Walmart human resource practices and change

Wal-Mart, the biggest global retail chain, may be counted among the largest organizations worldwide, with regard to its size, financial performance and business value. This paper aims at examining Wal-Mart’s Subsystem and HR Management change, with particular emphasis on personnel selection, development, performance, training, and compensation management (Thompson 2016). Further it will address the key stakeholders of the organization.

Numerous factors contribute to a company’s success, and a few of them critical to the success of Wal-Mart are personnel selection, development and training (Thompson 2016). The organization needs to ensure its HR department receives adequate support to maintain its reputation and satisfy its business expectations and needs. Its major subsystems include Adaptive, Maintenance, and Management.

Investors:
Investors’ chief concern is profits. They desire more revenue generation by the company, which would increase their dividends. They also desire minimization of operational expenses, as profits increase with decreased expenditure. Thus, the company’s strategies prioritize its investors by minimizing salaries, thereby minimizing expenditure (Meyer, 2017).

Customers:
Shoppers are usually counted among a retail store’s stakeholders. Wal-Mart’s customers, particularly American customers, attach great value to affordable, quality products. American society typically gravitates towards retail stores offering low-priced products. Thus, the company also has to focus on customers’ interests. Wal-Mart is, in fact, popular for its affordable prices and may be considered to be adequately addressing customers’ interests (Meyer, 2017).

Employees:
The Wal-Mart workforce is a key consideration in management decisions. The two key interests of the company’s personnel include increase in salaries and greater job security. Owing to the low salaries Wal-Mart offers its personnel, the former issue of interest is understandable; the latter relates to an assurance that the company will retain its personnel for the long term (Meyer, P. (2017).

Wal-Mart’s corporate structure is function-based and hierarchical in nature. The term ‘hierarchical’ implies a vertical line of authority and command; the term ‘function-based’ implies the firm’s structure has personnel groups performing specific functions. For instance, the functions of sales, marketing, and HR management all have their own departments (Lombardo, J. (2017).
The following 4 key element of Wal-Mart’s corporate culture drive personnel behavior:

1. Customer Service
2. Acting with Integrity
3. Respect for Individuals and
4. Striving to achieve excellence (Lombardo, J. (2017)

The Adaptive subsystem
This may be demonstrated via needs assessment. Various kinds of needs assessments in relation to personnel training exist. Their applicability is dependent on a company’s HR management goals. The following are applicable in case of Wal-Mart:

1. Benefit-cost analysis
2. Work/task analysis
3. Organizational analysis

Benefit-cost analysis facilitates optimization of HR management and training expenses through the identification of the training technique that minimizes cost whilst simultaneously yielding the best outcomes. Meanwhile, task analysis is largely utilized when attempting to understand the requisite skills, abilities and knowledge for fulfilling job responsibilities. Lastly, organizational analysis facilitates the identification of emergent or novel HR management concerns like the need to open more stores, alter store layout, add new products, etc., which may be incorporated into training (Thompson 2017).

One good example is the company’s recruitment strategy
Wal-Mart banks on diverse sources when it comes to recruitment; consequently, it boasts a diverse labor force. Its HR department possesses a decentralized structure, with local information utilized as the basis for conducting recruitment efforts. Employees are largely selected from the locality wherein the Wal-Mart store is situated (Schermerhorn & Uhl-Bien 2014). Wal-Mart’s recruitment sources include direct recruitment from the local community, recruitment from college campuses, and e-recruitment. The above recruitment approaches ensure personnel diversity. For example, recruiting online draws candidates who may not be residing near the Wal-Mart store in question. Lastly, referrals help acquire qualified candidates on the basis of dependable referrers (Thompson 2017). Subsystem in Need of Change Wal-Mart’s maintenance subsystem, including compensation and performance management, needs to change. These elements are debated by both company critics and partners. This issue has apparently arisen due to its large, diverse associate pool – the company has roughly 1.3 million employees (in-store) across the numerous stores situated all over the US. Understandably, there is an expansive range of benefits and pay related requirements. The company understands this need to have a wide-ranging list of alternatives for personnel and addresses it (Bouffard et al. 2006).
The company is not wholly effective when it comes to addressing personnel concerns as it maintains a low-wage policy (Meyer, 2017). Impact of the Proposed Change Wal-Mart is famous both for its low salaries and its affordable prices. Increasing salaries would support personnel needs (as the workforce constitutes a major adaptive subsystem element). Currently, the minimum wage per hour at the company is 7.25 dollars, appreciably lower than the US average (9.93 dollars). Compensation system reformation would bring about a major corporate culture reform as it would reflect the organization’s sincere respect of individuals. A new minimum wage per working hour would serve to bring the company in line with Gap and other retailers who pay their employees ten dollars an hour, at the minimum. Wal-Mart’s HR department anticipates that such change would bring about improvements like personnel retention (Thompson, A. (2017).

The key driver of this compensation structure change is: increasing its lowest wage per hour to no less than nine dollars (or no less than 1.75 dollars above the present federal government-established minimum wage), followed by increasing it by another $1 per hour in the next year. This would ideally result in improvements like flexibility and transparency in work-schedule. This shift is partly motivated by management efforts to boost sales by improving company image and partly by the tightening of the American labor market; thus the need to have an all-inclusive approach, sustainable in the long run.
Realignment of stores’ operational structure would help associates enjoy a more constructive relationship with superiors, besides having more control over work schedule (Buss, D. (2015)

Selection Criteria
Conflict management, problem-solving and analytical skills are vital for management and supervisory posts and Wal-Mart’s HR team ought to assess this among candidates. Individuals in these roles are required to evaluate and solve issues and workplace conflicts (Schermerhorn, 2014). Selection for the majority of posts ought to rely on job knowledge assessment and structured interviews (which help ascertain the candidates’ expectations and opinions with respect to the company). Such information helps ascertain the individual-organization and individual-job fit. Further, situational judgment and personality tests ought to be conducted in case of several posts, though they are largely utilized in case of management posts (particularly finance and HR management). The former gauge an individual’s problem-resolution and analytical skills while the latter help determine whether or not the candidate could adequately fit in with the company’s nature and culture. Such tests guarantee an all-inclusive HR selection strategy (Thompson 2017).

Training facilitates change by supporting it. Wal-Mart adopts the following training initiative design approaches, which deal with particular traits prioritized in case of diverse posts in the company: Process-oriented and Results-oriented initiative designs.
The first design aims to fulfill the HR management goal of maintenance of proper standard-procedure performance, ideal in case of standardized processes. This design is utilized by Wal-Mart to formulate workforce training programs involving supply chain and inventory management. Meanwhile, the latter design is more popular at Wal-Mart, and it utilized for satisfying requisite abilities, knowledge, and skills for individual jobs. It is largely applied for warehouse and sales personnel (Thompson 2017).

This may be accomplished via personnel retention initiatives. Personnel retention is crucial for the company as its current turnover rate is quite high, particularly among its hourly sales personnel. Wal-Mart’s HR department relies on the following approaches for dealing with this challenge:

1. Bonuses
2. Recognition
3. Academic credit
4. Promotions
5. Training and development

The company acknowledges its top-performers by publicly praising them. It awards bonuses on the basis of business performance, though this approach is employed mostly in case of managerial posts. Wal-Mart’s HR management also offers training, development and promotion for boosting workforce morale and supporting its HR needs. Hourly sales personnel are promoted to supervisory posts, and finally to managerial posts. One long-term personnel retention and career growth strategy employed by Wal-Mart is its agreement with APU (American Public University) to provide employees with academic credit based on their work experience (Thompson 2017).