[North-NV-Greens] Fwd: Inside the Wal-Mart Leviathan

Sun Dec 12 00:49:47 PST 2004

>
>Review: Inside the Leviathan
>
>By Simon Head
>
>
>New York Review of Books
>Volume 51, Number 20
>December 16, 2004
>
>----------------------
>BOOKS AND DOCUMENTS MENTIONED IN THIS ARTICLE
>
>Wal-Mart: Template for 21st Century Capitalism?
>edited by Nelson Lichtenstein
>Papers presented at a conference on Wal-Mart held at
>the University of California, Santa Barbara, April 12,
>2004.  New Press, forthcoming in 2005
>
>US Productivity Growth, 1995-2000,
>Section VI: Retail Trade
>a report by the McKinsey Global Institute
>October 2001, at
>www.mckinsey.com/knowledge/mgi/productivity
>
>Selling Women Short: The Landmark Battle for Workers'
>Rights at Wal-Mart  by Liza Featherstone
>Basic Books, 282 pp., $25.00
>
>Nickel and Dimed: On (Not) Getting By in America
>by Barbara Ehrenreich
>Owl, 221 pp., $13.00 (paper)
>
>Betty Dukes, Patricia Surgeson, Cleo Page et al.,
>Plaintiff, vs. Wal-Mart Stores Inc., Defendant:
>Declarations in Support of Plaintiffs
>United States District Court, Northern District of
>California, at www.walmartclass.com
>
>Everyday Low Wages: The Hidden Price We All Pay for
>Wal-Mart
>a report by the Democratic Staff of the
>House Committee on Education and the Workforce
>February 16, 2004, at
>edworkforce.house.gov/democrats/walmartreport.pdf
>1.
>------------------------
>
>
>Throughout the recent history of American capitalism
>there has always been one giant corporation whose size
>dwarfs that of all others, and whose power conveys to
>the world the strength and confidence of American
>capitalism itself. At mid-century General Motors was
>the undisputed occupant of this corporate throne. But
>from the late 1970s onward GM shrank in the face of
>superior Japanese competition and from having
>outsourced the manufacture of many car components to
>independent suppliers. By the millennium GM was
>struggling to maintain its lead over Ford, its
>longstanding rival.
>
>With the technology boom of the 1990s, the business
>press began writing about Microsoft as if it were GM's
>rightful heir as the dominant American corporation. But
>despite its worldwide monopoly as the provider of
>software for personal computers, Microsoft has lacked
>the essential qualification of size. In Fortune's 2004
>listings of the largest US corporations, Microsoft
>ranks a mere forty-sixth, behind such falling stars as
>AT&T and J.C. Penney. However, Fortune's 2004 rankings
>also reveal the clear successor to GM, Wal-Mart. In
>2003 Wal-Mart was also Fortune's "most admired
>company."[1]
>
>Wal-Mart is an improbable candidate for corporate
>gorilla because it belongs to a sector, retail, that
>has never before produced America's most powerful
>companies. But Wal-Mart has grown into a business whose
>dominance of the corporate world rivals GM's in its
>heyday. With 1.4 million employees worldwide, Wal-
>Mart's workforce is now larger than that of GM, Ford,
>GE, and IBM combined. At $258 billion in 2003, Wal-
>Mart's annual revenues are 2 percent of US GDP, and
>eight times the size of Microsoft's. In fact, when
>ranked by its revenues, Wal-Mart is the world's largest
>corporation.
>
>One sign of its rising status is an academic conference
>devoted entirely to the subject of Wal-Mart that was
>held last April at the University of California, Santa
>Barbara. The range of subjects covered in the
>conference papers to be published early next year
>testifies to Wal-Mart's impact both on the transfer of
>goods from third-world sweatshops to suburban shopping
>malls in the US and on local communities where its
>stores are located. At the conference the many class-
>action lawsuits against Wal-Mart's employment practices
>were discussed, particularly its unfair treatment of
>women, whether by paying them extremely low wages or
>denying them promotions. The conference organizer, the
>labor historian Nelson Lichtenstein, asked Wal-Mart to
>send a representative, but Wal-Mart declined.
>
>Within the corporate world Wal-Mart's preeminence is
>not simply a matter of size. In its analysis of the
>growth of US productivity, or output per worker,
>between 1995 and 2000-- the years of the "new economy"
>and the high-tech bubble on Wall Street --the McKinsey
>Global Institute has found that just over half that
>growth took place in two sectors, retail and wholesale,
>where, directly or indirectly, Wal-Mart "caused the
>bulk of the productivity acceleration through ongoing
>managerial innovation that increased competition
>intensity and drove the diffusion of best practice."
>This is management-speak for Wal-Mart's aggressive use
>of information technology and its skill in meeting the
>needs of its customers.
>
>In its own category of "general merchandise," Wal-Mart
>has taken a huge lead in productivity over its
>competitors, a lead of 44 percent in 1987, 48 percent
>in 1995, and still 41 percent in 1999, even as
>competitors began to copy Wal-Mart's strategy. Thanks
>to the company's superior productivity, Wal-Mart's
>share of total sales among all the sellers of "general
>merchandise" rose from 9 percent in 1987 to 27 percent
>in 1995, and 30 percent in 1999, an astonishing rate of
>growth which recalls the rise of the Ford Motor Company
>nearly a century ago. McKinsey lists some of the
>leading causes of Wal-Mart's success. For example, its
>huge, ugly box-shaped buildings enable Wal-Mart "to
>carry a wider range of goods than competitors" and to
>"enjoy labor economies of scale."
>
>McKinsey mentions Wal-Mart's "efficiency in logistics,"
>which make it possible for the company to buy in bulk
>directly from producers of everything from toilet paper
>to refrigerators, allowing it to dispense with
>wholesalers. McKinsey also makes much of the company's
>innovative use of information technology, for example
>its early use of computers and scanners to track
>inventory, and its use of satellite communications to
>link corporate headquarters in Arkansas with the
>nationwide network of Wal-Mart stores. Setting up and
>fine-tuning these tracking and distribution systems has
>been the special achievement of founder Sam Walton's
>(the "Wal" of Wal-Mart) two successors as CEO, David
>Glass and the incumbent Lee Scott.
>
>Throughout its forty-year existence Wal-Mart has also
>shown considerable skill in defining its core customers
>and catering to their needs. One of Sam Walton's wisest
>decisions was to locate many of his earliest stores in
>towns with populations of fewer than five thousand
>people, communities largely ignored by his competitors.
>This strategy gave Wal-Mart a near monopoly in its
>local markets and enabled the company to ride out the
>recessions of the 1970s and 1980s more successfully
>than its then larger competitors such as K-Mart and
>Sears.[2] Wal-Mart has also been skillful in providing
>products that appeal to women with low incomes.
>
>to read more, go to
>
>http://www.nybooks.com/articles/17647
>
>_______________________________________________________
>
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-- 
Paul Etxeberri

"Forests precede civilizations and deserts follow"   ---Chateaubriand