APPLICATION #5: INTERVIEWING A FAMILY BUSINESS LEADER 1

Application # 5: Interviewing A Family Business Leader

Name of Student
Institutional Affiliation
March 10th, 2021
APPLICATION #5: INTERVIEWING A FAMILY BUSINESS LEADER 2

Application # 5: Interviewing A Family Business Leader

Name of Company: Walmart
Name of Business Leader Interviewed: Doug McMillon
Location of the Company: United States
Company Industry: Consumer Staples
Generation of the Company: Second Generation

Brief Description of the Business Learned During the Interview

1. Company history:

Walmart is an American discount family-owned business that was established in 1962

as a chain store company. The company was started with a single store in Bentonville,
United Stated, before expanding to Arkansas in 1968 and eventually spreading its
stores to the entire United States by the 1980s [ CITATION Wal21 \l 2057 ]. currently,
Walmart chain stores have over 11,000 stores in more than 27 countries worldwide.
Walmart is owned by the Walton family, who owns more than 50% stake in the
business. Brother Rob and Jim actively manage the business as the directors of the
company alongside their sister Alice and the family's sister in law Christy. Each of
these directors of the company has a net worth of at least $35 billion. Other key
shareholders in the company business include the cousins Ann Walton Kroenke and
Nancy Walton Laurie.

2. Core values:

Walmart's core values are defined by a culture that focuses on superior delivery of
customer service, creating a conducive frontline workspace, and improving
performance as a strategy to achieve the expected business purpose of saving people
their monies and improving their living standards [ CITATION Nee20 \l 2057 ]. Therefore,
the company is anchored on applying four core values, including service to the
customer, Respect for the Individual, Striving for Excellence, and Acting with
Integrity. These core values also define and regulate the set of behaviours at the
business by ensuring that every business associate helps the business deliver the desired
business results and creates a culture of inclusion and diversity within the scope of
business operations.

3. Best practices:

As a second-generation business, Walmart has adopted and implemented many best

practices to manage its supply chains to achieve a competitive milestone over its
industry competitors[ CITATION Nee20 \l 2057 ]. Having a unique family history and core
values, Walmart has adopted best practices such as focusing on the consumer needs
through cost reduction, clear communication and understanding of the company's cost
structure, providing a straightforward and easy to understand logistics structure,
establishing an effective and efficient communication framework and systems,
respecting individual and corporate diversity through understanding and welcoming
independent third-party opinions, taking time to plan during policymaking initiatives,
having a competitive recruitment process, respecting the boundaries between
ownership and company management, leveraging on technology in making strategic
decisions and management, and clarifying and coding the family values into the
business operations, telling the family story concisely, focusing of long-term business
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perspectives and policies, and providing liquidity opportunity for its shareholders
among other best family-owned business practices.

4. How the best practices work for the company:

Best practices play an integral role in the success and sustainability of business
operations at Walmart. For example, by applying the best practices, the family-owned
business has been able to deliver desired business results and create an inclusive culture
that has not only given the business a better competitive niche but has also ensured the
rapid expansion of the business operations in more than 27 countries
worldwide[ CITATION Wal21 \l 2057 ]. By focusing on the core values and application of
Walmart's business best practices, the business has maintained its customer service
charter by remaining focused, innovative, and agile in meeting the specific customer
needs. This has been mainly achieved by listening to the customers, anticipating what
the customers might need, and then maximizing customer value. The company has also
managed to apply best practices to provide support and empowerment to all the
business associates by ensuring that customers are well served. Customer priority is a
frontline concern for the company. The innovative and agile focus on customer service
initiative has also enabled the business to remain steadfast in creativity and innovation
while taking necessary risks to ensure that all its customers are served with speed and
efficiency to maximize customer values.

Implementation of business best practices at Walmart has also enabled the company to
maintain its core value for individuals. This has been seen in the company's staff and
management's ability to listen, lead by example, and adopt an all-inclusive operational
framework in its business scope and operations. By listening to the customers and
stakeholders, the business has remained visible and available in addressing business
issues that may come up in business operations and ensure that a collaborative
framework is adopted across all the supply chain stores for the business. Open
collaboration has also enabled the business to have and maintain a comprehensive and
useful feedback system that enhances trust among the customers[ CITATION And10 \l 2057
]. Leading by example has enabled the business to remain humble while focusing on
how to teach the employees and customers how to trust their company and deliver their
duties with expectations that are anchored on honesty and the provision of accurate and
immediate feedback. By adopting and implementing an all-inclusive framework, the
business has been able to seek and embrace differences among people by better
understanding and implementing diversity practices while emphasizing the need to
share ideas and experiences that can be used to take the business to the next level.

Application and implementation of best practices also enable Walmart to strive for
excellence continually. As an organization that focuses on high performance,
accountability, and strategic intelligence planning, Walmart has been able to use the
best practices to set and achieve aggressive goals and objectives that have ensured a
better competitive advantage for the entire industry. Besides, the company has
enhanced accountability in all its operations by taking aggressive and active leadership
and celebrating all its employees' successes and responsive results. This performance
appraisal aspect has put the company at better competitive scores and has also
remained integral in the company's sustainability over the years[ CITATION And10 \l
2057 ]. The need to continually strive for excellence has also enabled the company to
make strategic, evidence-based decisions clearly with anticipation of adjusting the
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operational conditions due to industry dynamics and focusing on how the company can
adequately and effectively plan for the future.

Lastly, focusing on best practices and implementing them has enabled Walmart to
continually act with integrity by ensuring that all the business operations are honest,
fair and encouraging. By embracing business best practices, the organization has
ensured that all the employees tell the truth regarding the organizational products and
communication systems, keeping their promises to deliver quality products and
remaining trustworthy across all the supply chain stores worldwide. Acting with
integrity has also enabled the business to remain fair in most business deals with the
customers and the employees[ CITATION Spe21 \l 2057 ]. This has mainly been achieved
by ensuring that the company employees always do the right thing and remaining open
and transparent in all their deals that regard company operations. This has been
maintained by the company having a shared vision and operational framework and core
values that guide all the employees on how they should handle and treat their
customers. The company has also promoted courageous behaviour across all the
departments and chain stores by ensuring that the employees always speak the truth and
seeking clarification and guidance on issues that are not clear to them. This is
important, especially in ensuring the business is coherent and upholding business core
values as set out by its management and leadership structure.

Interview Questions and Answers

These interview questions were asked to Walmart's current CEO after seeking an
appointment with the CEO and having a video conference. The questions revolve around
how the business has applied best practices as a family-owned business and how applying
such best practices has increased the competitive advantage and promoted the business's
sustainability. The responses provided by the CEO regarding each question is summarized
below each question as provided in the following sections. Most of the interview questions
were open-ended to allow the CEO to give a comprehensive response to each of the best
practices that the family-owned business is using.

1. One of the core values of Walmart is focusing on meeting consumer needs. How
has the company focused on consumer needs through cost reduction?

Cost reduction was established as a competitive strength of the business in terms of how it
strives to meet consumer need. Usually, this is practised in the management of the firm's
supply chain, where cost reduction has been used to consider the company's
products[ CITATION Spe21 \l 2057 ]. Walmart, Walmartases directly from the suppliers
makin,g the prices of the products' prices to rem relatively low across all its supply chain
stores. This maximizes the customers' value by ensuring that the prices are affordable and
manageable throughout the customer experience with the company.

2. How does clear communication and understanding of the company’s cost structure
increase customer experience as a best practice?

Clear communication of the company's cost structure instils a sense of confidence and trust
among the customers. Also, it allows the company to track real-time data regarding sales
and all the inventories in the stores. This promotes efficient customer focus and effective
APPLICATION #5: INTERVIEWING A FAMILY BUSINESS LEADER 5

inventory management that reduces the aggregate product costs at the company.

3. Does the best practice of providing a straightforward and easy to understand

logistics structure benefit the company in managing its logistics efficiency?

Clear and easy to understand logistic structure is integral in promoting logistical efficiency
at Walmart. It not only allows the drivers to focus on meeting the goal of customer
satisfaction but also ensures that the drivers remain dedicated to their work and goal of
enhancing customer service and making it as efficient as possible.

4. What steps does the company take in establishing an effective and efficient
communication framework and systems?

To establish an effective and efficient communication framework and systems, the

company invests heavily in its employees' professional training and development to have a
competitive communication based on immediate feedback and inclusion of all stakeholders
regardless of their backgrounds and affiliations.

5. One of Walmart banks' identified best practices is respecting individual and

corporate diversity through understanding and welcoming independent third-party
opinions. How is this achieved?

Independent third-party opinions are integrated into Walmart's business practice by adding
independent board members in critical strategic decision-making initiatives. Walmart's
Board of Directors comprises non-family members that emphasize the diversity of thoughts
and opinions and focus on understanding different perspectives and opinions.

6. How does taking time to plan during policymaking initiatives help the company
meet its broad corporate agenda effectively and efficiently?

This is mainly important in managing conflicts that might arise due to the failure to consult
with other family members on vital managerial issues. Taking time to plan during
policymaking also enables the family members and all stakeholders to create and review
set policies and submit their thought and ideas on time for consideration and review.

7. How does having a competitive recruitment process help the company to maintain
its competitive advantage?

A competitive recruitment process enables the company to hire the best people for different
tasks outlined by the company. A competitive recruitment process also ensures that the
employees are well compensated. This is important in its retention and productivity,
ensuring that the company remains competitive in the industry.

8. Does respecting the boundaries between ownership and company management help
prevent management issues of family-owned businesses like Walmart?

Yes, respecting boundaries between ownership and company management promotes better
relationships and communication systems integral to the company's sustainability. This is
because of respect and diversity, which leads to mutual understanding and collaboration
among members in ownership and management.
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9. How does clarifying and coding the family values into the business operations help
Walmart meet a competitive niche?

This is mainly achieved by developing trust and understanding of the family values and
how they can be aligned to the goals and objectives of the family-owned business. This is
also important in ensuring a better understanding among stakeholders of what is expected
of them.

10. Does telling the family story concisely help in reducing issues within family-
owned businesses like Walmart?

Having a company where the family story is well understood shapes the decisions made by
management and enables the understanding of how succession issues and leadership can be
addressed well to prevent future failure of the business operations due to issues arising
from family feuds.

11. How does focusing on long-term business perspectives and policies help Walmart
to remain sustainable?

Focusing on long-term business perspectives and policies enables the business to allocate
resources effectively and make sustainable decisions in terms of achievement within a
specified timeframe.

12. How does the best practice of providing liquidity opportunity for its shareholders
impact the business operations at Walmart?

Failing to provide liquidity on time can cause family business disputes which are harmful
to the business operations. Management should, therefore, ensure that such liquidity is
provided on time to ensure such conflicts are avoided.

Conclusion: Summary of how business use/does not use the best practices learned.

From the interview, it was established that Walmart uses these best practices to achieve its
core values that are anchored on improving customer services, promoting organizational
excellence, respecting all individuals and ensuring that the company acts with integrity and
fairness in all its business deals. These are indispensable practices for any family-owned
business.
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References
Andrews, J. (2010). Managing Growth: Best Practices of Family-Owned Businesses.
Neebe, K. (2020). Sustainability at Walmart: Success over the Long Haul. Journal of Applied
Corporate Finance, 64-72.
Spector, B. (2021, October 14th). 25 Best Practices. Retrieved from Family Business
Magazine: https://www.familybusinessmagazine.com/25-best-practices-0
Walmart. (, 2021). Working at Walmart. Retrieved from Walmart:
https://corporate.walmart.com/our-story/working-at-walmart.