Walmarts Organizational Behavior - Case Study Example

Topic: Wal-Mart’s organizational behavior

Introduction

The organizational structure of Wal-Mart is responsible for determining the business activities of the company. Additionally, its organizational structure further imposes restrictions on the manner in which the company deals with its issues. On the other hand, the organizational culture of Wal-Mart is responsible for determining the manner in which people deal with challenges within the workplace. The spirit of the human resources within Wal-Mart in part relies on the attitude that the organizational culture supports. Nevertheless, the long history of the success and continued growth of the company globally demonstrates that the organizational structure of the company as well as its organizational culture gave been critical in regards to success and competitive advantage. Therefore, the structure of the organization has interacted with its culture to create a considerable competitive advantage for Wal-Mart. Therefore, the leadership position enjoyed by Wal-Mart within the retail industry as well as its potential for success in the long-term are connected to the valuable blend of the company’s organizational culture and structure. Even I am not employed yet, I hope to be employed at Wal-Mart as a manager in future and this paper will assess some characteristics of the organizational behavior of Wal-Mart some of which will include theories of motivation, behavior of groups, structure of the organization, culture as well as management of change, among others that have been crucial to its success.

Analysis of the organization

Wal-Mart is the biggest retailer in the globe which is a distinction that has been achieved through a multifaceted approach that involves uniquely low pricing, better technology, organizational development and behavior as well as Just-in-Time delivery. In regards to organizational behavior, the success of the company can be directed associated with elements such as traits of individual employees, psychological factors that affect decisions making, expectations, attitudes, values, culture as well as work design, organizational structure among others.

Wal-Mart organizational structure can be considered as hierarchical functional which has two characteristics based on the definition; functional and hierarchical. The hierarchical aspect refers to the vertical chains of authority and command in the entire organization. For instance, apart from the CEO, all the employees within Wal-Mart have a superior. Mandates and directives which come from the top management of the company are executed by the middle level management and implemented by the rank-and file employees in the company’s stores. Conversely, the function-based delineation aspect of the organizational structure of Wal-Mart entails groups of workers fulfilling particular functions. For instance, there is a department that deals with the management of human resources as well as different ones that are concerned with information technology and marketing. There represent some of the many function based sections of the organizational structure of the retailer.

The key impact of the hierarchical, functional structure of Wal-Mart as an organization is the capacity of the corporate managers to influence the whole organization with ease. For instance, new strategies and policies created at the company’s head offices are directly communicated to regional managers and to the managers in stores. In this manner, effective control and monitoring is achieved via the structure of the organization; nevertheless, a disadvantage of depending on such a structure is that it does not support flexibility in the company. Therefore, the lower levels within the structure of the organization are not in a position to alter business practices as a consequence of the long processes of communication and approval that involve corporate managers at the head offices and middle level managers.

Overall evaluation of Wal-Mart

Wal-Mart’s main goal is seeking to assist people to save money in order for them to live better and even though this is a fete that is difficult to achieve, the company has been able to save its clients a lot of money since no other retailer has been able to match its pricing. It continues to be the largest retailer in the globe and while in this position, it is continually seeking ways through which it can increase its market share. Presently, the company sells various products including clothes, garden implements, food commodities as well as beauty products; additionally, in a number of locations, the retailer operates automotive centers for oil and tire changes as well as carwashes that provide more profits for the company while making it more convenient for the customers.

In terms of pricing, Wal-Mart remains the leader in pricing as no other retailer has been able to sell its commodities at prices that are lower than those that offered by Wal-Mart. This can be attributed to the fact that the retailer has the power to dictate to its suppliers the amount that will be paid by the store for specific items, even in instances where the suppliers are drug companies as the company has an exceptional program that caters for customers who lack health insurance. The retailer offers thirty-day generic prescriptions as well as ninety-day prescriptions for only ten dollars. It is impossible to offer such prices in any other retail chain since the other chains lack the power to purchase that is enjoyed by Wal-Mart which is a program that has been highly beneficial to senior citizens whose incomes are limited.

In the past few years, there has been significant public concern that has increased the speculation on whether devised reforming has led to the creation of more bad occupations particularly in stringed nations. Detractors have argued that the employers have made alterations to old practices that regulated the manner in which salaries were set and employment terms. The fear is that there are lesser tasks that offer typical long-term employment bridges, while at the same time; there are numerous jobs that require less skill with high turnovers and limited opportunities for wage advancement and training. Evident has demonstrated that in the case of workers with fewer preferences in terms of education and minorities, the propensity to progress through the workplace hierarchy are becoming fewer. Wal-Mart is currently the biggest retailer in the United States with its grocery market allocation being approximated to be approaching twenty percent having grown from only ten super centers in 1993 to almost two thousand supercenters in 2005. Even though evidence from studies has shown that the development of Wal-Mart’s store along with other retailers have a significant impact on the labor markets, most of the experimental inquiries conducted so far have stressed on the alterations in country-level wages and employment that were experienced after Wal-Mart entered the market.

The success of Wal-Mart has been attributed to its pervasive and strong culture, and regardless of its exceptional size and rapid rate of growth, the company has maintained majority of its cultural elements which were critical to its success immediately after it was established. When it was established, the founder believed that happy and satisfied worker were more productive and thus ensured that customers were happy. In order to achieve this, Wal-Mart created a culture that encouraged the workers to do their best while at the same time making sure of uniformity and discipline within the organization that was growing rapidly and has been operating for a very long time. The culture of Wal-Mart is fundamental customer-oriented and embodies the goal of the company to provide the best value at the most inexpensive prices. A spirit of oneness and a unity of purpose has been established and retained throughout the organization. Some exceptional features have been binding the individuals associated with the company with one of the aspects being the fact that the company follows a calendar that is founded on Wal-Mart time with the first week in the calendar being the first week of the financial year of the company that begins on the first of April each year.

The culture of Wal-Mart is founded on three fundamental principles that were created at the inception of the company in 1962. Consequently, the principles have been used as foundations for the culture that the company has developed in its later years of operation. Wal-Mart recognizes that employees play a vital part in the success of its retail operations and thus gives significant value to them. In order to nurture oneness and equality in the employees, the company has embraced the practice of referring to workers as associates therefore making them acquire a sense of involvement and belonging in the success and activities of the company. According to Wal-Mart, if the employees are well taken care of, then they will care for the clients in the same way.

The company has attempted to create a cheerful and positive environment and was among the first organizations to introduce stock options and profit sharing for its workers. When the company went public, it started its profit sharing plan that provides a chance to the workers to better their income based on the store’s profitability; further, the employees are also offered store discounts and stock options. This is used in motivating the employees so that they can be actively interested in the manner in which the company works. A structure where bonuses and compensation were connected to performance is also used to make sure that the employees contribute their best to the company. Among the exceptional features of the human resource policy of the company is that the company does not authorize overtime. It does not allow the managers in charge of stores to overwork the workers with different tasks. The company is further committed to enhancing the career opportunities of its workers and has a policy of recruiting more than seventy percent of its employees in managerial positions from the low levels workers within the store.

Recommendation and conclusion

The organizational structure of Wal-Mart is perfect for the form of business that the company operates as well as the worldwide scope of its operations. Nevertheless, the company can make improvements in application of its beliefs in regards to culture of the organization as the beliefs work perfectly for its success. Further, the company has often been criticized for its failure to deal with the concerns of its workers in terms of poor remuneration. This kind of criticism points to the disparity between the belief of respect for people in the culture of the organization and the real treatment of the workers. Therefore, a pertinent recommendation for the company is implementation of more effective measures in regards to attaining respect for people as a component of the culture of the organization. Further, as the biggest retailer in the globe, Wal-Mart has thrice the number of employees as the retailer behind it and thus the size of the company may imply that the issues that affect it are likely to be many. It is practically impossible for head offices or executive management to monitor all the activities that go on in the stores and thus some stores may deviate significantly from the organizations culture. Considering this, the company should make some adjustments in the programs within its stores and come up with a posting system for all managerial positions in order to ensure that all employees are aware and are afforded opportunities to make applications for promotions.