Models and Theories Applied by Wal-Mart in order to Ensure that It Archives Its Goals - Case Study Example

Introduction Wal-Mart is a multinational corporation with its headquarters in the US. It is one of the main private employers in the world. It has anemployee base of about 2 million. Regional Vice Presidents (RVP) are the ones who manage the organization at the regional level. The RVPs are based in Bentonville, but they usually travel to their respective regions for three weeks every month in order to ensure that the operations of the regions are in line with the expectations of the company. All the regional managers are required to meet with the Bentonville-based executive leaders so that they can be able to discuss the various challenges that face all Wal-Mart’s stores. Every region has about eleven districts. Each district usually has about 7 stores. However, it is the goal of a district manager to ensure that all the activities of the organization are run smoothly at the district level. The District Managers usually work hand in hand with the Regional Personnel Managers (RPMs) to ensure that any issues relating to the operations of the stores are addressed adequately. It is the duty of the RPMs to select the people who manage individual stores. Wal-Mart stores are, therefore, designed in such a manner that the managers of the organization are the ones who allocate duties as well as monitor the activities of employees within the organization. The managers also identify any changes that need to be implemented to the stores in order to ensure that all the production processes within the stores are in line with the goals of the entire organization (The Wall Street Journal, 2012). The operarational and the leadership structure of Wal-Mart is essentially designed in such a manner that gives the company a competitive edge. This paper will discuss different models and theories that are applied by Wal-Mart in order to ensure that it achives its goals. Six sigma and TQM Modern organizations are undergoing turbulent economic times in today’s world and for their survival; each company should be ahead of the set benchmarks. Breakthroughs in technology and performance excellence are the most dominant requisites for a company to succeed. This business improvement methodology focuses on improvement of customer satisfaction. Wal-Mart applies this principle in reduction of defects, reduction of cycle time and ensuring customer satisfaction (Breyfogle, Cupello and Meadows, 2003). Wal-Mart adopt part of the (Total Quality Management) TQM philosophy that empowers the employees to identify quality problems and seek ways to tackle them (Babbar and Aspelin, 1994). Apparently, this is a remarkable shift from the old concept, when the employees feared identifying problems because they had no much authority on their disposal. Employees who identify problems are highly rewarded, and hence encouraged and motivated. The employees are given a degree of authority to make decisions with the aim of enhancing quality in the hotel processes. Plenty of incentives are offered to those employees who uncover problems within the organization. The organization highly values the input of the workers and considers their effort as key in achieving high quality in service provision. An extensive and continuous training is offered to the employees to ensure they are capable of performing their duties effectively and are capable of maintaining quality services (The Wall Street Journal, 2012). Communications technology Advancements in information technology have played a vital role in terms of revolutionizing the manner in which businesses communicate with their customers. Advancements in information technology have made it easy for organizations to communicate with their customers, suppliers and employees in an efficient and faster manner. It has also enabled organizations to reduce their costs of production drastically. As part of its growth strategy, therefore, Wal-Mart has invested in a communication infrastructure, which has enabled it to improve the way it interacts with its customers. Wal-Mart has a satellite communication system in the United States which links all its stores to the headquarters. This has made the process of managing the organization easier. Wal-Mart also uses Retail Link and EDI applications over the internet thereby making it possible for the company to exchange data with its suppliers easily all over the world. In addition, it uses Web 2.0 and social networking tools to enable it interact with its customers more effectively. Use of knowledge management Knowledge management are the strategies and practices that an entity applies with the aim of distributing, creating and enabling embracing of specific experiences and strategic insights (O’Leary, 2002). This knowledge is exhibited in an entity’s processes and practices. Wal-Mart stores Inc. has commmited a lot of resources towards development of knowledge management, which has seen it emerge as one of the world’s biggest corporation. According to Addicott et al (2006), knowledge management comprises of four divisions including completeness, connectdness, congruency and perspective. This knowledge is acheiced through identification of organizational gaps that exsits within knowldge management practices. These gaps, according to Choo(2002), are determinied by the manner in which an organization discharges its decision making and problem solving practices. In pursuance of knowledge management, Wal-mart focuses on contniouse improvement of business operations and processes, compeititve advantage and improved business performance. The following are specifc areas that Wal-Mart has adopted knowledge management. Cutting of operational costs Wal-Mart has managed to reduce its costs significantly, passing on the benefit to their customers, which creates a highly competitive pricing strategy. In order to develop and take advantage of this strategy, Wal-Mart has focused on developing an advanced and highly structured supply chain management strategy (University of San Francisco, 2012). The aim of this strategy is to ensure that whatever Wal-Mart do is in the interest of its customers. When sourcing for goods, the company enters into strategic partnership with vendors who provide them with products at the least price possible. The company’s philosophy is that they are in business because of their customers and hence the customer should get the goods at the least price possible. Human resource management According to Wolpert (2001), for an organization to become successful in the area of knowledge management, the kind of human resources management strategies that are embraded becomes an integral determinant. Human resource, in this respect, is about pursuation and inspiration of employees towards attainement of the organization goals. The managers of Wal-Mart are actively involved in motivation of their employees with the aim of steering the company towards attainment of its goal in a manner that gives it a competitive advantage over its rivals. The relationship between senior executives and employees at Wal-Mart is based on close communication, respect and high expectations. Though the employees are not remunerated very highly, they usually enjoy other benefits such as health care plans, profit incentives, and retirement schemes. The company also advocates for an open-door policy and provides a variety of promotion opportunities thereby enabling the employees to remain committed to realizing the goals of the organization. Though this strategy is not common in large organizations, it usually adds value to Wal-Mart’s employees thereby enabling them to devote themselves to their jobs as well as offer the customers high quality services. Conflict resolution and problem solving Wal-Mart has embraced knowledge management in a manner that ensures smooth management of conflics, by instituting a complex system for conflict resolution (Zetie, 2003). Conflict management refers to a situation whereby an organization is able to address any conflicts that arise between employees and customers. Wal-Mart ensures that its employees and customers relate positively with each other. It does this by ensuring that the employees are well-trained to handle all customers’ queries politely. This makes the customers to trust in the products and services that Wal-Mart offers. Wal-Mart is usually very cautious with regard to addressing issues such as production of defective products. It always ensures that any problems that arise are addressed in the shortest time possible in order to ensure that customers remain loyal to the organization. Wal-Mart Future trends and adoption of technology The workplace today is experiencing significant changes. This is because people are getting more educated thereby impacting on the way they conduct their daily operations. People today are more efficient in the activities that they perform. In addition, education has become global thereby enabling people from all over the world to share ideas and improve their working skills. In the case of Wal-Mart, it hires qualified personnel from different parts of the world thereby enabling it to benefit from the diverse skills, which the employees possess (Lueneburger & Goleman, 2010). Technology has played a very important role in enabling Wal-Mart to be successful in its operations. Technology has helped Wal-Mart to improve the relationship it has with its customers and employees. The customers can therefore easily access the various services that the company offers through the internet. As a result, it is possible for customers to find more information about the products before making an actual purchase. In addition, the company has a very responsive support team who usually address any queries that the customers make. Leadership trends impacting on Wal-Mart Wal-Mart implements unique leadership strategies which enable it to become successful in its operations. The company ensures that information flows smoothly from the headquarters to every store. The people from the headquarters are the ones who are sent to the stores so they can gather information about competitors and other challenges that the stores might be facing. However, to face the competitors, Wal-Mart’s require the people from the local stores to go to the headquarters in order to give out information about their activities. This unique practice by Wal-Mart enables the local stores to develop a close relationship with the people at the headquarters. This state of affairs has enabled Wal-Mart to to respond to the demands of its customers on a timely basis (Businessweek, 2010). Diversity Management Diversity management refers to a situation whereby an organization is able to handle a diverse group of employees who work within the same organization. Diversity in organizations is usually observed when they employ people who belong to different cultures or whereby young and old people are made to work together in an organization. In the case of Wal-Mart, diversity management is observed because the company is able to manage the different groups of employees within the organization thereby enabling them to work together to realize the goals of the organization. Leadership models Many companies today are competing for survival in the world market. Technology has also played very vital role in terms of boosting the competitiveness of organizations in the world market. In addition, leaders of different organizations are adopting different leadership strategies to enable their organizations to become competitive in the global market. As a result, it is important for leaders of organizations to adopt leadership strategies that will boost the performance of their organizations thereby enable them to compete effectively in the global market. There are trends that are being observed in the business environment which are making it important for leaders to formulate leadership strategies that can enable their organizations to remain competitive in the world economy. In the case of Wal-Mart, the leadership process is hierarchical in nature. At Wal-Mart, the Regional Personnel Managers are the ones who manage all the activities of the stores in all the regions. The District managers on the other hand are the ones who give out information to the RPMs regarding the performance of the stores at district levels. Ethics Ethics refer to the acceptable codes of conduct in every organization. Wal-Mart practices ethics by ensuring that all the rights of the employees within the organization are respected. It also ensures that the customers are treated fairly and that the employees receive fair salaries. Moreover, Wal-Mart adopts production processes that are friendly to the environment. Decision making models These refer to the manner in which decisions are made within an organization. In the case of Wal-Mart, the top-level managers give employees an opportunity to participate in the decision making process in order to ensure that the decisions made within the organization are effective and that every employee within the organization is able to comply with them (Foster, 2004). Conclusion Wal-mart is growing to become one of the biggest corporation in the world courtesy of its unique strategies that gives it a competitive advantage. This company has adopted principles of knowledge management and quality management to ensure that its operation gives it an edge over its competitors. Wal-mart puts the interest of its customers first, and goes ahead to procure its products at the lowest price possible in order to reduce cost on behalf of the customers. Furthermore, Wal-Mart manages its human resources strategically in order to motivate them to perform well. These strategies coupled with a strong leadership has seen the company become one of the most successful in the world. References Addicott, R., McGivern, G. and Ferlie, E ., 2006. Networks, Organizational     Learning and Knowledge Management: NHS Cancer Networks. New York: Sage. Babbar, S. and Aspelin, D., 1994. J. TQM it is as easy as ABC. The TQM magazine, 6(3), pp. 32-38. Breyfogle, FW, Cupello, JM & Meadows, B 2003, Managing Six Sigma: A practical guide to understanding, assessing, an implementing the strategy that yields bottom-line success. New York: John Wiley & Sons. Choo, C., 2002. Strategic Management of Intellectual Capital    and Organizational Knowledge. Oxford: Oxford University Press. Foster, S.T., 2004. Managing quality: An integrative approach. New Jersey.Upper Saddle River. Lueneburger, C. and Goleman, D., 2010. The Change Leadership Management Sustainability Demands. [online] available from [Accessed 12 December 2012] OLeary, D., 2002. 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