It’s been twenty-one years since Sam Walton passed away. His Ten Rules for Building a Business are still posted on Wal-Mart’s web site…but are they living up to them?
Sam Walton’s Ten Rules for Building a Business are found in his book, Sam Walton: Made In America.
Let’s look at each of them one by one and see where Wal-Mart stands today. Regardless of whether they still practice these principles, it doesn’t change the truth of them. They are excellent primers for all business leaders.
1. Commit to your business.
As a leader, you have to believe in your business more than anyone else does. If you aren’t the leader, believing in the business more than anyone else does goes a long way towards becoming a leader.
Commitment means passion, intensity, and willingness to sacrifice for the business.
I do believe that those at the top at Wal-Mart have committed themselves to the cause, Wal-Mart’s success. But has it trickled down? Have they created a culture in which each and every team member is committed? Definitely not and I think it’s related to a failure in principle two.
2. Share profits with your employees.
“Employees” are partners. They are team members. The cashiers, stockers, and store managers are the only people 99.99% of us encounter with Wal-Mart. Most of us don’t hang out with their CEO.
I believe this is one of the areas where Wal-Mart has struggled. I’m not going to theorize about whether they should pay more, provide better health care, or whatever. But I will say this…team members who are unhappy with their pay or benefits rarely perform to the level at which they are capable of performing. And it shows to the customer (you know what I am talking about).
3. Motivate your partners.
This is about more than money. This is about pushing people to achieve more than they ever thought possible.
I believe, on the whole, that Wal-Mart excels here. They are legendary for promoting within. Twenty-five year olds are managing hundreds of millions of dollars in merchandise each year. Five years prior they were cashiers.
The opportunity for advancement is one of the greatest motivators there is and Wal-Mart seems to be doing a phenomenal job in this area.
4. Communicate everything you possibly can to your employees.
Communicating everything means demonstrating open leadership. It means sharing information you don’t want to share. It means sharing sometimes sensitive information and trusting your team with it. It means sharing your failures and asking for help. Leaders who do those things usually find that it pays huge dividends in team loyalty and performance.
Sam Walton was a big advocate of overcommunication with his team. I can’t speak to the information sharing at the higher levels of Wal-Mart, but it appears this principle has been lost with the frontline team members.
5. Appreciate everything your associates do for the business.
This is the part that goes beyond principle #2 (share profits). You have to let every single team member know that their role and their performance is valuable and critical to the team’s performance. The salesperson doesn’t get a chance to sell if the person answering the phone is rude. And if that person is phenomenal, the salesperson’s job is that much easier.
Practice catching team members doing things right and thank them. Find success stories and follow principle #6.
The average associate at Wal-Mart today suffers from small fish, big pond syndrome. In an operation of the size of Wal-Mart, it’s easy to forget the necessity and contributions of frontline team members. This is an area where Sam Walton would definitely like to see some improvement.
We’ll cover principles 6-10 tomorrow.
6. Celebrate your successes.
7. Listen to everyone in your company, and figure out ways to get them talking.
8. Exceed your customers’ expectations.
9. Control your expenses better than your competition.
10. Swim upstream.
Which of these principles do you feel Wal-Mart has succeeded at the most? The least?