organizational paper-2

Organizational Change of Wal-Mart

Organizational Change of Wal-Mart

Introduction

In the corporate world of today, transition has got the consideration of establishing a competitive advantage for any given company. Nevertheless, for the transition to be effective in nature, a change supervision package is essential for the purposes of recognizing latent conflict between the business and the change itself. Similarly, the change supervision package has a sole responsibility of addressing the requirements of all the employees in the organization. Last but not least, the package should also conduit the breach amid the prospects of the executives of the organization, the stakeholders undertaking the transition as well as to the end users that will be affected by the change. According to modern research, certain organizational changes have prospered while on the other hand, some have failed due to the ignorance of applying an effective organizational change theory (Adopted from Business Week, 2013). From the information as already given above, this paper takes turn discussing an example of a failed organizational theory subsequent to the emphasis on an organizational change theory in conformance to its application on the failed organizational change.

Failure of Wal-Mart to Reap Benefits by Going Upscale

Among the array of failed organizational changes, the failure of Wal-Mart to reap prospected benefits by going upscale is not an exception. Wal-Mart is a business company known to be selling all products under one store. It means that in each and every branch of the business organization, there is the trend of selling close to all commodities in one roof. The business stocks food merchandises, domestic commodities, music appliances, electronics, clothing and various varieties of goods. Recently, the business established an organizational change of expanding its market share. In the transition theory, it involved stocking of goods of relatively higher prices(DuBrin, 2015). The given merchandises that were upscale in nature, encompasses from trendy fashion to executive merchandises. In the plan, the business prospected to retail upscale commodities that were rather trendy in nature. The main reason for retailing the stylish merchandises was for the purposes of attracting first hand clients to buy its products. From the information as already mentioned above, it raises the question; did the organizational change by Wal-Mart really worked out?

According to the financial reports as well as analysis of the business, the strategy never worked out as earlier panned by the executives as well as to the stakeholders of the business organization. As we all know, in the corporate world of today, there occurs two types of consumers. They include the higher-end end users as well as to the lo-end customers. The higher-end users consist of the persons that are at a position of buying goods that are relatively of high value in terms of price and quality. On the other end, the low-end users consist of the customers who are only capable of buying goods that are relatively of low value regarding price. It is a matter that subjects to the difference in income of individuals. The strategy of retailing goods of upscale by Wal-Mart mainly aimed at the higher-end customers. Nevertheless, the given higher-end consumers never took clench of the strategy.

In general, the higher-end consumers were kind of underwhelmed with the move of increasing the prices of the commodities of upscale. As a result of having no option, they resorted to buying the given goods only that the turnout was low in number. On the other end, part of the higher-end consumers as well as to the low-end users resorted to buying commodities from other enterprises that stocks similar goods just like Wal-Mart. In the given move, the customers aimed at finding solace in businesses that offered bargains for the commodities they sell(DuBrin, 2015). It is already clear that the strategy by Wal-Mart to stock goods of upscale hence increasing their prices did not really work as expected. For instance, the business enterprise lost most of its customers to the business that stocked similar merchandises at prices that are relatively low than that set by Wal-Mart.

As a result, the business enterprise resorted to signing of contracts with new advertising agencies for the purposes of informing the general consumers on the given change that the business had made. Still, the business continued to face a decline in the number of its customers. It is an issue that forced Wal-Mart to review its strategy plan by the time period of 2012. During the given year, the business pronounced a newfangled perspective of reviewing the strategy of stocking upscale goods that saw it loose majority of its customers. Research indicates that the business did not have a forethought planning procedure regarding the change. It is the reason as to why its customers resisted the upscale goods hence led to the eventual failure of the given organizational change. In the new strategy, it pronounced its policies of relocating more efforts on low prices of its merchandises. According to the thoughts of most of the renowned economic experts, reduction of prices by the business enterprise was the only sure way to retain as well as regain its customers. In the bigger stores currently, the business stocks commodities that are of moderate scale in terms of prices. In the smaller stores however, the business is seen to retail goods of upscale. Is there any probability of the new plan of stocking upscale goods in its smaller stores work out the second time?

According to reports, US’s prevalent retailer has pronounced new plans of reinvesting close to two billion dollars in merchandises that have a consideration of low value. In the new plan, its main purpose involves influencing of additional traffic to its stores that are above 3,800 in number, in the entire United States of America(Adopted from Business Week, 2013).

Restoring its Bargain Cred

The main purpose of the new move involves retaining and regaining both its trademark and goodwill in conformance to the increase in dollar stores. In a more heightened perspective, the move by Wal-Mart projects as a sequence rectification that aims at alleviating the business’s self-missteps.

Reasons why Wal-Mart’s Organizational Change Failed

Ineffective Communication: The business enterprise failed at establishing success for the set organization change as a result of ineffective communication. The management might have succeeded in communicating effectively with the workers and the stakeholders. However, the business did not succeed in communicating effectively to its customers regarding the reasons as to why the given change was essential to both the business and wits customers respectively. Wal-Mart is thereby an example of business enterprises that failed at viably uttering to its troops on the importance of adhering to the organization change of retailing goods that are of upscale in nature. For instance, a recent research indicates that about sixty percent of the employees and the stakeholders never understood the utmost importance of effecting the given change by the business (DuBrin, 2015). It therefore raises the question; how many customers did not conform to the given organization change in the event that most of the employees as well as to the stakeholders never adhered to it?

Divergent Agendas: Wal-Mart failed at attaining the set prospects of its organizational change as a result of outlining differing agendas in terms of the set transition. Initially, the business majored in the retailing of commodities that have a consideration of low value in terms of price. It then came up with the new policy of retailing merchandise that are of upscale in nature hence it conforms to relatively higher prices. In the span of 2012, the business again pronounced its new plans of going back to its roots – retailing of merchandise that are of low value in terms of prices. From the information as already mentioned above, it means that the given business enterprise entails divergent ideas in terms of its marketing strategies. In this perspective, it leaves the customers in a dangling situation concerning the future goals and interventions of the business enterprise and its customers subsequently.

Poor Planning: In the event of establishing an organization change plan, every business has got the requirement of developing an effective plan regarding achieving the prospects of the transition. Did Wal-Mart clearly have an effective planning process of its organizational change? Well the business did not succeed at that. Research indicates that the business did not have a forethought planning procedure regarding the change. It is the reason as to why its customers resisted the upscale goods hence led to the eventual failure of the given organizational change (Adopted from Business Week, 2013).

Lewin's Organizational Change Management Model

One of the important component that need to be incorporated into today’s business is the transition from one age or improving the services over the other. This is so important that this will help regardless of the size and shape of the business. Transition can be seen in almost all the industries. In this section of the paper we will see how would the Lewis change management model would have helped the Walmart to achieve its goal in the organizational change (Burke et al., 2001).

This model basically has three steps that need to be followed during the change process of the Walmart. These steps are first proposed by Lewis in 1940. But still they are so relevant to today’s business change management. The steps are:

Unfreeze: This is the first step in the Lewis change management process. This step mostly involves the things that the organization considers to change. So in order to determine what needs to be changed. The organization should involve in the assessment process by which it can identify all the aspects of it. In order for the change to be effectively and controlled it is crucial to get the management support. This will the help the change process lot smoother and run equally across all the departments of the organization. Management support hear also involves the support from the mangers, senior executives and key stakeholders of the organization. The organization should identify the reasons of change and how it is going to be established in the organization. The change that is to be implemented in the organization should be effective and after application change is expected to be different from what it is existed now. The change has to be measured through the visualization of the changes.

Change: This holds up all the communication that is required in the organizational change process. The perspective and things are to be established in the early stage (unfreeze). The change has to occur in a way as it is planned and thought to be implemented. All the change sets that are determined are provided with details in this phase and the appliers should get the approval from the executives before establishing this plan across the organization. All the problems that are existing should be resolved before the change is applied to the organization. Once all the problem is solved. The process should be carried out. The change plan should be discussed with the key personnel of the organization such as the executives of the organization and provide the plan of execution and explain it clearly. So the top managers will get to know what changes are made on a day to day process and this will also measure the performance of change in the implementation process.

Refreeze: Now from the other two stages, the organization already have fulfilled all the requirements for the change. Now the change has to implement appropriately inside the organization by clearing all the barriers that are existed in the organization before the change phase. In order for the change to be effective the plan should change plan should be appropriately assist the change process and support for the changes. Leadership has an important role in supporting and establishing process change across the organization in an even way (Liu, 2011). After the employees receive the support training that is required for the newly developed process. Now the organization has perfectly applied the change process that is effective.

Application of the Above Theory to the Failed Change

In a just perspective, Kurt Lewin has succeeded in the creation of one of the first hand theories to assist most of the organizations in effectively establishing a promising organizational change. In the application of the above mentioned theory, it generally involvesfour main stages. They include;

1) Awareness of a delinquent subsequent to the prospective clarifications. In this phase, it involve to major parties. The first party involves the executives of the given business enterprises. The second party includes the executives of the given business enterprise. The two management team of the organization has to ensure that effective communication process occurs throughout the organization.

2) Resolutions to embrace the new Invention. It includes all the executives of the company taking turn in proposing possible effective solutions towards the proposed organizational change. In the given study, Wal-Mart could have resorted to appealing contributions as well as to the suggestions made by each and every stakeholder. In such like circumstance, the stakeholders include the workers as well as to the employees who opt to undertake the responsibility of influencing the success of the given organizational change(Liu, 2011).

3) Putting at Work the Definite Organizational Change. In this category, it involves the implementation as well as to the execution process of the given organizational change. In this face of an organizational change, there should be a check list that ensures that all of the proposals as well as executions are noted in writings for the purposes of future referencing.

4) Affiliation of the Organizational change with the day to day Operations of the Business Enterprise. In this face, in mainly involves incorporation of the organization’s day to day operations with the already commenced organizational change. By doing this, it ensures that all of the employees related to the given organizational change to be in transition with the transition itself.

Through the above mentioned steps, the given organization should ensure that each and every step is followed in conformance to the requirements of this paper. In the event that Wal-Mart could have undertaken follow up of the above mentioned steps, there occurs high prospects of the given project attaining the executive’s set goals. Besides the Lewin’s model, there are figurativelynumerous models that can be used in effecting transitions in an organization. Each and every organization has got a sole responsibility of responding to the day to day changes so as to avoid the company undergoing a failure in terms of organizational change.

Conclusion

In a true perspective, it is certainly going to take a long period of time for the given business enterprise to outdo its current competitors. Take a look; in the event that Wal-Mart took the initiative of undertaking its business to more upscale merchandise, all of its customers were angry about the given decision. In true sense, most of the people have got the desire of shopping many times when it comes to Wal-Mart stores (Burke et al., 2011). According to the modern research most of the people likes each and every branch of the business organization for an array of reasons. There is the trend of selling close to all commodities in one roof. The business stocks food merchandises, domestic commodities, music appliances, electronics, clothing and various varieties of goods. Nevertheless, the business must be aware of the benefits of resorting to an effective organizational change theory.

References

Business week. (2013). New York, etc.: Bloomberg L.P., etc..

Burke, W. W., Lake, D. G., & Paine, J. W. (2011). Organization change: A comprehensive reader. San Francisco: Jossey-Bas

DuBrin, A. J. (2015). Essentials of management. Mason, OH: Thomson Business & Economics. https://www.tinypulse.com/blog/top-7-reasons-why-organizational-change-fails

In Goksoy, A. (2016). Organizational change management strategies in modern business.

Liu, X., Akram, S., & Bouguettaya, A. (2011). Change management for semantic web services. New York: Springer.