Summary of the Book
Since the demise of Sam Walton in 1992, Wal-Mart has witnessed a significant transformation. The company has moved from dominating the retail industry to clinching the top slot in the list of the 500 largest companies in the world as enumerated by the Fortune Magazine. One of the people that contributed to this success is Don Soderquist. Walton tried hiring Soderquist for over twenty years.
However, he later joined the company at a time when it undoubtedly required his services. Soderquist was given the responsibility of managing most of the company’s support divisions, which he managed diligently and in line with the company’s principles.
Perhaps no other executive has managed to help the company witness a significant growth as Soderquist did since the death of Walton. In this book, Soderquist confides how he helped Wal-Mart company grow its assets from $43 billion to $200 billion. Numerous books have tried to account for the growth of Wal-Mart. Nevertheless, the Judeo-Christian values that Soderquist upheld during his reign in the company contributed to this success.
What the Entrepreneur did Wrong
Soderquist managed to help the Wal-Mart company improve on the quality of its products. Nevertheless, his management had some conspicuous flaws. For instance, despite helping the company expand its production capacity, he did not work on opening new branches across the globe.
This situation underlines the reason why Wal-Mart has branches in a few countries across the world. Soderquist managed to help Wal-Mart dominate the grocery industry. Nevertheless, allowing the company to specialise in different products like stationary, clothing, and food affected the company’s efficiency thus giving the competitors a chance to wage competition.
What the Entrepreneur did Right
The success of Wal-Mart is credited to the management practices that Walton and Soderquist adopted during their reign as the executives in the company. During his reign, Soderquist ensured that his management sticks to the company’s vision. Despite the hardships, he ensured that the company did not swerve from the established vision.
Soderquist helped the company to produce quality products. Besides, he worked on employee development to make sure that all the staff was equipped with the necessary skills (Soderquist 6-13). This strategy ensured that the staff members were in a position to address all the customer needs leading to the consolidation of the company’s customer base. Another thing that Soderquist did during his tenure in Wal-Mart was to uphold the company’s culture. He ensured that the entire staff group was aware of the company’s culture thus passing it from one generation to the other.
Soderquist demonstrated an authentic commitment to the company’s goals. He used all means to ensure that other employees were committed to the company’s objectives too. For instance, he offered competitive salaries to his staff besides treating all employees with respect and dignity (Soderquist 25). This strategy also made the employees feel appreciated by the management, therefore, committing themselves to organisational goals. Soderquist nurtured the belief that every employee was crucial to the company.
This case underlines the reason why most of the company’s practices were initiated in the front lines of the company’s stores. The ability by Soderquist to identify the opportunities before his rivals gave him an upper hand in the market. He could always capture any emerging opportunity long before his rivals could do. This tactic kept the company ahead of the others thus contributing to its immense success.
What I would have done Differently
Organisational leaders use different strategies to enhance organisational growth. If I were in Wal-Mart, I could have embarked on opening new branches across the world to help the company diversify its operations. Currently, Wal-Mart is one of the leading companies in the grocery industry. However, the company has limited branches across the globe.
Hence, in spite of the company dominating the grocery industry, its influence is experienced in a few countries across the globe. To help the company increase its profit, I would embark on opening new branches in countries that Wal-Mart does not exist. This approach would open new markets for the company thus increasing its sales volume.
Besides opening new branches for the company, I would also work towards streamlining the operations within the company. Currently, Wal-Mart is a leading company. Consequently, the management encounters challenges in controlling the operations in the various available branches. Failure to streamline the operations in the different Wal-Mart branches is giving the rival companies an opportunity to establish themselves in the market that Wal-Mart had dominated for a long time. To enhance the company’s efficiency, I would ensure that all the branches operate autonomously.
I would achieve this by establishing an operation department in every branch. The department would be responsible for running the operations in the branch. Besides, I would link all departments to an operations department in the headquarters, which would be responsible for monitoring the operations of the individual branches and collecting the operation hitches the branches encounter.
Economic Principles used in Wal-Mart
Soderquist applied various economic principles in his management. Among the principles was the belief that voluntary trade generates wealth. Besides, he believed that the results of any choice could only be determined in the future. The main reason why Soderquist embarked on a massive production of good in Wal-Mart was that he had the conviction that the company would gain from the goods. The company sold its products to the target consumers because its management believed that it would benefit from the sales.
Moreover, Soderquist insisted on the organisational culture and values since he believed that they held the future of the company. Soderquist made the decisions to work on employee development since he believed that equipping the employees with operational skills would help the company to come up with quality products and services in the future thus increasing its revenue.
Soderquist employed the economic principle that holds that people react to incentives to promote organisational growth. He made sure that employees received a better pay and that they were promoted based on their performance. The salary and promotion were incentives aimed at promoting employee commitment.
Lessons from the Book
One can learn a lot from this book. One of the lessons I learnt from the book is that one can surmount any kind of hardship no matter the circumstance. To succeed, one needs to have a vision on which he or she sticks. The main reason why Soderquist managed to see Wal-Mart grow its assets significantly is that he kept to the company’s vision.
Besides sticking to organisational vision, it is clear from the book that employees form one of the most valuable assets of an organisation. They dictate on the organisational growth. Hence, for an organisation to grow, it has to treat its employees well and or motivate them. Soderquist made sure that employees received better salaries as a way to motivate them. In return, the employees were loyal to the company thus leading to its significant growth.
Soderquist, Don. The Wal-Mart Way: The Inside Story of the Success of the World’s Largest Company. Tennessee: Thomas Nelson, Inc., 2005. Print.