Walmart is a household name at this point in time and everyone’s either been to one or heard of it. So, you might be wondering why is Walmart such a successful company and what have they done to get there. Walmart was founded in 1962 by Sam Walton when the first store opened in Rogers, Arkansas. Ever since then Walmart has been extremely successful by the end of January 2019, Walmart’s total revenue was $514.4 billion.
Sam Walton was an American businessman and entrepreneur best known for founding the retailers Walmart, at one point in his life was the richest man in the world and eventually left an estimated $100 billion fortune to his wife and four children when he died. Mr. Walton actually worked for a short 18 months at J.C. Penny and that’s what solidified his goal of opening up his own retail store now known as Walmart. He was also a very humble man; even after becoming a billionaire, Walton drove a pickup truck and wore clothes from his own store.
Walmart tends to target the 95% of the American population for customers. Literally everyone but the wealthy. Walmart’s target market is the vast majority of people, typically the ones who need to find the lowest prices and those who simply want a bargain and convenience. You’re probably wondering why they don’t also target the wealthy and that is because they believe the wealthy only shop for high end products; and when you think about it, the rich don’t even buy their own groceries.
Walmart is the biggest retail brand in the USA and the battle in the retail industry is intense. Some of their main competitors are Amazon, Costco, Target, Best Buy, Kroger Company, etc. what makes these companies strong competitors is that they isolate one aspect of the retail industry and lock in. For example, Best Buy only sells electronics, Costco and the Kroger Company only focus on food retail. Amazon is probably Walmart’s biggest competitor but their biggest flaw is that they’re in the world of E-commerce which means only online shopping. That’s what makes Walmart stand out, the fact that you can do all your shopping in one place. You can buy a T.V., groceries, fishing pole, a bow and arrow, and a dress within 15 minutes. That just goes to show the vast selection of items Walmart has for sale.
Walmart has a hierarchical functional organizational structure. Which mean there is are vertical lines of command and authority throughout the organizational structure so every employee has a direct superior. Directives and mandates coming from the top levels of the company’s management are implemented through middle managers down to the employees. Walmart also has other departments such as function of information technology and human resources.
Walmart’s social obligation is to be powered by 100 percent renewable energy, create zero waste and sell products that sustain people and the environment. Walmart wants to help the environment and create a better future. Also, “Walmart has hired more than 194,000 U.S. veterans and promoted more than 28,000 veterans to roles of greater responsibility” and “Walmart and the Walmart Foundation have provided more than $44 million in funding to support disaster response and preparedness around the world”. These are just a few things they have done to help society and people in need. Walmart felt they had a social responsibility for their employees an has invested $100 million in programs to help workers advance their careers in retail, and is funding the training for one million farmers. Going back to the mission of using renewable energy; Walmart has set a goal to be powered by 50 percent renewable sources by 2025, and has currently achieved an estimated 28 percent, which means they’re on track to reach the goal.
McMillon the CEO said “Meaningful change is rarely easy but it’s essential to set us up for success in the future”. He opened up saying that the company is going to make changes moving in to the future to comprise a successful future but has to maintain true to the “values and culture” Sam Walton(founder) put in place. For example, one big change recently made by the organization is called “Walmart’s New associate education” which helps employees gain a college degree while working at Walmart, which leads to more educated workers.
Walmart’s leader consists of 37 executive managers and five CEO’s (Doug McMillon, Greg Foran, Judith McKenna, Marc Lore, and John Furner) followed by the board of directors which consists of 12. Walmart which is one of the biggest retailers of the world has been very successful in motivating its employees, by the uses of both Intrinsic and Extrinsic rewards. Walmart really believes in the idea of working in a motivated environment and want all employees to feel like a part of the (family). Walmart is very effective when it comes to organizational communication and are always willing to listen to employees ideas and concerns. Recently multiple employees complained about the workers dress code and Walmart changed the rule. Now employees are allowed to express themselves fashion wise as long as they wear the iconic blue vest.
The recruitment and selection process of new employees is quite simple. They only accept applications online which you can do online or at a Walmart hiring kiosk. Then you are given a assessment test to get an idea of how you would deal with certain situations. If you make it to step 3 you’ll be interview by 3 people at the same time, the 3 interviewers take turns to ask you questions. If they’re interested you’ll be called back for a 2nd interview which means you were the best fit for the job out of the other applicants and this leads to orientation. This might seem tedious but Walmart believes in their employees and want the best fit foreach position. Walmart strongly believes in diversity. Walmart’s U.S. workforce of more than 1.5 million associates consists of 22% African American associates, 14% Hispanic or Latino American associates, 4% Asian American associates, 1% Native Hawaiian or Pacific Islander and 1 % American Indian or Alaskan Native. 55% of all associates are women, which includes 43% of our managers and 31% of our officers. Walmart believes in combining ideas no matter your culture, gender, or race. Wal-Mart reportedly has had as many as an average of 17 new lawsuits filed against it each day. Many of these lawsuits focus on ethical issues such as inadequate health care for its workers and wage law violations. Walmart tends to try and resolve issues in house, means try to come to an agreement with the “victim” or give a plea but some result in a full court case. When you have such a vast company not everyone’s going be happy so lawsuits are inevitable.
Also going back to the Amazon vs. Walmart dilemma. Amazon is currently dominating the e-commerce industry and Walmart is fairly new to it. This is what makes Walmart so superior to its competition, which is the will to adapt to the future, on top of that Walmart has a price match guarantee. This means that no matter the price you find anywhere else Walmart will sell it to you for 1 penny less. As shown the graph below Walmart is doing very well in their component of online shopping and is gradually increasing throughout the quarters.
After completing my research on Walmart, I have came to a conclusion that I would love to join the organization. I believe Walmart will dominate the industry for many years to come because they’re so well at adapting to the future and as long as they keep the main goal of customer satisfaction they’ll always be successful. In this new world of technology and e-commerce I feel like that’s what society will always hold close to their heart in the shopping industry which is human connection and satisfaction that technology can never give you. Also, the fact that Walmart is so open to the idea of listening to their employees and have so many “in house” opportunities for you to grow and learn from is amazing. Also, I’m majoring in finance so it would be a dream come true to work for the U.S.’s largest retail company.
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