21 Great Leaders: Learn Their Lessons, Improve Your Influence (14 page)

President Bush began by telling the story of Wal-Mart’s rather inauspicious beginnings. “Back in 1962,” he said, “Sam Walton started with one Walmart store in Rogers, Arkansas, just six miles from here. And I did hear a story about the opening of his second Walmart over in Harrison—”

The Walmart insiders in the crowd laughed.

President Bush grinned. “Obviously you’ve heard it, but I’m going to repeat it. For those of you in Washington, I will repeat it.” The president nodded toward Sam Walton’s successor as CEO, David Glass. “The way my esteemed friend David Glass tells it, Sam had watermelons for sale on the sidewalk and he offered donkey rides in the parking lot. The only problem was the heat, 110 degrees. Well, the watermelons popped, and the watermelon juice was everywhere. The donkeys did what donkeys do in a situation like that, tracking the stuff all over the place. And according to David, who had a nice successful business of his own, Sam’s second Walmart store turned into the worst-looking store he’d ever seen. Dave went so far as to suggest to Sam that he ought to find some other line of work.

“Today, more people work for Sam’s company than live in Tulsa, Oklahoma—380,000 at the last count. This includes the man with that sound career advice, David Glass.”
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Sam Walton (known as “Mr. Sam” to his employees) was a people person. He loved the people who worked for him, and he loved the people who shopped at his stores. As former General Electric CEO Jack Welch observed, “Sam Walton understood people the way Thomas Edison understood innovation and Henry Ford, production. He brought out the very best in his employees, gave his very best to his customers, and taught something of value to everyone he touched.”
²

Michael Bergdahl worked alongside Sam Walton for years, serving as Walmart’s Director of People at the Bentonville headquarters (Mr. Sam nicknamed him “Bird Dawg”). Bergdahl said, “Mr. Sam preached, emphasized, and taught the importance of having strong people skills. For the most part, the individuals Mr. Sam promoted into higher levels of responsibility were the leaders who had the proven ability to work with and motivate a large team of people.”
³

And Robert Slater, author of
The Wal-Mart Decade
, wrote that Mr. Sam “was chiefly concerned with assuring harmony among store managers, employees, and customers…. He worked at the people level, not the administrative one.”
⁴

As a business leader, Sam Walton was complete in the Seven Sides of Leadership. If there was one side of leadership that characterized him above all others, it was his commitment to the Third Side of Leadership, people skills. The company Sam Walton founded has grown considerably since President Bush awarded him the Medal of Freedom. Today Wal-Mart Stores Inc. employs 2.2 million people around the globe, including more than 1.3 million in the United States, and is the largest private employer in the United States and in Mexico.
⁵

From the beginning, Sam Walton has said that he’s not just in the retail business; he’s in the people business. There’s much we can learn about the Third Side of Leadership from the most successful retailer in history, Sam Walton.

Samuel Moore Walton was born in 1918 in Kingfisher, Oklahoma. Sam was ambitious even in his youth. As an eighth grader in Shelbina, Missouri, he achieved the distinction of becoming the youngest Eagle Scout in Missouri history. During the Great Depression, he worked at a variety of jobs, including delivering newspapers, delivering milk (produced by the family cow), and waiting tables (often paid only in tips and free meals).

Walton worked his way through the University of Missouri. His ambition in those days was virtually limitless. As he recalled in
Made in America
, “I even entertained thoughts of one day becoming president of the United States.”
⁶
He recalled how he taught himself the art of meeting people and making friends:

Walton graduated in 1940 with a degree in economics. Three days after graduation, he started as a management trainee at a J. C. Penney store in Des Moines, Iowa. His career at Penney’s was less than stellar. His handwriting was, by his own admission, completely illegible. Since sales receipts were written by hand in those days, this became a major problem when his receipts were audited. “Walton,” his supervisor told him, “I’d fire you if you weren’t such a good salesman. Maybe you’re just not cut out for retail.”
⁸

He joined the army in 1942 and was assigned to the Army Intelligence Corps, eventually achieving the rank of captain. It was excellent on-the-job leadership training, and Walton’s experience gave him confidence as a leader. While in the army, he began planning his postwar career as an entrepreneur. Assigned to an army post in Salt Lake City, he would visit the public library and check out every book on retailing. He also visited Zions Cooperative Mercantile Institution, the department store founded in 1868 by Brigham Young, looking for ideas.
⁹

Sam Walton and his wife, Helen, were married in 1943. Their marriage lasted until Sam’s death in 1992.

Walton set aside $5,000 from his army pay—a substantial nest egg for a twenty-six-year-old in 1945. He was eager to start a business, and with the help of a $20,000 loan from his father-in-law, he bought a Ben Franklin variety store in Newport, Arkansas. The franchise company put him through two weeks of retail management training, which gave him a good foundation in business basics—though Walton believed he learned more about retail by studying his competitor across the street.
¹⁰
Sam Walton succeeded in increasing the store’s sales volume from $72,000 to $175,000 in the first three years—and his success was his undoing. The landlord decided to cancel the lease, take the store over (including franchise rights), and put his son in charge of the business. Though Sam was able to sell the inventory and fixtures to the landlord for $50,000, he had been forced out of business. He made up his mind that he would never again give a landlord veto power over the business he had worked so hard to build.
¹¹

Walton bought his next store in Bentonville, Arkansas, in May 1950. Before Walton arrived, that store was producing annual sales of $32,000; after one year, Walton had pushed it to $95,000.
¹²
With help from his brother Budd, a former fighter pilot, Sam scouted new store locations from the air in a secondhand airplane he had bought for $1,800.

As Walton expanded his operation, he learned the art of delegating. Whenever possible, he hired managers who were willing to invest their own money in exchange for a stake in the store. Because of their investment, these managers were highly motivated to run a successful store.

Walton opened the first store bearing the Wal-Mart name on July 2, 1962, in Rogers, Arkansas. He scrapped his original plan to call it “Walton’s Five and Dime Store” when an employee pointed out that “Wal-Mart” would be only seven letters long, saving a lot of money in neon signage.

Most of Sam Walton’s business strengths were related to his people skills. He was a great team builder, a great recruiter of talent, a great motivator, and a great listener. He got his best ideas from his people. When an employee suggested that Walmart might benefit from these newfangled machines called “computers,” Walton pounced on the idea. In 1966, long before the advent of low-cost personal computers, Sam Walton attended an IBM school for retailers in Poughkeepsie, New York. Computers became an essential tool for maintaining control in his rapidly expanding operation.
¹³

In 1982, Sam Walton was listed by
Forbes
as the richest man in America. He only began to slip from the top of the
Forbes
list in 1988, when he began distributing parts of his fortune to his heirs. On April 5, 1992, Mr. Sam passed away after a two-year battle with multiple myeloma.

(A personal note: As I discussed in my book
The Mission Is Remission
, I was diagnosed with multiple myeloma in 2011. Medical science is making enormous strides in treating multiple myeloma, and I wish Sam Walton could have had the benefit of the amazing medical advances that have kept my disease in remission for several years.)

I would define “people skills” as the ability to show people you care about them. When people know you care, they will adopt
your
vision as
their
vision,
your
success as
their
success, and they will work hard to make your shared vision a reality.

I could sum up my concept of people skills in a single word:
love
. By
love
, I don’t mean an emotional feeling. I’m talking about the kind of love the ancient Greeks called
agape
(pronounced ah-GAH-pay)—love that is a deliberate decision.
Agape
love means that you, as a leader, continue cheering for your followers even when they mess up, cost you money, and break your heart. You choose to love your followers even when they disappoint you.

Loving your people and using good people skills doesn’t mean you never apply discipline or enforce the rules. Sometimes the most loving thing you can do for your people is to hold them accountable for bad decisions. You do so because you want the best for them.

James Kouzes and Barry Posner, founders of The Leadership Challenge, write, “Love is the soul of leadership. Love is what sustains people along the arduous journey to the summit of any mountain. Love is the source of the leader’s courage. Leaders are in love: in love with leading, in love with their organizations’ products and services, and in love with people.”
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Love for people you lead is not an act, not a technique for manipulating people into staying later and working harder. Your leadership love must be sincere. Here are some people skills to help you authentically love your people:

People Skill No. 1: Be visible and available
. In his 1982 bestseller
In Search of Excellence
, Tom Peters urges leaders to “manage by walking around” (MBWA). Sam Walton was an MBWA leader long before Peters coined the term. Peters observed that the most effective leaders spend considerable time simply “hanging out” with their people in the lunchroom or on the shop floor. Years before
In Search of Excellence
was published, Mr. Sam crisscrossed the country in his little two-seater plane, visiting every store in his empire, shaking hands and giving encouragement to the frontline staff while keeping his eyes and ears open at all times.

Mr. Sam was an iconic figure in his white cap with the blue Walmart logo on the front. He would teach and preach Walmart values, but he spent most of his time listening and learning. If he uncovered a potential problem, he would help people find solutions. Based on Sam Walton’s example, here are some ways to improve your “walking around” skills:

1. Keep your visits spontaneous and unplanned. Make sure it’s not all about business. Be genuine. Ask people about their families, the sports teams they follow, or the books they read.

2. Keep it friendly and nonthreatening. People should be thrilled, not terrified, when you appear unannounced on the floor.

3. Express a willingness to hear bad news. Reward candor, and you’ll get more of it; punish candor, and you’ll be left in the dark.

4. Ask for ways to improve the organization. Are there processes that aren’t working? Can customer care be improved? Are there ways to improve products or services?

5. Avoid favoring one employee over another. Spend equal time and show equal interest in everyone.

6. Catch people in the act of doing things right. Praise people for their contribution to the organization.

7. Bring donuts. Or baked goods. Or pizza. Make your visit a time of fun and refreshment. Create a positive vibe, and you’ll always have a positive impact.

Quality expert Neil Snyder observed, “Walton knew of no better way to scrutinize the stores than to talk to associates, shaking hands and meeting people, all the while keeping a sharp eye out for ideas, successes, and failures…. He was out on the floor with them, and that gave them pride.”
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People Skill No. 2: Be a good listener
. Many leaders are great talkers, but the greatest leaders are skilled listeners. Everyone in your organization needs to be heard. Be a leader who listens. Mr. Sam himself said, “Great ideas come from everywhere if you just listen and look for them.”
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Sam Walton was committed to learning from everyone in his organization, regardless of position. Lee Scott was CEO from 2000 to 2009. He recalled, “For a long, long time, Sam would show up regularly in the drivers’ break room at 4 a.m. with a bunch of donuts and just sit there for a couple of hours talking to them.”
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People Skill No. 3: Delegate
. The art of delegating is the essence of leadership. To accomplish goals through others, you must delegate tasks and authority. Early in my career as a sports executive, I did everything myself—and I had the angry stomach lining to prove it. But I quickly learned to delegate, and I eventually became very good at it. Today I have the cleanest desk in the state of Florida because I delegate so many tasks to my capable staff.