The Hindu Business Line : Begin with a dream

What is the secret of Wal-Mart's success? "No secret, no magic formula," writes Don Soderquist in The Wal-Mart Way, from Pearson (www.pearsoned.co.in) . As the former vice-chairman and COO (chief operating officer) of the retail colossus, he should know. Because when he joined Wal-Mart more than a quarter century ago, it was a $1.2-billion company with 276 stores. Now, it operates `more than 3,800 stores in the US and 2,600 more abroad,' and its turnover is about $1 billion a day.

"Sometimes the simplest truths are the hardest to grasp because they seem so obvious," notes the author. "Many bright, educated, articulate people are turned off by simplicity, thinking, `It can't be that easy, or other people would have done it. Where's the real magic?' Others dismiss the story as sheer luck. Sam was just in the right place at the right time."

No single factor, but a dozen principles, are what made Wal-Mart win, writes Soderquist. The first principle is, "Every successful venture begins with a dream that requires determination, passion, and the willingness to grow if it is to be fulfilled." Bentonville was a detour, narrates Soderquist. Because Sam Walton had lost the lease on his first store in Newport, Arkansas.

By 1962, Sam and his brother Bud had a regional chain of 15 stores. They were Ben Franklin's largest franchisee. But Sam wasn't contented. "Our stores are too small," he said to Bud. "There's not enough room for all the merchandise our customers are asking for. They don't want to have to drive to larger cities to buy the merchandise they need and want right now. They also want the lower prices that they pay in the larger cities. We've got to rework our plan and start building bigger stores if we want to satisfy our customers."

The second principle is about vision — `the power of seeing what others don't see'. Plus, you should never take your eyes off of who you are and what you are today, advises Soderquist. "Talk of vision has become so prevalent - maybe even so commonplace - that many leaders take the process and discipline of vision-casting for granted," he rues.

Principle #3 is about culture, "where everyone shares the same values, purposes, and expectations of success." It is the leader's responsibility to `tell the story,' `paint the picture,' `walk the talk' of what is truly important to an organisation, insists the author. "In great organisations, a leader's words and actions model what really matters, and as a result, everyone gets on the same page and pulls together."

Next, `people make the difference,' because "true success is achieved in direct proportion to the degree that an organisation treats its people with respect and dignity - and believes in them enough to help them grow." In Wal-Mart, no one is more important than anyone else, recounts the author. "We all have different roles and titles, but everyone in this company is just as important as everyone else." Find little ways of impacting your people's self-esteem, and get out of their way, he counsels. "The sad reality is that the majority of people in the work world do not feel appreciated."

Wait. Haven't we heard many a criticism about Wal-Mart? `Reputation attacks' is how the author calls "lawsuits, negative coverage in the news media, laws and regulations written specifically with Wal-Mart in mind, and even organising activity by labour unions in the company's stores." He explains in the last page of the book how Wal-Mart, which has grown to become larger than some governments, has not only become `a lightning rod for some of the most challenging issues we face as a society' but is also `judged on a standard of perfection'. As a result, "every mistake has the potential to appear on the evening news or on the front page of the local newspaper."

The company is not perfect and needs to improve, concedes Soderquist. "Ironically, those who attack Wal-Mart will ultimately play a key role in making it a better company, and even a more successful retailer."

Timely read.

http://BookPeek.blogspot.com

D. Murali

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