Sam Walton

There is no disputing the landmark changes Sam Walton has made in the business climate. He formed Wal-Mart in 1961. The company today is a global company with more than 1.8 million associates worldwide and nearly 6,500 stores and wholesale clubs across 15 countries (Wal-Mart website).  Sam Walton was the proponent of the use of technology in the inventory process, which ensured just-in-time inventory control and sophisticated logistics, thereby making Wal-Mart’s computer database in 1998 second only to the Pentagon’s in capacity (Huey, 1998). His business strategy of “Everyday Low Prices” is an approach that passes on savings to customers and earns Wal-Mart its profits through volume. He also maintained low overhead by way of reducing payroll to the barest minimum but was able to justify this to employees through his charisma and by selling the idea that this was “a crusade on behalf of the lowly consumer and as a quest for a better life for all Americans” (Frank, 2006). In 1971, he made sure his staff had a stake in the company by introducing a profit-sharing plan that allowed employees buy subsidized Wal-Mart stock from a percentage of their wages. This is Rule Number 2 in the book “The 10 Rules of Sam Walton” (Bergdahl, 2006).

However some of these tenets are not in evidence in the Wal-Mart of today. An example is the ongoing furor over Wal-Mart’s infringement on labor laws. It received so much attention that in November 2005, filmmaker Robert Greenwald released a documentary titled “Wal-Mart: The High Cost of Low Price”. The documentary berated Wal-Mart for its approach to unions, independent retailers, outsourcing, and wages and benefits. It has gotten to the extent that Washington is also involved. In 2004 a report, “Everyday Low Wages: The Hidden Price We All Pay for Wal-Mart”, was released by Pep. George Miller of California making an issue of the company’s wages and benefits. This is in contrast with Wal-Mart in the days of Sam Walton, which made sure that employees felt they had a stake in the business and sold employees on the notion that working at Wal-Mart meant limitless opportunity.

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