Judith McKenna

Behind the scenes in retail: MBA students dig into talent, transformation and trolleys with Judith McKenna

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No subject was off-limits when the Walmart International CEO visited Oxford Saïd

‘Businesses and people can no longer be wedded to the old ways of working. We have to become much more open, more willing to partner with people and organisations in ways that might previously have been seen to be anti-competitive ... You need to know when to build, when to buy, and when to partner … You need to adapt and change faster than you ever thought possible.’

The retail sector used to be mistaken for the poor relation of career options – tied to a long history and bricks-and-mortar stores, plodding slowly behind glamorous and innovative technology companies. But anyone who still thinks that has clearly not met Judith McKenna, CEO of Walmart International, who visited Oxford Saïd to talk about everything from transformation at scale to curiosity and continuous learning.

Introduced by Paul Chapman, Fellow in Operations Management, McKenna was keen to answer questions put to her by the MBA students in the audience.

What is the key to creating change at scale?

You need two things: trust and simplicity. If you are going to transform a company at scale you need the trust of the business. They must know what you are doing, believe in it, and know what good looks like. And then you have to keep it simple. In a company the size of Walmart, if 2.2 million people don’t get it, frankly it is not going to happen.

Walmart is one of the largest companies in the world and one of the most dynamic. Yet when I look around at my classmates on the MBA they all seem to want to work for Amazon or McKinsey. Is Walmart failing to attract the best talent?

I think Walmart has done a good enough job of telling our story, talking about the opportunities we create, about what we do around the world, and that it’s a place where you can build pretty much any career that you want and make a difference at scale. And I think we’ve just got to keep telling this story on different levels.

We’re making some really great hires, which suggests that the message is getting out there. We are seeing more people coming in from top business schools, often with new skills that were not perhaps part of the traditional Walmart skillset – but are now.

How do you use your power and influence with suppliers to influence worker safety and responsibility within the supply chain?

This is an issue that we take very seriously. We have a separate Responsible Sourcing team whose entire job is making sure that the suppliers we use, particularly in more challenging parts of the world, take their own responsibilities seriously in terms of workers’ rights, health and safety, etc. We have regular factory inspections and all our manufacturers have to be certified.

We believe it is important to work in partnership with our suppliers, rather than in a purely transactional way. Our Project Gigaton, for example – a sustainability project to remove a gigaton of greenhouse gases from the value chain by 2030 – is one where we have to bring partners along with us. Similarly, our focus on community – improving and enriching the lives of the people around the stores – is a matter for partnership rather than negotiation.

I think leaders now should be measured by their ability to create an environment where if it’s not right first time, it’s OK.

As an individual leader, how do you know your ideas are going to work?

Actually, I don’t always know they’re going to work! Experience can usually help you judge if something is practical, but the world is changing, and much of what we once knew we are going to have to unlearn. Certainty is no longer a defining quality of a leader.

I think leaders now should be measured by their ability to create an environment where if it’s not right first time it’s OK. People need to be comfortable bringing ideas to the table and having the courage to take them forward. One of the things I look for in people is the ability to take risks. However, they have to be able to balance that with the ability to communicate. If you are doing something new and untried, you have to let people know what you’re doing, and you have to let them know why you’re doing it. Additionally, if you’ve got something you want to try, don’t start by implementing it worldwide with your entire workforce. You have to start small, test things, try them out – and scale rapidly when you know they will work.

As a woman at the top of the company, are there any particular challenges you face, especially in dealing with different cultures?

If you’re working in an international business, one of the hardest things is understanding and being respectful of different cultures. One of the things I have learnt is never to assume anything. You need to do research, talk to people, and question if you are taking the right approach. It is important also to surround yourself with people who are not afraid to tell you if you have put a foot wrong.

Does it cause a few waves sometimes when it’s a female leader who walks in to a business meeting? Occasionally. But in those circumstances you just have to remember that it’s not personal. You’re representing the company, you’ve got a job to do, and you’ve got to do it in a respectful way.

How much time do you dedicate to shelving and uniforms and trolleys compared with high-level strategic matters?

In my previous role these things mattered a lot. I didn’t care just about the trolleys but the wheels on the trolleys – did they work? Did they squeak? Did they go in the right direction?

My role now is much more strategic and less hands-on. But it’s not good business to allow yourself to become disconnected, whether in retail or any other sector. You have to make sure you still understand what the customer wants and how you can best serve them. That’s why we have ‘listening sessions’ in Walmart, to allow people from head office to spend time in the stores and really know what’s going on there.

How do you achieve transformation in a company as big as Walmart?

I talk a lot about finding your ‘North Star’ and that is the key to it. We can over-complicate strategy, but it’s really about seeing where you want to go and understanding the processes that are going to get you there. There is no magic answer – just adding layers as you go through each programme and process.

There is never a shortage of ideas in the organisation, but always a shortage of resources, including people and brain space. So you have to know how to prioritise ideas and sometimes you have to say no. It’s hard but you have to be able to look at all the options together and decide where you are going to make trade-offs – and that’s in all three dimensions. You have to look at the short term, the long term, and the medium term altogether.  

How does Walmart think about the question of purpose in business?

The thing about Walmart is that it was built on the purpose of saving people money so that they can afford to live better. You go to any Walmart store in any part of the world and you’ll see that. It is more than just a set of words: it drives decision-making about what we do and how we do it. It is a very, very active conversation in our organisation.

And I think you will increasingly see businesses understand that this is the right sort of conversation to be having. But it’s got to be real, it’s got to be genuine, and you have to back it up with actions that you take. So the principle of Walmart is everyday low prices supported by everyday low cost. This touches every part of the product cycle, so it’s not just a purpose, but underpins the business model.