Here comes the Wal-Mart attack.
ALWAYS LOW PRICES BLOG
WM Documentaries
By Kevin on Politics
Both CNBC and FRONTLINE will examine WalMart in depth:
THE AGE OF WAL-MART: INSIDE AMERICA'S MOST POWERFUL COMPANY. CNBC takes a tough look at the nation's largest and most controversial retailer. Tonight at 7 and 10 on CNBC.
IS WAL-MART GOOD FOR AMERICA? "Frontline" takes a tougher look. [It should be on next Tuesday, check your local listings].
I know people who swear by Wal-Mart and people who swear at it, folks who break into grins when they see the retail chain's flying, price- slashing smiley-face symbol in a TV commercial and folks who would like to practice their skeet-shooting on it. Whichever camp you're in, two new documentaries about the company, one tonight and one next Tuesday, should be of interest....
CNBC's report is the less adversarial of the two, but mainly because it spends more time on the history and day- to-day operation of Wal-Mart than "Frontline" does. CNBC is a business network, after all, and it's pitching its two- hour program to people curious about the inner workings of the company as well as to Wal-Mart's clientele and critics....
Both the CNBC documentary and the "Frontline" report would be stronger if they had done the hard math, so to speak, of comparing one town's per-capita income and tax collections before and after Wal-Mart's arrival, and if they had put Wal-Mart's business practices in the context of those of other big box retailers such as Target and Costco. But either program provides a good primer for a discussion of what our best interests really are.
With a small-town culture, Wal-Mart dominates
MSM MONEY
The company had to learn to do many things on its own because it started in little Bentonville, Ark., but that helped it become a retailing power. Has it gone too far?
By David Faber
8:57 AM EST November 10, 2004
Love it or hate it, Wal-Mart (WMT, news, msgs) is one of the greatest powers American business has ever seen. This year its annual sales will top $270 billion. It's the largest private employer in the United States with more than 1.2 million workers.
Wal-Mart sells more DVDs, groceries, bicycles, guns, diamonds, engine oil, bedding, detergent, dog food, sporting goods, CDs, socks and toothpaste than any other company in the world. It's the nation's biggest film developer and optician, largest private fleet truck operator, energy consumer and real estate developer.
To some Wal-Mart is an example of capitalism at its finest, a company whose success allows people of limited means to live well. To others, Wal-Mart is a predatory monster responsible for low wages, suburban sprawl and lost jobs."They're exploiting workers by the conditions that they have them working under, by the low salaries that they pay them and by depriving them of benefits that workers are entitled to," says John Sweeney, AFL-CIO president.
"If you listen to the outside world and you said, 'why is Wal-Mart different,' the people who don't particularly care for us might list all things you might have asked me about, health insurance, wages or whatever else. But the truth is, what makes us different is our logistics, our information systems, our culture," says CEO Lee Scott.
Indeed, what's important at Wal-Mart is sustaining the culture that founder Sam Walton created. It's a culture that expects managers at all levels to wake up early and work long hours.
Early hours
It's 5:30 a.m. when regional manager Pat Curran leaves her Bentonville, Ark., home. Around the world in Shenzen, China, Joe Hatfield, Wal-Mart Asia CEO, likes to hit the office by 4:30 a.m. Every Saturday morning, Wal-Mart's top execs get together at 7 a.m., citing their biggest sellers and going over the latest sales numbers. Its semi-annual managers' gathering starts at 6 a.m. and gets right down to business. Even its shareholders have to get up early because Wal-Mart's annual meeting gets rocking by 7 a.m.
"It's like our management meeting we have on Fridays and Saturdays, and they're early meetings, but they're designed to get action started before the day is over," says David Glass, a Wal-Mart director and former CEO. "I used to always come to work at 6:30. That was just a time that worked out well for me. And when I'd get here, Sam would always be here. He'd get here about 3 o'clock in the morning."
Adds Scott, "David Glass has been retired for, gosh, four and a half years now, semi-retired now, and I try to get in to work at 6:25 because he gets in at 6:30 and I just can't stand the thought that he might know more than me at first."
Wal-Mart's culture also comes from being in a small town.
"A lot of our competitors were headquartered in cities or operated in cities where they had access to wholesalers and other services that they could employ," Glass says. "We didn't have that. Being located in northwest Arkansas ... we had to do a lot of things for ourselves. And initially, we created our own distribution logistics network which served us very well. We were on the leading edge of technology because we had to do that to control the growth. And as we began to do things for ourselves, it gave us a competitive advantage over the other folks."
That small-town culture also creates an almost cult-like atmosphere.
Like almost everything else about Wal-Mart, the annual shareholders' meeting is the biggest in the nation. More than 18,000 people from around the world come to the Bud Walton Arena at the University of Arkansas. Like many Wal-Mart events, it's part pep rally, part revival meeting, giving management another opportunity to spread the gospel.
But for all the cheering, Wal-Mart remains wary of the outside world.
"You can see us getting criticized more and more and even attacked more and more," says Jay Allen, a senior vice president of corporate affairs. "The media, political leaders, it's going to continue."
Always improving
Wal-Mart can look paranoid. "I think it's probably with good reason," Scott says. "There's always somebody who's just really good, and if you ever get satisfied with what you're doing, you're in real trouble."
The focus on improvement usually leads to a focus on how to cut costs. Wal-Mart is relentlessly efficient. Whether it's the conveyor belt that makes sure there's no wasted space between goods moving through one of its 110 distribution centers or the company's health benefits policy under which employees bear a significant cost, no expense, large or small, is overlooked.
Scott and Chief Financial Officer Tom Schoewe earned a combined $14 million in stock and cash in 2003. But on business trips, the two will share a $49 hotel room.
"Sharing rooms is a very symbolic part of what we do," Scott says. "It's also an equalizer. If I'm asking the district managers to share a room, but I won't share a room with Schoewe, then what am I saying? There are two different standards here? The customer is the most important thing for all of you, but for me I think I'll run a different standard.
"You can't do that. You can't do it because it's not how Sam would have done it."
Says Glass, "Sam has been gone for a number of years now, but he's still alive and well in this company to a great extent. There's not a day that goes by that I don't hear conversations around here about what Sam would do or how he felt about something." |
