Samuel Walton built a small grocery store into the giant Walmart supermarket chain, amassing a fortune of over $23 billion, grew up during the Great Depression. He had numerous chores to help make financial ends meet for his family as was common at the time. He milked the family cow, bottled the surplus, and drove it to customers.
He took a loan to buy his first store, and thanks to simple innovations in business, he soon bought his second store. Within 3 years, his sales volume grew to $225,000. The first true Wal-Mart opened on July 2, 1962 in Rogers, Arkansas. The rest is history. Forbes ranked Sam Walton as the richest person in the United States from 1982 to 1988. At the time of his death in 1992, he had 1,960 Wal-Mart stores, employed 380,000 people and clocked annual sales of about $50 billion.
Here are the 10 Success lessons from Sam Walton – “From Rags to Riches” for entrepreneurs,
1. Stick to fundamental values
Sam Walton had simple values that guided him through his life and business. He didn’t follow the latest management fad, nor did he believe in any of the get-rich-quick ideas. He was solidly living his life by the values that he grew up with.
Similarly, as a leader building a team or an organization, you need to get away from all the ‘noise’ about the latest management framework, or the next idea about how leadership should be done.
2. Take care of your people
Sam Walton took extremely good care of his employees and he gave very employee a chance to become successful with him by allowing them to purchase stock options of Wal-mart at a discount. He treated them as associates of the business and wanted them to enjoy part of Wal-mart’s success.
If you can value every single employee or team member in your organization, it will help toward your personal success as well. But do it only because you genuinely care. Make them part of the organization by allowing them to share the organization’s success, be it by stock options or other forms of rewards.
3. Motivate your partners
Money and ownership alone aren’t enough. Constantly, day by day, think of new and more interesting ways to motivate and challenge your partners. Set high goals, encourage competition, and then keep score. Make bets with outrageous payoffs. If things get stale, cross-pollinate; have managers switch jobs with one another to stay challenged. Keep everybody guessing as to what your next trick is going to be. Don’t become too predictable.
4. Don’t follow the money, follow your passion
Sam Walton didn’t start off his variety stores with an ambition to become rich; he simply had a passion for his craft and at each point in time, he only wanted to do it better and better.
If you follow the money, you’ll be running from one business opportunity to another without any focus. But Sam Walton had one focus: retail and so should you. When you follow your passion, you’ll be successful in whatever craft you do, and you will become a leader in that field that you commit yourself to.
5. Control your expenses better than your competition
This is where you can always find the competitive advantage. For twenty-five years running – long before Wal-Mart was known as the nation’s largest retailer. You can make a lot of different mistakes and still recover if you run an efficient operation. Or you can be brilliant and still go out of business if you’re too inefficient.
6. Communicate everything
Communicate everything you possibly can to your partners. The more they know, the more they’ll understand. The more they understand, the more they’ll care. Once they care, there’s no stopping them. Information is power, and the gain you get from empowering your associates more than offsets the risk of informing your competitors.
7. Treat the customer as the boss
Sam Walton was a true believer that the customer was his boss. This idea made Walton implement many services and customer friendly activities that were designed around the attitudes of small-town America.
From the greeter at the door of every Wal-Mart to the “Satisfaction Guaranteed” signs he would place on his first Wal-Mart store in 1962, Wal-Mart would distinguish itself from other retailers by maintaining the philosophy that the customer was always in charge.
Appreciate everything your associates do for the business. Nothing else can quite substitute for a few well-chosen, well-timed, sincere words of praise. They’re absolutely free and worth a fortune. A paycheck and a stock option will buy one kind of loyalty. But all of us like to be told how much somebody appreciates what we do for them. We like to hear it often, and especially when we have done something we’re really proud of.
9. Embrace new technology
Before the age of the Internet and instant e-commerce, stores across America were relatively low-tech. It wasn’t until a select few entrepreneurs, including Sam Walton, decided to push the boundaries of the retail industry that new technologies began to be embraced.
He went to the IBM school in upstate New York in 1966 to find the best technology students so Wal-Mart would always be on the cutting edge. As an example, Wal-Mart became one of the first stores to develop universal bar codes and was the first retail chain to use electronic scanners as cash registers. Not only did the cash registers scan the individual items, it was networked to the inventory-control computer, so the stores would know when stock was running low and re-order was necessary.
10. Swim upstream
Go the other way. Ignore the conventional wisdom. If everybody else is doing it one way, there’s a good chance you can find your niche by going in exactly the opposite direction. But be prepared for a lot of folks to wave you down and tell you you’re headed the wrong way.