees

with the appropriate tools to do their jobs efficiently. The technology was not

used as a means of replacing existing employees, but to provide them with a

means to succeed in the retail market (Thompson & Strickland, 1995).

Wal-Mart's popularity can be linked to its hometown identity. Walton

believed that every customer should be greeted upon entering a store, and

that each store should be a reflection of the values of its customers and its

community. Wal-Mart is involved in many community outreach programs and

has launched several national efforts through industrial development grants.

What are the Key Features of Wal-Mart's Approach to Implementing the

Strategy Put Together by Sam Walton -- The key features of Wal-Mart's

approach to implementing