Wal-Mart CEO Answers Critics
In Exclusive Interview, Lee Scott Says People Are Attacking The Wrong Company
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But lately, Scott's hardest sell has been his company's image, which has been under the target of relentless attacks from union groups that say it pays poverty-level wages. As CBS News correspondent Anthony Mason explains, the company is also under attack from Democrats who have their eyes on the next presidential election.
"I don't see any indication they care about the fate of middle-class people." Sen. Joe Biden, D-Del., says.
So how does Scott feel about being used as a political issue?
"Oh, I think they're attacking the wrong company," he says.
In a rare interview at Wal-Mart's Rogers, Ark., store, Scott offers a reminder that 127 million customers shop at Wal-Mart every week.
"It's surprising to me to me that anyone would want to take a chance at irritating people who like us," he says.
But Wal-Mart has paid a price for the bad press. A leaked internal study showed up to 8 percent of the store's customers no longer shopped there because of its reputation. Even Scott admits the critics struck a nerve.
"When we started getting that criticism, it hurt," he says.
Wal-Mart has hired outside image consultants and set up a public relations war room and gone on the offensive. One of their recent commercials says, "Last year alone Wal-Mart created tens of thousands of new American jobs."
From its modest beginnings as a five-and-dime stores in Bentonville, Sam Walton's company has become a corporate colossus — a $300 billion-a-year business that is also the largest private employer in the country.
But does this mean the company has a responsibility to pay a living wage? Scott says he doesn't know "what specifically a living wage is. Our average wage is over $10 an hour."
In the past year, after a study showed that nearly half of the children of Wal-Mart workers were uninsured or on Medicaid, the company expanded its health care plan, and last month raised wages 6 percent at many stores.
Does this imply that the company wasn't paying enough in the first place?
"I guess that if you wanted to make that case. I'd prefer to look at it as we have been raising wages and improving benefits for years," Scott says.
But the CEO concedes that criticism has forced one sweeping change: the greening of Wal-Mart.
Scott has committed to cutting Wal-Mart's energy costs by 30 percent.
"Now, you may not think of this, but that is a thing of beauty," Scott adds.
In an experimental store in Colorado, Wal-Mart is already testing energy-saving technologies.
The Rogers store has display cases with light-emitting diodes that give off much less heat, making it cheaper to cool.
But Wal-Mart skeptics still doubt the company's commitment, suggesting, perhaps that the company is just trying to "green wash" its image.
"The one thing I've found at Wal-Mart is trying to be overly sophisticated and manipulative is not our strength," Scott adds.
But the company that's made its name cutting costs is smart enough to know that improving its image could also improve its bottom line.
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See all 53 CommentsCody, Wyoming
Wake up America, your paying through the nose for infererior merchandise. Walmart's meats and vegetables are inferior and, to top it off, Walmart sticks you with the cost of their employee healthcare to boot.
How can we be so ...........dumb?
Ask Lee Scott if he knows what it means when a company goes UNDER? Yes, I am an associate, and do you, CBS see that all the negative comments come from current assoicates, or at least on behalf of curent associates, with, of course the one praise comment thrown in by some store manager's wife. Show us that you are not all about a pretty picture with Katie. Show us that you want to show the world the WHOLE story, if you are doing a story about Walmart. Don't just get the smoke blown up your skirt by the CEO. Talk to the millions of disgruntled CURRENT associates Walmart is *** nationwide. It is not just bad in the Red states. It is bad in the Blue states as well.
You must be management to make those comments. Or in a multi-staffed UPC office, or maybe the SWAT team or in a warehouse in some remote area. If you really work for Walmart in the trenches, or as some call it the 7th level of Hell, then you know as well as anyone that the changes they are making is not for customer service improvement but improvement for their bottomline. Are you really thinking you work for the soon to be next Saint? Get educated, see what associates in your store think about layaway going away and hourly wage caps, or cutting staffing during peak hours. Ask a real customer what it is like trying to get a piece of fabric cut from a bolt when the D19 dept mgr is at lunch. You are so clueless. I can't believe you really work for a Walmart in the real world!
I just re-read your comment and see that you make a 6 figure salary. Who are you kidding?
We are over worked, understaffed.And just plain sick of things. Moral with associates is at an all time low. No wonder customers complain about non friendly associates.
Even "under" managements moral is down in stores.They are just as stressed,The reason the average wage for associates is so 10.00 is because they average in associates that have been there for a long time. They fail to mention that those associates have now had a cap put on their pay.
Maybe Lee Scott should have a grassroots with associates and get the real feeling. When I first started I would have praised and pushed everyone to work at walmart now I wouldn't recommend it to anyone. It's a job now I go do it and get the heck out of there. I'd rather shop at the competition then spend any extra time there.
Supercenter#3247 - Delavan WI
In your "Greening Process", please turn off the full blast heat in the Summer in aisles #11-13, and the Crafts/Fabrics Dept. Thank you.
Please help us find "just" one associate in this Supercenter who recently received a 6% wage increase.
WHERE IS THE "OPEN DOOR?", this Supercenter is not equipped with one.
What happens to the "Good Customer Comment Cards"?
I see the customers complete them, deposit them in the gray box, and vanish. Is it true an associate is to receive a good job pin for each good customer comment card? Does Wal-Mart still have good job pins??????
Yahoo!! Yes, indeed, please immediately implement "Surprise Store/Supercenter Visits." Only and especially if you care to make improvements, and things better for all.
These consistent planned/announced/leaked visits and "star's", only do WAY more harm than good. One can only make changes to the truth, not a fabrication/cover-up/camouflage. To fix, or make changes one must actually see and hear how a store truly actually functions. PLEASE I invite, and encourage you to do so. What could you possibly be so afraid of? TRY a weekend - peak visit or even an evening, not a Tuesday morning. You are not afraid to work a weekend, or a holiday like the rest of your 1.3 million required associates?
What truly happens to a "grass roots"? What meter measures a Supercenter Manager? Is it true that 3 consecutive bad grass roots, and the Supercenter Manager is gone? Don't tell me, sales are the bottom line.?
Now, is your chance and time for Action Senior Management - You make the call. Use those dozen Lear jets at Rogers Airport, dress casual, save money on hiring "outside consultants". Dare to challenge Senior Management to one - just one, unannounced SURPRISE store/supercenter visit. Be your own MYSTERY visitor. Target one in each state of the United States of America, prepare your reports, and compare. Measure Up and Take Action from your own hard earned work - not paid information, press or hearsay, Mr. Sam would.
Oh, and by the way, on those salary caps for hourly associates, is there a plan for cost of living adjustments?
10.00 dollars an hour in what world are you living in??? Where and who. Silver card employees thats who. Thank you for the wage cap also. Open door where in my house, not at any wal-mart where I have been. Managers say hello in the am where? your lucky if they know who you are and even luckier if they know your name. Good thing we have name tags.Harrassement and favortism never not in our store ya right. you million dollar boys better get on your million dollar jets and fly around ole Mr. sam would be rolling in his grave about now if he hasn't jumped out by now and went to a different state. I am so glad I don't have a family to raise and work at wal-mart. It is a very poor reprsentation of family work place. Maybe management family not the workers. Oh ya million dollar boys wheres our bonuses we were promised Management gets them wow surprise surprise and WHO DOES THE WORK EVER THINK OF THAT SEE YA BETTYBOOP692
As for this latest PR campaign. I have not come across a wal-mart that got a 6% raise. Salary managers got a raise this year, while hourly associates were told they were capped . This are same associates that make wal-mart look good in the books because a new associate makes $6.50 a twenty yr associate make $16.00 it averages out till about $10 .
On another note the store I work at lost 30 people and we have been able to replace them because even the local pizza place hires at $7.25 hr.
Just my 2 cents hope someone listens
water@alloymail.com
Is this $10.00 per hour average for an hourly associate something that you know, or where told to say?
Please go to your nearest Wal-Mart SuperCenter to the Electronics Dept., purchase a $1.00 calculator, use your 10% discount card, pay .90 cents plus tax and do the math:
A) By Seniority Less than 1 year
2-5
6-10
11-15
16-20
21-25
25-30
31+
B) By Store/SuperCenter Age Use Same Formula
C) By Division
D) By Region
Now, we get a whole set of new true numbers. Please share them with us, and do tell the truth.
P.S. CBS, there are great ideas here, do implement them.
I Love Betty Boop's comment.
If, I EVER saw JUST one member, just ONE member of the management team -EVER- practice the 10' Rule, to ANYONE (Customer or Associate), I would lay down and join Mr. Sam for the biggest SHOCK of MY life. Get out the defib.
Move over Jerry Springer, stop chasing Paternity Revalations, and star a show for former Wal-Mart Associates. Forecast: Make your Stock purchases (on The Springer parent company) now.
Why don't we leave if we aren't happy? Because I MADE this company what it is today and I shouldn't have to. I actually believed in the "Old Wal-Mart" When I was hired I was told the sky was the limit and that "our people make the difference" What a crock that turned out to be. I gave Wal-Mart the best working years of my life. It probably wouldn't be possible to start over this late in life-who is going to hire a 50+ year old woman who has worked at Wal-Mart for the past 20 years?
Seriously, Lee. If you want to get a true vibe about what your associates (who are also CUSTOMERS) think about the company and its current changes and direction, you need to get out into the stores UNANNOUNCED and ask us. Specifically those of us who have 10+ years with the company. I can tell you for a fact, I won't support a company who doesn't support me. I will not buy Wal-Mart stock, and have changed my profit sharing and 401k distribution to not invest in Wal-Mart stock. I suggest others do the same.
When making your UNANNOUCED SURPRISE MYSTERY VISIT, do dress as a blue collar worker, make a small purchase; bottle of water, candy bar (don't use your discount card). Stand in the longest line, listen and hear; your customers, the pages, the attitudes. Then after checking out, try and locate a CSM, or any other associate who will page a "manager" for you, tine how long the "manager's" response takes, complain - about anything (check out the bathroom's) and listen to their response.
The closeing of layaway and Fabrics(most stores) and soon the closing the paint and sporting goods counters i hear as well is making this onetime giant company a soon to be small fry in the retail world.
as someone said before by phasing out thier job they will get less pay with Walmarts Union type payscale.
Think about it.. they close layaway/fabrics/paint counter/sporting goods counter.. That's about 15 peoplle who will lose thier job and be absorbed into the store as a reguler worker and recive less money after thier pay is taken away from them due to thier new job code.
And the news about the new race based stores sounds crazy.. this is america and i don't feel like working in a store where everything is in spanish or some other language.
I'm not racist, in fact i am of mixed races.. but how am i supposed to work/shop in a store where i can't read the signs.
And when they were making their plans they forgot that we as associates are shareholders too- or in my case- used to be. I will not own stock in a company I don't beleive in.
we made it what is today. if i had known when i hired in that my job would end up like this i would not have stayed this long. i feel betrayed. i have honored my contract with wal-mart can they say the same.
a very diappointed associate.
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