By the widest of margins, Walmart (Mike Duke, CEO) is the largest public company in the world measured by sales. With $408 billion on this measure in the Forbes Global 2000 listing, it is $130 billion ahead of the next player, Royal Dutch Shell. It was fifth on the list for market value at $ 205 billion and tenth by profit at $14 billion. It is by a large margin the planet’s largest retailer.
In its annual report, Walmart claims to serve customers and members (of its membership retail clubs) 200 million times a week from 8400 retail units in 15 countries. The company employs 2.1 million people.
Walmart’s motto is “Saving people money so they can live better.” Starting in smaller communities away from big cities in the United States, it is famous for creating huge stores – what Europeans would call hypermarkets – and driving an aggressive and finely tuned business model and supply chain to achieve its motto: Walmart sells huge volumes at low prices. Its stores quickly become the dominant retail outlets in their market areas. It delivers wide selection, friendlly, efficient service, and above all, low prices.
Walmart came number 9 in Fortune’s most recent list of most admired companies, presumably because its business model is so effective. Its customers regularly vote with their wallets by buying lots of stuff at Wal-Mart.
At the same time, it has been criticized. Complaints against it include allegations of driving small firms out of business, paying low wages with meager benefits, squeezing suppliers, being anti-union, and being unfair to women. WalMart has always defended itself vigorously against the charges levelled against it. It has defended its business model as being in the best interest of creating value for its customers. It has defended its treatment of its employees and suppliers as fair, respectful, and even-handed in the context of its business model. It has denied being unfair to women.
Its announced ethic is to value servant leadership, teamwork, courtesy, and customer service. My own experience in Walmart stores tells me that as a customer, it works.
On its website, Wal-Mart claims three basic beliefs:
- Respect for the Individual
- Service to our Customer
- Striving for Excellence
Wal-mart has a “10-foot rule” for customer service, originated by its legendary founder Sam Walton. There’s a pledge: “I promise that whenever I come within 10 feet of a customer, I will look him in the eye, greet him, and ask if I can help him.”
Founded in 1962 as a feature of small-town America, the company is now represented in 15 countries, including China, India, Brazil, Argentina, Mexico, Canada, Japan and the U.K. Just under 25% of sales now come from outside the U.S.
Giant that it is, with its roots deep in middle America, it will be interesting to see how Walmart’s digests its experience with the rest of the world. Although many people will probably be critical of its tight-fisted ways, its business model will stand it in good stead in an increasingly competitive world. My guess is that on, on net, its customers, employees, and suppliers will all be glad to have it around.
The growing list of Interesting Communities of Leadership is athttp://lovingwork.org/interesting-communities-of-leadership
Scott is scott@lovingwork.org and @scottdowns3 on Twitter.
business models · customers · emerging markets · global · leadership · people · service · value · values · Walmart
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