Diagnosing Change

Assignment 2: Diagnosing Change

YaVanda Dobbins

Dr. Allan Beck – HRM560

January 30, 2017

Walmart: Diagnosing Change

Walmart has been one of the largest discount retail chains in the industry. Founded by Sam Walton in 1972, his vision led the company to establish goals dedicated to excellent customer service and great value. Walton believed in the servant leadership philosophy, where leadership is derived from the willingness of the leader to serve individuals. This vision allowed Walton to stretch boundaries beyond what competitors were achieving, creating a culture that focused on providing quality service and products. As aspirations grew, Sam’s Club and Walmart Supercenters provided consumers with new store formats. There are over 11 thousand store locations globally, employing over two million associates (Walmart Stores Inc., 2017). In addition to dominating the discount retail industry in employment, Walmart’s revenue at the end of its 2016 fiscal was over four hundred billion dollars.

Walton’s vision for customer service correlates to his idea the associates’ ability to incorporate valuable customer service entices others to join the company. Walmart’s human resource initiatives concentrate on four areas, opportunity and advancement, culture, benefits, and career. The concept has allowed the company to create a culture where progress is possible. Over 75 percent of their store management teams started in hourly positions, further providing insight into Walmart’s vision of valuing the people they serve (Walmart Stores, Inc., 2017). The company’s job design structure, allows each store to create HR practices unique to its location. Overall the company fosters a hierarchal centralized organizational structure that ensures a company as large as Walmart managed effectively. This system allows managers at each store to manage their respective areas, guided by the decisions of higher level managers. The centralized structure is useful for organizations who take high risks to increase productivity and performance. Walmart continues to take risks while restructuring and redesign their organizational structure, providing opportunities for advancement. Walmart uses this design to ensure each location functions as one, however it is also imperative for the organization to be flexible when needed.

Walmart’s job design structure heavily focuses on acquiring talent in sales and marketing at all levels, especially management. Thompson states, “the HR management’s specifications for these jobs generally require at least a degree in sales or related disciplines for the position of sales manager and store manager” (2016). When hiring new associates, their forecasting is first based on a sales analysis from each store, then turnover rates and the gap between needs and capacity are analyzed. The information from the analysis and design allows Walmart to determine the job description and specifications. As previously mentioned, using the hierarchal organizational structure allows Walmart to specify each aspect of their associate roles. Lastly, Walmart’s individual incentive plan and bonus program are also structured to ensure each store meets quality sales performance. Full-time and part-time associates qualify for the program, provided quarterly and based on store performance (Walmart Stores Inc., 2017). The individual incentive plan is structured for top level management, to motivate top sales performance.

Walmart Stores Inc.’s vision for retaining and acquiring associates is based on serving associates, the community, and shareholders. The desire to create an opportunity for advancement is a significant commitment for Walmart. Providing details on their corporate website holds the company responsible for carrying out these practices, in addition to effectively encouraging applicants to review and apply for available roles. Walmart also provides information on their commitment to serve internal and external customers. The company states “our associates are building better lives for their families, and we’re proud to be a part of their success stories” (Walmart Stores Inc., 2017). With 75 percent of their top level executives starting the company at hourly level jobs, it shows the company is committed to servicing their team. Even though Walmart undertakes to service the associate, there are enhancements to their job analysis and design that can be evaluated create a better experience and completely drive the vision of the company. Walmart focuses on sales performance for all its locations, which is a great concept to manage performance. However, they will benefit from instituting a system to develop job classifications, specifics, and details tailored to customer service as well as sales. The centralized and hierarchal structure is ideal for this type of organization; however, it can sometimes overshadow localized issues and concerns. The environment for each store is different, even though they offer most of the same products. The standard structure is centralized and hierarchal, but Walmart allows a lot of flexibility for their stores to operate the human resource programs dependent on the location. Establishing guidelines to ensure service-minded associates are retained and hired can assist the bottom line, increased sales performance. Dating back to 1979, Walmart has focused on developing their people and turning entry-level jobs into career opportunities (Walmart Stores Inc., 2017). Incorporating this change can create positive change within the organization by stretching to focus on overall customer support. Consumers value excellent service and valuable products, therefore developing jobs geared towards those skills and abilities can significantly increase productivity and performance. Making this a core practice in all stores regardless of location can instill positive change throughout all stores.

Walmart is consistent with the value they provide to their associates and customers. Incorporating new job descriptions and adding specialized skills in service can enhance the cohesiveness of their locations. It can also create a rewarding and engaging environment for customers and associates. Walmart has devoted over two billion to increase wages, education, and training, plus promoted two hundred thousand associates (Walmart Stores Inc., 2017). With this type of commitment, they can establish this change easily. The Nudge Theory is a change management method that encourages positive reinforcement and the core understanding of human nature. This theory doesn’t direct or instruct what changes need to take place, and it provides assistance with managing change effectively. “Change management is not just the successful implementation of change, but the use of specific techniques and structures to implement change,” states Akdeniz (2014). The Nudge Theory helps to reduce resistance to change and enforce behaviors consistent with Walmart’s values. Enhancing each location’s ability to work as a cohesive unit between human resources department can create a winning culture focused on supporting associates, servicing customers, and increasing sales. Change management is not a process of resolving a problem; it is a people guiding experience that creates the understanding of change.

When an organization is ready for change, there is a shared commitment among individuals throughout the company. The vision is clear and implementing the change would be more effective. “When organizational readiness for change is high, organizational members are more likely to initiate change, exert greater effort, exhibit greater persistence, and display more cooperative behavior,” believes Weiner (para. 3, 2009). To determine an organization’s readiness for change, Walmart can use associate surveys that provide detail into the culture and engagement of the organization. It can also determine if associates are passionate about the progress of the company, and determine development gaps and opportunities. Walmart can also invest time into effective observations and focus groups within their stores; this can provide valuable detail into the readiness of the organization and individual associates. Beich suggests studying the corporate culture helps “to see how best to introduce changes, as well as to encourage personal values to align with organization ones and to develop people’s openness to change” (p. 43, 2007). Since Walmart is a large organization, the survey results can provide insight into performance, satisfaction, cultural differences, and direct feedback. Assessing the organization’s readiness for change is an integral part of the change process because it prepares the organization for future challenges and successes.

The readiness assessment provides an understanding of the state of the organization, in addition to identifying areas of improvement. Walmart can improve on areas of customer focus by offering training and development to enhance soft skills for associates. Walmart’s CEO Doug McMillon committed to “changes for associates in the US that will not only provide higher pay but also with the ability to advance in their careers” (Oliver, 2015). Encouraging associates to grow within the company is only half the task, creating a better organizational flow through leadership level changes provides perspective into their readiness to change. Change starts from the top down, Walmart’s executive vice president Brett Briggs encouraged his team of leaders and shareholders to believe in the new values and vision for the company suggesting “even though this is a really big company it’s about one member or customer at a time and one associate at a time” (2016). After reviewing and assessing Walmart’s readiness to change, the company would be able to implement changes to how management and leadership skills and roles are designed. They’ve taken the necessary steps to understand what is needed within the organization and are nudging the teams to incorporate the new culture. Walmart is ready for change, their consumers want to better experience, and the leaders within the organization want to provide support to its associates and customers. Walmart Stores Inc.’s website leaves everything open for shareholders and consumers to review. It is a publicly traded company; therefore any new implementations, changes, or issues that arise must be communicated. Biech suggests “major change is difficult to accomplish without a central organizational force behind it in the form of unified leadership and cohesive team to implement the various aspects of the change initiative” (p. 49, 2007). With the leaders of the organization standing behind their promises and providing the necessary information to keep everyone informed, proves their ability to make a change successfully.

Reference

Akdeniz, C. (2014). Change Management Explained. Germany: First Publishing.

Beich, E. (2007). Thriving Through Change. Alexandria, VA: American Society of Training and Development.

Biggs, B. (2016, June 3). Brett Biggs: Transformation from a Position of Strength. Retrieved from http://corporate.walmart.com/article/brett-biggs-transformation-from-a-position-of-strength

Oliver, K. (2015, April 27). Pay Alone Will Not Close the Opportunity Gap. Retrieved from http://corporate.walmart.com/_news_/executive-viewpoints/pay-alone-will-not-close-the-opportunity-gap

Thompson, A. (2016, May 17). Walmart: Human Resource Management. Retrieved from http://panmore.com/walmart-human-resource-management-hr-management

Thompson, A. (2016, May 17). Walmart: Human Resource Management. Retrieved from http://panmore.com/walmart-human-resource-management-hr-management

Walmart Stores Inc. (2017). Our History. Retrieved from http://corporate.walmart.com/our-story/our-history

Walmart Stores Inc. (2017). Company Facts. Retrieved from http://corporate.walmart.com/newsroom/company-facts

Weiner, B. (2009). A theory of organizational readiness for change. BioMed Central Ltd. doi:10.1186/1748-5908-4-67