Diagnosing change – Walmart

Wal-mart Stores, Inc. is a multinational firm whose operations involves wholesale,  retail and other business units in a range of formats. The history of the firm dates back to 1962 when Sam Walton, inspired by success he experienced at Walton’s 5&10 stores, started the first Walmart in 1962 to exploit a greater opportunity of providing value to customers of his business (Wal-Mart, n.d).   The business strategy utilized at the time involved providing products at lower products and improved service which enabled the firm to beat its competitors with time. The company has grown to be a leader in the industry globally and in fact, becoming among the largest firms in the world. For 2016 fiscal year, the firm earned revenue of $485.9 in total which was an increment from the previous year (Reuters, 2017). The company’s workforce is composed of 2.3 million people around the world, with about three quarter of the store management team starting their employment on hourly wages and growing gradually (Wal-Mart, n.d).

 Wal-mart is the largest employer not only in United States but around the world and its policies and procedures on human resource management have bought about many challenges at the work place. The challenges can be attributed to HR policy that encourages low compensation, poor work-life balance and lack of morale or motivation. The compensation structure of the company has seen the firm reduce employee benefits over the last two decades which has resulted to internal resentments among managers and their teams. The policy has involved minimizing the merit-based benefit raises, full-time hour employment and even the profit sharing programs (National Labor Relations Board ,2014). There have also been pay caps programs for some positions so that some employees’ compensations have not been raised for nearly a decade. There is centralization of HR policies at the head office so that store managers do not participate in raising employees’ salaries.  Another issue regards long-working hours especially for stores managers which leave them less time to develop other aspects of personal growth and development. The working conditions have, thus, deteriorated over the years. Given that employees are not encouraged to form trades unions, those who have spoken out about these conditions have been retaliated against by the management. These challenges have also seen the firm being sued by National Labor Relations Board (NLRB) due to violation of employee’s rights and consequently the operations of the firm have been affected (National Labor Relations Board , 2014). The challenges employees are facing at are leading to high rate of turnover across the organization .This calls for a complete change on compensation and reward policies and communication procedures between management and the employees.

 The need for these changes is based on various reasons.  To begin with, employees in Wal-mart need to feel safe working in the organization such that whenever they feel unsatisfied with current conditions they can speak out without fear of being retaliated against. Employees need to feel that they are working an environment where is no constant fear of failing to progress in their career or development in other aspects in life. This is based on Lewin’s Change Management Model which holds that most people prefer to operate in zones that offer safety (Mourfield, 2014). Another reason is the need to have shared values which plays a central role in developing other critical elements in the organization. Shared values include why the firms were created and what its stands so that other aspects including skills and staffing are based on this. Employees determine the performance of the organization and meeting the set objective and goals.  Wal-mart needs to create values that are shared with employees so that human resource policies appreciate the role played by employees in its global success so that even where policies are aimed at cutting costs, they do not affect employees’ motivation and morale. This is based on McKinsey 7-S Model. The other reason is to create a build a team that is dedicated to a change that will benefit both the employer and employee. There is need to bring change in HR policies that will improve the working conditions for employee and at the same time prevent actions by employees, compensation programs that will disrupt the operations of Walmart. This is based on Kotter’s Change Model which holds that employees will accept a change if management convinces them of the need for the urgency in bringing changes (Mourfield, 2014).

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To assess the Wal-mart readiness for change there are three tools that can be used which include stakeholder analysis, force-field analysis and questionnaires and the use of questionnaires. Stakeholder analysis is an important tool that assists in assessing the needs of all the groups and individuals who are to be affected by this change. The tool helps in learning how the approach they are likely to use in adjusting and influencing the change process. This ensures that all individuals who are initiating change have put into consideration the needs and expectations of all relevant stakeholders of the organization (Cawsey, Deszca & Ingols, 2012). Force-field analysis as a diagnostic tool enables one to evaluate the advantages and disadvantages of the change to be introduced, the desired outcomes and how it will impact the organization. The tool depicts the positive forces and negative forces that are supporting or opposing the specific change and in this case the change that is to be done on human resources policies and practices. This technique looks for the means of strengthening support, reducing any opposition and inducing new forces that perceive the change in a positive way (Cawsey, Deszca & Ingols, 2012). Another tool that can be used in assessing change readiness is a questionnaire whose aim is to determine the extent to which individuals in an organization are prepared for a change. The tool will help in assessing each person in different departments especially the management on how ready they are to accept the human resource policy changes that are to be introduced. The questionnaire can measure various dimension such capability and willingness to change and how people understand the aspect of change (Information Resources Management Association, 2017).

 The best tools for assessing the readiness of the organization to human resource policy change include stakeholder analysis and force-field analysis. Stakeholder analysis ensures that those individuals who are supporting change understand the need for considering the view of others on change and various concerns that are raised. Using force-field analysis assists in understanding the ways of strengethening support, reducing opposition to change and generation of other forces that will support the change (Cawsey et. al  2012).

The stakeholders’ analysis can be used in assessing the readiness of Wal-mart to accept human resource changes on policies and practices. The management has centralized the human resource policy and thereby depriving store managers of any involvement in employees’ compensation, working conditions and growth. The results has been disgruntled employees who have tried to raise alarm on these conditions but have faced backlash from the management,  whose policy has been minimizing cost through reduced benefits. The company has even faced court battles on the same but has settled such in the court of law. The firm has been endeavoring to avoid loss of morale and motivation among the employees and discouraging formation of workers union. The firm has embarked on retaliating against workers who speaks up on the poor working conditions that exist in the company and which relates to centralized human resource policy. The various civil actions against the company and even strikes have in the past cost the company billions in revenues. There have been increased turnover rates as dissatisfied managers leave the firm followed by their subordinates. The management presents a force against change the centralized polices which is likely to increase costs. Employees and government agencies are pro-change and have desired for revised human resource policy that will not violate workers’ rights.

In conclusion, the organization is not ready for change since the management has not shown any sign of improving working conditions through better benefits while employees have not acknowledged that maintaining low wages has sustained profitability. Relating this to Lewin’s Change Management Model, there people in the organization including employees and managers do not view the issue as leading to safety in the firm. Organization is resisting change with an aim maintain status quo while employees are unwilling to compromise. There is a need to make both sides come to a common ground where a change will be adopted that brings benefits to all parties involved.

Reference

Mourfield, R. (2014). Organizational Change: A Guide to Bringing Everyone on Board. Management.

Cawsey, T. F., Deszca, G., & Ingols, C. (2012). Organizational change: An action-oriented toolkit. London: SAGE. 201-203

Information Resources Management Association. (2017). Organizational culture and behavior: Concepts, methodologies, tools, and applications. Hershey: Information Science Reference.858-859