BUS 320 Winter 2019: Walmart Managerial Strategy Evaluation

This report provides a comprehensive analysis of Walmart's managerial strategy, examining its internal structure, organizational context, and the most appropriate managerial approach. The report explores the factors influencing Walmart's operations, including its core competencies, employee treatment, and market competition. It identifies the high-involvement strategy as the most suitable approach, emphasizing employee rewards and participation in decision-making. The analysis contrasts the suggested strategy with Walmart's current classical management approach, highlighting discrepancies in employee satisfaction and motivation. The report further assesses the alignment of the reward system with the managerial strategy and offers recommendations to improve employee morale and align reward systems with the adopted managerial strategy, ultimately aiming to enhance overall organizational productivity and customer service. The report also references various sources to support the analysis and findings.

Running head: MANAGEMENT
Management
Name of the Student
Name of the University
Author note

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Table of Contents
Overview of Walmart.................................................................................................................2
Factors Dealing with Internal Structure.....................................................................................2
Factors Dealing with Organizational Context............................................................................3
Most Appropriate Managerial Strategy......................................................................................4
Analysis of Managerial Style.....................................................................................................4
Analysis of whether Managerial Strategy is in Use...................................................................5
Matching of Reward System with Managerial Strategy............................................................6
Recommendations......................................................................................................................6
References..................................................................................................................................8

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Overview of Walmart
Walmart is an American multinational company which operates a chain of grocery,
hypermarkets and discount departmental stores. The company is headquartered at
Bentonville, United States and it was founded in the year 1962. The founder of the
organisation is Sam Walton and the areas served by them is worldwide. The number of
employees working is 2.3 million in worldwide till 2017 (Walmart.com, 2019). The
significant characteristics of Walmart include the service provided by them to the customers
along with striving for excellence. The innovative aspects adopted by them helps them in
improving the facilities and serving the customers is the priority. The revenue earned by the
organisation is US$500.34 billion till the year 2018, and total equity earned by them is
US$77.869 billion.
Factors Dealing with Internal Structure
The core competence of the company is inclusive of the use of information
technology which supports international logistics system. Through the help of this, Walmart
can see the performance of individual products worldwide.
Furthermore, people are the key to the business of Walmart, and the company invests a
considerable amount of time in training and retaining the developing team. Additionally, the
scale of operations which is afforded by Walmart is such that they can achieve economies of
scale regarding the volume of the product sold by them. The products can be offered to
customers at a lower price which will be difficult for the competitors to beat them (Batra &
Vohra, 2016).

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Figure 1: Comparison of Top Five Retailers
(Source: Walmart.com, 2019)
On the other hand, the treatment provided to employees such as discrimination and
unequal wages and promotions to individuals has tarnished the brand reputation of the
company. Due to the same, there is high turnover among employees, and there are no such
CSR practices adopted by them. Lastly, there is no such differentiation between stores
which affects their overall operations.
Factors Dealing with Organizational Context
There are different opportunities and threats which are being faced by Walmart that
affects the overall efficiency and productivity of the firm in both negative and positive
manner.
Threats
Aggressive competition is one of the major threats which is faced by Walmart as the
other competitors are trying to include the different healthy and organic items which are

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becoming a threat to the company. As to overcome the same, the presence of Walmart
through online channels is mandatory (Forbes.com, 2019).
Legal and other regulatory pressures are affecting the brand image of the company
as the company do not follow any kinds of compliance and there have been different lawsuits
against them. Additionally, the economic factors create a significant impact on the
profitability of the brand which has led to lower profitability in the market (Forbes.com,
2019).
Opportunities
Change in the style of HR management is one of the significant opportunities
wherein it will be the inclusion of creativity and innovation. It will be helpful in improving
the brand image and creating a positive framework which is essential for organizational
productivity and effectiveness (Nguyen et al., 2017).
Improvement in standards of quality is the other opportunity which will be
improving the quality standards which will be helpful in addressing the concerns of the
consumers at low cost (Temminck, Mearns & Fruhen, 2015).
Most Appropriate Managerial Strategy
The most appropriate managerial style which can be used in Walmart is High
Involvement of Employees as the employees are required to be rewarded for their opinions
and those opinions should be considered in the process of decision-making in the
organization. Furthermore, there are different competitors of Walmart such as Woolworths
and Tesco; therefore the change in the HR management approach will bring flexibility in the
completion of tasks and achieving the goals.

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Analysis of Managerial Style
As per the High Involvement of Employees, it can be helpful in increasing the
efficiency of the employees which will lead to an increase in overall productivity in the
organization. the high-performance work teams are mainly focused on learning along with
continuous improvement to find and suggest better ways to perform the tasks in the company
(Pee & Lee, 2015). The managers in the high-performance teams focus on continuous
learning as this will improve the career development. Providing workers with autonomy is the
best manner to keep them happy which will enhance the overall productivity. In the high-
involvement teams to work, the workers need to be knowledgeable in the fields which will
improve the morale of the employees.
Analysis of whether Managerial Strategy is in Use
According to me, the managerial approach which is being followed at Walmart is
different from the suggested managerial approach. The managerial strategy used by
Walmart is the classical approach as it can be analyzed that in Walmart, there is no such job
satisfaction among the employees that has decreased the morale of employees negatively. In
Walmart, the primary specialisation of the profit maximization that has affected the overall
organizational performance in a negative manner (Pee & Lee, 2015).
The Classical Management Theory is not being utilized by various companies as there
is a different shortcoming of the same. In the classical management approach, the feelings of
the employees are not being considered, and it affects the overall productivity of the
organization negatively. It has been noticed that when the employees are putting forth their
emotions, those are not considered and it impacts the overall efficiency of the organization
negatively (Odoardi et al., 2015).

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The turnover among the employee's increases as the different employees fails to
develop the relationship with the business as they feel it is not the satisfying job and they
deserve a better job satisfying job for their survival (Faletar et al., 2016). On the other hand,
there are few advantages of the classical management approach as there is the division of
labor wherein the job roles and responsibilities of the employees are being considered and
due to division of work, it is helpful in increasing the overall productivity to a great extent
and the business owners benefit from the same.
Matching of Reward System with Managerial Strategy
The reward system matches with the classical management approach as the
employees are not being considered necessary for the organization as the primary motive of
Walmart is to strive for excellence regarding providing best services to the customers in the
market. In the classical approach, the employees are not offered with job satisfaction which
has demotivated the employees, and it has led to the employee turnover (Kamphorst &
Swank, 2018).
During 2017, it was being noticed that Walmart has increased the compensation
packages of the workers as this will involve the proper customer service in the market. It is
quite similar to the classical managerial approach as the primary motive is the customer
satisfaction, and the employees are being rewarded in such a manner which will be based on
competence and their ability to perform the tasks to improve their ability to satisfy the needs
of the customers.

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Recommendations
From the above, it can be seen that there are few recommendations which can be
provided to Walmart as to improve the morale of the employees and to allow the reward
approach to matching the managerial strategy which has been adopted by Walmart.
Firstly, Walmart needs to improve the managerial approach wherein the main motive
requires to improve the overall job satisfaction among the employees. The employees are
expected to be treated as the assets which will be beneficial for them in improving the overall
morale of employees and gain colossal productivity.
Furthermore, Walmart needs to improve the HR management officials who will be beneficial
for the company to motivate the employees through arranging career development programs
which play a vital role in enhancing the customer service along with making employees the
priority.

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References
Batra, S., & Vohra, N. (2016). Exploring the linkages of cognitive style and individual
innovativeness. Management Research Review, 39(7), 768-785.
Faletar, J., Jelačić, D., Sedliačiková, M., Jazbec, A., & Hajdúchová, I. (2016). Motivating
employees in a wood processing company before and after restructuring.
BioResources, 11(1), 2504-2515.
Forbes.com (2019) Minimum Wage Hikes Won't Solve Walmart's Customer Service Problem
(online) Retrieved from
https://www.forbes.com/sites/panosmourdoukoutas/2018/03/18/minimum-wage-
hikes-wont-solve-walmarts-customer-service-problem/#51dfb09d1e09 [Accessed on
30 January 2019]
Kamphorst, J. J., & Swank, O. H. (2018). The role of performance appraisals in motivating
employees. Journal of Economics & Management Strategy, 27(2), 251-269.
Nguyen, T. T., Mia, L., Winata, L., & Chong, V. K. (2017). Effect of transformational-
leadership style and management control system on managerial performance. Journal
of Business Research, 70, 202-213.
Odoardi, C., Montani, F., Boudrias, J. S., & Battistelli, A. (2015). Linking managerial
practices and leadership style to innovative work behavior: The role of group and
psychological processes. Leadership & Organization Development Journal, 36(5),
545-569.
Pee, L. G., & Lee, J. (2015). Intrinsically motivating employees’ online knowledge sharing:
Understanding the effects of job design. International Journal of Information
Management, 35(6), 679-690.

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Temminck, E., Mearns, K., & Fruhen, L. (2015). Motivating employees towards sustainable
behaviour. Business Strategy and the Environment, 24(6), 402-412.
Walmart.com (2019) Save Money. Live Better (online) Retrieved from
https://www.walmart.com/ [Accessed on 30 January 2019]
Zhao, X. R., Ghiselli, R., Law, R., & Ma, J. (2016). Motivating frontline employees: Role of
job characteristics in work and life satisfaction. Journal of Hospitality and Tourism
Management, 27, 27-38.