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Walmart Company’s Problems Action Plans Case Study

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Updated: Apr 20th, 2021

Problem 1: Negative Media Coverage

Implementation Plan

The company has gained quite a negative image due to negative media coverage. One of the possible steps to address the issue is to increase employee pay rates. One of the causes of the negative image of Walmart is the dissatisfaction of employees who have to work long hours but get quite a little money compared to other retailers. Employees are not motivated to work hard or invest more money as they are not satisfied with the amount of money they get.

It is necessary to raise the salaries of employees at all levels. Admittedly, this is associated with a certain loss in profit but it will also lead to significant improvement in the long run. Girotra and Netessine (2014) stress the effectiveness of this strategy as it has twofold implications. First, it will motivate employees to work harder and be more loyal. Secondly, it will attract more skilled professionals and skilled managers are what the company needs. The raise in salaries will be implemented within 3 months.

The beginning

All employees will get a 10% increase in salaries. It should be announced that the second wave of salaries’ increase will be held in a month and will depend on employees’ performance.

Month 2

Performance of employees (especially managers of all levels) is evaluated by supervisors assigned. Those who perform well (make no or a few mistakes, do everything on time and so on) get an additional 15% salary increase. The salary after the second month becomes permanent.

Month 3

After the third month a program of additional financial rewarding commences. Most efficient employees get a 10% increase at the end of the succeeding month. Each employee will be evaluated by assigned supervisors and each department will get the corresponding amount of money which will be distributed among the most efficient employees.

This strategy will motivate workers and will help solve the problem with shifts and customer service. Notably, increasing employees’ health benefits or acceptable work hours are associated with significant costs and will have little effect on employees’ satisfaction. Employees will be committed to perform better to be able to get extra payment.

Problem 2: International Expansion

Implementation Plan

It is crucial for a big company to expand and, hence, Walmart cannot confine its operations to North America only. However, the expansion has turned out to be very difficult for the company which faces numerous issues. To avoid further difficulties, the company has to examine competition to help with entry. Van Rijmenam (2014) notes that Walmart is operating big data well enough using numerous resources including social networks. Thus, in different areas, stores respond to customers’ needs mentioned in social networks.

However, international expansion needs detailed research of the existing competition. Understanding potential customers’ needs are not enough as it is essential to know what competitors operate and which strategies they use. This will enable the company to occupy the necessary niche. Every new market entry will need 2 months of strategic planning. Admittedly, this alternative is quite time-consuming and costly. Nonetheless, it will have numerous positive effects as the company is unlikely to have losses if all peculiarities of the market (including competitors) are taken into account. It is not enough to learn about cultural peculiarities of the region to expand and it is erroneous to remain in one market for a big company as it often means stagnation.

Month 1

Walmart has to address a company that specializes in market research. In a month, they have to come up with a report on major competitors in the market and the way they operate. The report should also include a strategy to utilize.

Month 2

The company has to analyze the data obtained and decide whether it can enter the market and whether it will be able to successfully compete with existing companies. The company will also decide whether it can adjust the plan suggested to its values.

Problem 3: More than Low Prices

To address customers’ needs in quality of products and services, Walmart can carry the line with products of high quality. However, in this case, it will be difficult to maintain low prices and its major advantage. The strategy that needs the least investment is changing the stores’ layout. However, it will not address the problem fully as people often interact with employees even if a store has a perfect layout.

Therefore, the most efficient option is to invest in employees’ training. This will have numerous implications. Of course, training will increase the quality of services provided and, as a result, will positively affect customers’ satisfaction. In its turn, this will lead to an increase in sales and profit. More so, training is often seen as an additional perk and it leads to an increase in employees’ job satisfaction (Miller, 2014). Even though it will need extra funding, it will soon pay off. The training should be continuing. It is possible to address trainers from other companies and encourage human resources professionals to train employees. Since the training is lasting it is difficult to set certain time limits but it is possible to identify certain components.

Component 1

Professional trainers provide training sessions on a variety of issues (with a special focus on management) including team building events. Notably, this training may be held at all levels starting with unskilled employees up to top management.

Component 2

Employees share their experiences. Successful employees share their approaches. Importantly, these employees are paid for their ‘training’ sessions (this can be a fixed sum of money).

Problem 4: RFID Use on Merchandise

The use of RFID has been associated with certain tension as people feel uneasy with products that have this technology. Of course, the company could refuse to use RFID to meet customer’s wants. However, RFID is an efficient system that helps avoid losses associated with stealing, shipment, and so on (Long, 2009). Thus, making customers a bit happier is unlikely to lead to an increase in sales. However, it is likely to lead to considerable losses.

The company could try to develop a new and more efficient technology which could help with logistics and meet customers’ desires. However, this development will require significant investment and a considerable amount of time. Again, the chances that the company will have more profit after the use of new technology are quite slim while additional expenditure is obvious.

Therefore, it is necessary to leave everything as it is and continue using RFID. It is noteworthy that lots of companies are using it for numerous purposes and even customers may benefit from this system (Long, 2009). At that, it is possible to launch an ‘educational’ campaign. It is possible to tell customers about the benefits of the system and destroy myths associated with it. This campaign will not be very costly but it may change the customer’s attitude towards RFID. The campaign will involve in-store commercials on the matter, leaflets, and numerous events in the store (for example, quizzes with prizes for customers).

Reference List

Girotra, K., & Netessine, S. (2014). The risk-driven business model: Four questions that will define your company. Boston, MA: Harvard Business Review Press.

Long, M. (2009). . Shopper Marketing. Web.

Miller, A. (2014). Redefining operational excellence: New strategies for maximizing performance and profits across the organization. New York, NY: AMACOM.

Van Rijmenam, M. (2014). Think bigger: Developing a successful big data strategy for your business. New York, NY: AMACOM.

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