The Expensive Decision Walmart’s CEO Made That Changed Everything | WSJ

My name is Doug McMillan. I'm a Walmart associate and I've been around for a long time.

>> For 35 years, Doug McMillan has worked at Walmart the last 12 as CEO in charge of the country's largest retailer.

>> My dad told me to make some money to pay my way through school. McDonald's,

Craft, Walmart were the three employers of young people here in Bentonville at the time. Um, the Craft Cheese Plant

the time. Um, the Craft Cheese Plant didn't call me back. McDonald's paid 335 and Walmart paid 650. He first joined as an hourly worker in a warehouse in the

summer of 1984 after his junior year of high school.

>> 35 years. How do you feel?

>> Emotional, excited. Um, you know, first and foremost, I think the company's in great hands.

>> When McMillan became CEO, a lot of people didn't like Walmart very much and sales were weak. To many, it was a poor employer and seller of cheap stuff.

McMillan focused on improving stores, raising wages, and online growth. Sales

went up. On the eve of his last day as CEO, McMillan sat down with the Wall Street Journal. Think back to 2014. How

Street Journal. Think back to 2014. How

did you think about that challenge at the time?

>> I was really interested in e-commerce, as were some of the rest of us. But the

first thing that had to be done was to get the Super Center comps growing. And

I traveled around the country and asked our associates, "What needs to happen?"

And they said, "You need to raise our wages. you need to give us um some

wages. you need to give us um some schedule certainty. You need to get the

schedule certainty. You need to get the inventory out of the back room and get back to everyday low price. We need some department managers back. We need to lower our prices. The team and I brought that plan back to our board in 2014 and

said, "The bad news is it's really expensive." And the board said, "We

expensive." And the board said, "We agree with that plan. In fact, we think you should be more aggressive. We want

you to raise wages more." And that was the right thing to do. And once those changes started to take place, we started to get some momentum in the super centers which gave us breathing room to get more aggressive in e-commerce.

>> You know, in those early years, you made some big acquisitions. There was Jet, there was Flipkart. Looking back now, we've sort of ended up where you began, which is Amazon is closing most of its

physical stores, and you've grown incredibly on a grocery business online, too.

>> We thought in the United States we could win food e-commerce. We had great food close to people and people were saying, "Well, you're not going to put bananas in a brown box and ship them through

FedEx, so how would you even do e-commerce food?" But we knew there was

e-commerce food?" But we knew there was a way to do this um that would leverage the stores and would involve last mile delivery.

>> Back in 2016, Warren Buffett started to sell his Walmart stock and I think got out of Walmart by 2018, around there.

Got a lot of attention at the time, right? Have you talked to him since

right? Have you talked to him since recently? Have you have you gloated to

recently? Have you have you gloated to him a little bit?

>> No. No, I would not do that. That's a

funny question though. I like him a lot and I've been blessed to spend some time with him. So, when he started selling,

with him. So, when he started selling, it hurt my feelings. But I didn't say anything. We just went about our

anything. We just went about our business and I had confidence that our plan would work. I finally called him and I said, "Warren, I just have to know was it is it me? Like what is this statement?" And he basically said,

statement?" And he basically said, "Retail is changing so much and e-commerce is the future and I just don't know what to make of brickandmortar retail anymore." And I said, "Well, I respect that. There is a lot of change going on, but we're going

to be one of the winners and I hope to see his I've seen him a few times since then, but I would I would never bring that up, but I wish he had stayed in because he would have done well."

>> Yeah. The numbers don't lie. You're

known for being a pretty calm person and having a calm leadership style.

Obviously, you're in a very stressful job. How do you manage your own stress

job. How do you manage your own stress and I think in a in modern terms, your own mental health through all of this?

>> Have a great family. I think faith and family help and I'm also not alone.

Sometimes people will say the CEO job can be lonely and I can kind of understand that if you let it be, but I haven't felt that way. The things that have been hard have been the things you can't control. Like the shooting in El

can't control. Like the shooting in El Paso was the worst day I ever had working at Walmart and our associates did an amazing job recovering from that.

The pandemic was hard. There are things like that that you can't control that you have to lead through. How do you set that tone that allows people to take

risks and be be weak sometimes and fail, right? But also keep working hard and

right? But also keep working hard and doing good work.

>> You have to do that yourself. So, I've

made plenty of mistakes. You can't be a buyer at Walmart without making mistakes. So, you learn how to say,

mistakes. So, you learn how to say, "Yeah, I messed that up. That price is wrong or that item's wrong and I'm fixing it." And if if my approach is

fixing it." And if if my approach is that way, um, then everyone else can feel safe doing that. As someone who has faced this dilemma many times in your

career, what role do you think CEOs should play in society and in speaking out?

>> I don't get up every day thinking about politics. I get up every day thinking

politics. I get up every day thinking about how we serve customers better and thinking about our associates. They're

people though and these issues matter to them. And so what happened over a period

them. And so what happened over a period of years is there were things that occurred where our own associates were like, "We want to hear something from you on this subject." And a number of things happened in a series that led

businesses to to commenting more often.

In my case, I should be doing everything I can from a practical point of view to make people that work at Walmart feel heard and included. They've got to be happy or customers won't be happy. That

is the primary focus.

>> Do you think CEOs should be speaking out about what happened in Minneapolis the last few weeks?

>> Some have and and I think that's appropriate. Most of them are in

appropriate. Most of them are in Minnesota, which makes sense. I think

everybody's going to make their own choice about what they say and how they say it. You know, sometimes a private

say it. You know, sometimes a private conversation is more effective than a public statement. Sometimes if it's

public statement. Sometimes if it's already been said, there's not a lot of value in adding even more to it. So,

it's a case by case decision.

>> What are in your mind the biggest challenges that you worry about for Walmart in the future?

>> Walmart's navigation of AI is going to be really important. I think the foundations that we have here like peopleled techpowered we we have a servant leadership culture we have this

purpose we should keep those things strong and remain human put people first associates customers that's who we're serving secondarily be great with

technology technology is going to enable us to do things for customers we were only able to dream of in the past and AI is going to play a big role in that >> so what's next I I can't fully picture

you just retiring. You're quite young.

What do you want to do next?

>> I don't know. Um I've been working since I was a child and I've not had a blank calendar. I haven't had a moment um like

calendar. I haven't had a moment um like this. So, I'm kind of excited about

this. So, I'm kind of excited about doing nothing in addition to the Walmart responsibilities for a while. I don't

know how long I'll hold off. I'm just

going to take some time and pray about that and be quiet about it and I think the path will illuminate. Have you ever considered or are you considering now running for political office?

>> No, I am not a politician.

>> Are you sure?

>> I'm sure.

>> This is like wild. I'm like, what's going on in your head? Are you okay?

Like, how's it going?

>> I have not had an ugly cry yet. I'm

trying to avoid that.