Summary

Inside one of America's most remarkable success stories, from the bestselling author of Jack Welch and the G.E. Way. Two of the toughest challenges for any company are leadership transitions and rapid growth. How do you replace an enormously popular and beloved CEO-especially one who started from scratch to create a national icon? And how do you maintain a rapid growth rate without losing the culture and focus of a small company? Over the past ten years, since the death of the legendary Sam Walton, Wal-Mart has passed both challenges with flying colors. In 1992, it had revenues of $43.9 billion; now it's number one on the Fortune 500 list of America's largest companies, with revenues of $218 billion. Sam Walton's successors have taken the company into far-flung new markets and new directions yet without losing the down-to-earth retailing culture that made Wal-Mart thrive in its early years, when its business model was truly revolutionary. Robert Slater, a highly respected business journalist and author, was granted unprecedented access to the company while writing The Wal-Mart Decade. He takes readers deep into the inner circle, where the big decisions are made about strategy and operations. And he weaves a fascinating, accessible story about the many challenges of the past decade and how Wal-Mart built on its founder's legacy to overcome them.

Author Biography

Robert Slater was a reporter for Time for eighteen years and is the author of a number of bestselling business biographies including Jack Welch and the GE Way.

PART ONE WAL-MART TODAY

1 Celebrating in a Basketball Arena

(20)

PART TWO THE FOUNDER AND HIS LEGACY

2 The Man from Kingfisher

(20)

3 Give Me a Squiggly: Sam Walton's Culture

(13)

4 Avoid the Layers, Avoid the Frills

(15)

PART THREE A NEW WAL-MART, A NEW TEAM

5 A New Management Team Follows Mr. Sam

(17)

6 A Strategy of Growth

(15)

PART FOUR WAL-MART AS A GROWTH ENGINE

7 The More Complex Wal-Mart Today

103

(12)

8 Applying the Culture a store at a Time

115

(16)

9 Beyond the Seas: A New Outlet for Growth

131

(16)

10 Live Snakes and Turtle Races: Wal-Mart in China

147

(16)

PART FIVE WHO DEFINES WAL-MART?

11 Mr. Logistics Takes Over

163

(15)

12 A Matter of Reputation: Taking the Gloves Off

178

(15)

13 A Strategy for the Twenty-first Century: The New Openness

193

(22)

PART SIX WHITHER WAL-MART?

14 Where the Future Will Take Wal-Mart

215

(8)

Acknowledgments

223

(6)

Notes

229

(6)

Index

235

Supplemental Materials

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Excerpts

PART ONE WAL-MART TODAY CHAPTER 1 Celebrating in a Basketball Arena June 7, 2002. Thousands of Wal-Mart loyalists storm into the cavernous Bud Walton Arena on this summer morning in Fayetteville, Arkansas. The blaring music, the screaming crowds, the bright lights assault the senses-it is, after all, only six in the morning! Hard to believe, but when the annual shareholder meetings began more than thirty years earlier, Sam Walton, Wal-Mart's founder, huddled with five other people around a table at a coffee shop next to a company warehouse and speedily dispensed with business. In stark contrast today, the Wal-Mart gathering lasts six hours. It is, at least for that morning, the greatest show in town. No other company in the world puts on a show for shareholders quite this spectacular. One after another, executives race to the stage, adrenaline pumping, fists waving, and smiles on their faces. Roaring with approval, the crowds pour their hearts and souls into an event that has all the trappings of a pep rally or a political convention. Whoever said that a shareholder meeting had to be stuffy or formal? Other corporations race through annual shareholder meetings. Why shouldn't they? The way others conduct these meetings, they are too boring for anyone to want them to last more than fifteen minutes. The Wal-Mart attitude is different: If you're going to assemble twenty-thousand Wal-Mart loyalists under one roof, the least you can do is give them a rousing good time. And so Wal-Mart turns its event into a wild weeklong celebration, replete with canoe rides, concerts, fireworks, seminars, visits to a company distribution center, and, lest anyone forget why they had all come together, tours of the home office in Bentonville, a thirty-minute drive to the north. The Wal-Mart assemblage takes up nearly every seat in the 19,300-seat arena, making this the largest corporate annual meeting in the world. More in keeping with a sporting event than a corporate gathering, the visitors wear every possible combination of company buttons and banners and hats. The red hats and banners identify one Wal-Mart division, the green, another. The reds and greens applaud and scream unendingly, but they save the loudest roars for that golden moment when someone on the stage mentions the name of their division. Then a section of the arena erupts, and you really feel as if someone has just scored the game-winning basket for the home team. The Wal-Mart audience-"First Lady" Helen Walton and her four children, executives, rank-and-file employees ("associates," in Wal-Mart parlance), the board of directors, shareholders-gathers here on this day with one purpose in mind: to rejoice. Every year they travel-some of them thousands of miles-to take part in this corporate festival with the dual purpose of learning more about the place at which they work and to celebrate the achievements of the past year. Never have they had more to celebrate. HHH It has been just over ten years since Sam Walton died, leaving behind a discount merchandise business that few believed would ever make waves but that has defied the imagination of even the greatest of skeptics. At first there just seemed no way that a backwater retailer like Sam Walton could make a mark. Too many of the big boys in retailing had already established footholds in the big cities, the only places that counted for a retailer. But Sam Walton had two very important things going for him: First, he was perhaps the greatest merchant of his era. He had an uncanny instinct for sensing what products would sell, at what prices they would sell; where to locate stores, and what those stores should look like. FREE TO DO AS HE PLEASED And he also had a vision that was both prescient and revolutionary: He became the first mass merchant to focus on the small-town backwaters of America. Initially the skeptics howled derisively, mockin