Organizational Change
High Employee Turnover in Walmart Inc.
In the modern tech-driven corporate society, organizational change is inevitable for every business. Indeed, organizations, especially retail giants like Target Corporation and Walmart Inc., need to constantly adapt and evolve in response to shifting market conditions, new technologies, and internal challenges to be competitive and successful. However, organizational transformation is often complicated, requiring a systematic and planned approach. Kotter’s 8-Step Model for Leading Change is one strategy extensively used to manage change in the retail industry. Notably, the eight interconnected phases of this approach offer a complete framework for businesses to execute change effectively. The paper applies Kotter’s eight-step change process model to address high employee turnover in Walmart Inc. and provides recommendations on how to improve the situation.
Walmart Inc. is one of the organizations offering a conducive work environment in the retail industry. The organization shows high dedication to its employees using successful management methods. In other words, the organization places a premium on its workers and believes in fostering a good working environment that promotes cooperation. However, the organization faces high employee turnover. Turnover is a major problem for many businesses, and Walmart is no different. Relatively, the dynamic has led to a drop in productivity, increased operating costs, and a bad company image in the past. Therefore, the organization works to lessen employee turnover, which will positively impact the company’s bottom line and the quality of service provided to customers. Employee turnover is a major concern for businesses, but by following Kotter’s 8-Step Method, Walmart Inc. may make real changes to reduce turnover.
Company Overview
Walmart is a multinational American retail corporation that operates a chain of hypermarkets, discount department stores, and grocery stores. The organization was founded in 1962 by Sam Walton in Bentonville, Arkansas. It is one of the biggest retailers in the world, with approximately 11,500 shops and clubs in 27 countries. The organization employs over 2.3 million individuals worldwide (Walmart). Concerning services and products, Walmart Inc. sells electronics, furniture, food, apparel, mattresses, and medicine. Walmart Supercenters are the company’s hypermarkets, providing a full-service grocery store, pharmacy, and general product selection under one roof. Walmart also runs Walmart Express, a smaller local market, and Walmart Discount Shops, bargain department stores(He et al., 2021). Besides, Walmart offers online shopping and home delivery services through its website, Walmart.com. In the precepts, shoppers take advantage of free two-day delivery on all purchases over $35 at Walmart.com and a wide variety of goods, including some available exclusively online.
Walmart’s target customers are often middle-class and working-class households prioritizing affordability and variety. Because of its extensive retail reach and powerful online presence, it regularly serves more than 265 million customers worldwide. The company’s low prices and wide selection are great for saving money. Because of the retail giant’s extensive reach, customers from all corners of the world may purchase at Walmart. In terms of structure, Walmart follows a conventional hierarchical model consisting of a board of directors, an executive leadership team, and many departments. In order to meet the needs of its many consumers, Walmart is split into three separate divisions: Walmart U.S., Walmart International, and Sam’s Club.
Doug McMillon serves as President and CEO of Walmart. McMillon is supported by a group of executive vice presidents responsible for running various business sections, like Walmart International. An executive vice president oversees each department and is held accountable for its success. Walmart U.S. and Walmart International are responsible for running the company’s supermarkets and discount shops in the United States and other countries, respectively. Sam’s Club is a retail network of warehouse clubs accessible solely to members. In addition to the company’s management staff, Walmart is governed by a board of directors chaired by Gregory Penner. Walmart’s board of directors comprises individuals from a wide variety of professional and personal backgrounds who are tasked with monitoring the company’s strategic direction and overall corporate governance(He et al., 2021). They collaborate closely with Walmart’s top executives to guarantee its success in satisfying its many stakeholders.
Walmart faces stiff competition from other establishments, including supermarkets, discount retailers, and internet marketplaces. Target, Costco, and Amazon are some of its primary rivals in the U.S. market. Nevertheless, the organization concentrates on cheap products and a wide assortment to entice customers searching for value and convenience.
In the world market framework, regulatory and cultural variations and competition from local merchants provide extra difficulties for Walmart’s worldwide businesses(Pandey et al., 2021). Walmart has overcome these obstacles and expanded into major foreign markets, including Mexico, Brazil, and China. In these regions, the firm has been able to attract and retain clients by emphasizing value and convenience despite intense competition in the retail sector. The retail industry is always changing, and as Walmart grows, it will confront new difficulties and possibilities.
Across the world, Walmart employs almost 2.3 million individuals in various roles. Walmart places a premium on human resource management since the company’s success is based on the efforts of its employees. Walmart is committed to providing its employees with competitive compensation, excellent health benefits, and attractive retirement plans. The Walmart Career Choice Program and the Walmart Academy provide staff opportunities to further their education and careers inside the company. In addition, initiatives like Walmart’s Women’s Economic Empowerment Program are in place to ensure that all workers feel valued and respected. The percentage of women and people of color in executive roles is a target area for diversity efforts.
Nevertheless, Walmart has been criticized for handling its workforce, especially regarding labor relations and turnover. Employees have complained about the company’s poor treatment, including low pay, few perks, and unsafe circumstances at work. Walmart has also been the target of anti-union litigation and other labor-related legal disputes. Walmart has responded to these issues by introducing several programs designed to enhance the company’s workforce management methods (Pandey et al., 2021). The Walmart Customer First Program and the Walmart Associate Engagement Survey are two such efforts, respectively, to boost customer satisfaction and staff morale. In addition, the firm has boosted its investment in employee training and development, intending to expand employees’ access to promotional and professional development possibilities.
Diagnosis
In the past few years, Walmart has struggled with high staff turnover, and its operations and bottom line have been under constant strain due to the high turnover rate. The high staff turnover rate at Walmart may be attributed in part to the following factors. To begin, low hourly wages at Walmart compared to competitors in the retail business. Unions and activists have voiced their disapproval of the company’s pay structure, claiming it has a negative impact on morale and employee engagement. Similarly, Walmart’s rewards and benefits are less generous than some of its competitors. Workers are underserved by the corporation regarding health insurance, sick pay, and retirement savings plans (He et al., 2021). These poor benefits package is linked to the high turnover rate at Walmart.
Another factor is low staffing levels, whereby long hours and inadequate training are just some complaints against Walmart throughout the years. Low staffing levels are linked to long working hours, high-stress levels among employees, and poor balance between work and family among employees. These factors may be a major problem for the corporation because they can damage sales, morale, and other metrics (McMann, 2019). Suppose there need to be more employees to handle the volume. In that case, shoppers may have to wait longer than usual or get less personalized attention than usual, which may erode consumer satisfaction—consequently, the dynamic leads to employee burnout, high turnover, and difficulties finding fresh talent.
Walmart provides little opportunity for workers to advance in their careers. Many workers at the organization believe they need somewhere to go in their careers due to the few promotions available. Additionally, the organization embraces a corporate culture that is hostile to employees. As a result, employee empathy problems and a bottom-line obsession have been connected to the company’s scale and profitability-driven culture. Concerning competition, the job market has become more competitive; Walmart will have to compete with other companies who are willing to pay higher salaries and provide better benefits to attract and keep workers. Walmart’s high employee turnover rate may be partly attributed to this intense rivalry(McMann, 2019). Employees are leaving the organization because of these problems, increasing the company’s costs associated with recruiting and training new personnel. Walmart has to take a holistic strategy that considers all of these things and increases staff retention rates.
Kotter’s 8-Step Approach
Walmart’s high turnover rate can only be solved by implementing radical changes that boost morale in the workplace and make it more attractive to potential employees. This revolutionary shift may be directed through Kotter’s 8-Step Process. The following strategy is to improve Walmart’s corporate culture and cut attrition rates.
Create a Sense of Urgency
The first stage in implementing transformative change is to instill a feeling of urgency in both the workforce and the executive suite. The CEO, Doug McMillon, and other administrative leaders must discuss how the high turnover rate hurts the company’s bottom line and client happiness. In other words, the administrative team in the organization needs to acknowledge the drawbacks of high employee turnover, including the money spent on recruiting, hiring, and training new workers. These problems are linked to decreased retail productivity and poor customer happiness. It is critical to communicate with the staff and upper management about the advantages of implementing change and why it is necessary.
Create a Guiding Coalition
The next phase is organizing a group of influential people inside the company to spearhead the transformation. In Walmart, forming a steering coalition involves identifying important stakeholders, establishing concrete objectives, crafting practical solutions, disseminating the plan, and keeping tabs on its implementation. The stakeholders spearheading the change should have a vested interest in and ability to contribute to the change initiative’s success. Walmart’s executives, supervisors, human resource personnel, retail managers, and workers all fit under this category. In different perceptions, members of the governing coalition should come from various departments and roles within the organization. A wide range of opinions and experiences increases the likelihood that the change initiative will be consistent with the organization’s core values. The steering coalition should work together to establish concrete targets and plans for increasing retention and decreasing churn.
Develop a Change Vision and Strategy
Through the human resource department, the administrative team needs to create a compelling change vision and plan for future employee management. All personnel in the human resource department and the administration should know the vision and understand how it relates to the company’s overall goals(Tanner, 2023). For example, Walmart’s transformation vision and strategy should aim to fix high employee turnover by making workers happier and more invested in their job. For Walmart, the change vision aims to become known as an employer of choice with low turnover rates and high levels of employee satisfaction. The vision aligns with the company’s overarching objectives and core values. As a transformative strategy, internal and external reasons should inspire the transformation, including stiffer rivalry for top employees.
Regarding strategy, the organization’s human resources, in collaboration with the management team, must create a plan for making the change that will help realize the goal and overcome the challenges. Among these measures might be pay raises, more opportunities for professional growth, schedule flexibility, and rewards for staying with the company. Walmart can create a more engaged and content workforce by following these steps to construct a transformation vision and plan to lower turnover (Harper-Lane, 2021). There has to be internal and external communication about the transformation vision and strategy, and it needs to be consistent with the company’s larger aims and values.
Communicate the Change Vision
It is critical to share the change strategy and vision with everyone in the company who will be affected by it. Everyone from the CEO on down is included in this category. The guiding coalition must communicate the change vision through departmental meetings, corporate communications, and training sessions (Harper-Lane, 2021). It is important to keep everyone informed about the progress and the next steps in the transformation process for the organization to become known as an employer of choice with low turnover rates and high levels of employee satisfaction. Constant communication of the goal and the value of retaining employees is crucial.
Empower Broad-Based Action
The administrative team and the human resource managers need to give departmental managers, store managers, and supervisors the authority to make the vision a reality. As mentioned, providing education and tools to enhance working conditions, schedule flexibility, expanding benefits, and launching new career paths are all ways to achieve this goal. It is crucial to provide everyone with the necessary resources to realize the goal. Broad-based action enhances labor management and boosts employee retention in response to the company’s chronic employment shortage. For example, the human resource billing department should be paying more competitive salaries of $15 to $25 per hour to attract talented job seekers and talents from other organizations. Walmart’s departmental and store managers must embrace flexible scheduling, so workers may choose shifts that work with their schedules(Harper-Lane, 2021). This policy has the potential to boost morale and decrease attrition. Similarly, the human resource department in the company needs to double its funding for employee training and development initiatives. The strategy gives workers more chances to learn new skills and progress in their careers.
Walmart managers and executives intend to fix its personnel problems by launching a series of programs to boost labor management and retention. Walmart can boost its workforce management procedures and guarantee enough staffing levels to satisfy its consumers’ and workers’ demands by investing in training, delivering competitive compensation and benefits, and leveraging technological solutions. To assist in lower turnover rates, Walmart has instituted retention incentives, including bonuses for sticking with the firm for a set amount of time. Long-term employee satisfaction and retention may be increased by using initiatives to increase employee engagement, such as providing employees with chances to provide feedback or participate in decision-making.
Generate Short-Term Wins
Short-term successes for Walmart in addressing its high staff turnover include lowering turnover rates in certain areas, raising employee satisfaction ratings, increasing minimum hourly wages, and boosting retention rates. These short-term wins, near-term successes, and quick successes prove that the transformation initiative works (Tanner, 2023). Increasing employee happiness, lowering staff turnover, and boosting customer satisfaction are all viable strategies for achieving this goal. In the context of lowering Walmart staff turnover, the following are some possible techniques for creating short-term wins. First, providing retention bonuses or other incentives to workers in divisions experiencing high turnover rates positively impacts the retention rates in the area. Second, conduct employee surveys in different Walmart stores to uncover problems or difficulties leading to a turnover. Additionally, provide training and development options for staff in high-turnover areas to increase job satisfaction and retention rates in the near term. Further, improve employee scheduling by allowing greater scheduling flexibility or delivering more regular work hours to enhance short-term employee happiness and retention. Lastly, salary increases may be an immediate solution to the problem of excessive turnover in departments.
Consolidate Gains and Implement More Change
Walmart’s administrative team and human resource managers must build on the short-term wins and make even more progress. Building on the progress accomplished to bring about even greater transformation(Tanner, 2023). To maintain the forward momentum of the transformation process, it is possible to enlarge successful projects and launch new ones. Implementing more improvements to decrease turnover rates and increase employee satisfaction significantly is the next phase in Walmart’s plan to address its high employee turnover. The administrative team led by Doug McMillon should provide continuous support to effective strategies to lower staff turnover. In a different thought, the human resource department needs to continue addressing the fundamental causes of turnover identified in the previous phases of the change effort. The strategy ensures that the improvements achieved in the short term are sustainable in the long run. Walmart may assess the performance of the transformation effort and find opportunities for additional development by continuing to measure progress toward lowering turnover rates and increasing employee satisfaction.
Anchor Change in the Culture
Walmart should firmly establish the new measures across the organization and inside the established norms of the company. The organization may adopt new practices, foster a culture of constant development, and stress the need to retain current employees. Every department and store in Walmart management should make the changes achieved in previous phases of the change effort permanent and integrate them into the company’s culture. Including the changes in things like performance reviews and training programs may help make sure they stick around. To ensure that efforts to improve employee retention and satisfaction get the attention and resources they need, it is important to prioritize these goals within the organization (Tanner, 2023). The new culture may be strengthened by recognizing and rewarding those workers who adapt well to changes and assist lower turnover rates and boost morale.
Conclusion
The high staff turnover rate registered in Walmart over the past few years is a major problem for the company. A radical shift must be made toward better working conditions, higher morale, and lower turnover to solve this problem. With the appropriate strategy, Walmart can address its high staff turnover rate and build on its effective change implementation track record. Maintaining the company’s dedication to its workers and customers requires a focus on reducing turnover. Ultimately, Walmart must use Kotter’s 8-Step Method to change its corporate culture and lower turnover rates. A feeling of urgency must be established, a strong coalition formed, a vision for change developed, that vision communicated, others empowered to act on the vision, quick victories established, gains consolidated, more change produced, and new methods firmly anchored the organization’s culture. Following this strategy will help Walmart boost profits by decreasing turnover, boosting staff morale, and delighting customers.
Walmart has to build a culture of continuous improvement and embed innovative techniques in the organization’s culture to minimize employee turnover. This implies that the new practices and rules must be integrated into the firm’s fabric and continually reinforced to ensure they stick. Walmart can reform company culture, decrease attrition, boost morale, and boost customer happiness and profits by adopting Kotter’s 8-Step Method. Walmart has the potential to become an even more prosperous and long-lasting business with the help of competent management and a forward-thinking strategy.
References
Harper-Lane, D. C. (2021). Strategies to Reduce Voluntary Employee Turnover in Big-Box Retailers (Doctoral dissertation, Walden University).
He, Z., Ding, Y., & Liu, W. (2021, September). The States Quo of Walmart and Challenges and Opportunities of Their Online Transformation in China Based on SWOT Analysis. In 2021 International Conference on Financial Management and Economic Transition (FMET 2021) (pp. 353-359). Atlantis Press.
McMann, S. (2019). Turnover rate: Walmart.
Pandey, R., Dillip, D., Jayant, J., Vashishth, K., Nikhil, N., Qi, T. J., … & Qhi, L. Y. (2021). Factors Influencing Organization Success: A Case Study of Walmart. International Journal of Tourism and Hospitality in Asia Pasific (IJTHAP), 4(2), 112-123.
Tanner, R. (2023). Kotter’s eight step leading change model – Management is a journey®. Management is a Journey® – Helping you with the people side of the business™. https://managementisajourney.com/summary-of-kotters-eight-step-leading-change-model/#kotter-1
Walmart. (n.d.). Walmart.com. https://www.walmart.com/
