we’re incredibly excited to have you here we have a lot of material that we want to cover today if you will spend about the first third talking about Walmart’s business globally the second third talking a little bit about your personal leadership experience and then we’ll save the last third for questions from our audience for get started though I’d actually like to hit on some news from last week and a blog post on the Walmart website you announced the starting associate store sources yet pay in the US was going up to $9 an hour and this year and next year to $10 an hour along with a variety of other changes to the way you manage your store associates I’m curious why this change and why now why not we’ve been joking the leadership at Walmart about how cool it is to go to work on a day and give 500,000 people a raise I hope you get to do that someday it’s really really pretty great we we were just trying to run great stores and for those of you that don’t have experience in retail I think you’d be surprised at how many decisions we make how many variables there are so we just think about a store for example you’ve got to have engaged associates I’ve got to care about what they’re doing so you need to think about the wage rate you need to think about the opportunity that they have you need to think about healthcare you need to think how many hours about how many hours you’re scheduling and I could go on and on and on but the changes we announced last week here in the US for walmart and Sam’s Club or largely aimed at creating a better store experience and and I’m sure we’ll talk some about the internet and about how technology is changing the business but our strategy is to find ways to bring stores and Technology together in a way that exceed customer expectations and excite them so to do that you’ve got to have great people that are excited about their opportunity at Walmart and that’s that’s what this is is designed to do great and in your explanation of the changes in a call for shareholders you explained it in largely economic terms so they’re largely the terms you used here that better store associate pay leads to a better store experience and eventually more profit for Walmart now there’s another line of argument about associate pay that focuses on a very different logical tract focuses on this is it the Walmart has a moral responsibility to give a living wage or that there’s you know other considerations beyond the you know store experience and the profit to Walmart I’m curious to what extent did those considerations also enter the decision was it largely driven by economic reasoning it’s both but it’s mainly about running a good business our philosophy is if we run a great business society will benefit communities will benefit now we are using the size and scale the company to engage in sustainability social and environmental sustainability in fact we were here today having a milestone meeting with our folks in our e-commerce business it was broadcast around the this hemisphere I suppose talking about what we’re doing is it relates to the environment as it relates to the obligation we have turn on people the way we think about it is that we’re trying to design a meritocracy so you heard that I started out unloading trucks eventually got into the buyer training program worked as an assistant manager in a store and then was lucky enough to move into her home office and start managing categories which was a lot of fun more fun that I would have dreamt and I just fell into it I wasn’t planning on being in retail didn’t have designed to be at Walmart it just kind of happened but but what happened for me and what has happened for many other people we employed 2.2 million people around the world is that you get in and you have an opportunity to exceed your own expectations about what’s possible so our design is one where we try to create the first rung of the ladder to be one that people can reach so you could say Walmart should pay a living wage to every associate and then that first rung would go up but there would be many people who couldn’t reach it and they might not have jobs and they might not have an opportunity so if you want to start as a cashier in Walmart and learn how to work in retail learn what it means to give good customer service learn what it means to keep a store in stock etc then you can move on to becoming a customer service manager you might become a department manager which next year will pay $15 an hour you might become an assistant manager start making $50,000 an hour you might become a store manager and make fifteen hundred eighty thousand dollars an hour and just work your way your way on up in the business to do whatever it is it was that you tripped up or you’re capable of doing let’s say so we want a meritocracy we want a ladder of opportunity and I’m proud of that I don’t have any issue with explaining that to people and do all the time and really I think it’s the American Dream and there are people and I met one the other day we had our what we call our your beginning meeting with store managers we pulled them all together in Orlando and we were talking about this phrase that’s existed in the company way back to 1979 our people make the difference that was one of the subjects that we were covering at that meeting and when it was over with this store manager walked up to me and she said Doug I just have to tell you thank you for the opportunity that Walmart’s giving me I lived in North Carolina but a few years ago I was divorced my husband took all the money literally became homeless for a while but so and so she called up the store manager’s name gave me a chance to work in the in the store as an hourly associate and now I think it was four or five years later she’s running a super center and making a great living and you know a tear in her eye and there starts to become a tear of mine that’s that’s what Walmer is about and I’m proud of that it’s clearly been a little great potful for you to develop your career and I’d like to delve into that a little bit later but right now actually I’d like to focus on the scope of the business globally so before you were CEO you ran Walmart’s international business and under your leadership it grew to be more than 6,000 stores and 26 countries outside the United States some major acquisitions there’s the math smart acquisition that brought you into many parts of southern Africa but also some bumps along the way there’s the revaluation of the JV in India and pulling out of Korea and Germany so I’m curious given you know lots of experience in many different countries what did you learn about scaling a business globally as later Wallman international it can be complicated we learn from experience and I think our organization has learned from experience if I if I started with Germany which goes way back and we tried to install our culture too fast into that organization we tried to teach them the Walmart cheer and hand them to our technology and say let’s go like all at once and it just blew up we had two companies that we bought we tried to put them together and the the way we were thinking about the business was not sophisticated and we didn’t listen enough and it was just purely out of ignorance we had the best of intentions but it didn’t work so he fast forward to the last few years government rules play a role if you look at the situation in India where currently multi-brand retail isn’t allowed from a foreign direct investment point of view you have to have a JV you have to have a relationship and that relationship can be complicated and the government can shift policies sometimes in subtle ways that that change the ground rules in our case today we’ve got about twenty cash-and-carry units in India they serve the kuranes the small business owners in India we would like to have a much bigger business but right now about all we can do is just scroll those cash-and-carry units and then and then we’ll see if the rules change in Africa we used a principle that we’ve developed over the last few years which relates to scale some of the downsides of an acquisition can be a cultural alignment issue you can buy a business that doesn’t believe what you believe and that will create all kinds of problems in the case of mass Mart we found one that was very culturally aligned to who we were and that scale buying a business that’s big enough that you can start to do business the way you want to do business so for example we like to practice every day low price which has a lot attached to it including how you negotiate with suppliers we would like to not be paid to run advertisements we would like to have a lower cost every day and pass that on to customers every day which creates supply chain efficiency and helps our productivity with work well you can’t do that if you have two stores none suppliers will listen to you so there are times when we need to grow through acquisition to achieve some level of scale there are other times where the government situation or other requirements prevent us from doing so interesting so you mentioned there’s one more second a variety of different strategies to enter you mentioned acquisition some are green field somewhere JD’s so it sounds like you’re taking a portfolio approach in the past in your strategies to continue doing more the same that there isn’t necessarily one dominant way to enter a new market that you’ve learned works best yeah like the way I would think about it is on the front end closest to the customer things need to be unique while it’s true that products are becoming more common globally and I’m seeing pampers everywhere you can’t go to a country without finding Colgate I mean these brands are global in nature but the decisions about what you carry and subtleties around fresh food or a spice or things like that require us to have a local relevance and that means we’ve got local buying teams so in the country we have local talent making decisions about how we go to market where we set prices what items we carry running the stores and all that kind of stuff but on the back end there are things we’ve learned about retail things related to technology or the supply chain by the business model itself that need to be applied over time so what we do is we hire great talent to run the markets and then we give them tools and resources that over time results in more of a common culture and more of a common business model and just one last thing about that the internet is changing things dramatically and the commonality of what people read how they consume media what they think what they hear about that’s pulling people together and also causing retail to become more alike in some ways the way that that mobile and stores come together is going to be more common around the country than it is different it’s interesting and then you mentioned culture it’s part of one of the things you try to keep relatively common across your different countries and it’s been something that you’ve spoken quite a bit about as a leader in Walmart we curious what specifically do you do to try to ensure consistent global culture because it sounds like that’d be difficult given the eight hundred thousand employees abroad in you know 26 different countries yeah some of you have a lot of work experience some of you may not I don’t think you can o precise the importance of culture and what we mean by that is behavior you can have the most beautiful image of your values on your side or on your mobile app and that means nothing if people don’t actually believe those things in act that way and our culture comes from our founder if you trace it all the way back the characteristics of our founder Sam Walton were strong and positive and then even today even though he passed away in 1992 you can find characteristics of Sam Walton and our business in Guatemala characteristics of him in China things like a customer service attitude sense of urgency listening to your associates those things have caused success and they will cause success in the future and the way we articulate the things that we talk about at Walmart as we typically start with our purpose I’m not sure I can remember exactly what year it was but one of the presidents named Bush came to Bentonville and gave an award to to Sam before he passed away a Presidential Medal of Freedom and he was sick with cancer at the time and he passed away fairly shortly after that but he stood up out of his wheelchair and said a number of things but one of them was if we work together we can help people around the world see what it’s like to save money and have a better life and that phrase became save money live better and that’s our purpose so around the world we’re proud of that core deliverable from the company our purpose is important it’s real it’s meaningful if you click down to values we have four core values we have service to the customer striving for excellence respect for the individual relates to things like listening and acting with integrity and I think those are universal truths that stand the test of time and what we’re trying to do at Walmart is to get our everyday behaviors of new associates we hired in a country or those that have been around for a while to just match up with those values and when I go into a Walmart store and it’s not in good shape customers aren’t being treated well it’s not in stock maybe the stores not as clean as it needs to be it you know breaks my heart and I’m always trying to figure out okay what could we have done better to create a situation where that store manager and those associates could have done a better job so that Walmart lives up to its potential doing that across 27 countries now that we’re 52 years old is harder I think and what it might have been a decade ago and what about the challenge of maintaining those core values or maintaining the same focus on the customer given the e-commerce disruption of traditional retails Walmart’s business is changing and retail is always changing to be more online how do you how is your business changing and how do you keep those core values or those values have to change actually as the business changes I think that the core values stay the same I think some of the behaviors probably change in the way we go to market clearly changes now tell you a story a few months ago I was talking to a person from Silicon Valley who’s brilliant and if I said this person’s name you would know their name and they’re in our office in bentonville and they do some contracting work with us and they were writing on the whiteboard how they run their business and how they design their algorithms and what they try to do and what their purpose is and stuff like that we were talking about the future of business and it dawned on him after talking about our mutual businesses for a few minutes that in some ways we’ve already done the harder part so if you want to reach a large number of customers and grow a business that’s almost five hundred billion dollars you’ve got to be positioned to add a lot of volume to be able to grow that company so you’ve got to be able to not only serve customers the way you used to serve them in stores or clubs but you’ve got to reach them in new ways and so mobile becomes more important cetera and his point was you know you’ve already got 2.2 million people you’ve already got a culture that when it when it’s carried out correctly at store level this DNA results in good customer service you’ve already got the physical supply chain what you don’t have is the code and the codes easier to write than it is to go build all the physical assets that you already have and I think there’s a lot of truth in that so I it will come back to people the way people are treated and in turn how they serve customers whether it’s through some sort of digital experience or it’s a phone bank or it’s the text response they send back to you or it’s the person in person contact you have with someone in a store those things are still going to matter so our culture has got to be even stronger in the future as we grow then it’s been in the past there’s so much more we could touch on the future of Walmart and Technology and markets of but I actually like to shift a little bit now and focus on your career specifically and the leadership lessons that you might have to share with the MBAs in the audience one of the things that Dean Mirage I mentioned is you spent nearly your entire career at Walmart and I think many of the MBAs in the audience have already had three or four employers so I’m curious what’s kept you at Walmart for so long it’s challenging and I mentioned before I didn’t plan on doing this I certainly didn’t plan on retail when I was 16 my dad moved our family to Northwest Arkansas to start a dental practice and I went to say goodbye to my girlfriend which I thought was the end of the world because I thought she was it and I’m standing in her driveway we’re probably both crying or whatever you know and her dad walks out and he says so what’s going on I said well we’re moving to this little town called Bentonville I’ve never heard of it I don’t want to go there my dad’s making me I’m not happy I’ll be back and he said you’re gonna end up working for Sam Walton and I said who okay so when you shop at Walmart I and I said yeah I guess what you’re gonna end up working for that company because that’s all there isn’t Bentonville turns out that was true literally all there was when I moved we move to that little town there was one stop life it was a McDonald’s one pizza joint and Walmart was it and so you start hearing about Sam Walton and you it was a little town so you run into him or run into other people just you know being there and I needed a summer job so the warehouse was hiring at six fifty an hour and and I took that job because it paid more than McDonald’s but I ended up meeting this guy the day that I started it was summertime it was hot and there was this guy named Johnny unloading trucks with me and Johnny was bragging about having two hundred thousand dollars in profit sharing and I thought whoa this dude unloads trucks you don’t even have a shirt on maybe I need to pay attention to where I am you know and you connect all the dots what I learned about retail is it’s really hard it’s really challenging it’s a narrow margin business you have customers to deal with you’ve got to think about marketing merchandising operations logistics finance legal real estate compliance ethics culture global business now technology you know I meet young people who are excited to be in the valley and I come out here quite a bit these days and the startup thing sounds cool to me but I haven’t heard one yet that is more challenging than what we’re trying to do if you want hard try to take a 52 year old business that this size and change it that’s hard and it’s worthy I mean creating a situation where 2.2 million people stay employed and have a life that’s a big deal so if you want to work at Walmart give me a call I promise you it’ll be hard one of the you may get some emails now be careful um one of the interesting things about your career is you’re the youngest CEO that Walmart’s had since Sam old and you’ve risen very quickly through the ladder starting with unloading trucks and now being CEO too what you attribute the fact that you rose so quickly through the ranks at Walmart well I’m not the only one I mean I ended up in this job so people pay attention to it but if you were inside our company you would meet many many many people who’ve had opportunities and a lot of people who say I didn’t want to be at Walmart I just wanted a job or I needed to pay my way through school or whatever and they end up being here 20 or more years pause your question how did it happen yeah I’m still trying to figure that all right it was a step at a time yeah you know I loved merchandising I fell into a situation where the challenge of the work was something I really liked so I ended up getting to go to Sam’s Club I’ve actually been an international twice then was given the opportunity to lead our international business and each one of those steps kind of prepared me for the next but if I had to answer it in one word I would say I think it’s just because I love it I really like it and I’m still learning a lot and so I think the company needs us this current leadership group to respect the past and to not forget the things that made the company special and be very selective about what we carry forward so you know does that distribution center the way it works provide value to society to our business to the customer in the future if it does keep it if it doesn’t get rid of it that kind of attitude forward looking willing to change my I did not work for Sam Walton personally I didn’t get to know him a lot but I was around him a few times and got to talk to him a couple times and he if he were here would be driving change I mentioned earlier if this were bait whether if you want more people here if you see if you say to one more people the only thing that’s constant is they say change well that’s a great platform to operate off of it gives you the freedom to go do things differently and that keeps it exciting yeah just I mean it’s clear your excitement for working at Walmart but one of the things you haven’t mentioned it’s kind of surprises means you haven’t talked about the role of ambition in your career at Walmart did you know it wasn’t staying at Walmart wasn’t part of your calculus when you joined that you know aiming for the top job wasn’t necessarily something that you wanted to be chief merchant someday that was my aspiration I was a buyer and loved merchandising and I kind of overshot it so we need when did that change and what what caused that change well I was I was a chief merchant at Sam’s Club and I worked for a guy named Kevin Turner who was our chief information officer and he got promoted to run Sam’s we were both in our 30s and Microsoft recruited him away and Kevin’s currently the chief operating officer at Microsoft so when he left Lee Scott was our CEO and Lee Lee came over and he said hey you’re about to hear in the next day or so that Kevin is leaving to go to Microsoft will will be putting someone new in Sam’s Club it probably won’t be you I’m sure you’re good with that so yeah I love my job and whoever you send over here I’ll help and he said okay so a few days go by and he comes back and he says we’ve thought about it and we really don’t have anybody else we want to put over here so you get to be the CEO Sam’s Club that’s how I said it wait please quietly are you taking a lot of Lee Scott stories but that’s that’s how that happened so that forced me to learn a lot about things other than merchandising and if I hadn’t been given that opportunity I probably would not have been given the opportunity to to lead international which was the most mind-blowing experience ever I mean I’m a kid from Arkansas and certainly I’ve traveled a lot but sourcing and buying stuff I’ve traveled around the world for a long time now but to be responsible for a business in 26 countries that’s 140 billion dollars with 700 thousand people and it didn’t get to enter Africa and get to deal with some of the complexities of the app is just extraordinary really blessed I actually like to talk a little bit more about the role of travel in your career now one of the core Walmart management philosophies is cbw a just coaching by walking around the idea that managers and to interact with associates and problem-solve on the store floor but when you’re running an international business you have employees you have associates all over the world how did you balance trying to efficiently run a global organization when you led the international business with the need to be physically present in all those different locations yeah well first of all you can’t be everywhere so you have to have great people and we have a Deepti mean we’ve got talent in all the markets you know that we’re proud of but there is no replacement for really understanding the businesses so I traveled for five years you know a lot and loved it enjoyed being on the ground I’ve been to places I never really would have thought I would ever get to go to and go into stores in Nigeria there are hours wow what an experience all over Latin America I’ve learned a lot about China don’t profess to understand China but I’ve been there a lot and fascinated by it so you have you have to be there but my responsibility was do we have the right management talent at the top do we have the right culture within that organization and I do spend a lot of time talking about culture are we positioned to win are they getting the resources that they need and in what I ended up doing in the role that I had is to get our leadership team to focus on the things that we had in common maybe this is a good way to answer the question when I moved into the job everybody told me you really need to understand what’s different you got to focus on the local differences don’t try to run it from here I think some of the lessons from Germany were probably playing out in that in that direction but after doing it for five years all I can tell you is everybody’s the same do people around the world are thinking about the same things they’re thinking about their family their thing about their career they’re thinking about you know the vacation they’re going to take they’re reading a lot of the same media they’re we’re more and more the same even during the five years that I was international I could see a difference in people and I remember one morning getting up in Japan and reading the same news story I’d read the day before in the u.s. about Angelina Jolie I’m like okay we’re all on the same page here but products are becoming more the same and the last year I was international I started asking people when I was in a store I did once in Costa Rica for example I would say show me something that is uniquely Costa Rican in this store and they would look at each other and say ok so they took the over this bottle that was labeled salsa it looked like a1 sauce and when I turned it around it said Unilever on the back and people just increasingly had a hard time showing me anything that that’s unique now local produce locally grown product things that are you know produce really near a store still matter and we want to source those things but I could see kind of a global wave of commonality happening and that was fascinating Wow you mentioned one of the things that it’s common people you meet all around the world is there everybody’s thinking about work and family and trying to balance these things and I’m curious especially you had a career that involved so much international travel and so much responsibility I think that many of the MBAs in the audience are also thinking about how to balance their careers with other obligations that have in their life so I’m curious you know what have you learned to try to make that balance work because you have a family and sons invent evil and you know how what advice do you have to give to MBAs who are kind of embarking on trying to start that figure out that balance after they graduate I think it’s personal you know you guys have to solve it for yourselves based on what’s important to you for me life came in phases so there’s a period of time where my kids were little shelling I have two boys and I did not want to miss like those little three-on-three soccer scrums with a six year old you know so being there at that age mattered a lot by the time I was responsible for international my boys were teenagers and they were like he’d been gone dad I mean he didn’t miss me that much it’s very different than when they were in elementary school and stuff so there’s probably a time and a place for everything and you just need to manage that pay attention to it pay attention to yourself you know are you getting the right rest are you taking care of your body are you right minded and in in the jobs that you’re going to have your decisions will really matter so you’ve got to be prepared to make important decisions and you can’t do that if you’re exhausted as look at least you won’t do it very well so I think you need to know yourself and know what’s important to you whether its family or faith or whatever it is you’ve got a you got to be right on that note in making important decisions as you know CEO of the world’s largest company your decisions have a lot of weight they affect a lot of people there’s a lot of those big dollar amounts at play here can you tell us a story of the difficult decision that you’ve had to make over the course of your career yeah I mean just the round of decisions we got through making in announcing last Thursday are the first things that come to mind because they’re recent the the importance of having great people around you a good team that can help you think about an issue you will not face very many things where you have 100% of the knowledge and the image that pops into my mind all the time we were having this conversation yesterday with the leadership team about the future of our supply chain and we had ecommerce leaders and people who are steeped in logistics in the room and what you literally saw play out on a whiteboard is people putting pieces of a puzzle together and the people that have been doing it for a long time said here’s what it looks like and the e-commerce people said yes but you’re missing this piece and then of another person said what if we do this and all of a sudden a picture emerged on the board of the future of our supply chain that was better than it would have been with any individual so in this latest rain set of changes that we’ve made there were different people people from within our HR or people area that contributed to training in a big way there were other people who said for us to run great stores when you’ve got to change the structure there were other people that said you know the starting wage needs to really be thought out and here’s how we should think about it and when people make great decisions you just need to let them you know I don’t make every decision in Walmart don’t want to make every decision Walmart if I do my job well I’m not making very many decisions because the team is doing it but every once in a while I’ve got make some and they better be right and I need to have listened to others to try and sort it out many of them are unclear by the time they get to my desk if they were easy somebody else would have solved them so knowing sometimes this isn’t going to get any clearer there’s more there’s no more data that will help me make this decision I’m just going to have to go with my gut you have to do that sometimes I have a lot more than I could ask a lot more things I’m curious about but I want to make sure that we give our audience a chance to ask some questions I think we’ll start with a question from Twitter what do you think that future of the US grocery market will be in five to ten years and more specifically are you worried about the rise of the discount stores future of grocery that’s a big question and I think grocery will be more food will be more focused on quality in some ways it’ll be more local definitely this huge trend towards you know organic and gluten-free that’s where the growth is and quality the way you handle the supply chain the way produce is handled all the way through the process is going to be increasingly important I do think grocery home delivery will play a role although I don’t think it will be in the United States more than 10 percent of business anytime soon in the UK we’ve been doing grocery home delivery for 15 years and it’s it’s still well under 10 percent of our business picking up your groceries in the parking lot or in an off-site pickup location that will happen and is happening we’ve got experience with that in the UK you may have read we recently announced some pilots here in the US for grocery pickup and grocery delivery Denver in Phoenix so other places so we’ve got testing going on the way customers will take product will be different than what they’ve done in the past we’ve got a pickup location we opened in Bentonville last year where you can’t go in the store and shop you order on your mobile device ahead of the time and you just go through and drive into a slot and we put it in your trunk for you and that test is going well dan just reported to me his wife had an experience today and no substitutions in less than a five-minute wait so we’re making progress on learning how to do that so grocery is going to change I think we got the team to help sort it out we don’t have the reputation that we want to have today for quality that’s a big area focus for us but it’s achievable okay let’s go here first hi I’m a band I’m an MBA one here first of all thanks so much for coming to speak with us so there’s a report released last year that said US taxpayers subsidize Walmart to the tune of 6.2 billion dollars in food stamps Medicaid welfare I guess how do you respond to the critics who are who are saying you know whether it’s six billion or three billion or whatever the number is but the biggest company the world the wealthiest family in the country shouldn’t should be paying its workers enough that that money doesn’t need to be there at all yeah I understand the criticism first thing that comes to mind is we pay almost two percent of the corporate taxes in the country so I don’t feel very subsidized okay but the issue you’re raising goes to respect and it goes to opportunity and what I was talking about earlier is how I feel about it we’re a company that gives people an opportunity to go do more now where we put that first rung on the ladder matters and I don’t know the statistics about how many Walmart associates are currently on government assistance but we don’t want any of them to be on government assistance because we want them to be able to move up that ladder and we want to set that first letter in the right first rung on the ladder in the right place so we think about things like health care and accessibility of health care starting wage rate what we do with 401k program so that people who can save have an opportunity to save helping them with an education helping them get their GED if they don’t have it providing skills for people who are learning English as their second language we’re trying to create that meritocracy that I described and I think the decision we made most recently to put a billion dollars into our us associates is an indication that we do care and that we are listening and you know we’re always going to have critics and critics have their own agenda I don’t expect to ever escape that but if our associates and our customers know that we have good hearts and there were well-intentioned and that we’re taking action in the right direction I think we’ll be in good shape this working area I’m Daniel I’m an MBA one as well I’m interested to hear you talk about outside scrutiny both from a media perspective and also from the wall street stock analyst perspective as CEO you know you’re the steward of shareholder value obviously over the long term you’re probably never going to have the New York Times and you’ll always have Fox News in your corner got it think about anybody in our corner I’d be great but so you know in more recent times we’ve obviously seen this incredibly exciting announcement as a you know an avid Walmart customer I’m you know very appreciative of what you’ve done for your employees but every single press announcement has also said and the decision coming after six quarters of same-store sales being down right what link you know is this coming because as a management team you have to be really sensitive to what the street is saying and what the press is saying or at the end of the day do you have to take a 52-year view or 152 year view and say they’ll always be critical of us in cycles and we have to keep our eyes on the prize hmm that’s it and keep keeping your eyes on your eye on the prize and thinking a bit longer term is the way we feel about it and you mention though the Walton family one of the benefits of having the Walton family own as much of the company as they do is that you get to take a long-term view so this is a family who benefited greatly from the creation of Walmart who cares about our culture cares about our associates cares about sustainability so we have a board of directors including our chairman Rob Walden who asked us to think about the long term and to do what’s right for the business for the long term so sometimes I will say something like a big part of my job is to help position the company to be here 50 years from now I’ll never make it in this job anything near 50 years so really I’m worried probably about the next 10 you know in a more tangible way so whether it’s the investment it’s in people or the investments in technology I mean we everybody knows we’re losing money in e-commerce in the short term to build capabilities that will help us in the long term that mindset is vital and it’s vital to surviving if you look at the history of retail you could take a snapshot of the top 10 retailers in the world by decade and I carry this around on a PDF on my phone to remind me it changes a lot and fast so you’ll see a company like JCPenney or Sears or others who rise to a top spot and then they fall a big challenge at Walmart is to be relevant in a way for customers such that we can grow five years from now and ten years from now because history is actually against us but the advantage we have is that we can think long term and we have resources if you make the right choices invest in the right places you can do it but these choices do matter hi emily ambrose thanks so much for coming to speak with us i’m really interested in hearing how you think about walmart relative to amazon so what scares you about amazon how do you think walmart competes with amazon and then ultimately how do you think walmart beats Amazon is Jeff here oh the way that I was taught to think about competition in walmart is that you should do everything you can to learn from them so you could feel threatened by a great competitor if you wanted to but it’s actually more productive to think about what are they doing that the customer likes that we can learn from and I think Amazon and others have shown us that the customer wanted access to a broader assortment they loved being able to do it in an easy way you know doing it online and increasingly mobile has much less friction than getting in your car and driving to a store when you don’t want to so we’ve been thinking about these four different dimensions the first one might call it as the breadth of assortment and when we started opening supercenters got 120,000 SKUs versus a grocery store or a category killer it out it out assorted those competitors you could do one-stop shopping more effectively so we’re winning on assortment but now the Internet’s changed what assortment means an assortment looks more like tens of millions of items than 120,000 items values different price transparencies increased sess is different you can get more delivered you can pick more up in the future than you did in the past and then the experience has changed now we have a lot of customers that are using their mobile devices on the floor of our store they’re using it for navigation they’re using it to search they’re using it to buy an item they couldn’t find in the toy department when they were looking for it those kinds of things so the way we ultimately win against anybody is we work across those four dimensions in a way that’s unique leveraging the supply chain and the assets we have so that we end up giving customers a better value across a broader assortment and help them save time and hopefully surprise and delight them with a couple things along the way so the investment in digital matters and the way we put it together with stores is how we’ll win do you think our next question from Twitter wraps so you mentioned that going international is very hard one of your biggest investments has been an ad star which is a UK grocery market how successful do you think that investment has been and how do you think a star welfare going forward in the changing retailing and scape in the UK yeah I didn’t answer the second part of the discounter question and in the UK is certainly seeing Aldi and Lidl and the discounters do very well so we feel their presence as it relates to as in our business in the UK by the way if you don’t know we’ve got over 50 different retail brands around the world and in the UK we’re known as de so what we have to do in that circumstance is to make sure that our opening price points the entry-level price points into each category are strong and the qualities right then we have to offer service or assortment with a premium product that enables us to win on assortment so going back to those competitive dimensions that I was just describing some combination of those four applied in a market delivers the winning formula and we may have to tweak it here and there depending on what customers are offered from competition in a particular market as there’s been a great investment terrific talent mark our current Walmart us chief operating officer is British her name is Judith McKenna and she’s now responsible for 1.3 million u.s. so she it’s which is fun because she uses British phrases that most of us don’t understand we’re teaching a new form of English but you know this this acquisition has been one of our better ones hi my name is Mahara and I’m an MBA – you talked about e-commerce and the importance of the digital platforms and I was wondering if you could elaborate a bit more about your omni-channel strategy and how do you plan on breaking the organizational silos in a 52 year old organization where your ecommerce department and your retail branch are so far apart yeah that’s hard we’ve got some members of our e-commerce team here now and if you asked you know what could threaten Walmart one of the answers I would give you as internal ways of working know-how we have new ideas that may emerge from California but we have knowledge and experience in our core business a lot of it in our home office in Bentonville and how do you get those people to work together in such a way that the outcomes better than it would have been individually that’s one of our big challenges so we currently have some work underway to look at incentive alignment and how strategies are pulled together to make sure that they are cohesive and do work together a lot of it boils down to trust and relationships and people being willing willing to listen to each other so I was talking to somebody recently and they are one on one side of the house but don’t cross both sides and I said you know you may have 80% of that figured out problem is I don’t know which 80% and neither do you the other person in the room may know the other twenty your job is to help communicate what you think about the ad but also listen so that you can find the other 20 and you attitudinally that’s kind of what we need from our leadership team right now and I think we’re generally getting there but there’s some things that we need to do to make it easier so that it doesn’t feel like it takes decision by consensus which can kill you to speed matters too so if you worked inside Walmart today this would be one of the hot topics there’s a phrase that’s emerged this year who owns the D which means ultimately who is the decision-maker because people want to know so they can move with speed and I’m trying to help us figure out how do we move with speed but also use the appropriate collective wisdom Marissa Mayer is on our board and we were talking in a board meeting about this a while back and she said something like you know within our business there may be just making this up eight people who should really weigh in on a decision and sometimes we seek feedback from 40 I’m just going to quit worrying about the 40 worry about the 8 make the decision and get moving and if the other 32 have something to contribute they’ll have to jump in front of the bus and try to stop us because we got to keep moving and it feels like that within Walmart too we got to get the right few people in the room to make the best decision and then get on with it and in a business of our size and our age that’s a challenge great question hi I’m Michael e I’m a first year medical student and and I’m really interested in the rise of retail health Walmart is clearly a big player in this space so I was just wondering if you could comment on the future of Walmart with regards to breaking into the healthcare industry yeah the healthcare industry looks complicated from here we just our retailer but the the long-standing pharmacy and optical businesses that we’ve had we’ve got some Sam’s Clubs that do a job with hearing and hearing aids clinics we are doing we’ve tried several things with clinic clinics third parties partnering with hospitals in some cases doing more of the infrastructure on our own our customers want it because they want affordable health care that’s accessible and easy and so I think what you’ll see us do is continue to slowly move into healthcare in the appropriate ways in a way that serves customers and helps us with traffic but I think we should be very thoughtful and cautious as it relates to what we do to make sure that what we deliver builds trust with customers if we rushed into clinics and try to put them in too many stores too fast I’m certain the quality wouldn’t be what we need it to be so who we partner with and how we go about it matters and we’re learning and we’ll keep moving that direction because we think our customers want us to healthcare is complicated up close to I think we have time for one more audience question in the back corner here hi I’m Nene and I’m MBA one you mentioned the walton family’s commitment to sustainability and I was wondering how you thought that has played out at Walmart if it ever doesn’t make short-term business sense and how some of those decisions might play out in the company that doesn’t have that kind of family commitment and ability to think long term yeah one example would be capital investment so if you think about renewable energy I think we’re at about twenty-eight percent renewable energy globally at the moment around the world some markets are ahead of others Mexico is actually one of our leaders in this space they do a great job with renewables capital investment in LED lighting in a store for example which might have a higher upfront level of investment but payback over a period of time we’re very comfortable making that kind of decision so we were the first retailer to go to China with LED lighting for example what we invest related to refrigeration and the type of refrigeration that cuts down on greenhouse gases that has a little bit of a short-term negative impact maybe more than a little bit but we do it for those reasons that you decided so I think that’s an example of where a long term disposition helps and and that does ultimately flow back to our board of directors the Doug I’d like to conclude by asking a question that’s become a bit of a tradition here at Stanford all the MBAs in the audience will have answered this question as part of their applications to the GSB what matters most to you and why I’m still trying to please my grandmother that was a little too personal wouldn’t it that’s probably true Am I you know my family matters a lot the faith family matter a lot to me I’m also very competitive person and I like to win and falling into Walmart has just been more than I could have ever dreamt so you know I don’t know what you guys are all gonna go do but I hope you find a place where you know you’re in the right spot and if you’re not move and go somewhere else you probably all eventually end up at Walmart which will be fine we’ll see well thank you for ending up at Stanford it’s been a pleasure to host you please join me in thanking dunk for joining us here today

Author Since: Mar 11, 2019

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