Organizational Behavior Analysis: Wal-Mart - Case Study Example

Wal-Mart is one of the leading organizations in the United s, which at present is functional in 15 countries worldwide. Even in the present global economic downturns, increased inflation and exponential rise in prices, the company is dedicated to providing excellent services and best quality products to the consumers. Sam Walton established the company in 1962 and the main goal of the organization was to provide an opportunity to supply high-quality products to customers at a very low price rate. The research discusses the Wal-Mart organization and the key factors associated with its success. The paper examines the organizational behavior by focusing on the professional skills that are required for the successful operation of a business giant like Wal-Mart itself plus other issues related to the market ("Wal-mart: organizational behavior," ). Organizational Overview: Sam Walton founded Wal-Mart in the year 1962 in the form of a single store in semi-rural Arkansas ("History," ). The business voyage started with three openings; Sam’s club in 1984, then first supercenter and a neighborhood market in 1999. So principally, the company was divided into three basic segments; Sam’s club, Wal-Mart stores, and global openings of the organization, where Wal-Mart was considered as the complete discount store, and superstores and the international organization incorporated all the stores outside the United States. The global segment comprises of operations outside the United States. Wal-Mart is at present operating 2,898 super centers, 711 discount stores, 608 Sams Clubs and181 Neighborhood Markets in the United States. Outside America, the company is functioning operations by 455 in Brazil, 53 units in Argentina, 267 in Chile, 323 in Canada, 77 in El Salvador, 175 in Costa Rica, 55 in Honduras, 171 in Guatemala, 1,606 in Mexico, 413 in Japan, 56 in Puerto Rico, 58 Nicaragua, and 382 in the United Kingdom. In addition, Wal-Mart also functions 304 stores in China through an amalgamation of joint endeavor and minority-owned subsidiaries ("Walmart stores, inc.," 2010). Today, Wal-Mart is considered as the world’s largest retailer and United States largest private employer. In 2004, the company reported sales revenues in surplus of a trillion dollars and provided employment to more than a million and a half people all across the globe. Wal-Mart has approximately 5300 stores worldwide; two-thirds of them are located in the US. Wal-Mart succeeds on low living standards. The company’s sales revenues have relied chiefly on low-income customers for whom low-prices are the decisive factor when deciding where and what to buy for. Wal-Mart thrives on low living standards. The secret behind the success of the company is largely on the basis of the best team of employees, who are professionally trained and energetic and can accept any challenges related to the market, as they have accepted, many difficult challenges in the past. The company is sincerely doing its part and offering all of its employee’s freedom of expression and prospects to bring about productive and pragmatic innovations in the vast system. The company has given freedom to its employees to share innovative ideas or challenges to improve the company’s future in the best possible manner. The company’s teamwork is great and all works are performed under the rules and regulations and employees respect each other and help in the success of the business. Wal-Mart has intelligently maintained its customers trust and respect by offering quality products (Vi d a l, 2009). According to the Wal-Mart 2010 Financial Report, the net sales in fiscal 2010 were a record $405.0 billion, up 1.0 per cent from fiscal 2009. Wal-Mart Stores, Inc operating income increased by 5.1 per cent in fiscal 2010, which is a 5.2 per cent increase in Wal-Mart U.S. ("Walmart 2010 financial report," ) Discount Store News in 1989 named Wal-Mart as the retailer of the decade. After Walton’s death in the year 1992, the company’s sakes continued to grow exponentially. This significantly proves that Wal-Mart is able to survive in any condition. In addition, the company is making huge profits as well. And the main reason for its success is that it has maintained its quality and ensures that nothing is more valuable than customer satisfaction. Wal-Mart not only serves its customers through marts and superstores, it has also expanded its portfolio through online marketing. Since online shopping is getting huge popularity, Wal-Mart also started its online shopping services in 2008 and expanding its network with time. On the other hand, the company is also keeping an eye on competitors and handling them professionally. There is no doubt that Wal-Mart is growing, but at the same time, it is facing so many challenges and tough competitions in the market. It is obvious to face such kind of situation for a well-known firm like Wal-Mart. The market is full of competitions, both small as well as big multi national companies are in the fray and their target is same everywhere. These leading companies may give tough competitions in terms of sales and services. Some of the global and local brands include Tesco, Carrefour, Target, Sears, Home Depot, Best Buy and Kohl’s, Kroger besides others. Wal-Mart is tackling these situations professionally. It has maintained its stores, retailers, online sales catalogs, discounts, marts and super stores in the best possible manner. Wal-Mart has a well-organized stakeholders group, which is very crucial and valuable for the company. Stakeholders in simple terms are considered as the backbone of a company. The company’s management depends primarily on the stakeholders. Walton has categorized its stakeholders as managers, employees, communities, supplies, customers, vendors in short everyone related to the organization. In simple words, the company’s principles are simple and have to be followed by every individual associated with the organization. Behavior Practices: Give respect to customers and offer quality services to them – these are some of the focused principles of the company. The organization has maintained an excellent working atmosphere and ensures quality work. The company gives more emphasis on its employees training and encourages them to work fervently. It is very crucial for the organization to focus on employees because they are the main sources that help in running the company smoothly. Employees have been divided into several teams and each team consists of 6 to 7 members. Each member of the teamwork as per the tasks given to them and teamwork is considered as the most important factors for the same. Multiple teams work together to maintain quality control and determine the responsibilities and schedules as per the defined performance standards. And to motivate employees, the firm arranges insurance and bonuses that motivate them to work enthusiastically. The organization utilizes good leadership skills and accomplishes desired results. Sam Walton believed always believed that if a person would wan to live happily, then he or she must save money. And with so many outlets all across the globe, this mission has rightly been achieved. According to one of the most popular slogans from Wal-Mart, “Save Money. Live Better,” several obstacles such as energy can be dealt with intelligently. San Walton in his autobiography has stated that "If youre good to people, and fair with them, and demanding of them, they will eventually decide that youre on their side," (Gimein, 2002). He has also mentioned some basic set of rules such as respect to individual, customer services, customer satisfaction, employee motivation, leadership, teamwork, and competitiveness, which are mandatory to follow to accomplish something big. His given set of rules are very crucial for making a good organizational structure where every individual is free to share his ideas and beliefs in order to support the company’s progress in the best possible manner. Recommended Improvements: Though the firm is placed at the top as compared to its counterparts, there are still some scopes for improvement. The basic error associated with the firm is the opening of new outlets in already existing areas. This may result in decrease in sales and can adversely affect the business. In addition, some employees complain about the salary they are getting or they are not paid even after the work is accomplished. Moreover, gender discrimination is another one of the most important issues that need to be taken into consideration quite seriously. Conclusion: In today’s world, organizations, small or big are facing cutthroat competition in the market. Many leading organizations implement new policies and gain success for a short time period. However, when they don’t get profits from the market due to adverse economic conditions, their attitude towards employees as well as customers change and they either deteriorate the product quality or pose strict policies on their employees and as a consequence, face heavy loss in their businesses. Wal-Mart on the other hand has always given top priority to its customers and employees. It is the company’s basic policies (Vidal, 2009) that have given constant success to the company for so many decades. The company has faced many obstacles, and competitions in the market, but it has always taken a professional approach to solve problems, if any. Though it is true that no one is perfect, but the secret of success for the company Wal-Mart lies in its practical and professional approach towards the business. Reference: History. (n.d.). Retrieved from http://walmartstores.com/AboutUs/297.aspx Walmart stores, inc. data sheet - worldwide unit details november 2010. (2010, 11). Retrieved from http://walmartstores.com/pressroom/news/10497.aspx Vi d a l, Ma t t. (2009). Organizing prosperity.Economic Policy Institute, Retrieved from http://www.kcl.ac.uk/content/1/c6/04/29/10/Vidal-OrganizingProsperity.pdf Gimein, Mark . (2002, 3 18). Sam walton made us a promise wal-marts founder made a pact with employees: he would be fair to them, and they would work hard for him. it was a good deal, but can it survive in the 24-hour service economy?. CNN Money, Retrieved from http://money.cnn.com/magazines/fortune/fortune_archive/2002/03/18/319920/index.htm Walmart 2010 financial report. (n.d.). Walmartstores, Retrieved from http://cdn.walmartstores.com/sites/AnnualReport/2010/PDF/01_WMT%202010_Financials.pdf Wal-mart: organizational behavior. (n.d.). Research Assistance, Retrieved from http://www.research-assistance.com/paper/38176/a_ra_default/wal-mart:_organizational_behavior.html Read More