Certainly everyone in the western hemisphere knows about Walmart. However, what may not be as well-known is the story I am about to tell. What makes this tale so remarkable is that it involves technology in the year 1986, yet the moral of the story is as relevant as today.
Thirty years ago, Walmart Stores was in the midst of its meteoric growth. It’s hard to imagine now, but Walmart did not even exist prior to 1962, and by 1990 it was the largest retailer in the Unites States.
In 1986, Walmart was in the process of building the largest private satellite communication system in the U.S., linking the company’s operations through voice, data and video communications.
Wal-Mart’s legal department was not sitting idly by. Led by its first general counsel, Robert Rhoads, and ably assisted by the legal department’s systems administrator, Pat Glisson, the legal department was an early adopter of continuous improvement policies and procedures.
I know this first-hand because Walmart used the original commercial version of Lawtrac – it was a DOS-based program, even pre-dating MS Windows. DOS? That is ancient technology compared with today’s web-based, user-friendly applications. Yet I can state with certainty that Walmart achieved more with its DOS-based software than many law departments of today that have the benefit of much newer software.
So what did Walmart do that yielded such positive results? They simply analyzed their data in Lawtrac in two important ways:
- On a weekly basis, their core team met to review all new claims to set strategy based on prior claims of a similar nature;
- Also on a weekly basis, the same group reviewed all closed claims to see what lessons could be learned so as to hopefully avoid similar situations in the future.
It was through this disciplined process that they had an “ah-ha” moment. In analyzing their closed claims, they realized they had a higher than normal number of claims involving one particular aerosol product. Upon further investigation, they observed what I would describe as a “squeeze the tomato” pattern. In this case however, the “tomato” was an aerosol can. What they learned was that customers would pick up the aerosol can and, human nature being what it is, press the button.
This had the unintended consequence of spraying a fine mist of liquid on the aisle floor. You probably can imagine what happened next. Another customer would walk down the same aisle, hit the slippery substance, and wham! A new slip and fall claim was on its way to the Walmart legal department.
It did not take long for the team at Walmart to spring into action. They approached the vendor whose product was dispensed in the aerosol can with this data. In no time at all, the vendor re-packaged its product with a cap covering the button. Result? No more slip and falls due to fine liquid mists on shiny tile floors.
This is another shining (pun intended) example of the fourth step of a Continuous Improvement Program – namely, Dispute Avoidance. And just as in my blog post of March 13, 2015 involving KONE Corporation, the success both Walmart and KONE achieved was not a result of the technology per se, but how the technology was used that made the difference in the level of success achieved.
I will continue to highlight other law department success stories going forward. While these stories involve companies in different industries, using different technologies, and may cover periods of time that are decades apart, one common thread is almost always present. Each department was led by a visionary general counsel and had on its staff an effective law department administrator that was able to implement the procedures required to achieve the general counsel’s vision.
The point is, regardless of individual departmental characteristics, the same management principles apply in order to implement a successful Continuous Improvement Program.