Biz Books (column for 09/12/04)

By Jim Pawlak

"What I Learned From Sam Walton" by Michael Bergdahl, John Wiley & Sons, $24.95. Bergdahl worked directly with Sam Walton at Wal-Mart. He provides numerous insights on how to make a retailing operation successful, his methods can be readily adapted to B2B and service industries. Bergdahl¹s success strategy is P.O.C.K.E.T.S. All of its elements are co-dependent.

P - Price. Sell value. Sustainable competitive advantage comes from product/service differentiation and selection, as well as service after the sale, not price. Low bidders lose long-term because their margins cannot sustain differentiation, post-sale service and operational efficiency.

O - Operations. Continuous improvement is the mantra here. You have to be close to your customer to know what it wants. That closeness also gives you the ability to show it what it needs.

C - Culture. In order to develop passionate employees they must understand your brand. An enthusiastic staff is your best sales tool. Reward productivity and weed out non-performers quickly. Managers should treat staff like they would a customer.

K - Key Item/Product Strategy and Tactics. Build vendor partnerships around a sense of urgency. Product mix and price points allow the customer to customize its purchase.

E - Expenses. Obsess on cost control, but not at the expense of the customer experience. Labor cost is the toughest to control. Don¹t think that cheap labor will translate to satisfied customers; it may well lead to employee retention problems. High employee turnover makes it difficult to develop a customer-centric culture.

T - Talent. Recruit constantly. Talent is the face of your company seen through the customers¹ eyes. Hire people smarter than you are; they¹re the ones that have to carry the business to the next level. Top talent always has choices; you have to sell them on working for your company.

S - Service. Never take a customer for granted. Make customer service a core competency. Hold your suppliers accountable for quality. Help customers make buying decisions by understanding their needs.