EMBA 8820 Leading the Enterprise Change Leadership Story 10.14.

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“One person seeking glory doesn’t accomplish much… everything we’ve done has been the result of people pulling
together to meet one common goal – teamwork – something I also picked up at an early age.” (1) In 1945, Sam
Walton purchased his first store, a ‘five and dime’ called Ben Franklin in Newport, Arkansas. Over the next 15 years,
he added 14 more stores to the chain, and by 1960 anticipated a major change in the way retailers met their
customers.

By now, Walton must have realized Ben Franklin’s lifecycle was shifting from a gritty startup, built on maverick spirit
and ambitious drive, to a growing institution requiring a shift in the hearts and minds of his people. Internally he
knew that success would result from better systems and processes, but he was lightyears away from the brilliant
supply chain network that would be the foundation of a global juggernaut. Today his challenge was just getting his
renegade store managers to use a P/L statement. Walton also perceived the advent of new pressures from external
sources; competition for capital, real estate, merchandise, and most importantly, talented workers. He knew the
importance of building a culture that attracted the best and brightest from an increasingly competitive field.

In 1962, Walton opened the first Wal Mart in Rogers, AR, and quickly took an inventory of the motives and desires of
his staff, understanding who would support the changes, who was just along for the ride, and who stood in
opposition. Through the 60’s Walton continued adding Wal Marts to the chain, instilling the company’s driving
values into every employee by personally visiting his stores, walking the aisles, talking about core principles with
individuals, and building routinized habits for his store managers to report on weekly. These habits instilled the
values of thrift and service in the hearts of his team, building their identity as Wal Mart people. It was something for
them to be proud of.

As the years advanced, an empire grew. Walton had to let the spirit he poured into his organization grow
organically, by appointing change leaders as regional managers, routinely flying them to their respective stores each
week, challenging them to bring back one idea good enough to pay for each trip. Many of these ideas came straight
from the entry ranks in the organization. He empowered the front-lines by soliciting their ideas and acting upon
them, generously sharing the profits from those ideas with the people who generated them. He communicated with
them frequently, explaining not just the ‘what’, but the ‘why’, fostering an environment that encouraged ideation
and expression.

As time went on, the ‘computer’ generation flourished and the company went through many more changes, but
because he had connected at the gut level with his employees, and because he knew how to put influential people
in the right places, his organization didn’t just evolve with external changes, it defined them. Walton probably never
heard of Kotter’s Change Model, but he was a true Originator and risk taker, capitalizing on his insight to the hearts
and minds of his people. He didn’t follow the academic script because the script itself was modeled after people like
him. He had the rare natural gift of both business and emotional intelligence, attracting world class leaders like
Hillary Rodham Clinton to his board of directors. For the rest of us basket-of-deplorables, we’ll have to settle for the
change models and context frameworks that can help us think in the ways that just came naturally to Sam Walton of
Bentonville, Arkansas.

(1) Walton, Sam; Huey, John. (1992) Sam Walton Made in America. Doubleday Press