Bob Ortegas' first book "In Sam We Trust" (Times Business 1998)
chronicles the story of Sam Walton and his Wal-Mart retail empire. This book
may or may not send Ortega to the top of the literary mountain, but it
convincingly reveals his true talent: he's a first class investigative reporter.
Ortega, who for five years covered Wal-Mart for The Wall Street
Journal, examines Walton and his business in minute detail; from 1962s'
first store in Bentonville, Arkansas to the current retail behemoth. No
glitter, no gossip, no reading between the lines....just the facts maam;
and those facts make up a very interesting book.
The author balances his work, so if you are expecting a complete
one-sided bashing of Wal-Mart, you might be disappointed.
The birth and early years of Wal-Mart were dominated by one thing:
the force known as Sam Walton. This countrified whirling dervish of a man
was a fabulous merchant, working 20 hours a day with extraordinary ambition,
enthusiasm and common sense. Hey people, when you get those qualities
wrapped in the shell of a natural leader, something big might happen...presto
Wal-Mart!
As a bonus in this book, you get a good general overview of mass
market retailing since the turn of the century. Ortega goes into some detail about many of Wal-Marts' conquered competitors: Montgomery Ward, WoolWorths,
worth, Kresge, K-Mart, etc. He examines mistakes these firms made, and how
how they were quickly taken advantage of by Wal-Mart. Obviously, 99% of the
locally owned mom and pop stores were crushed, and this fact is reason #1
why Wal-Mart has been disliked by so many.
Sam Walton used a few basic ideas as a cornerstone for Wal-Marts'
enormous success: build big stores in small towns; run an efficient distribution system to keep the stores full of merchandise; keep all expenses
to a minimum; and the most important ingredient of all....Sam Waltons'
hokey, infectious personality...seemingly able to get him out of any jam
or awkward position. Once, when distribution center workers were so overwhelmed with work, they were seriously considering overtures from a union.
When Walton got wind of this he personally went to the center, humbly apologized, vowed to hire more workers and said it would never happen again "So
help me Sam." Nothing much happened to ease the workload, but Sam was always
ready and confident he could calm them down again, if needed.
Ortega explains that in the early years of Wal-Mart, Walton found it
tough to find managers and assistants for all the new stores. Sam would
recruit constantly, many times taking personnel from the very stores he was
putting out of business. Walton would then try to infect them with the Wal-Mart attitude and personality. However, when Wal-Mart acheived a position of
dominance, Walton began hiring testosterone laden executives only to happy
to go for the throat in every business deal and negotiation. Walton was then
free to continue his folksy ways, while behind the scenes his troops loved
doing the dirty work.
A defining moment for Wal-Mart as we know it today came April 6,
1992...Sam Walton died of cancer. David Glass, Sams' hand picked successor
was a proven and competent executive...but in the eyes of the associates...
no one could replace Sam.
As you can imagine, many things were never the same at Wal-Mart
after Walton passed away. For one thing, Ortega explains, the stock price
stalled. Employees of Wal-Mart tolerated low wages because they were building
wealth in their retirement plans due to Wal-Marts' almost constantly rising
stock price. Now, all of a sudden, many were making 6.50 an hour with their
retirement savings going nowhere. Once again, talk of a union surfaced, only
to be put down by alert Wal-Mart management.
The final chapters of "In Sam We Trust" describes Wal-Mart at its'
most despicable. Their patriotic "Buy America" program was shown to be a
fraud. It was proven conclusively they used overseas child and prison labor
to make their clothes, only grudgingly admitting the truth and fiercely
opposing monitoring of working conditions on their own. Very few associates
were ever made full-time so benefits would not have to be paid, and any town
that fought the arrival of Wal-Mart could expect a long, nasty battle. But,
in this area, things were slowly changing, as the opposition grew bigger,
smarter and more nasty themselves...defeats for Wal-Mart were beginning to
happen.
Bob Ortegas' 5 page conclusion ties this book up beautifully,
reminding us that in the end Wal-Mart, like any other business, will respond
to what the public demands from it. Customers, associates, and communities
are demanding more and more, and Wal-Mart is slowly responding.
