Walmart Reveals How it Kick-Started Sustainability
Early sustainability discussions at Walmart were fraught with conflict and argument as the group tasked with the effort realized that every time someone at the company makes a decision, there are 100 unintended consequences, according to former vice president of strategy and sustainability Andy Ruben.
“I can barely describe just how many nights we spent just hashing it out and fighting and arguing about how we were going to live up to our potential,” Ruben recalls.
Ruben made the comments in “Walmart’s Sustainability Journey: Andy Ruben and the Design of Strategic Goals and Processes,” one of seven case studies that make up the Walmart Sustainability Case Project. The project is an in-depth analysis based on 30 interviews, 25 of which were with current or former employees of Walmart, and will be used to teach business students at the University of South Carolina about sustainability and business development.
According to the Ruben case study, after Walmart’s then-CEO Lee Scott kicked off a bold plan in 2005 to create zero waste, sell sustainable products and use 100 percent renewable energy, the retailer faced the mammoth task of designing processes and goals for an enormous organization that employed 1.6 million people, served more than 138 million customers and tracked some 68 million stock keeping units every week.
Ruben was tasked with translating long-term vision into operable actions. Four key issues required immediate attention: setting strategic goals and processes to translate Scott’s vision into operable programs and activities; creating stakeholder engagement strategies to bring new ideas into the organization; initiating educational efforts to develop and spread new mindsets and expertise throughout Walmart; and building a sustainability office to lead these efforts, according to the case study.
He grappled with whether to develop a strong, centralized sustainability group to define and implement strategic priorities or to continue with the bottom-up style of experimentation and trial that had characterized decisions up to that point.
Ruben also knew observers would want measurable results of whatever sustainability strategy was implemented. He ultimately determined to include projects that provided fast, observable returns and would be easily recognized as beneficial as well as long-term initiatives that had the potential to achieve significant improvements compared with historical benchmarks, the case study said.
Ruben’s sustainability team broke projects into three groups based on the scale and timing of their impact: quick wins; innovative projects designed for one- to three-year paybacks; and game-changers that entailed changes in traditional business practices and required longer-term planning.
Ruben also understood there was outside stakeholder pressure on Walmart from nongovernmental and activist groups and any public promises, beyond the broad goals initially set, could backfire.
The sustainability team used a litmus test to judge every project independent of its media value. “The test was, if you want to do X, would that be something you would if no one ever knew about it?” said Ruben.
The process had uncomfortable and challenging moments as well, including when Walmart first agreed to meet with outside environmental groups, and as it struggled with how to change the mindset of executives and balance environmental impact with business profitability, according to the case study.
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