Operative Management - Term Paper Example

Operative Management Introduction Wal- Mart stores Inc is selected for assessing its operative management. An in depth researched study is carried onin analyzing the management tools used for achieving the mission envisaged by Sam Walton. The write up carries a study on the management theories applied, evaluation of work flows, performance of productivity audits, and management techniques used by the company to enhance its productivity. Mission, Vision, and Values “With a clear defined mission and vision, you can more easily communicate your critical success factors, motivate, and direct your organization, and ultimately move more rapidly in the pursuit of your competitive advantage” (Jeffrey a. Rigsby and Guy Greco, 2003)i Sam Walton, the founder of Wal- Mart had a clear vision to establish Wal- Mart as the best retail store in the industry. The mission of Wal Mart was simple, easy to explain to those responsible for its achievement, and straight forward that left nothing to imagination. The goal of the Sam was not be the biggest retailer but the best retailer in the industry. Wal- Mart was equipped with certain basic values to attain its straight forward mission. These values are the ability of merchandising, creating innovative retailing ideas, best store operations, cost control, technologies, customer services, distribution, and establishing a culture as a retailer. The reason for such a phenomenal success as the best retailer in the word is to pursue the business with these pre- established values. Wal- Mart translated these values in its retail practices and achieved the best results. Wal- Mart executed its strategies by developing the skill of managers in areas of communication, motivating junior staff, team development through training, establishing standards for customer service, and fixing responsibility and accountability. Management theories applied by Wal- Mart Wal- Mart used one of the basic theories of management called ‘theory of motivation’. Theory of motivation seeks persuading efforts from management to encourage employees. Sam Walton, the founder of Wal- Mart, used to visit his stores and meet employees at different levels of activities. He used to carry a tape recorder and treated it as his ‘tool of empowerment’. He used to tape his conversations with employees and later listened to those recordings for devising means to create motivation among his work force. He was first in the industry to call his worker as his ‘associate’. Addressing an employee as an ‘associate’ of the management is enough to instill in employees a sense of responsibility at par with ownership. Employees are trained in Wal- Mart as merchants and not as just subordinates of seniors. Wal- Mart is pioneer in providing financial incentives to its employees (nee associates). Schemes like profit sharing incentive bonus and stock purchase plans motivated its associates so much that all of them were keen to make Wal- Mart as best retailer of the world. Every Day Low Price (EDLP) is another management strategy that helped Wal- Mart management in reaching at peak of retail business in the world. Since the inception of Wal- Mart, its customers were sure that Wal – Mart would be charging the lowest of prices in the industry. This way Wal- Mart developed a sort of faithful customer club. The strategy of EDPL “lies in purchasing the goods at lower prices and selling the goods to customer at much lower prices, cutting the price as far as possible and increasing the profit by increasing the number of sales. This ferociously increases the competition in the market and Wal- Mart competes with all its competitors till it dominant in the market.”(Gopal Pottabathni, 2009)ii Project Manager’s role Project managers are called ‘Associates’ in Wal- Mart. Associates meet store employees on daily basis and as per Wal- mart custom do Wal- Mart Cheers three times a day as per shift change. Stores employees up date Associates about the current problems faced by them. Associates discuss those problems with Managers and try to find out solutions in the interest of Wal- Mart. These daily meetings provide Associates and other staff an opportunity to gain clear information about the company’s working standards. It is all like treating employees as business partners in Wal- Mart. Evaluation of work flow process Managers at Wal- Mart have expectation of certain level of work from employees. These expectations are communicated to employees as job objectives, deadlines, schedules, and service quality standards. The appraisal of employees’ work is done by Managers by comparing the level of work executed with standards set for those works or actions. Supervisor or Manager evaluates each employee’s works in term of qualitative and quantitative performance achieved. The evaluation is done taking into consideration the initiative undertaken by the employee, his/ her job knowledge, his/her relationship with other employees, and other factors as well. These evaluations also become basis for payment of bonuses and promotions of employees. Productivity audit Wal- Mart productivity audit is basically a performance appraisal exercise. Various yardsticks like rating scales, supervisor detailing employee incidents, sales reports, and other statistical information are used to evaluate the performances and other results. Wal Mart believes in collecting a lot of data. This type of productivity audit is called the process of data mining. Usually data mining starts with raw data and is preprocessed utilizing many techniques. After preprocessing the results are formatted back into formats that are understandable by data visualization techniques called Computer added designs (CADs). Expert in each field analyze the performances with the help of those CADs and pass on results to authorities for necessary actions. Methods used to increase productivity The strategies of buying in large quantities and at cheaper rates and use of new employee training programs were the basic techniques that enhanced Wal Mart’s productivity. It owned distribution centers and trucking facilities that improved efficiency of inflow of goods. Wal- Mart encouraged the development of Universal Product Code (UPC) that increased the productivity of retailers world over by streamlining various processes. The application of Electronic Data Interchange to transmit purchase orders, invoices, and other documents in order increase speed and productivity in general. It created a Retail Link system that integrated suppliers directly with computers. Conclusion Wal- Mart achieved its mission as visualized by Sam. The theory of motivation and EDLP strategy were basic management techniques that paved way to its success. The title ‘associates’ instilled energy among employees and it was a sort of management marvel. Its productivity audits using modern day techniques were refreshing ways to appraise the performances. Productivity boosting by exploiting economies of scale, modern day training programs, and inventive use of computerization are some of many features introduced by Wal- Mart in the management arena. 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