Since the early operation of Wal-Mart stores, what made them stand out from competitors and allowed to gain a competitive advantage is the Wal-Mart way, i.e. the unique and innovative operating model aiming at creating value in all aspects of the chain’s activities.
In my view, this approach permeates all aspects of the daily as well as the long-term operations. The sources of competitive advantage at Wal-Mart can be summarized in the following two approaches that are applied diagonally in the company’s operations:
• Management style based on the so-called “open-book and open-door policy” for managing human resources at all levels, as well as for partners and vendors.
• Adopting and relying on new information technology (IT) tools.
• Keeping very low prices, still being attentive at delivering a quality product.
Concerning the management style, there are different key aspects that represented a competitive advantage with respect to competitors and became a sustainable advantage as a trait of the Wal-Mart culture. One important aspect is the fact that employees (at all levels, down to employees/associates) felt engaged to the company, and it was recognized also outside the company. In fact, employees were motivated and followed through their working life at Wal-Mart; also, they were given trust and responsibilities while local management constantly checked on them, as well as upper management closely monitored stores performances.
Such results could be achieved thanks to the “open-book and open-door policy”, which allowed sharing information and ideas through the company.
Concerning the investment in IT, this would not constitute a sustainable advantage per se; nevertheless, as it contributed to many aspects of the operation, it became an irreplicable and distinctive sign of Wal-Mart operating...