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• The Wall Street Journal features an interview this morning with Eduardo Castro-Wright, CEO of Walmart’s US stores division, in which he addresses both the company’s resurgence during tough economic times and other issues confronting the company.

Regarding the three-year plan that brought the company to the point where it could take advantage of a declining economy, Castro-Wright says, “First, we had to reinforce our price leadership. We needed to ask ourselves what we stood for and it was more than just low prices, but [rather] saving people money to make their lives better. That gave us a unifying marketing message and gave 1.3 million associates a powerful sense of purpose.

“Then it included everything from improving navigational signs in the stores so people could find things more easily to investing in technology to allow for a faster checkout. We took down high shelves to reduce clutter and improve sight lines throughout the store.

“We learned that providing customer choice wasn't about more products, but carefully selected products that customers cared about. We made big bets in growth categories such as consumer electronics, providing brands that gave us authority. It's still not finished yet.”

And, he adds, The one thing I would do differently is I would have done things faster, which is counterintuitive. When you think about changing a big organization rooted in its history, you think the changes should be gradual. I think that the faster you move, the faster you make the tough calls and the better off you're going to be. You don't want to have organizations in what some people think of as a liquid state. I'm an engineer by training so my physics comes back. An organization is something very solid and when you apply a lot of heat to change it, it becomes fluid. You want to make sure that you don't keep it fluid too long, because liquids move in many directions that you might not have intended.”

Interestingly, Castro-Wright downplays the current economy’s role in the company’s comeback: “I wouldn't say a significant part of the current results is related to the economic environment. The changes in merchandising, marketing and improved service in the stores ... have vastly improved the shopping experience, and that will continue to drive sales after the economy rebounds.”

KC's View:
I think he’s got that half right. I think Walmart did what it needed to do to get its retailing house in order…but if the economy wasn't in turmoil and if customers weren't in a recessionary mindset, I don't think Walmart would be doing quite as well as it is a present time.