In 2015, Walmart’s new CEO risked billions, ignored the experts, and rewrote the rules of American business.
He raised pay for hundreds of thousands of Walmart employees, adding billions in extra costs. Within hours of the announcement, the stock plunged 10%, wiping out more than $20 billion in market value.
Analysts called it reckless.
Pundits said he had caved to political pressure.
Investors were furious.
But Doug McMillon didn’t flinch. He wasn’t trying to please analysts. He was focused on fixing a business that had lost its way.
At the time, Walmart’s stores were understaffed, morale was low, and customers were frustrated. Turnover was sky-high. Shopping there was often a bad experience.
The company that once defined low prices and efficiency had grown bloated and tired.
Walmart’s turnaround began where few expected — by investing in its own people.
McMillon saw what Wall Street didn’t: the real problem wasn’t expenses, it was execution. And the only way to improve execution was to invest in people.
That single decision, raising pay, wasn’t an act of charity. It was sound business.
By increasing wages and improving training, Walmart stabilized its workforce. Turnover fell. Stores became cleaner, shelves stayed stocked, and service improved.
Over time, those changes rippled through the entire company.
Customers came back. Sales rose. Walmart’s U.S. business began growing again, and its online operations — once an afterthought — started competing with Amazon.
Today, Walmart’s results speak for themselves.
Revenue has climbed every single year since 2015 and now stands near an astonishing $700 billion.
The stock has more than doubled in the past five years.
The company remains the largest private employer in the United States, with more than 1.5 million workers earning an average of $18 an hour.
That is what happens when a CEO focuses on long-term growth instead of short-term optics.
The irony is that the same analysts who once punished McMillon’s decision now praise Walmart as a model of corporate transformation.
Harvard Business School even turned his strategy into a case study, proof that treating employees well can be one of the best investments a company can make.
Build for Decades, Not Quarters
The lesson here fits perfectly with the American Prosperity approach: we want to own businesses led by CEOs who think long term, take care of their people, and ignore the noise.
That approach boils down to three timeless principles that define every great American business, and every investment we make at American Prosperity.
We like leaders who tune out Wall Street. Analysts are obsessed with quarters. They track margins to the decimal, issue ratings, and pressure management to cut costs or chase trends. But that kind of thinking destroys real value.
Great CEOs, like McMillon, know their job is not to meet this quarter’s expectations — it’s to build shareholder wealth over years and decades.
They make decisions that strengthen the company’s foundation, even if it hurts in the short run. That’s what separates visionaries from caretakers.Treating employees well is not philanthropy — it’s smart business. Workers who are respected, fairly paid, and properly trained take pride in their jobs.
They stay longer, perform better, and create stronger customer relationships. That translates directly into higher sales, smoother operations, and lower turnover costs.The numbers prove it. Since Walmart began investing in its workforce, its U.S. sales have risen every single year. Its employee retention rate has improved by double digits. And the company has expanded into digital retail faster than almost anyone thought possible.
The most successful investors and executives share one trait: patience. They understand that building something great takes time.
America’s most enduring companies, Apple, Costco, Home Depot, and Walmart, didn’t achieve success by cutting corners. They grew by focusing on excellence, people, and consistency.
Short-term traders chase headlines. Long-term builders create wealth.
Doug McMillon’s story is a powerful reminder that doing right by employees and shareholders is not an either-or choice; it’s the same choice viewed from two different time frames. What looks like a cost today can become a competitive edge tomorrow.
When McMillon told investors that Walmart needed to “clean up its house before inviting people over,” he wasn’t just talking about stores. He was talking about culture. He wanted to fix the foundation before building higher.
And that decision — unpopular as it was — has now paid off more than anyone expected.
That is the kind of leadership we look for at American Prosperity. CEOs who are willing to ignore the noise, invest in their people, and build for the long haul.
Because the truth is simple: the market eventually rewards real value. It just takes time.
When management focuses on the long term, shareholders win. When employees feel valued, customers notice. And when a company does both, prosperity follows.
That’s the American way of doing business, and it’s still the best formula for lasting success.
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Regards,
Charles Mizrahi
Prosperity Insider
