Wal-Mart Announces New Procurement Exec

Quite often, when an executive is named the head of procurement and / or supply chain for an organization, the headlines describe the person's past track-record (or newfound focus) on reducing costs and improving efficiency. That's why it raised a few flags when I saw this announcement yesterday naming Lawrence Jackson as President and chief executive of global procurement for Wal-Mart. According to the announcement, Jackson will "head up purchasing offices in 28 countries as well as ethical standards teams responsible for oversight of factories and labor laws." While I have no issue with the "ethical standards" role, in my view, ongoing cost reduction and operational efficiency should be job one -- and should be called out -- for someone in his shoes. For if Wal-Mart can't continue to drive new efficiencies and pass those savings on, what differentiation will they provide? In the US, Target and Costco (while not always as inexpensive as Wal-Mart) present a much better shopping environment in my view. Wal-Mart differentiates on operational efficiency and scale, and they should not be afraid to continue to hammer this point home. Pandering to critics by prioritizing procurement's role overseeing "ethical standards" and "labor laws" from a PR perspective is a waste of time.

Jason Busch

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