WalMart- Group C

8/7/2019 WalMart- Group C

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The Good and Bad of Wal-Marts

Culture

Members:

Rewati Limaye

Madhavi Karra

Vishwa Patel

Utsav Parasrampuria


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Question 1

INTRODUCTION

Wal-Mart was owned by SamWalton.

He was born on March 29, 1918 in Kingfisher, in the state of Oklahoma.

First exposure of retailing.

1940- Graduated

1942- Army Captain till the second world war(1945)

1943- Married

O n the return from army , decision to start a retail store.

Took loan to set up Ben Franklin Variety store in Newport.


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Important Operational Policies

Store Location

Purchasing in bulk

Longer hours of working


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Brief History

Early 1950, Lost his store

In July 1950- second store

Handed it over toWillard walker ( concept of profit sharing)

Walton ideas changed the retail world

Individuals dont win but teams do". Employee

compensation with the profits of stores

1950- Waltons family center.( many retails stores)

Concept of limited partnership

1962, Focus Strategy- business in rural towns

Central location was Arkanas


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Growth Phase

1967- Expansion to 24Wal-Mart stores

1968- Change of central location

1970- First distribution center & home office in the central location

1970- traded for the first time as Public Limited Company in over the

counter stock trading and also approved and listed in the New York Stock

Exchange

1975- 125 stores, with $ 340.3 million, 7500 employees.

1977- 16 Mohr value stores

1978- purchased different in its stores

1980-276 stores $ 1.4 billion ( rural areas, strong demand led to the rapid

growth)

1984- 640 stores,$ 4.5 billion and profits of $ 200 million


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Continued.

1988- David Glass as CEO ofWal-Mart

Initiation of Hyper mart discount store/ supermarket chain

Wal- Mart supercenters

1990- acquired McLane company ( grocer and retail distribution)- new

retail format- Buds discount city.

1991- first overseas store in Mexico

1992- autobiography- 10 principles of Retail ofWal-Marts success

Death ofWalton on April 5, 1992

1999- largest private employer in US with 1,140,000 Associates, same year Corporate citizen of America

1999- Strategic alliance with AOL for the easy accessibility ofWal-Marts

website as well as to push AOLs software.


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Recognition

In 2000- H.Lee Scott as President and CEO ofWal-Mart stores Inc.

with sales of $218 billion in 2002,Wal-Mart overtookExxon Mobil.

In the same year it created a new retail record sales in all stores totaled

$1.43 billion on a single day, amount bigger than the GDP of36 countries

in the world.

In 2003,Wal-Mart featured as the most admired company in the world in a

survey conducted by FORTUNE.

In the fortunes history this was first time in history that he worlds

biggest corporation was also its most respected one.

In 2003, it reported sales of$244.5 billion with a net income of $8.03billion.


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Store locations till 2003

Wal-Mart had become the worlds largest retailer with a total of 4688

stores (3,400 stores in the US and 1288 stores internationally).

Wal- Mart had operations in

Argentina

Brazil

Canada

China

Germany

Mexico

Puerto Rico and

United Kingdom


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HR practices

Equality and oneness among employees( Associates)

Reduction of costs in the recruitment

Profit- sharing

Performance linked compensation First-in-Line program.

Associate in Critical Need Trust.

Wal-Mart cheer

Customer Oriented Approach

Sundown Rule

10 foot rule fine tuned byWalton.

EDLP- Everyday Low Price.


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Key Strengths

According to us the major key strengths of the

company are:

Cost-Leadership

Customer Oriented Approach

Profit Sharing


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Areas ofImprovement

The company is global, but has a presence in relatively few countries

Worldwide.

SinceWal-Mart sell products across many sectors (such as clothing, food,or stationary), it may not have the flexibility of some of its more focused

competitors.

Few Women involved in top management positions.


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Wal-Marts Competitive Strategies

To achieve competitive advantage two basic strategies

adopted were:

Differentiation strategy ( Cost Leadership

strategy)

Focus strategy( store location)


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Wal-Marts culture

Wal- Marts culture was mainly built on three basic beliefs in

1962. They were:

oRespect for the individualo Service to customers

o Strive for Excellence


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Question 2: Competitor-TESCO

We would recommend Tesco to look into Wal-MartsWeaknesss and ask

them to convert it to their strength.

The Corporation is huge but still has presence in 14 countries.

Customers sometimes are curious about the quality of products.

Keep poor performance employees on hand.

The market share is low outside the US market.

Supplier profit margin is very low.


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The 10 Foot Rule

The 10-foot Rule is one ofWal-Mart's

secrets to customer service.

During his many store visits, SamWalton encouraged associates to

take this pledge with him: "I promise that whenever I come within

10 feet of a customer, I will look him in the eye, greet him, and ask

if I can help him.


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The Sundown Rule

SamWalton created the Sundown Rule.

Its really just a twist on why put off until tomorrow what you can do today?

Observing the Sundown Rule is very simple.Whether it's a request from a store

across the country or a call from an associate down the hall, we do our very

best to give our customers, and each other, same-day service.


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Making Work Fun ! !

THE WAL-MART

CHEER !


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Question 3: Key Advices Wal-Mart has been in the news for many wrong reasons and a lot of negatives with regard to its operations have been greatly

highlighted in the press.

It has been criticized by womens rights groups and other community organizations and there are many high profile court

cases against it due to alleged discrimination against women employees in terms to lower wages than their male counterparts

and also with regard to promotions and management opportunities.

This kind of bad press reflects very badly and there may be truth in that as it has been endorsed by thousands of current and

formerWal-Mart female employees.

In this regardWal-Mart should take affirmative action and ensure that the amount of managerial women employees reflects

the actual percentage of women that are working in Wal-Mart and also ensure that needs of women working are addressed.


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Another criticism that has been alleged againstWal-Mart is that it pays relatively lower wages for

the amount of work that is done by its associates, and the associates have to suffer due to its mission

of constantly lowering its prices for its customers.

Wal-Mart is currently taking some steps in this regard like offering healthcare and wellness benefits

for its associates and having overtime pay, and also using advanced IT systems to ensure that

employees are paid accurately and in time for the amount of work that they are doing.

HoweverWal-Mart should understand that the associates, who work so hard to ensure the high

standards that have been set should be treated fairly and should try to rationalize their wages or offer

other benefits that would ensure that they are able to maintain a good standard of living


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To manage an issue and prompt a very quick resolution,Wal-Mart has a open door policy where an

associate can walk up to an discuss with the store manager or supervisors any of the problems that they are

having. In addition to this, Wal-Mart should have outer outlets for employees to address their concerns as

some of the employees may not want to go through this channel due to various reasons such as for the fear

of being reprimanded or not having confidence in the store management that they would resolve the issue.

This can be one reason why so many issues has escalated into the major problems that have gone outside

Wal-Mart and it receiving very bad publicity for it. Also as Wal-Mart is strictly opposed to unions, there are

no other outlets for employees to raise concerns or openly negotiate with the management.

Therefore it is recommended that in addition to the open door policy and the direct communication channel,

there must be a host of other communication channels both at the store level and at the corporate that

specifically looks at these issues and addresses them, and this reduce employee grievances as soon as

possible


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Question 4

Be Flexible:

Managers have some discretion about when people get to use their time off

or whether they need to be in the office everyday at a certain time. Some

jobs don't allow for as much flexibility such as manufacturing assembly

lines or hospital operating rooms; however, most office jobs have some

degree of flexibility. As long as it isn't abused, an occasional favor for an

employee who needs to do something important will go a long way to

making them feel good about their organization. So, showing theWal-Mart

employee that their Job could be flexible enough could be a plus point on

our side.


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Provide opportunities:

Top performers especially are seeking opportunities to improve their skills, make acontribution, and get promoted. As a reward for top performance, you can provide some

special opportunities for additional skill development through training or working on

special projects for the business.We can consider them for promotions and even lateral

moves that will allow them to expand their skills and learn new things. The best people

have a desire for keep abreast of new trends and this can help your business too. Tellthem that they will be sent to attend conferences or association meeting and have them

give a report to the team. This not only gives them the opportunity to learn, but also lets

them enjoy a moment in the spotlight with their team.


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Keep intouch:

People like to be recognized, and they especially like it when their boss pays attention to them. Even

the most self-actualized people like the recognition bestowed by a personal relationship with people

at the top. They like to be appreciated. This will cost you very little to do, perhaps a lunch or two,

but will be a good investment. Having one-on-one meetings with your direct reports or skip level

meetings with people who indirectly work for you is also a good way to keep in touch with what is

going on in the business.We need to know that these people are often closer to the customers and

aware of operational issues that you will want to know about.

It is easy to do, but it is often overlooked. This is one reason why people leave an organization. And

if a company understands this then they will always be able to retain their customers.We need to

take opportunity and recognize top level management ofWal-mart and give them credit for what

they are doing. And appreciate their work.


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Conclusion Wal-Mart without a doubt can be said to be one of the companies of the century and a symbol of how one

mans vision can make a great difference to the entire world. It has got very well defined processes backed

by technology that has enabled it to scale up its business to become the worlds largest private enterprise.

Even through it is not the best paymaster, by creating a culture of customer service and high performance,

and by making them owners in the core business processes through trust, it is able to motivate its

employees to achieve greater things and strive for excellence.

However there are some areas thatWal-Mart needs to concentrate on to achieve its goal of makingWal-

Mart a great place to work for its associates and provide them with a professional experience that will make

them better


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