Background of Wal-Mart
The success of an organization is dependent on the organization is entirely dependent on the organization leadership. With dynamic organizational changes, the management of any organization needs to be prepared strategically to embrace the changes and provide useful guidance aimed at driving increased efficiency and productivity of the organization (Brewster et al. 2016, p. 7). The modern corporate world has been characterized by different challenges which have affected the performance and efficiency of organizations. The development of effective strategic management plans plays an essential role in running the organizations. The leadership of the organization plays a vital role in developing the tone of the corporate culture. There have been many contemporary issues which have hindered organizational development through increased productivity. The process of resolving the problems and implementing positive change in the organization starts with the identification of the main issues (Vance & Paik, 2014, p. 27). This report, therefore, seeks to provide an analysis of contemporary issue affecting the Wal-Mart Organization which has been faced with recent challenges in managing their employees. The study will be focused on the use of various leadership concepts and theories to help in providing a possible solution to the organization management team and enhance employee productivity.
Wal-Mart Inc. is an American multinational retail company or corporation and is recognized as the world’s largest retail company regarding revenue. The company or retail organization operates a chain of hypermarkets, supermarkets as well as discount stores and grocery stores. The company was incorporated in the year 1969 and was founded by Sam Walton (Schuler & Jackson, 2014, p. 42). Being the largest trading retail company, it has been able to record revenue of $ 500.3 billion so far in 2018. It has been able to employ 2.3 million employees in their various departments globally. The company operates through three primary segments including the Wal-Mart US which is the most significant group, the Wal-Mart international and the Sam’s Club. The company offers to its customers an assortment of the company merchant and other company services at everyday low prices.
Despite the company productivity and profitability in the industry, the company has been able to employ a considerable number of employees in the sector. The human resource department is therefore presented with a challenge to manage the massive organization workforce. The organization is consequently faced with numerous employee-related cases and lawsuits especially with matters related to poor working conditions, anti-union politics, low amount of wages for their employees despite increased profitability as well as inadequate health care for employees (Hwang & Park, 2015, p. 822). Employees are referred to as the most significant assets of the company. However despite the increased profitability of the organization, employee management in the company has become a problem today and has hindered the effectiveness of the company as well as its productivity. There is a great need for the company to develop various leadership strategies that are effective in improving the company as well as enhance its productivity.
Organizational leadership in any organization places much emphasis on developing leadership skills and abilities relevant to the organization. Either formal or informal leaders, they are required by their organizations to develop and implement strategies that will drive a lasting change in organizational operations and enable it to adapt to rapid regulatory changes as well as uncertainties (Dinh et al. 2014, p. 54). Organizations comprised of employees from different cultures and backgrounds and therefore it is essential for the leaders to develop a management system that will help to incorporate all their efforts into the business culture. More importantly, the ability to understand the needs of every employee is critical and plays a significant role in developing a sense of belonging to the company or organizations (Antonakis & House, 2014, p. 756). A satisfied employee will be willing to give his or her best efforts in helping the organization achieve their set objectives. Inability to develop employee management strategies may be very costly to the organization, and therefore it is the responsibility of organizational leaders to build a corporate culture which takes care of employee interests.
Challenges Faced by Wal-Mart’s Employees
The leadership of the organization should be aimed at establishing or developing the best working relationships with the employees and ensuring that the working environments are conducive to promote organizational development. Employee’s welfare is very critical in determining their contribution to the organizational development and is inclusive of employee rewards systems in the form of wages and salaries, employee health cover and also ensuring that the organization supports the policies of employees union (Tourish, 2014, p. 83). These are some of the issues which have been facing the Wal-Mart organization despite its growth and profitability.
The employee of the company complains of their working conditions to be unfavorable and require the organization to develop more favorable working conditions which will motivate them and make the employee more engaged in the operations of the company. The organization has been using a top, bottom approach to addressing employee-related challenges which have not been active (Dugan, 2017, p. 7). The company has not always implemented some important policies from the employees union which require the company to cater for the healthcare of the employees through insurance policies, medical cover or even having special health care benefits for their employees.
The role of leadership in organizations is, therefore, to promote and motivate their employees to achieve higher performances or improve their productivity and efficiency through enhanced human relationships in the organization. The company employee reward strategy has not been effective in motivating the company employees since the reward is based on relatively the job levels and in most case, the individual performance incentives are rewarded to the different managers heading different stores or departments (Steinbach et al. 2017, p. 1717). It, therefore, does not recognize employee efforts and such has been one of the reasons the company has been able to shut down some of its stores due to lack of productivity. Employees are always motivated if the organization reward system is cognizant of their contribution and efforts in organization development. The company has majored so much in rewarding company employees based on their positions and status in the compared to the use of recognition and reward systems based on employee’s performance. Due to the economies of scale in the organization and the nature of its human resource services, the company has not been effective in addressing employee-related concerns, and this may become a significant hindrance in achieving efficiency and sustaining the company productivity levels.
Application of Leadership Theories in contributing to effective employee management in the organization
One of the most important leadership theories used in organization development is the situational contingency theory developed by Fred Fiedler. The approach pre-deposits that leadership effectiveness in an organization is influenced by two main factors. The first factors are the leader’s motivational structures or their leadership style while the second factor is the degree to which the leadership situation leads to effective control and influence over the situation (Harrison, 2018, p. 26). According to this theory, we have two types of organizational leadership or leaders; one that is task oriented or task oriented leaders and one that is relationship centered. The job-related leaders are focused on delivering results and therefore are more directive, strict to deadlines and have established different structure situations. They are interested or focused on the effects more than the process. On the other hand, the relationship-oriented leaders are focused on developing the right relationships with their employees and are usually less directive and more considerate of employee issues.
The Importance of Organizational Leadership in Employee Management
This leadership theory is critical to understanding the Wal-Mart contemporary issues affecting the company employees. From the Analysis of the company relationship with its employees, the company can be said to be having task-oriented leaders who are interested with the results or performance of the company and are less concerned with employee development initiatives in the company (Gottfredson & Aguinis, 2017, p. 576). Despite the human resource strategies of employee recruitment, training, and retention the company needs to change its leadership style to a relationship-oriented leadership. This will facilitate the leaders with an opportunity to focus much on employee-related issues and concerns. The productivity of an organization is determined by how motivated their workforce is as well as their commitment to organizational goals and objectives (Lee, 2017, p. 31). Focusing on employee development through establishing the right working conditions, developing active reward systems, supporting the union policies and providing medical or health cover will help the company use fewer resources to achieve their objectives as compared to using task-oriented measures.
The development of behavioral leadership theory helped to establish strategic thinking that leaders can be developed through learning and not through characteristic inherent traits. The approach is focused on what the leaders do and how their behavior can be used to influence organizational performance. The theory is critical in enhancing leadership development in an organization and assumes that useful leadership behavior is as a result of productive role behavior (Alcala, 2017, p. 41). The theory argues that leaders can use technical skills, human skills as well as conceptual skills to contribute to the increased organizational development and enhance leadership effectiveness. Therefore it is the behavior of an individual leader which will be used as a measure of good leadership or bad leadership. The functional responses of successful leaders according to this theory include the ability to determining goals, motivating employees, achieving set goals, effective communication and ability to interact with employees efficiently and build a team spirit (Tremblay et al. 2017, p. 57). Such leadership provides higher satisfaction to the employees and promotes increased efficiency.
Wal-Mart company type of leadership can be said to be trait-based and not behavioral. The company leadership has not been able to influence organizational performance positively. The leaders have been efficiently determining goals of the company but have failed so much in motivating their employees and having an active communication channel (Shore et al. 2017, p. 47). Interactions within the company are not sufficient since it’s not based on relationship building but performance or task oriented. The top division of the company is made by the senior management in the organization and trickle down to the employees through the various departmental managers. Such a system does not promote adequate relationship with employees and may be slow to implement any solutions to employee problems due to the organizational bureaucracy and leadership structure. Establishing a leadership based on behavioral approach promotes the culture of higher satisfaction in the company.
Employee relationship strategies and Concepts
Every organization is faced with a responsibility to develop an effective employee relations strategy. This is not the role of the human resource management but should be the role of the organization leadership starting with the top management. Establishing a reliable and efficient employee relations strategy is mainly concerned with the leader’s capability to develop an environment that delivers what people want. People or organizational employees would love to feel good about themselves, who they are, what they do and proud of where they work (Bayraktar et al. 2017, p. 50). The understanding of these factors is an excellent step towards the facilitation of effective leadership in the organization. On the other hand, the ultimate goals of every leader in an organization would be to feel good about the organization productivity, general performance and their ability to develop new leaders from within their organization.
Effective Leadership Strategies for Employee Management in Wal-Mart
Developing what employees want in an organization is our focus on helping us understand how Wal-Mart Company can establish a culture that is inclusive and recognizes their efforts. Developing an effective employee relations strategy starts with the development of organizational culture. This is because most employees’ want of feel-good of what they are doing and where they are doing it. This means that the organization needs to develop its image and a good way to establish an effective organizational culture would be through effective leadership that is relationship oriented and not task oriented (Taylor, 2017, p. 29). Wal-Mart company need to develop an employee relationship culture based on employee relationships and not task oriented. This will help the leadership to be more concerned about the employee’s welfare and not focus only on their contribution to the organization regarding performance.
The company needs to develop an active communication channel for communicating the employee’s needs. The company communication strategy has failed and that has contributed to the increased cases of lawsuits from employees since their issues cannot be addressed efficiently through the human resource management strategies most of the employees have sought to seek help from the courts which is something that has impacted the image and reputation of the organization (Adjibolosoo, 2018, p. 84) negatively. Employees should be able to understand what is going on in the company which means that the organization needs to involve the employees in decision making especially in issues relating to employee performance. Instead of making a decision from the top management level and passing the resolutions to employees through the departmental managers the company should develop a platform for engaging their employees through meetings and seeking their feedback about specific issues affecting the company. An active communication channel plays an essential role in helping the employees to channel or articulate their needs, concerns, wishes or even complaints.
Employees also want to feel that their services are valued in the organization, and the best way is through developing an effective compensation strategy. The issues relating to low wages in the company despite the continued profitability of Wal-Mart Company could have been resolved through effective leadership. An efficient compensation strategy will involve the efforts of organizational leaders to motivate their employees through various mechanisms or approach (Dong et al. 2017, p. 440). The motivation can be done through attractive salary packages, benefits and incentives plans, reward systems for excellent performance and even other non-monetary reward systems such as having dinners and social gathering as well as team building activities. The company had failed in this aspect, and the leadership of the company paid more focus or rewarding the top performance managers or focusing only on rewarding the high performing employees who meet specific sales targets.
Lastly, effective leadership of organization will establish an employee relations strategy that if focused on solving employee complaints. Every employee will always want to feel kind of how they are treated by their employers, and therefore it is the responsibility of the leaders to develop a mechanism of handling employee’s complaints and solving any conflicts by the use of internal conflict resolution measures to avoid these issues going to the public through lawsuits and increased cases.
Conclusion
The management and leadership of Wal-Mart organization are required to develop an employee relations strategy that seeks to compensate or reward the employee’s efforts not only based on their performance but also on their overall contribution to the company. The company through the human resource department should conduct a salary review in the organization based on the total productivity of the company. When the company is more productive, the benefits should also come back to the employees and not only to the company top management and shareholders. The company should establish, so benefits sharing proportions accorded to employees annually depending on the overall productivity of the company.
The relationship strategy should be aimed at improving the social and health status of the employees. The development of employee health benefits is significant in enhancing employee’s productivity. Access to health has been costly, and every employee would love to have a health cover by their employer which is also another form of compensation to the employees. It is also important for the company through the relationship strategy to develop an internal conflict resolution department within the various departmental stores through which the different human resource managers can help in solving multiple employees’ complaints (Aarons et al. 2017, p. 29). Such a strategy will be advantageous in understanding the needs of the employees in the company as well as protecting the reputation of the company by preventing small issues from going to the public through lawsuits from employees.
Conclusion
With the rapid growth of organizations, human resource function has become very important in the leadership of an organization. Effective organization leadership will seek to establish a mechanism which will develop a positive relationship between employees and the top organization management. Employee relationship management has become very vital in determining the success of an organization and in assessing organization efficiency and productivity. The leadership Wal-Mart company despite their productivity and profitability in the retail sector need to develop and implement an effective employee relations strategy to solve the issues facing the company leading to lawsuits from employees due to the failure of the organization to meet and address their needs and concerns.
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