Wal-Mart Success and Challenges - Case Study Example

The strategy of keeping low prices has been the hallmark of Walmart’s success, and this helped the company in achieving a very high sales volume. This strategy was originally initiated by the founder Sam Walton in the 1960s and 1970s (Wal-Mart, 2012). The rapid expansion plan has been the key to the superstore’s success opening up more than 6,800 stores all over the world and having around 1.61 million employees. The other pointer to the growth of the firm is the setting up of a one-stop shop for their customer’s needs; this is what the firm refers to as a supercenter, as they contain numerous shops within the building including banks and ATMs.

Success and Challenges
Wal-Mart has the advantage of a strong brand built over six decades, and this attracts top-notch employees while at the same time retaining their key employees. In addition, they offer discount pricing and have new superstores offering one-stop shopping, and modified stores expected to entice new buyers. Many critics of Wal-Mart’s business strategy point out that the superstore has been unable to tackle three important steps of an effective strategy successfully: identifying key issues, vitalizing employees, and putting in relevant resources to ensure success. The general system of carefully scrutinizing an important problem in an organization is the use of the SWOT analysis. A careful mechanism of dealing with an issue in an organization involves engaging relevant stakeholders in the identification of the problem. This helps in pooling resources and ideas as opposed to single-handedly trying to deal with the issue.

The leadership adopted by the founder was very influential in propelling the company to success all over the globe and his adoption of a family-like association with the employees was very instrumental in retaining key staff members. This is only negated by an overly controlling and commanding style of leadership, which had the effect of attracting unnecessary lawsuits amongst employees of the company and former employees of Wal-Mart. The firm is currently facing numerous lawsuits from employees who have brought all manner of suits ranging from unpaid wages to workplace discrimination. The space that the firm allowed its employees to be innovative and creative had been a key impetus to the growth and success of the company. The compensation and remuneration strategy of the firm was a source of admiration amongst its key competitors here in the United States and amongst its branches abroad.

Pertinent Issues
It is important to acknowledge the present environment and circumstances of the organization operating without disregarding past successes and failures, and this needs framing of the issue. To achieve this, an examination must be carried out to determine opportunities that might be available, any opportunities that the organization might create, and the abilities of the organization. This also involves tackling important factors within the organization and includes facing people and programs that are deemed inapproachable or those that are untouchable. Execution of these strategies should be done without any hindrance and flawlessly within the workforce, and it should be noted that a poorly executed strategy is likely to fail. This leads to the importance of the employees.

Recommendations
Management should, therefore, only hire those employees whose skills are necessary when implementing these strategies of the organization, and they should be harnessed to ensure that the workforce carries on the duties with passion. The management should also be directed to aid the existing workforce in acquiring and developing new skills and knowledge to ensure that the company competes effectively in this turbulent retail business.

The management must recognize that the company is operating in the 21st century and that all forms of prejudice, be it related to gender or race, must be eliminated at all levels in the company. This is very important as it helps the company avoid unnecessary lawsuits and also aids in promoting the image of the company all over the world and more so, where the company’s branches and franchises are located. The business must also invest its resources in team development. This strategy is very important as it ensures that employees in the company understand one another, thus valuing everyone’s contribution to the organization’s goals.

Recognition of different cultures has been the key to the success of the organization, and the elimination of cultural barriers ensured that the company expanded to remote geographical regions all over the globe. Read More