Human Resources IP5

Unit 2 Individual Project: Walmart Benefits and Compensation

Human Resources Strategy MGT652-1503C-01

By

Andrew T. Robison

AIU Online

08/16/15 Walmart Benefits and Compensation

As a multinational company that offers to give its customers a wide variety of merchandise, groceries, pharmaceuticals, and other household goods, Wal-Mart is arguably one of the largest profits making retail chain globally. Although the company was established in early 1940s, the retail chain has been able to grow and create its market niche in the competitive retail business. Available information indicates that the company has a big number of employees across all its retail stores (Singh et al, 2006). Just like any other company of its size, the management of Wal-Mart continually revises its strategies and methods of ensuring that its employees are remunerated well.

Through the strategies put in place, the company has ensured that it listens and pays close attention to the workers grievances so as to come up with better benefits and compensation plans that encourage the staff to work for Wal-Mart. By having one of the best benefits and compensation packages for employees, the management of Wal-Mart has been able to find time to handle customer satisfaction, which is one of their core values (Goldstein, 2009). According to business analysts, one of the biggest benefits that Wal-Mart offers to its staff is the competitive wages as compared to other companies operating in the same sector. A report prepared by Forbes indicates that Wal-Mart Company offers incredible opportunities for all hardworking and ambitious workers, who intend to work their way up in the retail chain.

Currently, there are top managers who earn up to $170,000 annually, which is a relatively good package in the market. Additionally, Wal-Mart offers all its staff comprehensive packages which provide more cash up-front to pay for medical expenses. In addition, some of the packages offered as benefits are geared towards helping employees save and plan for retirement (Goetz, 2006). Further, the company ensures that its employees are handsomely compensated in the event that they are exposed to serious harm while working. In the event of death of an employee, the company compensates the next of kin of the fallen worker. According to market analysts, the amount the company uses as compensation or benefits to its staff constitute at least thirty percent of the company’s total budgetary allocation. This demonstrates how serious Wal-Mart considers issues of benefits and compensation towards its staff. The management of Wal-Mart uses internal equity compensation approach as a means of compensating its staff. It must be noted that in most instances, a worker’s compensation is based on an individual’s position and job within the company.

Business Leadership and strategy

Most businesses are guided by the mantra of meeting the needs of their targeted clients. To this end, the management of most companies identifies a business leadership strategy that helps them meet their objectives and remain viable. According to business leadership experts, there are at least three generic strategies that business leaders can use in meeting the objectives of their companies. They are focus, differentiation, and cost leadership. However, before adopting any of the strategies, it is fair and important for the management to critically look at which strategy best suits the company (Goldstein, 2009).

The business leadership used at Wal-Mart is the Cost Leadership. By using the everyday low prices strategy in attracting customers, Wal-Mart has been able remain successful in the market. Rather than relying on sales, Wal-Mart has continually used the idea of everyday low prices in offering products at a cheaper rate as compared to its competitors. The company has been able to achieve this courtesy of its large scale and very efficient supply chain. In addition, in order to ensure that the company has a grip on its market, Wal-Mart sources its products from cheap domestic supplies and low-wage foreign markets. Therefore, this approach helps Wal-Mart to sell its items at a relatively low price and to profit off thin margins at a high volume.

Diversity

Through increasing its number of outlets around the world, Wal-Mart has been forced to critically consider diversification of its employee profile so as to meet the actual needs of the different markets. Since new markets have specific needs, there company has had to use a unique strategy of using qualified natives to run the different chain stores. The approach has seen the company establish a grip on every new market it has ventured. Other than using a diversity of staff in its retail chain stores, the Wal-Mart has diversified in the products that it offers in the stores (Singh et al, 2006). Available information indicates that during its initial phase, the company limited itself to provision of groceries. However, with time, the company has diversified its products to other goods and services that meet the basic needs of most of its clients. However, it must be noted that in order to avoid losing the focus of the company at the expense of diversification, Wal-Mart has a robust department of Human resource. Other than having the mandate of assessing professional qualifications for the employees, the department is mandated to ensure that the company achieves economic growth.

In order to handle the diversity of its workforce around the world, Wal-Mart utilizes various routines. One such routine is the continuous polishing employee motivation and satisfaction (Treacy & Wiersema, 2007). The management of the company acknowledges that a poorly motivated workforce will most likely not deliver on their mandate. Available information indicates that the company embraced the idea of hiring experts who have the capability of handling the various diversity challenges that may arise at the company. Other than handling all issues related to staff and institutional diversity, the experts are also mandated in ensuring that all the other operations within the company remain effective.

Employee relations

In order to remain viable and ensure consistency, Wal-Mart considers its employees as the backbone of their success and operations. To this end, the company implements several strategies that aim at ensuring that employees relate well with each other and the management. The company has put in place strategies that aim at paying personal attention to employees and make them feel accepted by the company. By listening to the grievances of its staff and allowing them to engage in associations that champion employees’ needs, the company has created a good environment for efficiency (Treacy & Wiersema, 2007). Although the company has created a good working environment and encouraged good employees relations, some experts argue that there is still more that can be done. It is argued that the management of Wal-Mart has on a number of occasions acted contrary to the agreed terms of service to its employees. Such scenarios have led to some employees suing the company for unfair treatment or dismissal from employment. However, the management of Wal-Mart has been voted as one of the best in the world that encourages and supports employee relations within and outside the company.

Ethics and corporate social responsibility

Ethics and morals have great value in any organization because these two aspects boost innovation strategies in business organizations. For business organizations to remain productive and profitable they must incorporate the right ethical principles in their information systems. Information systems entail a variety of disciplines which includes computer networking, database management among other systems. It is evident that Wal-Mart has incorporated the right ethical principles in its information system which aims at supporting innovation, management, operations, and decision making. In a broad sense, the term information system combines both ICT that an organization utilizes and the way individuals associate with the technology to endorse business processes. There are several ethical issues associated with information systems and they can affect the way organizations and people function. Due to technological advancements, information systems are facing numerous daunting challenges.

Research studies have revealed that ethics is one of the driving forces in business organizations because business organizations that run ethically have promoted their image in their target markets. It is foreseeable that Wal-Mart is one of the business organizations that run ethically hence the business organization has remained innovative in its business operations. Wal-Mart’s ethics have played a role in the business organization’s innovation strategy. It is undeniable that the ethics practiced by Wal-Mart have enabled the company to realize its full potential and become a learning organization. It is apparent that Wal-Mart is a learning organization which facilitates the learning of its employees and continuously changes itself.

Each of the Wal-Mart’s stores has an establishment that commits itself to the welfare of the neighborhood (The Economist, 2006). Every year the organization offers millions to philanthropy, schools and some of the less fortunate communities in need of financial support. This move has strengthened the relationship between the company and the surrounding communities where the company operates. It also remains clear that Wal-Mart has been supporting some of the communities programs which alleviates poverty and other challenges which communities encounter.

Organizational and employee development

It is evident that Wal-Mart’s organizational structure depicts on product, market and geographical structure. Notably, Wal-Mart is a global business organization hence its market structure clearly presents different responsibilities of the top management together with the subordinate staff (The Economist, 2006). Statistics indicate that Wal-Mart has played significant role of creating employment opportunities in most of the countries where it operates. For an organization of this size and sort, the most proper capacity for the organization is the capability of the company to plan courses in which it has the ability to minimize the expenses particularly relating to its operations. For instance, stock administration and dispersion frameworks, which aim at decreasing huge expenses of transportation together with labor. In essence, Wal-Mart unique advantage is the centralization of assets for the business sector in the remote areas. It is evident that Wal-Mart has captured new and ready markets for its products and brands in most of the remote areas, which includes suburbs and small towns.

For decades, performance appraisals have helped organizations improve organizational performance, develop individuals, and feed into business planning. Most of the organizations across the globe generally conduct formal performance appraisals annually in order to measure and evaluate the performance of their staff. It is the mandate of the organization’s line manager to appraise each staff member. For instance, annual performance appraisals in Wal-Mart have been streamlining the whole process of management and monitoring of agreeing expectations, objectives, standards, and delegation of tasks and responsibilities.

In addition to this, staff performance appraisals in Wal-Mart have also played a key role of establishing individual training needs and present organizational training needs for planning and analysis. Arguably, performance appraisals also enabled the management of Wal-Mart to review each employee’s performance against standards and objectives for the trading year, acknowledged in the previous year. Performance appraisals have also remained essential for succession and career planning for crucial jobs, individuals, and for the entire organization. Furthermore, performance appraisals in Wal-Mart are crucial for staff behavior development, motivation, attitude, communication, and aligning organizational and individual aims. They also help Wal-Mart in fostering positive and beneficial relationships between staff and management (Cardy, 2011). Ideally, performance appraisals are vital in organizations because they manage the performance of organizations and people.

It remains clear that Wal-Mart is truly included in the welfare of the employees and even made a film on them and their existence at the organization. Assuming that they offer the allotments and benefits of the organization to the worker and helps them to tune in the benefit making practice of the organization, this satisfies an alternate requirement for the employee. This is the need for self-realization that all individuals inside the working vicinity require. Employee ranking is a yearly performance evaluation process that takes place in Wal-Mart, which grades employees following uncomplicated best-to-worst scale in order to develop a quality and recommendable workforce. It remains clear that in forced ranking managers usually rank employees into three major categories. The top ranked employees are offered with the best incentives and pay such as training. In addition, the middle ranked employees are offered with minimum development incentives and opportunities, while the lowest-ranked employees are fired or neglected by the management of the organization.

Talent Management

Performance appraisals have the major objective of providing employees with targeted guidance and feedback to help them grow, learn, and develop. It is apparent that Wal-Mart uses performance appraisals in order to manage the talents of its employees. Notably, employee appraisals have a broad variety of impacts on employees that managers must understand and identify. It remains clear that an employee appraisal can serve as motivation for a talented employee in an organization hence increase productivity. When employees see that their goals are defined they are greatly motivated. Motivated employees have the ability of helping organizations achieve their ultimate goals in due time. Wal-Mart has done a recommendable work of creating a comprehensive plan that aims at developing employees and inspiring them for a higher level of efficiency. For employees to execute their tasks as expected Wal-Mart management has provided the workforce with a recommendable guidance which nurtures the talent of each employee (DelPo, 2007). One of the major parts of employee appraisal in Wal-Mart is when the employee and the employer review the job description and differentiate the employee’s performance with the expected outcomes or results. This provides the employees within the organization with a deeper understanding and a feeling of clarity that helps them perform their allocated duties excellently.

Technology

Statistics have indicated that Wal-Mart is using the latest technology to link its stores with the largest data warehouses across the globe through enhanced analytics. Notably, the company has built faster, better and more efficient technological programs which support the organizations operations. Wal-Mart technological structure comprises of officials and analysts who help the company in the process of generating reliable statistics for the entire company. It is evident that this group of personnel is not involved in the operational workflow of the company. The work of the personnel is to configure and design the company in order to allow it operate smoothly. In this regard, these personnel remain the most qualified people who give instructions and train the other members within the organization. In addition, they play a pivotal role in public relations matters (Robbins, 2007). In Wal-Mart this personnel usually fill the positions of both support and marketing managers in different. Finally, they can play an essential part in recruiting new employees and advertising.

References

Cardy, R. L. (2011). Performance management: Concepts, skills, and exercises. Place of publication not identified: M E Sharp.

DelPo, A. (2007). The performance appraisal handbook: Legal & practical rules for managers. Berkeley, Calif: Nolo.

Goetz, S. (2006). Wal-Mart and Social Capital. Am. J. Agr. Econ. 88 (5): 1304-1310.

Goldstein, S. D. (2009). Superior customer satisfaction and loyalty: Engaging customers to drive performance. Milwaukee, Wis: ASQ Quality Press.

http://www.economist.com/blogs/freeexchange/2006/11/an_enviromental_walmart

Robbins, S.P. (2007). Organisational Behaviour (12th ed). Dorling Kindersley. South Africa.

Singh, V. P., Hansen, K. T., & Blattberg, R. C. (2006). Market Entry and Consumer Behavior: An Investigation of a Wal-Mart Supercenter. Marketing Science, 25(5), 457-476.

The Economist. (2006). Another reason to love Wal-mart. The Economist. NEW YORK.

Treacy, M., & Wiersema, F. D. (2007). The discipline of market leaders: Choose your customers, narrow your focus, dominate your market.