2 Literature Review
4.2 HRM Practices
4.3 The Real Facts About Wal-Mart
2. Literature Review
“All around the world, we save people money, so they can live better. That’s good news – in any language.” – Wal-Mart Stores Inc. Wal-Mart is the largest Discount Store in the United States. Its enormity is not only recognized domestically but also expanded to International Market. The company believes that one day this one will replace the United States position when the trend down (Molin, 2004). Being number one in the United States does not always guarantee for being number one elsewhere in the world. There are many problems that Wal-Mart is now facing in this highly competitive business world. At the end of the day, many references demonstrate various Wal-marts problems cause of their HRM practices. The majority of Americans have a love-hate relationship with Wal-Mart Stores Inc that at times is difficult to comprehend. The creation of Sam Walton ("Wal-Mart", 2006) has morphed into today’s leader of discount retailing. The organization has faced, and is still facing, a significant amount of controversy over a number of different issues. However, none of these have done much more than lightly graze the exterior of this gigantic operation of 1.2 million associates in the US alone. This report will focus on Wal-Mart’s staffing practices, namely alleged cases of sexual discrimination. Analyses of the environment, company, competition, as well as related key issues in the company’s human resources management will also be given. It will conclude by offering recommendations on future action that should be undertaken by management in order to produce sustainable competitive advantage via its human resources. Wal-Mart’s overall strategy is one of cost leadership, evident in its slogan of “Always Low Prices”. It seems that Wal-Mart is intent on providing low prices holistically, including the salaries of its employees. According to PBS, “Wal-Mart employs more people than any other company in the United States outside of the Federal government, yet the majority of its employees with children live below the poverty line ("Wal-Mart Wages and Worker Rights", n.d.).
Analysts regard Wal-Mart as a force to be reckoned with; many hypothesizing that life for other retailers looks grim as the empire continues to expand and dominate the retail industry. Wal-Mart’s (Brent, 2005) strategic plan includes: Expansion of its SuperCenter format from 1,700 to more than 3,100 stores Moving into non-retail businesses including financial services, telecommunications, publishing and travel. Retail experiments such as convenience stores, freestanding drug stores, healthcare superstores, freestanding apparel units and small footprint general merchandise stores.
An unavoidable external force which affects the business practices of Wal-Mart and organizations in the same industry are legislation requirements. Wal-Mart must abide by many federal Equal Employment Opportunity laws and regulations (Mathis & Jackson, 2006) such as the Equal Pay Act, Immigration Reform and Control Act, and the Civil Rights Act of 1991 to name just a few. This paper will determine Wal-Mart’s problems and solution that can help company to improve their relationships with associates.
4.1 History of Wal-mart
Wal-Mart's milestones began in 1962 when the first Wal-Mart was opened in Rogers, Arkansas. Seven years later the company incorporated as Wal-Mart Stores, Inc. Then a year later they opened the first distribution center and home office in Bentonville, Arkansas, and also went public on the New York Stock Exchange. Several years later, in 1988, the first super center was opened. Then in 1991, the first international unit was opened in Mexico City. By the turn of the century, Discount Store News had named Wal-Mart "Retailer of the Century" and made Fortune magazine's lists of the "Most...
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