Project Proposal: Human Resource Issues at Wal-Mart Retail Chain

This project proposal offers an in-depth analysis of the human resource issues prevalent at Wal-Mart, a global retail giant. The study explores the company's operations, including PESTEL and Porter's Five Forces analyses, to understand the external and competitive environments. The core focus is on Wal-Mart's HR practices, highlighting problems such as poor wages, unfavorable working conditions, child labor violations, employing illegal workers, opposition from labor unions, sex discrimination, and health insurance issues. The project delves into the main and sub-objectives, providing a detailed examination of the company's environment, micro-analysis, and marketing mix. It also includes a SWOT analysis to assess Wal-Mart's strengths, weaknesses, opportunities, and threats, culminating in recommendations and a conclusion that summarizes the findings and suggests potential solutions to the identified HR challenges. The project aims to offer a comprehensive understanding of the HR challenges faced by Wal-Mart and their implications.

Project Proposal
A study of the Human Resources Issues in Wal-Mart(Retail chain)
Dep: Information Systems and Information Technology Management.
By: Osuagwu-chijioke Kelechi
Student ID Number: s5025657
Course Name: Applied Project
Instructor’s Name: Dr Sandhu Kuldeep
Department: Information Systems and Information Technology
Management

Table of Contents
Introduction..............................................................................................................................................2
Main and Sub-Objectives.........................................................................................................................2
Environment.............................................................................................................................................3
PEST.....................................................................................................................................................3
MICRO ANALYSIS............................................................................................................................4
Threat of substitute services and goods............................................................................................4
Threat of new entrants......................................................................................................................4
Competitive Rivalry within Walmart and the surrounding industry................................................4
Bargaining power of customers........................................................................................................4
Bargaining power of suppliers..........................................................................................................4
Human Resource Analysis........................................................................................................................4
Poor wages issues.................................................................................................................................4
Poor Working Conditions issues..........................................................................................................5
Child labor violation issues..................................................................................................................5
Employing Illegal worker’s issues.......................................................................................................5
Opposition from Labor Unions.............................................................................................................5
Sex discrimination issues......................................................................................................................5
Health Insurance issues........................................................................................................................5
Recommendations....................................................................................................................................5
Conclusion................................................................................................................................................6
References................................................................................................................................................6
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Introduction
Wal-Mart is engaged in the retail and wholesale operation around the world. The company is
known for offering assortments of merchandises and other services at an everyday lower rate.
In the recent time, the retail giant has more than 11,600 stores worldwide and deals with
products ranging from electronics, clothing, foot wear, health and beauty along with grocery
products. It is the world’s largest company by revenue that is approximately $480 billion as
well as the largest private employer hiring more than 2.3 million employees (Anselmsson et
al., 2016). The retail company undertakes many business strategies in its business activities
including generic strategy and competitive strategy that has actually contributed to the success
of the business. The successful business strategies of the organisation include product
differentiation and the cost effective measure against the products.
The study below consists of the analysis of Walmart grocery retail chain on the issues that the
human resources department undergoes. Many big warehouses and stores are run by Wal-
Mart stores. Walmart store was founded almost fifty years ago by Walton and his brother Bud
in Bentonville USA hence named after their names. Yearly it sells over 300$ billion, hence
considering it to be one of the most valuable companies in the world. In many times it has
been considered to be one of the biggest employer with more than one and half million
workers globally. It is estimated to have more than 11600 stores globally of which 80% are in
USA.
Studying the economic environment of Wal-Mart will be a key in addressing the analysis of
the business. Also the macro and micro analysis due to its running worldwide will also be
necessary. Furthermore, strategies which are operational will be necessary in knowing how
Wal-Mart is run. Another area is the marketing mix with the four factors being the 4Ps that is
the price, product, place and the promotion factors which will help in explaining both the
successes and failures of Wal-Mart.
Next, is the study of how the human resources of Walmart is managed. The main idea here
being to understand the exact area because criticism has been brought about that Wal-Mart
doesn’t do well with its employees.
Later, before i recommend on the case study, a SWOT analysis is done which will help in
looking into Wal-Mart failures and the critics. The last step in the case study will be the
conclusion, where there is a summary of all the issues studied and in existence in Wal-Mart
company.
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Main and Sub-Objectives
The below highlighted objectives will be illustrated in our study.
MAIN OBJECTIVE SUB OBJECTIVES
Knowing all retail sectors How the sector evolves?
How importance each sector is to economy?
The Environment Knowledge Understand context of PESTEL
Five porter analysis
Direct competitors analysis
Operations of Walmart and its Processes
analysis
Layout study
Operations analysis
System quality analysis
Human resources analysis Management of human resource and job
quality analysis
Understanding marketing mix Customer target study
SWOT analysis Weakness studies and how to handle them
Environment.
PESTEL analysis will need to be made that is the Political, Economic, Social and technology
factors that influences Wal-Mart directly or indirectly. In real world there exist so many
forces that make a company to be more or less appealing in terms of industrial gains. This will
be approached with use of five porter’s forces.
PEST
Many retail companies such as Wal-Mart act within a macro-environment meaning that the
scope of what happens in the outside depends on how the company runs. Unlike in micro
environments the company with the retail store cannot change as these change occurs but in
macro environment they adapt to the change as they occur and according to business rules and
objectives. The following below is a PEST analysis explanation.
Legal & Political.
Law enforcement in USA is in charge of local police, while the police of the states provides
services at the border. In our case regarding the legal and political laws that affect the retail
industry we consider such (Jonathan, 2016):
I. The issue about dictating what the company type of message will send to its customers
trying to convince them about the tastes and preferences of the products. In case of
any violation of these then some penalties will occur and fines must be met according
to the set law in case such happens.
II. Protection laws for customers – This entails protection of customers from exploitation
by companies in terms of pricing and quality standard of the sold goods. These laws
ensure that customers buy goods at reasonable prices and the goods or services offered
to them are worth the price.
III. Seeking punitive damages – These are personal injuries caused by the company to
individuals. The injured person is guided by USA laws while seeking justice. Punitive
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damages occur when the company’s actions are deemed to be reckless and in turn this
results to physical or mental damages to individuals (LLP, 2013).
IV. Discount prices that are misled – there exist laws that protect customers from being
misled by company’s unrealistic or fake discounts in order to impress their customers.
For instance a company may suggest that a product goes for $350 dollars from $500
giving its customer a $150 discount when in reality the company had not sold the
product at $500 before. This is termed as a misleading discount price. Therefore, the
USA laws protect the customers from such deceptions which act as a bait to attract the
customers. Use of misleading discount prices via advertisements or any other
marketing procedure is against the law.
Social
America is mostly occupied by the white as the majority, followed by the blacks and the rest
take the other percentage. The makes the US consumer to be determined and characterized for
it being so powerful or even having greater demand. The launching of products depends on
the fashionable style it is created upon and products consumer centric, hence creating an
engagement with the customers.
MICRO ANALYSIS
Walmart is facing a lot of competition from many different countries who have different types
of competition. With the use of specialization strategies stores like Target, Kmart, ShopKo
will compete successfully against Walmart (Shelly, 2014). This will be explained in to details
using the porters five forces.
Threat of substitute services and goods
One of the problem faced by Walmart is that it has very big retail stores but physically small
in terms of size. Other retails have been competing with Walmart in Way that they specialize
with one product with a motive 0f covering a wide range. This means that what one retails
offer is likely to be found in other stores. This bring to an understanding that the retailers
offering goods that are unique have an added advantage compared to their rivals.
Threat of new entrants.
Walmart should be aware that the E-commerce and M-commerce has competition that’s high
as we have very many new entrants. Entrance of new companies to the market may threaten
the existence of those companies that have been there for a while.
Competitive Rivalry within Walmart and the surrounding industry.
The expansion in the whole world is making Walmart to face a lot of competitors from
countries that are different. When it comes to individual they have very little bargaining
power with the retail stores.
Bargaining power of customers
Force involved here makes buyers to put Walmart under pressure making it to relate to the
laws within those specific territories in which Walmart operates.
Bargaining power of suppliers.
Walmart size can break a small supplier. This is because many companies depend on
Walmart in buying their product and this makes the suppliers to have very little power against
Walmart.
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Human Resource Analysis
The workforce of Walmart is about 2.2M globally. Walmart has encountered many issues and
lawsuits with its employees overall. The issues appointed and raised ranges from conditions
which are poor for workers, Union that are have policies that are against Walmart, Little
amount of money is paid as wage to its employees and lack of enough health care being just
some of the bigger issues with relations to how Walmart relates to its employees. In addition
to this, it has also been found that Wal-Mart does not pay the farmers well and in fact exploit
them in terms of making payment to them (Sparrow, Brewster & Chung, 2016). All these
issues have led to massive rebellion among the employees and have questioned the HR
policies of the organisation. Thus, it can be said that Wal-Mart is facing human resource
issues related to the employees of the organisation that needs to be sorted out.
Poor wages issues
High employee turnover rate of about 70% indicates that many employees employed by
Walmart leaves the retail one year after employment, hence explaining the above mentioned
issues to being experienced in Walmart by the employees. Wage issue is a very big concern as
many are employees are connected by the employer through the salary they receive from the
work done.
The main issues affecting Walmart is wages rates. When compared to other companies
working as retail such as Shopko, Target and others their wage rate is very good and
appealing when working with them unlike in Walmart where there is greater workforce but
with less employee wage hence many workers are not able work for long.
Poor Working Conditions issues
The working conditions in Walmart has also been described as an issue in human resource as ,
it has been described and reported that Walmart has very small physical stores but very large
stores of goods being squeezed in those stores. The mixing of different products and
commodities within the same store has made the working condition unconducive in such a
manner that the space is small but a lot need to be done within the small space.
Child labor violation issues
Third issue is the violation of child labor whereby there has been cases of Walmart being sued
for employing children’s who are under 18 to work in their retails. Globally in most countries
one is considered mature and ready to work after an age of 18 years. Globally attempt to
exploit the young children through employment at tender change is violation on children and
this termed as child labor.
Employing Illegal worker’s issues
Fourth issue brought about by Walmart is employing workers who are illegally not allowed to
work in those departments in different retails national wide or globally. By illegal workers we
mean those workers who doesn’t the specific skills to handle such outlets. This has been
experienced in Walmart as many strives to make their end meets. Employing illegal workers
put the lives of the customers or consumers of their goods, products or commodities at risk for
the lack of knowledge might lead to misunderstanding between them and hence tarnishing the
business name.
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Opposition from Labor Unions
Fifth issue is the opposition from the labor union. Walmart has been on the frontline to be
criticised by Labor union in USA. The opposition from labor Union which is mostly due to
results of Unsatisfied employees reporting them to the trade union for labor.
Sex discrimination issues
Gender discrimination in Walmart is also another issue. This has led to day to day rebellion
within its employees as women are paid less as their work entails much of sales associates.
This highest level of discrimination has led to Walmart being one of the largest discriminatory
retail in terms of gender.
Health Insurance issues
Last issue and not least is the health insurance issue. Insurance cover for the employee
working with Walmart has been an issue for a very long time. Retail is not a secure job
because sometimes the materials or products handled might be toxic, flammable, poisonous,
fragile etc. and this might need some cover as it is a risk one is taking to be part of the
organisation that provides this services. Walmart failure to cover some of its employees and
many issue arising when need for cover arises has been termed as a major issue in human
resource.
Swot Analysis
The graft for clients appreciative is its solicitation to developing a strategy and
implementing it. Once the client understands the process completely then the team that
takes part in organizing the strategy will need to receive, then digesting it and then
apply what they found in their analysis. Strategic planning context understanding
through which a customer or client may think is through understanding the one way or
of conducting the SWOT Analysis (Goodstein, 1993). This is client or customer way
of understanding, as this analysis will provide the uniqueness in viewing Walmart
retail store through its Strengths, weaknesses, Opportunities and Threats – from mostly
the client’s point of view.
Strengths
Weaknesses
Opportunity
Threats
CONCLUSION
Maintaining and solidifying current customer value and developing tactics for meeting
unanticipated emerging needs provides the basis for either developing or modifying an
organization’s strategic plan. It is this application that makes the customer
understanding
analysis pay off.
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Recommendations
The issues brought about above are clear and evident that there is necessity of undertaking
severe action in order to improve the human resource strategy in the organisation. As it has
been found that the organisation has faced law suit for its ill behaviour and treatment against
the employees, it is highly recommended that the HR policies should be developed keeping
the employee guidelines of salary and their welfare. The human resource strategy should also
include the training of the workers in order to increase their efficiency at work (Ravi.S.P,
2015) (Ravi, 2015). If there remains the opportunity, the management needs to consider the
transfer of knowledge as well that would eventually help to improve the performance of the
employees in the organisation. In addition to this, the company should also consider the
importance of gender equality in the organisation that would help to overcome the blames that
Wal-Mart is facing in the recent time.
Walmart should address and adapt a corporate attitude that is friendly, because it has damaged
its image because of its laborsuits towards their suppliers (Walmart, 2016). Another
recommendation that should be considered is participating in charitable events as this will
show some kind and make the world to be better.
Lastly just like any other organization no matter how small or big it may be either nationally
or globally, safety and health of the employee should be given priority. The priority here
should be updating their health and medical insurance cover at all times as they might have
issues that may arise during working hours and this covers will be highly needed. The
working conditions of the employees should be large such that the stores and office have
enough room for movement within as this will reduce the congestion that has been
experienced in the already existing stores of Walmart globally.
Conclusion
Walmart should have initiated its business at a scale that is lower. This mistake led to the
situation that it could not cope up with the benefits of economies of scale. Walmart by the
name and looks have been seen as one of the best retailers in the world but in real sense it has
led to many quitting jobs in other sectors so that they can be employed by them, to end up
jobless as their needs and expectations are not met after being employed by them. In
conclusion with regards to the issues studied and researched that seems to be experienced by
Walmart human resource department, Walmart should take in to considerations of the above
recommended solutions to issues brought about and this will eliminate most problems and
make Walmart a better retail chain store.
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References
Jonathan. (2016). Government Laws affecting retails. Retrieved from small business:
www.smallbusiness.chron.com/government-regulations-affect-marketing-retail
LLP, T. R. (2013). Punitive Damage and When to Seek Them. JDSUPRA.
Ravi.S.P. (2015). Technology Solutions for Sustainable Business Practices. Stakeholder perception in
Walmart, 106-108.
Shelly, B. (2014). Walmart notches against its rivals. wall street journal.
Walmart. (2016). suppliers standards. Retrieved from walmart: http://corporate.walmart.com/global-
response/ethical.htm
Whaples.Robert. (2007). Modern Hr Economic issues. Walmart growth and Prodctivity.
Gorzeń-Mitka, I., & Okręglicka, M. (2014). Improving Decision Making in Complexity
Environment. Procedia Economics And Finance, 16, 402-409.
http://dx.doi.org/10.1016/s2212-5671(14)00819-3
Sparrow, P., Brewster, C., & Chung, C. (2016). Globalizing human resource management.
Routledge.
Kumar, N. P. (2014). Human resource management in future an obstacle of champion of
globalization. Human Resource Management, 1(1), 49-57.
Anselmsson, J., Anselmsson, J., Bondesson, N., Bondesson, N., Melin, F., & Melin, F.
(2016). Customer based brand equity and human resource management image: Do
retail customers really care about HRM and the employer brand? European Journal of
Marketing, 50(7/8), 1185-1208.
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