Message from Sam Walton

The Real Hidden Asset on Wal-Mart’s Balance Sheet

Much has been written concerning Wal-Mart's remarkable development into one of the outstanding retail companies in America. Many folks outside our Company, and within, talk about various elements that have contributed to this unusual success story in retailing.

In my opinion, there's one factor that probably overshadows all others in having made it happen...the quality of utilizing and recognizing our people as our truly number one asset.

This is a quotation I recently saw in an article entitled "Successful Management Of New Products".

"A company has vast resources in funds, facilities, and people. If the latter are properly utilized, a continuous flow of ideas can be initiated. Recognition, both monetarily and with corporate acceptance, has to be given to individuals with ideas, so more will be forthcoming. If not, this potential pool of talent will shrink up and stop trying. They'll perform daily duties and little more. Encouragement is essential."

How well the message comes through to all of us in Wal-Mart, and that actually has been a vital element in our management process for many, many years. I feel our management at all levels, and in particular our District Supervisors and Regional Directors, have done an excellent job in this regard.

Why is our VPI program so successful and so important to our Company… or our store level loss prevention committees. . . or our weekly merchandise meetings held with our department heads with their show and tell sessions? I think you know the answer...it's management listening, learning, and taking the ideas and suggestions from our very interested associates and making them a part of our program.

I don't know of a better example of this concept than what occurred in our very fine Festus, Missouri Store no. 69 recently. I hope you folks there will excuse the personal reference. However, I'm so proud of you all...I must relate the story.

Our management was quite concerned with the approaching opening of a new competitor in Festus. Venture, an excellent discount chain from St. Louis, will open this Fall in Festus, taking over a 100,000 square foot Grant store. Our store is 60,000 square feet. Management knew we needed to take all possible measures to get our store ready. So the first step was to call our associates together in Festus for a store meeting and review the entire situation with them ... telling our concerns...the type store Venture would operate, etc. Then our Management asked the question...what would you folks suggest we do to get our store completely ready and competitive to meet this difficult competitor?

And the response was tremendous. Over a dozen great ideas for improvement came from that one meeting! Others were added as the campaign was initiated and action taken.

The results have already been dramatic and spectacular. Consistently, Festus has been on our Honor Roll for the last two months. Our associates' morale is sky-high in Festus. Our customers are really getting a full measure of WaI-Mart friendliness, service, and what they came for.

My hat's off to Manager Clem Barrios – District Manager, Bill Adams – and Tom Jefferson, Vice President of Northern Region, for being that management that listened first, and then, most importantly, took those ideas from our associates and put them into action.

So that's our story...and it has been, and is being, repeated throughout our Wal-Mart World every day... Bartlesville, Jefferson City, Sullivan, Harrison, Broken Arrow, Fayetteville...and on and on.

So the moral must be, and I'm sure you would all agree, Wal-Mart is recognized as having one of the strongest financial balance sheets in the retail industry, but the single most important asset must be our people and the continual stream of ideas that they feed into our program. Let's all continue to listen, act, and be very appreciative of this great talent we have throughout our Company.