HR 5

This is a human resource competitive analysis of Wal-Mart retail store. An industry human resource competitive position is elaborated alongside other competitors. Also given are the human resource risks that companies can face in the operations and the opportunities that exist in the market that they can seize to remain competitive in al dimensions. The paper finally gives an overall assessment of human resource competitiveness in retail industry.

Industry Competitive Position

The retail industry is in the United States and generally depends on the level of competitiveness of its staff. This ranges from the way its staff deals with customers, suppliers, and other stakeholders. The key skills required are customer relations skills, marketing and promotion skills, and the general human resource management skills (American International University, 2016). Often, success in the industry depends on the skills of the employees and how they can seize the opportunities arising in the market to get an edge above the other players. It is thus important to train employees on these core skills and on innovativeness (American International University, 2016). Many players in the industry are paying key employees efficiency wages plus a couple of non-pecuniary benefits to retain them. Heavy expenditure on training of employees especially on courses related customer relations and promotion and marketing define the success in the industry (American International University, 2016). Another key approach to human resource management in the retail industry is that of employee training. In order to enhance employee competiveness, regular trainings are necessary. Training refreshes the minds of the subjects and also exposes them to changes in the market to enhance their astuteness in handling new tasks.

Comparator Group Competitive Position

A core competitor to Wal-Mart in the retail industry is Target Inc. Target has had rougher experiences with its employees. It has recorded unprecedented employee turnover between 2010 and 2014 and this makes its human resource sustainability unstable (SHRM Foundation, 2010). Even though it has not lost key staff members such as the CFO and Marketing managers, the company has lost a number of personnel working under them. This makes them quite exposed and less competitive. Some of the risks that Target could experience dealing with less experienced staff members include the fact that there may be lagged activity as they familiarizes themselves with the market (American International University, 2016).

Human Resources Risks

Description

Human resource risks also referred to as human capital risks refer to the exposure of a group to losses as a result of drain or loss of key personnel, inadequate human resource development strategies, and deterioration of staff morale, inappropriate working schedule, inequity or inequality in human resource management, inappropriate industrial safety, and or discriminatory conducts against the employees (SHRM Foundation, 2010). Some of these risks expose the business in ways that can have bearing on its productivity as well as the way the key business stakeholders relate with the company. For Wal-Mart, it is exposed to a number human resource risks. These include the risk of employee sabotage of operations, risks of losing key personnel, risk of losing out to litigations due to court cases against the company, and the risks of reputational deterioration due to the perception they hold of the company as a result of its failure to comply with regulations (SHRM Foundation, 2010).

The risk of employee sabotage of operations could result from the dissatisfaction of employees against the management. Employees have a number of ways of addressing their grievances. First, they could opt for a go-slow or pilferage as a way of exercise vengeance against a management that they disapprove of. When this occurs, the operations of the company can be sabotaged and the organization will only be using the human resource sub-optimally (SHRM Foundation, 2010). The risks of losing key personnel refers to the risk that employees will seek pastures they deem greener based on the disapproval they hold against the company. This can be a consequence of poaching of key staff members who are already very familiar with the organization’s operational processes. This can plague the organization as it would have to incur training costs or have to pay efficiency wages to retain them (SHRM Foundation, 2010).

The risk of losing out to litigations due to court cases against the company refers to the exposure of an organization to court cases filed by disgruntled employees as a result of the organization’s non-compliance with basic regulations (American International University, 2016). These regulations could take the form of industrial and occupational safety standards observance by the organization, health and security compliance by the organization, and compliance with the labor and employment laws and regulations as well as labor union requirements (American International University, 2016). All these activities when they get to a level in which they must be pursued in courts of law, they will have cost implications such as on legal consultancy fees and the possible payment for damages and costs in case the ruling of the court turns to the disfavor of the organization (SHRM Foundation, 2010).

The fourth risk is the risks of reputational deterioration due to the perception they hold of the company as a result of its failure to comply with regulations (SHRM Foundation, 2010). Stakeholders are very sensitive to the safety of the company they are dealing with in all aspects and this is not limited to human resource policy management. Some suppliers and creditors insist on some bear minimum conditions that should be met before they can contract with the company for any form of dealing (SHRM Foundation, 2010). These could include observance and compliance with employment and labor relations laws. If the reputation of the company is damaged, say due to noncompliance with any regulations, the stakeholders may seize their dealings with the company and this may not only hurt the company’s operational dealings but also financial dealings and thus liquidity (American International University, 2016).

Analysis

Wal-Mart is exposed to all these categories of human resource risks. There have been dissents among the members of its workforce both in the United States and in its offshore subsidiaries (Walmart Inc., 2015). One case is when the Ottawa workers carried out demonstrations against the organization’s decision not to implement the minimum wage laws and refusal to accede to the unionization calls by employees (Walmart Inc., 2015). Employees require good working conditions and a means of airing their grievances and this can be best achieved through unions. Denying them the right to unionize could only make them seek alternative employments elsewhere and this could be detrimental to the organization’s operational flows. Wal-Mart is utterly exposed to this kind of risk (Walmart Inc., 2015).

Wal-Mart is exposed to the risk of incurring high costs resulting from litigations that have been filed against it by the employees and employee unions. In 2014 alone, the company registered an average of 17 cases per day including the domestic branches and the offshore from its subsidiaries. This figure is utterly catastrophic given that it is 10 cases per day above the Fortune 500 cases (Fortune 500 , 2015). Costs that could be associated with litigations include legal consultancy fees and fees incurred in form of settlement of damages and costs (Fortune 500 , 2015). The continued payments of these costs could not only affect its liquidity but also affect its operational stability (Walmart Inc., 2015).

Wal-Mart is exposed to the risks of sabotaged operations by its disgruntled employees. Employees whose morale is deteriorated cannot be as productive as those with higher morale. They can do anything to satiate and compensate the shortfall in the morale boost. They can opt for go-slows and shirking which could affect the company adversely (American International University, 2016). The wide dissent among the employees especially as a result of the catastrophic reports of industrial injuries can make employees avoid undertaking certain tasks that are core to the operational sustainability of the company (SHRM Foundation, 2010). Some of the ways they could sabotage the operations of the company include diverting customers to other stores, selling the company’s operational plans to competitors, and even inciting customers and other stakeholders from dealing with the company (Walmart Inc., 2015).

Wal-Mart is exposed to the risk of reputational deterioration as a result of the bulging number of cases surrounding it. These cases cast doubts as to its commitments to comply with basic regulations such as employment and labor relation regulations, industrial safety, and minimum wage legislations (Walmart Inc., 2015). In 2014, Jodec Inc., a key consultant on marketing issues in Canada, threatened to strain its relations with and services to the company unless and until it complies with employee unionization calls in Ottawa (Walmart Inc., 2015). Its position was that the blatant declining by the company to accede to it was hurting marketing (SHRM Foundation, 2010).

Human Resources Opportunities

Description

There a number of human resource opportunities that a company can use to address matters relating to its human resource and to enhance its operational efficiency (SHRM Foundation, 2010). These include internally recruiting of staff members to different positions, automating operations to cut down on the reliance on labor inputs, and outsourcing human resource recruitment to human resource companies (SHRM Foundation, 2010).

Instead of spending fortunes advertising for positions such as vacancies in the management positions, the company can make use of its available stock of employees who are not only experienced working in their various departments, but who are also aware of the organization’s mission, visions, and values. This will save the organization of training costs and the risks resulting from trial and error due to the engagement of new members to the workforce (SHRM Foundation, 2010).

Automating operations is another opportunity that companies have at disposal in the face of growing wages which attract dissenting perspectives with the employees (SHRM Foundation, 2010). Companies can substitute human resource services such as inventory updates with modern inventory management software and this can help it keep a lean number of personnel that can support the organization and which it can, with ease, pay decent amounts in compensation and thus get motivated. The other human resource opportunity is to outsource recruitment and training services to other firms so that the organization can only focus on its central roles (SHRM Foundation, 2010).

Analysis

Wal-Mart’s position in terms of utilizing these human resource opportunities is quite impressive apart from a few areas that require improvement. In terms of internal recruitment, the company has preset standards in internal recruitment (Walmart Inc., 2015). 60 percent of internal recruitment is affirmatively reserved for the internal personnel. The remaining 40 percent is a reserve of the non-members of the compan (Walmart Inc., 2015)y. In terms of automating operations, Wal-Mart is one of the leading discount retail stores that have embraced the most modern human resource technologies in its management (American International University, 2016). These include robot-operated units; human resource information services (HRIS) which enhances its ability to manage employees, and automating its point of sales terminals to reduce its reliance on expensive labor services. HRIS has enabled the company to identify internal skills and respond to highs and lows in human resource supplies in its stores (SHRM Foundation, 2010).

Wal-Mart carries out major human resource services such as recruitment, selection, interviewing, deployment, appraisal, reviews, transfers, disciplining, and termination. There exist a number of firms and human resource consultancy firms that can undertake many of these tasks (Walmart Inc., 2015). They can save the organization the time and hustle of having to take part in each and every detail of these tasks. This can enable an organization to concentrate on core duties that can enhance its operational efficiency (SHRM Foundation, 2010).

Overall Assessment of the Company’s Human Resources Competitive Position

Wal-Mart’s human resource competitiveness depends on two key items: the nature of tasks that the discount store undertakes and its ability to retain its core employees from poaching by competitors (SHRM Foundation, 2010). The discount retail stores industry is one that does not require technical end specialty in skills of human resource. Core functions that are sensitive and which the organization needs to put emphasis on and to ensure that its competitive strategy is not watered down include financial and tax accountancy services, market research, and legal expertise. Wal-Mart has permanent employees dealing with these core functions. The chief accountant and the CFO have stayed in the company for well over 6 years which means that they are now very conversant with the ins and outs of the company dealings and this has enhanced the organization’s human resource competitiveness in this key area. Marketing planning and strategy functions are partly outsourced and partly done internally (SHRM Foundation, 2010). This is another core determinant of a company’s success in the retail industry. Wal-Mart has remain competitive in this aspect given is growing sales and expansion into foreign markets (SHRM Foundation, 2010).

Conclusion

The paper has focused on a number of issues relating to the competitiveness of human resources in the retail industry and with specific attention to Wal-Mart. The retail industry requires a lot of efficiency and effectiveness in the way human resource matters are handled because that is the only way in which the firm can be guaranteed of sustainability in operations. All the risks mentioned should be managed by the organization by taking appropriate steps to shield it from the adverse effects in case they come to be.

References American International University. (2016). Hoover's Pro at AIU: Home. Retrieved from http://careered.libguides.com/university_AIUOnline/HooversPro. Fortune 500 . (2015). Fortune. Retrieved from http://fortune.com/fortune500/. SHRM Foundation. (2010). Retrieved from http://www.shrm.org/foundation. Walmart Inc. (2015). Investor Relations. Retrieved from: http://www.walmart.com/.