Organizational Effectiveness at Walmart

Topics: Wal-Mart, Sam Walton, S. Robson Walton Pages: 4 (1347 words) Published: November 26, 2007
In the intensely competitive and highly dynamic business era of today, few organizations survive and manage to garner sustained public support. Organizational Excellence (OE) is the framework that spells out measurable amount of high quality in the organizational processes and systems. OE is an effective strategy for survival in the market amidst competition. In 2004, Wal-Mart was the largest retail chain in the world. Founded by Sam Walton (Walton) in 1962, Wal-Mart had grown into a global company with more than 1.3 million associates worldwide and nearly 5,000 stores and wholesale clubs across 10 countries. The "most admired retailer" according to Fortune magazine had just completed one of the best years in its history. In 2004, Wal-Mart generated revenues of $256.3 billion and a net income of $9 billion. The retail chain had a distinctive culture shaped by Walton and subsequently by his successors. In 2003, Wal-Mart, the largest retail chain in the world was also the world's largest company with a turnover of $245 billion. Each year, roughly 80% of American households made at least one purchase at Wal-Mart. Starting off in a small way, under the leadership of the legendary Sam Walton (Walton), Wal-Mart had emerged as a global player with operations in North America, Asia, Europe and South America. Wal-Mart symbolized operational excellence and cost leadership. Some economists even argued that the 'Wal-Mart effect' had reduced inflation and improved productivity in the US economy year after year. After Walton's death, a new leadership under David Glass (Glass) had taken charge. In October 1995, Glass had made way for Lee Scott. By all accounts, the succession planning at the top level had taken place smoothly.

The core of Wal-Mart's strategy is equally about creating lean, cost-effective, and efficient operations as it is about helping the environment. The core of Wal-Mart culture consisted of three basic...
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