Week 2 Assignment - Evaluating Ethical Behavior - Walmart - MGT 7019 v4 - Heather Cappiello 6.4.23

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Evaluating Company Behaviors - Walmart, 1 Evaluating Company Behaviors - Walmart Heather M. Herr Cappiello MGT 7019 v4: Ethics in Business Dr. Duncan June 4, 2023

Evaluating Company Behaviors - Walmart, 2 Walmart has been a giant in the retail industry for generations and appeals to a variety of consumer audiences. Targeting consumers who are looking to save money with products that can be found in a central location is exceptionally appealing and is a genius business model, provided it is executed properly. Appealing to the correct customer demographic is great, but appealing to current and future employees to help keep the doors open is just as valuable. Walmart has come to the forefront many times over the years due to the way that their employees are treated. For the most part, this is not something that comes to light in a positive way and brings up many ethical concerns in the way Walmart feels is acceptable treatment of the personnel that work for them. Mission Statement Walmart is a retail company founded in 1962 and developed a mission statement that not only defines, but guides the principles of the business. Walmart’s corporate mission statement is “to save people money so they can live better” (Ferguson, 2022). Walmart displays living their mission primarily through low retail selling prices. Vision Statement Walmart’s vision statement is to “be THE destination for customers to save money, no matter how they want to shop” (Ferguson, 2022). This vision statement has been in place since 2017 due to a change in consumer needs as well as changes in the landscape of the retail industry amongst other retailers.

Evaluating Company Behaviors - Walmart, 3 Strategic Goals Walmart is making each and every attempt to remain competitive in the market that it serves as well as in the global marketplace. The strategic goals of Walmart are centered around supply chain operations, inventory management with sales and marketing. Using this approach “leads to strategies that strengthen the business against competitors like Amazon and its subsidiary Whole Foods Market, as well as Home Depot, eBay, Costco, Best Buy, Macy’s, Kroger, Alibaba, IKEA, Target and Lowe’s” (Smithson, 2020). These decision making areas are broken down into 10 different areas listed below: 1. Design of Goods and Services 2. Quality Management 3. Process and Capacity Design 4. Location Strategy 5. Layout Design and Strategy 6. Human Resources and Job Designs 7. Supply Chain Management 8. Inventory Management 9. Scheduling 10. Maintenance Another big strategic goal that Walmart employs is the idea of maximizing productivity while minimizing the costs associated. These goals are measured through revenues per unit sold, stockout rate, and the duration of order filling (Smithson, 2020). These measurements are

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Evaluating Company Behaviors - Walmart, 4 executed at the actual store level, creating a high level of accountability to the local onsite operations management team. Values Walmart prides itself on the four following values: respecting the individual, serving the customer, striving for excellence, and acting with integrity (Walmart.com, 2023). Walmart’s website elaborates on each of these values as well as states the many programs that are in place to protect their people as well as their customers and the processes that are in place to ensure that their values are upheld. Organizational Culture Walmart’s organizational culture is based on a hierarchy and function based structures. The hierarchal piece that is used means that there is a top down vertical management structure where directives are aligned from the top of the company and disseminated down through the ranks of established management. For example, the CEO creates a new directive or program and that is passed down through the various management teams to communicate down to their direct reports on each respective team (Lombardo, 2019). The functional based piece of the structure is comprised of groups of people fulfilling and executing certain tasks (Lombardo, 2019). Examples of function based structural roles are the HR departments, IT departments or marketing departments. The hierarchal piece of this structure’s goal is to maintain control and has an glaring downside of being too rigid without room for flexibility at the lower hierarchal levels. Meaning, the lower levels of the hierarchal structure cannot make changes without proper approvals.

Evaluating Company Behaviors - Walmart, 5 Ethical Concerns As with any company, a well thought out mission, vision and value statements are a foundation to display where the company is and where it intends to go, but they are just words until they are actually lived in action. All organizations have their fare share of wins and successes to share, and they are more than happy to post those success for all to see. However, it is the opportunities and pitfalls that are made less apparent, and Walmart has its fair share of ethical issues that have come to light through the company’s existence. A common concern voiced by Walmart’s employees is discrimination. A 2022 claim with the Equal Opportunity Employment Commission (EEOC), stated that a black female in one of Walmart’s Iowa stores was not only given an unacceptable space for lactation as well as denying her promotional abilities due to the perception that she would not maintain her employment for a long period of time having small children at home (Segal, 2022). As mentioned earlier, Walmart employs a hierarchal structure to run is operations. Historically, “Workplaces that are very hierarchical with extremely rigid rules tend to be less hospitable to women (and other subordinated groups, such as people with disabilities, people of color, and LGBT+ employees)” (Segal, 2022). The actions taken by Walmart in this case are definitely discriminatory as well as illegal. A woman was discriminated against and given unsafe conditions to perform basic functions to take care of her family as well as being passed over for promotional abilities due to the same fact. No employer can just assume that a woman is not going to remain with a company just because she has small children and has to attend to the needs of her family as well as maintain gainful employment.

Evaluating Company Behaviors - Walmart, 6 Simply assuming someone will not have longevity with their employer is unethical in itself. Walmart violated three of its own core values in this case alone, which are respecting the individual, striving for excellence and acting with integrity. Recommendations for Improvement Walmart, as well as every other company that operates, is not exempt from process improvements. In fact, all companies should be striving to make themselves more efficient and make improvements as needed, not only to remain competitive, but to be a good corporate citizen in the business world. Walmart’s hierarchal and functional structure works well for a company of its size, when it is used correctly. The structure here is not the pitfall, it’s the organizational culture that is the issue. As see above in the EEOC case presented, Walmart clearly has an issue with one of its unit’s management teams not providing an employee an environment that is legally required, much less opportunities for advancement due to gender and family situations. This shows a dichotomy between the actual values of the company and the perception of employee treatment as well as a disregard for federal employment law. In this case, these values were clearly not aligned. A recommendation for improvement in this particular case is for Walmart to ensure that their management teams are trained on company policy, procedure and legalities of decisions made against ALL employees. Walmart needs to implement a more effective way to measure how well they are respecting their individual employees, which is a key component in their organizational culture. Perceptions commonly become reality and if Walmart can address perceptions before they become reality, they can save themselves not only money in the long run

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Evaluating Company Behaviors - Walmart, 7 due to legal troubles, but they can also save money in creating and retaining loyal employees who know that the company has their best interests at heart.

Evaluating Company Behaviors - Walmart, 8 References Ferguson, E. (2023). Walmart’s Generic Strategy & Intensive Growth Strategies. https://panmore.com/walmart-vision-mission-statement-intensive-generic-strategies Lombardo, J. (2019). Walmart: Organizational Structure & Organizational Culture. https://panmore.com/walmart-organizational-structure-organizational-culture Segal, E. (2022). Walmart Is Sued For Gender And Race Discrimination By EEOC https://www.forbes.com/sites/edwardsegal/2022/02/11/walmart-is-sued-for-gender-and-race- discrimination-by-eeoc/?sh=97e1e5e5614 Smithson, N. (2020). Walmart’s Operations Management: 10 Strategic Decisions & Productivity https://panmore.com/walmarts-operations-management-10-strategic-decisions-productivity https://corporate.walmart.com/esgreport/governance/ethics-compliance , (2023).

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