Walmart’s Strategic Human Resource Management

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Introduction of Walmart Sam Walton founded Wal-Mart in 1962 and opened its first discount store, Wal-Mart Discount store in Logers Village, Arkansas, about 10 miles east of Bentonville. At the time he was 44 years old and partnered with his brother Bud Walton. Wal-Mart is the world's leading distributor with more than 1.5 million people in 4,700 stores in 10 countries around the world. In 2002, it had a total turnover of $217.8 USD Billion, and in 2003, it was named the most respected company in the United States, ranking first for two consecutive years among the top Fortune 500 companies in America's leading business magazine. The exact name of the company is "Wall-Mart Stores" and currently operates four types of distributors around the world. The first is "Wal-Mart Stores," a discount store that sells clothing and accessories, and does not handle Non-fresh food. The second is "Wal-Mart Super Center," 35-40% of all products handled are fresh food, and the third is the "Sam's Club," a discount store in the form of a membership warehouse. Finally, there is "Walmart Naver Hood Market". Wal-Mart is the motto of the three major companies, Respect for the individual, Customer service and the Strike for the excellent. Wal-Mart's business philosophy is worthy of being called "consumer superpowers."

That is the spirit of America and identity. Walmart is an example of effective large-scale human resource management when considering Walmart has millions of employees worldwide. It is one of the largest companies in the world in terms of organization size, business value, and financial performance. The company supports human resources with satisfying business needs and expectations. Walmart considers how activities such as internal organizational processes support human resources. Human Resource Management Human resources management refers to a series of tasks to secure, develop, deploy, and assess human resources based on forecasts of future human resource demands to achieve the organization's goals. Members are utilized to suit the purpose of the organization with their capabilities, and HRM addresses issues of selection, development and utilization of members of the organization as well as their relationships with organization and their work efficiency by giving intrinsic and extrinsic rewards. Wal-Mart has a quite good reputation in human resource management and they were embarked on major management reorganization in 2004. They develop a plan to hire more than 300 human resources managers in work field instead of 100 executives in its headquarters and Wal-Mart also created a five-person team of human resources professionals with legal backgrounds who are available 24 hours a day seven days a week to handle supervisor’s concerns regarding employment matters. Furthermore, they offer various options for pay and benefits for employees.

For example, they divided benefits into four categories which are money, career, home and health so that employees have more options for their own pay, compensation, incentives, education and opportunities. Wal-Mart has many key elements in employee selection, training and development. Employ selection is one of the most important factor when they chose employees before they proceed training and development stages. The diversity is the first key element when they hire their staffs. Wall-mart says ‘they have a strong commitment to become a leader in diversity and they increase the ratio of women and minorities in their management ranks.’ In addition, they also look for young employment by hosting job fairs, college recruiting and internship to increase the diversity of candidate pool. The next stage is training and development. Wall-mart is using a combination of outside vendors and systems it has created on its own in the overhaul of training and development with their technology by using e training. Wal-Mart has a reputation of not treating their employee’s right and not being as up to date with technology as they could be. The Successful Human Resource Management case of Wal-Mart In the HRM case, the most successful example is the wall-mart. The Wal-Mart is famous not only in the U.S. but also all over the world.

So how can the company manage its employees to become such a successful company? There are many reasons for HRM, so I explain the three most typical reasons.

  1. Employment In Wal-Mart, they are never called “employee” or “worker” while it is called “associate” or “partner” since the founder believed that there is no boss and workers, and encourage managers to think of themselves as “servant leaders”. This is to encourage them to serve others while staying focused on achieving results.
  2. Career Development The human resource management goal is to ensure that every employee fits his job and the organization. Wal-Mart collects information from employees regarding their perceptions about the company. Such information represents employees’ point of view about the appropriateness of their jobs and Wal-Mart’s strategies. This method is typically applied per Wal-Mart store. One more goal of human resource management in Wal-Mart’s career development is that the human resource management objective is to ascertain what the employee is capable of doing. This information is used to support career development. Wal-Mart has comprehensive information based on recruitment documents and other records. In relation, the company uses the results of performance appraisals to assess employee potential. The human resource management objective in using performance appraisal results is to determine the employee’s current capabilities and performance level. With these criteria for assessment of employee potential.
  3. Compensation Wal-Mart offers compensation and incentives such as increasing minimum hourly wage, associate discounts, comprehensive health insurance plans, and associate stock purchase plan with company math for its workers. The company gives these opportunities to high-performance employees. Wal-Mart employees Wal-Mart employees can improve their performance and plan a long-term career to get these compensations. It seems like Wal-Mart is a company that shows the company run by employees not a boss. And also the boss is the first to think about employee management. These features make Wal-Mart recognize as a world famous company. Darkside of Walmart’s Human Resource Management For many years, Walmart enjoyed a reputation of effective management, superb logistic, and everyday low prices. Their main strategies has made them become a market leader through efficiency and processing.

But there is also a dark side of Walmart’s human resource management. Walmart has been always been criticized for low wages when they are one of the biggest retail stores that makes billions of profit yearly. In 2016, Walmart has a net income of $11 billion dollars yet it has not been able to solve some of the bad employment practices. As of 2017, Walmart has approximately over 5,000 lawsuits for their incompetent health care, wage law violations, anti-union retailer stance and also taking advantages of their workers such as making them work more than they should without paying them. One of the other problems of Walmart’s human resource management is also their lack of benefits for their employees, especially for part-time workers. A third of of the part-time workers that are not eligible for benefits are limited to work no more than 28 hours a week. While, workers who are qualified for the benefits often have to pay part of their health insurance and other benefits. The health care system provided by Walmart was not as affordable as compared to the other companies.

In year 1999, 36% of the health insurance were paid by the employees itself. Walmart has taken the cost-leadership strategy by reducing the cost of recruitment by not giving enough benefits, low wages and also encouraging working overtime. This leads to demotivation and discouraged workers to perform well. Suggestions According to the current situation of the human resources management of Walmart, the author renders the following four suggestions in this regard that may benefit the corporation to its largest extent. In the light of Walmart’s standardized recruitment procedure in which there are four successive steps: vacancy statistics, recruitment plan-making, recruitment information spreading, CV collecting and screening, written examination and interview and employment, it demonstrates that candidates’ fundamental professional skills, working quality, logical thinking, management ability, creativity, leadership, English ability and information competency are required to be tested. Examinations of comprehensive abilities are undoubtedly a necessary component in employment process. However, it is even more important for human resources managers to be clear of recruitment requirements, that is, to distinguish the priorities based on the responsibilities and features of different positions. That is to say that the core competence of the positions needs to be stressed, on the other hand, the requirements of the rest part should be weakened appropriately. The human resource department should also cooperate with other relevant departments to figure out the critical element of the positions and to test out candidates with emphasis.

As for new employees, induction training serves as an essential and relevant link. Training content should be adapted to local conditions. According to the market and customs of different regions, develop different training contents and build training courses with regional characteristics. The value of training can only be achieved if it is adapted to local conditions and seeks truth from facts. Although the training courses are different, the key factors such as the core values and systems of the company should be consistent. Secondly, reflect on and improve on training assessment. Wal-Mart should pay attention to self-evaluation of training effects. During the period after the training, it is necessary to conduct tracking. It is found that the trainees should analyze the reasons in time when they are unqualified, summarize the shortage of training, and improve the training program. Power distance also plays an important role in managing employees. Managers should be aware of different power distance that can differ depending on the employees’ culture and should approach each employee differently so that desired outcome can be achieved, and mistakes avoided.

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Walmart's Strategic Human Resource Management. (2019, Jul 30). Retrieved April 18, 2024 , from

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