Companies are Exploration
Most successful people found a lottery ticket and then invent a story to make luck sound like skill. (1) Yet for some, it is clear that regardless the starting point, they would end up on top. Sam Walton is among the latter.
Despite the aww-shucks tone and folksy self narrated drawl, Made in America is not a modest book. Sam Walton describes his childhood as obtaining eagle scout at 13 to win a bet, and as the high school football quarterback: * We went undefeated, and won the state championship.*
The most important takeaway from this book, is how to learn in business. Learning is an omnichannel constant struggle, and an area where Walton stands out. To start his first store * I went to the library there and checked out every book on retailing. * As America became more industrialized and packaged Walton did not complacently ride the tide of his Ben Franklin variety stores. He found the philosophy that set Wal-Mart apart in a competitor * I started running all over the country studying the concepts. Then so and such started a store with a simple philosophy: buy it low, stack it high, sell it cheap. * Wal-Mart rode a wave of change in the retail industry, and without the curiosity of its founder, the inevitable changes would have created just another small town operator like my grandfather.
As we all know, Wal-Mart did not get steamrolled, it was the steamroller. Not until Amazon has there been a company able to compete effectively with the machine that is Wal-Mart, and I was surprised by the number of cultural attributes shared between Wal-Mart and Meta, companies of different generations, industries, and business models.
Value talent, and strive to find solutions that work for employees over the long term.
Allow for experimentation at the local level, but strive to build infrastructure to propagate information as quickly and transparently as possible. If speed and accuracy are at odds, choose speed.
- If you can’t make your books balance, you take the difference and put it under the heading ESP, which stands for ’error someplace’. Then we would get the P&L out to the store manager as quickly as we could. *
- **Don’t be proud about innovation. **If you find innovation elsewhere, use it.
- I read an article about Ben Franklin stores that went self service. No clerks around the store, just checkout registers up front. I liked it, so I did that too. *
As is to be expected, Walton dismisses the externalities created by his company and narratives about him in an offhand manner. If you want to understand the effect of big-box retail on the American service class, look elsewhere. But if you want to understand how to create a winning business starting from almost nothing, this is the first book I would recommend. And of course Walton agrees: * On of the reasons I’m writing this book is so that my children and great grandchildren will read it and know this: if you start [selling stock to live high], or any of that foolishness, I’ll come back and haunt you. *
** 109th book of 2022 **
(1): See Built From Scratch (Home Depot), In-n-out Burger, Empire of Pain (Sackler Dynasty), just among books I’ve read this year.