Roles of Leadership and Management in Wal-Mart - Case Study Example

WAL-MART ANALYSIS Student’s name Code & Course Professor’s name University City Date Wal-Mart Analysis Introduction Wal-Mart has championed as a company with an extraordinary success story in the dynamic market. Starting in the mid 1960s the company has outstretched its limits and emerged as the world’s largest corporation. The discount retailer typified by the mantra; everyday low prices, has managed to garner customer confidence and boost its revenue base. Employing over 1.3 million in its 382 store outlets it dominates over 8 percent of the retail stores in the U.S., earning a capital investment of about 14.7 percent. Evidently, the company has sustained its profits over the years against rival companies such as Kmart and Costco. Its superiority reflects on its competitive advantage based on its successful implementation of sustainable management strategies. In the onset of 1962, the company emerged as a retail store that offered self-service supermarket to its customers. Initially employed by grocery outlet the company successfully implemented the strategy against other companies. As opposed to its rivalries that focussed on the urban and suburban locations, the retail store concentrated in the small towns. In the long run, Wal-Mart grew exponentially fast with lower pricing than the local mom-and-pop retailers. Nonetheless, there is much more to Wal-mart’s location. The company has effectively maintained its innovation in logistics, human resource and information systems. Taken together, they have maintained the company’s competitive edge that has resulted to lower cost and higher productivity. Principally, it has earned significant profits whilst its low pricing strategies. As a market leader it backed its strategies by implementing effective information technology comprising of bar codes and checkout scanners. Human resource initiatives played a significant role in improving employee experience and compensations programs. Through sound management practise Sam Walton advocated that the employees are subject to better rewards in improving the company’s work experience. Underpinning this belief, the management referred to employees as associates. An establishment of a profit sharing scheme enabled the employees to purchase the company’s stock as discount prices than its market value. Wal-Mart’s rewards were realised by high employee productivity, overseeing the reduced operation cost and high profitability. Compounded by effective leadership the company is able to succeed in all its markets. Nonetheless, a sound management practice has fuelled the creation of sustainable and workable planning system throughout its stores. Its budget and control system has maintained effective project management systems in various dimensions. Its budget and control system has facilitated the avoidance of overstocking in its stores, as such; the company does not hold periodic sales in shifting its unsold units. Nonetheless, its information system is linked to the nationwide distribution network that ships and stores its merchandise in a 300 mile radius. The consolidation of distributions centres and the information centres has enabled the retail company to reduce a considerable amount of inventory in the stores. Analysis Distributed Leadership Roles of leadership and management has complimented each other in attaining the organisational success at the retail company. Wal-Mart’s managers and leaders have worked in close relationship in ensuring the company’s smooth operational process. In a nutshell, strategic leadership is linked towards the strategic –making process that augments a company’s performance hence, increasing its value of enterprise to its owners. Pursuant to increasing a shareholder value , the managers have to incorporate strategies that increase the company’s profitability in a larger scale. In attaining these success, a company must outperform its rivals, and attain effective competitive advantage in the long run. Burns asserts leadership types emanating from transformational leadership and transactional leadership (Burns, 1978). In essence, transformational leadership changes the people’s lives in which the leaders operates. Transactional leadership affects is centred in the various transactions conducted with the leaders with their subordinates. It functions as a give and take form of leadership where the leaders rewards or punishes affected individuals. Wal-Mart’s successes has employed both leadership approaches. Predominantly, transformational leadership has been Wal-marts core guiding principle since Sam Walton’s leadership. The transformational approach has shaped the company’s success in various platforms. Top officials and managers have been involved in periodic visits to the various stores. As such, it facilitate a clear understanding of business and ground realities. In essence, it makes a considerable impact on employee functionality. For instance, Mike Duke’s visit to China realised the need to use local bananas than imported ones. Resultantly, swift action was taken in making the effective change. Project impact Wal-Mart strives at making decision with respect to the customer preferences. The launch of project impact was garnered at adopting and understanding various customer preferences at different operational levels. These steps have significantly transformed the operational steps in the organisation. Building leadership pipelines Emphasis have been placed on leadership pipelines, aimed at recruiting and developing a huge number of talented leaders who can implement the company’s vision. As such, different levels have created new leaders in this regard. Transactional leadership has facilitated the execution of strategies and creating a sustainable operation process. Mike Duke was subject for promotion to CEO after successful handling of the company’s operational process. Good Standard Balance The company has maintained an adequate balance of control between standard and control. Store managers are capable of making decision based on the freedoms associated with their stocks and decisions. Supplier Relationship Walmart supplier relationship is based on the model of “give and take”. Wal-Mart maintains cheap prices in return for supplier assurance on large supply quantities. Organizational leadership is therefore imperative in alleviating the performance of any organization. In a nutshell, the organizational strategy solely depends on leadership characteristics portrayed by the leader. Simply put, the triumph of an organization would ultimately depend on the strategies used by the leaders. Leader offer motivation in various forms (lipman, 2013). For instance, leaders can efficiently draft benefits schemes for the employees, have a sense of respect among the employees, provide ample support for their employees at different levels and encourage leadership feedback whenever necessary (Klitzner, 1977). Stringer affirms that whenever employees are motivated they productively offers an excellent working condition and propels the success of the organization (Stringer, 2013). Accordingly, development of a positive organizational culture can fundamentally augment the performance of an employee by 30 percent (Northup, 2007). Integration of Efforts Leaders capable of implementing their understating of a certain concepts are more likely to create goal driven objectives (Klein, 1991 & Ricardo, 2001). Accordingly, convinced efforts play an important role when addressing particular issues that affects the company directly (De Cremer, 2010). Through this the employees will be able to learn such values and emulate them. Therefore, through effective communication channels the employee can present his view to the leader; which might be a major breakthrough (Stringer, 2013). Consequently, Locke suggests that goals can affect the employee behaviour and performance in an organization (Robbin, 2007). Value and intention are indispensable in realizing an organization’s goal. A goal centered organization, can fundamentally attain its goal easily. The leader/manager acts as a determining factor in attaining the desired goals. As such, if the leader instils a notion of goal-centered ideology among the employees, it is likely that employees will strive at achieving the set goals (Hung-Wen, 2009). Read More