The World's Most Influential Companies

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The World's Most Influential Companies

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Wal-Mart

By Adam Aston

Location: Bentonville, Ark.
Industry: Retailing
Annual Sales: $379 billion

With its unparalleled buying power and reach, Wal-Mart has revolutionized retailing and business practices worldwide. Name practically any product category, from groceries to photo processing, and there's a good chance Wal-Mart is the No. 1 player in that space. It became the world's largest retailer by cutting costs to deliver rock-bottom prices. And it made thousands of suppliers do the same. With about 100 million Americans shopping at its stores every week, vendors have no choice. A deal with Wal-Mart can make or break a business.

Wal-Mart has been criticized for allegedly applying its low-cost ethic to people. Critics cite low wages for its 2 million workers, as well as goods sourced from countries where factory conditions are a concern.

Green Machine

But Wal-Mart is determined now to use its sway for good, especially to better the environment. It's pushing to create "zero waste" stores and sell more green products, with its sales of 145 million energy-saving light bulbs already dampening U.S. electricity consumption.

More significant, perhaps, it's forcing Chinese manufacturers to clean up their ways. In November, Wal-Mart told big mainland suppliers that they must become 20% more energy-efficient within three years to stay on contract, and they must disclose more. As incoming CEO Mike Duke told suppliers, "If you sell us tennis shoes, we expect you to know -- we expect you to tell us -- not just where the tennis shoes were assembled, but which subcontractors played a role in making them."

With Wal-Mart's pressure on the world's fastest-growing polluter, the impact could be profound. As sustainability consultant Andrew Winston argues: "Only Wal-Mart is big enough to daunt China's worst practices." Even those who like to blame it for other practices recognize Wal-Mart's power in going green.

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Toyota

By Ian Rowley, with Hiroko Tashiro

Location: Aichi, Japan
Industry: Automobiles
Annual Sales: $283 billion

Forget for a minute that Toyota will soon beat General Motors in vehicle sales to become the world's largest automaker. With the Big Three turning to Washington for life support, that milestone comes at a time when Toyota's own earnings are slumping.

Instead, head to Georgetown Community Hospital in Georgetown, Ky., and ask executives how they were able to trim 30 minutes off treatment times for emergency room patients. The answer: by working with a Toyota affiliate to adopt its fabled production system. No wonder University of Michigan professor Jeffrey Liker calls Toyota "the most influential [and] probably the most imitated company in the world."

Few companies have proven as influential beyond their industry as Toyota. Thousands of companies have studied its lean production methods to cut waste and increase efficiency. The impact is felt in industries from mining to retail. Veteran United Technologies Chairman George David is among the fans.

And since 1992 Toyota has consulted on its best practices through the Toyota Supplier Support Center. The goal is less to generate revenue than to foster goodwill. Toyota often sells services at cost or gives away materials for free. That's probably wise, given continued sensitivities over its impact on U.S. manufacturing.

Ahead of the Curve

Although not immune to the downturn, Toyota continues to change the game in the auto industry. When it brought the hybrid Prius to the U.S. seven years ago, rivals said the technology would never catch on. Today, GM and Ford are producing their own gas-electric vehicles. And Toyota, which has more than 1,000 hybrid-related patents and expects to sell 1 million hybrid vehicles annually within five years, has become synonymous with greener motoring. "There might be an occasional surprise" from competitors, argues UBS analyst Tatsuo Yoshida, "but Toyota will continue to lead."

While Toyota's influence arguably has increased during the financial crisis, the company is suffering. Sales are down, and it got into dubious practices like 0% financing to cut swelling inventory. Like U.S. rivals, it's paying for a rush to build and sell big vehicles. As pickup sales slowed recently, Toyota halted production in a Texas assembly plant.

As Detroit teeters, Toyota has another tool: some $40 billion in cash and securities it can invest in new vehicles and plants. And its expected $5.9 billion profit this year could leave it well-positioned to have even more sway once the economy recovers.

Richard Mia

Saudi Aramco

By Stanley Reed

Location: Dhahran, Saudi Arabia
Industry: Energy/Oil
Annual Sales: $210 billion (est.)

On June 22, Saudi Arabia's King Abdullah said the kingdom would open its taps to cool down soaring oil prices. The Saudi move, which annoyed some fellow OPEC members, helped trigger a subsequent price collapse. For J. Robinson West, chairman of Washington consultancy PFC Energy, the market reaction "was critical in pointing out the ascendancy and influence of Saudi Arabia in the industry."

Much of that clout resides in one company, Saudi Aramco. It allows Saudi Arabia to be a kind of central banker of oil. Every day the Dhahran-based outfit ships around 8 million barrels to industrial powers. It's the world's largest oil producer, controlling almost 10% of global supply. More important, as the only player willing and able to vary production significantly, it plays a critical role in the health of economies worldwide. If it lets prices drift too high, millions worldwide could suffer. Too low, and the Saudi economy gets hit.

Technology Leader

Incoming Chief Executive Khalid al Falih understands his company's influence over global supply. Saudi Aramco has spent tens of billions of dollars to increase capacity and keep fields operating at higher-than-average rates. Among other things, it has used its wealth to become a trendsetter in new technologies such as underground sensors and horizontal wells to squeeze more oil from each field. Andrew Gould, CEO of oilfield services giant Schlumberger, adds that Saudi Aramco's "success in tackling many of the industry's toughest technology challenges is growing."

Saudi Arabia has managed to overrule some of its more radical peers to keep up supply. The kingdom's financial health depends on its ability to successfully manage oil prices through Saudi Aramco. It doesn't always succeed. But the markets listen closely to what the Saudis say.

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