Walmart Stores, Inc. is the most significant retail business within the U.S. It is also the largest retail firm in the world. Mr. Walton, the founder, relates a successful business with better customer service and low pricing. By aligning business strategies to their human resource mechanisms, Walmart could accomplish seven over-riding plans, which are culture, products, expenses, price, talent, and service. This essay explores Walmart’s philosophy on the management of ethics, as well as outweighing its compliance challenges in its business environment.
Walmart’s Business Philosophy and why it is Considered Unethical
Walmart’s idea of low average prices of goods and services has, in the past, led to lots of criticism. Many people regard this act as immoral to both its suppliers and employees. There have been diverse views from the federal government, marketers, and customers regarding these assumptions. The Universal Responsible Sourcing Initiative by Walmart played a critical role in creating standards that align with its philosophy. This initiative has triggered new suppliers’ contracts to be recognized but by being forced to uphold the principles set by Walmart as well as evaluating charge, which leads to additional burden on the traders. Various criticisms come from retailers in the same channel of distribution . Walmart's operating policies have forced many businesses to relocate their production to overseas countries due to the higher cost of human resources in America. The company emphasizes on improving customer base by ensuring better after-sales delivery and setting prices at the lowest level possible.
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One of the unethical decisions that Walmart was involved in is the reluctance to permit employees to be unionized. Workers were supposed to join trade unions, which works in tabling their grievances by the formation of laws that governs them in the working environment. Contrary to this, Walmart denied workers the freedom of joining unions groups; otherwise, their contracts could have been deprived.
Additionally, the decision to hire part-time employees to avoid paying medical benefits is an issue that has raised ethical concerns. Workers were supposed to work for at least 30 hours in a day to achieve subsidies in the form of over-time benefits. In case it fell short of the prescribed number hours, it would be unable to receive their dues. These unethical practices created a negative perspective on the management practices by Walmart .
Effects of Walmart Business Philosophy on its Human-Resource Practices and Policies
Walmart's business attitude has become a global concern about human resource management. Besides, cost management techniques in terms of customer handling, the Human Resource department manages diverse employees around the globe. Usually, the Human resource department encounters many business risks at any given time (Collings et al., 2018). It is a valued business partner in terms of maintaining the culture, aligning people into different responsibilities, driving performance, reducing business risk, and ensuring results. Walmart centered its business success on the idea of handling employees to change their attitude. It advanced an economic advantage only by using workforce successfully and monitoring plans based on their know-how and abilities to improve the worker's performance to achieve desired objectives.
The human resource department aligns business strategies with operations, thus creating a competitive environment in terms of achieving desired results as well as maximizing profits. Fostering a culture dedicated to human resources goes beyond, making sure it aligned with the company's practices and set guidelines. After recruitment, hired managers and other employees go through detailed cultural orientations. Managers are supposed to undergo cultural proselytization to familiarize them with the operating environment of the Walmart store. The critical duty of the managers is to ensure other employees align with the core values and set policies set for the effective running of business activities.
The main impact on Walmart’s business attitude had negative implications is the level of employee turnover. The low wages and benefits-eligible tactics weighed heavily on the employees. These criteria made it very difficult for people seeking long term employee engagement with Walmart. The tactics used by Walmart human resource management were only appealing to short-term employees, such as university students and seasonal employees. Walmart focused more on recruiting executives outside its operations. This makes succession planning a priority in the organization, thus ensuring top talented employees are prepared to lead.
Walmart Violation of Legal Mandates
Walmart claimed that the closing of the store in Quebec was mainly due to economic reasons. The firm cited poor infrastructure as well as low supply, as the main reasons for the close-down. However, those claims were denied due to the availability of evidence that the store would re-open shortly (Muñoz et al., 2018). After close examination by the federal government, the court could not find the closing of the store to be genuine since there were no provisions of the set law. Walton repudiated the fact that the store closing was strictly related to the positive drive. The argument was inter-related to the frequent loss made over a few years under its operations. The engagement of the Audit committee revealed that the closure of the Quebec store was not long-lasting. It was, therefore, against the rule of law, Walmart was supposed to compensate workers who had been dismissed illegally.
Walmart had been accused on several occasions of denying employees the right to join labor unions. The global labor welfare fund accused Walmart of employee exploitation, including wage cuts below the minimum brackets, Failure to provide safety equipment to the workers, and engaging in fraudulent activities. Most of the illegal operations were focused against employees in the effort to reduce operating costs. However, this attracted various business risks (Collings et al., 2018). In the end, it was forced to incur lots of costs towards litigation fees and compensation to illegally dismissed workers during legal appeals.
The efficiency of the Walmart structure of ethical decision making
I trust that Mr. Walton aimed at providing goods and services to the families with little incomes while emphasizing on increasing customer base and reducing operating costs. Nevertheless, the business grew faster, and those founding beliefs were outweighed by the time. Many branches were opened both within the U.S. and overseas. This opted for the recruitment of different managers with different perspectives but the same ultimate business goal. With the new Management and Chief Executive Officer, the store took colossal turn-around strategy from an intimate, pleasant store to a monopolizing company focused on maintaining market share and continuously improving the economies of scale to both external and internal shareholders. When the company expanded internationally, Walmart experienced more tactical problems like improving the working environment and solving employee’s challenges (Xie & Cooke, 2019). This changed the pre-existing perceptions regarding business management ideas. The decision made thus far seems more industry guided than what the creator had in thoughts during the initiation period. The dynamic business environment portrays consistent changes in human resource management decisions as well as market venture tactics.
Mr. Walton initially managed the store, but interrogators are not hesitant to accept as a right that Walmart is what it used to be. This originates from the consistent criticism by competitors and workers. Misuse of employees, as well as torture in terms of long working hours and poor remuneration policies, creates a doubt on the assumed growth of Walmart store. When the company grows steadily, it is much difficult to reduce the risk factor.
Recommendations
Human resource management plays a vital role as it deals with diverse staff. The human resource department always focuses on improving the performance of every worker as well as increasing their productivity. The organization should ensure a reliable institution code of behavior and defiance is well preserved and certified to initiate a change in employee's perspectives to the Human Resource department.
The code of conduct should be scrutinized by the company's assessment board, which should take suitable actions in case of deficiency. Human resources should employ managers and department heads, putting them in continuous arduous teaching (Chatterjee, 2017). Furthermore, engaging outside forensic auditors purposely to evaluate the upper management performance, thus making sure it abided by the laws and policies of the organization. Walmart is a large organization that has been frequently accused of fraud and unfair employment practices. Therefore, Walmart needs to be vigilant on whom it employs as business representatives.
Walmart has been accused of different reasons, including corruption, as well as unethical business activities. Efforts have been made to restore the glory of the company. It might take some time before the company goes back to the top again. However, I think that changes can be made moving forwards, and it can become better, produce back more significant customer base, employee, and business partners.
References
Chatterjee, S. (2017). Two efficiency-driven networks on a collision course: ALDI’s innovative grocery business model vs. Walmart. Strategy & Leadership , 45 (5), 18-25.
https://doi.org/10.1108/SL-06-2017-0057
Collings, D. G., Wood, G. T., & Szamosi, L. T. (2018). Human resource management: A critical approach (2 edition). Routledge.
Muñoz, C. B., Kenny, B., & Stecher, A. (Eds.). (2018). Walmart in the global south: Workplace culture, labor politics, and supply chains . University of Texas Press.
Xie, Y., & Cooke, F. L. (2019). Quality and cost? The evolution of Walmart's business strategy and human resource policies and practices in China and its impact (1996–2017). Human Resource Management , 58 (5), 521-541. https://doi.org/10.1002/hrm.21931
