Interview With Bill MarquardBlog / Produced by The High Calling
How does the rest of the retail world win against Wal-Mart? What can Wal-Mart teach other companies—and individuals—about analysis and competition? For thinkers of every stripe, a new book by business author Bill Marquard assembles the analysis and principles of how to go up against Goliaths.
Marquard designed Wal-Mart's first-ever strategic planning process and ran it for three-and-a-half years. He has advised more than a hundred companies in 25 industries, including McDonald's, Walt Disney World, Meijer, Citibank, CompUSA, Denny's, Tyson Foods, the Brick Industry Association, and the U.S. Department of Homeland Security. In his newest book, the former Fortune 200 leader and current "thinking partner" packs information from some of the world's most influential and forward-thinking companies.
In this interview for TheHighCalling.org, Marquard answers some of the big questions about Wal-Mart and the faith behind his work.
Bill, thank you for talking with us today. Question one is to comment on the obvious: this is not the first book about Wal-Mart.
No, that's right—and the books out there about Wal-Mart tend to come in one of four categories. The first is economic analysis: "Wal-Mart is big, and it's a problem." Another is the insider account: "Here's what we did at Wal-Mart, copy us and find success." Third is self-help: "Follow this laundry list of ideas, and you can probably hold on." Fourth is the activist treatise: "Defeat the evil empire at all costs."
You're saying Wal-Smart is none of the above?
The Wal-Smart antagonist is not Wal-Mart but the economy it helped create. Wal-Smart is also prescriptive: "Now that we're in this economy, what do we do about it?" Basically, this is a guide for leaders and managers in any business, any industry, and any country wanting to make smart choices to profit in this new economy. Wal-Mart is the case study, and Wal-Smart is the answer key.
I also think the world needs exciting business books, and Wal-Smart delivers because it spurs thinking. It gives 12 specific choices to think about, then pushes past the front doors of real companies and talks to real executives who made smart choices in this economy as competitors, suppliers, employers, and community members.
Wal-Mart's enemies think Wal-Mart is about institutionalized greed. How do you handle those arrows?
Wal-Mart is about the American dream. It's a story of one individual with a vision of bringing low-priced retail to semi-rural areas across the country. It's also about putting greater and greater buying power in the hands of middle- and lower-income America. Clearly that dream has been tarnished by a lot of what you read. It doesn't take away, however, that the Wal-Mart story is the American dream.
So when did Wal-Mart become the enemy?
Wal-Mart became the enemy when David became Goliath. America's love of the underdog tends to translate to disdain when someone or something outgrows its underdog status. Go back through recent U.S. business history: IBM in the '70s, AT&T in the '80s, and Microsoft in the '90s were David's that became Goliath's. Wal-Mart continues that trend for the twenty-first century.
So Wal-Mart became the enemy when it got large?
It's not Wal-Mart's fault. It's our fault for turning on David when he became Goliath?
That said, to whom much is given, much is expected. I do believe that Wal-Mart fell asleep at the switch on social and environmental responsibility and other responsibilities to support its employees. I'm not making excuses. They've admitted and are trying to rectify mistakes. At the end of the day, however, when a free-market company has over 1.3 million employees who choose to work there, and that same company has significantly reduced the cost of living in many areas of the country, it's satisfied a useful purpose.
What about the criticism that Wal-Mart kills local individuality?
On one hand, you've got mom-and-pop stores boarding up when Wal-Mart moves in. On the other hand, as a competitor, this is the importance of differentiating from an industry giant—a me-too strategy is going to lose, and smaller stores are forced to genuinely individualize. There are huge opportunities for locally relevant merchandising and services to maintain and grow. Think about the mergers in the banking industry over the last decade, which created major national mega-banks. A new wave of local banks sprung up because people are still interested in the local banker and local service and local flavor.
What do you think this Wal-Mart retail world tells us about our times and what we value?
Today's retail world is basically the fulfillment of Alvin Toffler's prophecy of ten years ago when he coined the term the "demassification of society." Toffler rejects mass labels—democrat vs. republican, urban vs. rural, white collar vs. blue—for consumers’ individual tastes. Today consumers link with like-minded people for a specific purpose, he says, and disband when the purpose is fulfilled. Marketers would never classify Mike Ditka and an exconvict in one group, yet they both belong to a Harley Davidson motorcycle club. Today's retail world reflects the demassficiation of consumers facing a plethora of choices for when to buy upscale private goods at Trader Joe's, private label goods at the supermarket, off-price name brands at TJ Max, or the Armani Trunk Show at Neiman Marcus. As consumers, we each create our own store, our own shopping, our own experience, by picking and choosing the retailers offering what we uniquely need.
What challenges does that pose for business leaders?
The book covers a number of those challenges, but I'll mention one in each of our four roles as competitor, supplier, employer, and community member.
As competitors, our advantages are now built on when, not what. In the past, we could develop a what competitive advantage that could sustain us for a number of years. Today, duplication is so fast that Monday's competitive advantage is Tuesday's me-too also-ran. Competitive advantage, therefore, builds off a string of successive competitive advantages to have a short shelflife, which over time keeps you six to nine months ahead. That's the when.
As suppliers in an economy dominated by giants, the scales are tilted against us. The giants are our customers, and they have the bargaining power. We suppliers must figure out how to rebalance those scales. How do we make the giants need us more than we need them?
Employers face a significant challenge as employees' entitlement mentalities clash with the economic realities of the global marketplace. Employers must differentiate between employee needs and wants and serve those needs effectively while remaining competitive in the global marketplace.
Lastly, as community members, we face the interesting question of who's in charge? States impose health-care requirements on local corporations; corporations spring up with private disaster-recovery enterprises to displace ineffective government organizations. Governments are doing business, businesses are doing government, and activists are doing both.
So what does it mean to be Wal-Smart?
It means making explicit strategic choices. It means intentionally executing those choices in good times and bad. It means finding the "and"—linking competitor strategy to supplier strategy, to employer strategy, to community strategy, to create shareholder value far greater than executing each of those strategies individually.
Are you restating win-win and synergy?
In a way, but it's not just win-win. It's making your community-member strategy drive your competitive strategy. PetSmart about 13 years ago committed most of its philanthropic activity to ending euthanasia of companion pets. To date, that program has saved more than 2.5 million dogs and cats. That clearly brings a humanitarian service to the local community. It also drives PetSmart's competitive differentiation in the eyes of its customers, most of whom love pets. It also appeals to PetSmart employees, who tend to love pets. And needless to add, that's 2.5 million dogs and cats needing food and toys, and driving revenue and shareholder value. In summary, it means you make explicit decisions, both as employer and community member.
Is there one role you put over the other?
They're all equally related, and you can find links between strategies in any one of those four roles.
Several times you've mentioned "explicit choices." In the book you go into great detail about the "choose or lose" principle.
In this economy, unless we make explicit choices about how we're going to plan and execute those choices, with intentionality, we're destined to lose. "Deer-in-the-headlights" is not a viable business strategy.
Do you differentiate between business decision making and personal decision making? Does "choose or lose" play into your understanding of God's will?
My personal “choose or lose” includes paying attention to the doors that God opens and closes. One of my favorite verses is from Proverbs: a man makes plans but the Lord directs his steps. In spring 2004, for example, I was evaluating whether to embark on this book project or build an apologetics website. I prayed about it, and virtually every open door for the site swung shut. And every door around the book opened. I said, "Wait a minute, You want me to do this secular book project when I can do this great apologetics website?"
Did you think business is what you do until you get to the real work of theology?
Not at all. I know many people struggle with the question of business versus ministry. My answer is one of the chapters in Wal-Smart: find the and. As far as I'm concerned, business is ministry. Business is a way we steward the gifts we're given: whether people, purpose, or purses. My responsibility in my work is to live out Christ's love in its endless ramifications.
How do you do that?
Francis of Assisi said, "Preach always, when necessary use words." One of the areas we've fallen down on in the U.S. church is our not being noticeably different from the world or the culture as Christians. That doesn't mean separating ourselves from the world. But we need to be making a noticeable difference.
Can you give an example of "noticeably different"?
Earlier in my career, I had a boss who was truly a servant leader. When he and I met one-on-one to go over my department's business plan for the upcoming year, he concluded by asking one question I'd never heard from any boss ever: "What can I do to make you successful?" I came to realize that it's the role of any leader to work himself out of a job, to grow and groom his team in such a way that the team can take over the leader's role, freeing the leader and his talents to be deployed elsewhere in the organization or even with another company where he can have an even greater impact.
You've worked with a lot of top business leaders in the U.S., professionally and in ministry. Through your work at that level, what have you learned?
I've learned the importance of having a personal purpose and business strategy that enable you to say no. If you can't say no, you minimize your impact. If you're everything to everyone, you're nothing to anyone. Two other things: even the disciples focused. Paul and the Gentiles. James and Jerusalem, etc. And lastly, the light bulb disperses light into a darkened room, but focus that beam of light into a laser, and you can cut steel.