Wal-Mart was founded by Sam Walton in 1962. The group operates in sixteen countries including the United States, Canada, Mexico, Argentina, Brazil, and China. In 2005, the total number of stores amounted to nearly 5000, with more than a quarter positioned abroad. The group has around 180 million customers per week and earns profits of $20,000 per minute. Sam Walton is the figurehead of the company; he is the father of the revolutionary strategy behind the enterprise and continues to sustain the success of his company.
The strategy followed is "Every Day Low Prices"; the resounding success of Wal-Mart mainly stems from the lower prices offered by the retail chain. Another success factor is that the stores offer an assortment of products in its portfolio, and allows Wal-Mart to reduce its purchasing costs. But the multinational stores are now being criticized, particularly in regard to the ruthless working conditions. These include low wages, forced overtime that is often not paid, no health security, the right to unionize being harshly repressed and many more.
The potential for growth in this country remains huge and Wal-Mart is not present in seven states in the US. Its internationalization strategy is still marked by extreme caution and its location has not raised the same claims in the United States. So even if the development and expansion of Wal-Mart is feasible, the company feels more difficult to establish.
We try to answer the following question in this report: why does the opening of new Wal-Mart store pose a problem? Our analysis will be done in four parts, first we'll take a look at the socio-political situation and then , we will analyze the regulatory issues. Subsequently, we'll examine the ethical approach adopted by the company and finally a managerial analysis will be undertaken. In conclusion, we will present a general summary and offer some recommendations.
Wal-Mart is the largest private employer in the United States and the leading distributor worldwide with 1.4 million employees (U.S.) and a turnover of $260 billion. Economists allocated the company a major role in disinflation and the country's competitiveness; it generated 2.3% of GDP in America. But the company is far from the leading edge of economic and social rights. Thus, Wal-Mart is also increasingly becoming the target of prosecution.
Wal-Mart is one of the most fiercely anti-union companies in the world; more than 100 complaints about illegal practices in the work were made against Wal-Mart in the U.S. Since 1995, the U.S. government was forced to issue at least 60 complaints against Wal-Mart in the "National Labor Relations Board" (Labor Standards Commission). Wal-Mart has been facing growing opposition to its establishment concerning lawsuits. America is a democratic country characterized by dispersion of power.
Such pluralism allows everyone to defend their interests. Relevant stakeholders that Wal-Mart faces is the shareholders, employees, unions, pressure groups, suppliers, media, consumers, competitors and the state. Each segment has a vision of the reality of its own. Indeed, each player will typify the problem according to his personal representation and perception of the phenomenon. This is a constructivist approach in which reality exists under the definition given to it.
Tags: Sam Walton, international strategy of retail chains, Wal-Mart in the United States, National Labor Relations Board.
[...] The survey covers the handling and transport of goods containing hazardous materials such as fragrances, nail polish, spray and fertilizer. A survey of the same type was launched in Nevada. - January a judge allowed Wal-Mart workers in Pennsylvania to bring a class action against their employer. The employees argued that Wal- Mart is pushing for them to work overtime without pay. This action could affect nearly 150,000 current and former employees of Wal- Mart. Other similar lawsuits against Wal-Mart received the status of collective action in Massachusetts and Minnesota. [...]
[...] There is even talk of a Wal-Mart "green" Annex 3. Annex Stakeholder typology: one, two or three attributes at present Appendix A model of corporate political involvement Appendix The generic strategies in conflict GENERIC STRATEGIES IN CONFLICT GENERIC STRATEGIES IN CONFLICT Bibliography Books: - Fortin Clovis Portrait of Wal-Mart: A Strategic Perspective Items - Serge Halimi, Wal-Mart's assault on the world, the world diplomatic 01/01/2006. - C Vaillancourt Quebec Coalition against sweatshops, newsletter January 2006 - Pasquero J 2003 The socio-political environment of the company - Face troubling Wal-Mart, The Business Press - The Assignment: Wal-Mart social responsibility cheap, December 2005 - Mitchell, Ronald, Agle 1997 Toward a theory of stakeholder identification and salience: Define the principle of who and what really counts.Academy of Management Web sites: www.actionconsommation.org www.walmartvswomen.com www.walmartwatch.com www.lamarde.com www.bravenewfilms.org www.wal-martlitigation.com Videos The Far Side of the Empire Wal-Mart, Radio Canada, December Video Radio Canada: The Far Side of the Wal-Mart empire December 2005 www.actionconsommation.org . [...]
[...] In Wal Mart this policy represents an increase of stocks, promotional expenses and increased uncertainty among consumers who questioned its perceived value, and sales are often deficient. The Wal-Mart model is a model of efficiency through an information network and a computer system without flaw. The company has set up a lean logistics performance. However, we cannot attribute all the cheap brands to the technology and efficiency of production systems; it must be offset by the effects of payroll employees. The Wal-Mart model creates winners and losers. The purchasing power of the brand assures better prices from its suppliers. [...]
[...] This would be a good way for Wal-Mart to regain the trust of stakeholders. Wal-Mart cannot continue to prevent unionization and its unions must be more transparency. Wal-Mart no longer has the legitimacy of a new business that requires everyone's efforts to develop. The company has become one of the most powerful in the world. The social model is implemented now may be the model adopted by the next companies. Leaders must consider their social responsibility. So now their actions are ethical economic leaders must strengthen their links with politics and finally with the company. [...]
[...] - In addition, Wal-Mart will have to invest more in health insurance for its employees in Maryland. To escape this company did not hesitate to make a vigorous campaign of lobbying which did not play in his favor. Indeed, on January the Maryland legislature passed a law under which employers with 10,000 or more employees must spend at least of their payroll into a health insurance program or pay the difference with the state program "Medicaid." This law is a response to criticism that Wal-Mart skimps on the benefits to its employees and transfers costs for health to government. [...]
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