High Performance Leadership at Walmart

Abstract

Walmart Inc. is a multinational retail giant under the leadership of Doug Mc Million. The company which was founded by Sam Walton in 1962 in Bentonville Arkansas has come a long and still abides by its mission statement of providing low priced everyday goods so that their customers save money and live better. Doug Mc Million uses transformational and democratic leadership style. When it comes to the aspects of rules, standards, procedures and application of code of ethics, beauracratic leadership style is applied. This ethical leader has led the company into raising employee wages and providing better benefits such as education support, paid off days and health policies. At Wal-Mart leadership is not treated like a position but rather a process where it is everyone’s business. Employees are empowered by the leader’s use of referent power which makes them part of crafting everyday solutions.

Introduce Company

Wal-Mart Stores Inc. is a retail giant in the United States. Wal- Mart Stores Inc. is headquartered in Arkansas where it was founded by Sam Walton in 1962.This multinational giant operates a chain of grocery store, discount stores  and hypermarket chains. Wal-Mart offers a wide range of products which include groceries, financial services, wireless services, pharmaceutical services, tech products and clothing apparel. Wal Mart is worth over 485 billion and is the highest private sector employer with over two million employees.

Wal-Mart Mission Statement

Wal-Mart Inc.’s mission statement is to “save people money so that they can work together”. Walmart staff direct their team effort towards the reduction of costs of everyday products so that their customers may have better lives. The mission statement was created when Walmart Inc. was founded by Sam Walton and the company still strives to achieve the same goal today. The simple and straight forward mission statement is reflective of the organization’s goal which is to formulate high performance and strategies using low prices to attract more customers and retain the existing ones (Ferguson, 2018).

Walmart Vision Statement

Walmart Inc.’s corporate dream is to “Be THE destination for customers to save money, no matter how they want to shop.” (Ferguson, 2018 para 5).The vision was introduced in 2017 after the organization saw its Impact in community leadership. Initially the vision was “To be the best retailer in the hearts and minds of consumers and employees.” (Ibid, 2018 para 5).

The decision to change shows the tactical changes that the company did in response to the situation and environment. Wal-Mart Inc. leadership realized that the company had become one of the leading player in the retail industry and now their main goal is influencing the followers towards elasticity in addressing the needs of their customers. Although the aim is generally the same, the main point is emphasizing the importance of their employees during the leadership process. Leadership at Wal-Mart is seeking to achieve goals and gain competitive advantage through human resources as they are one of the most important stakeholders.

Goals and objectives of Wal-Mart

Goals and objectives are used as the yardstick for measuring depth. Goals are aftermath statements that state what an organization seek to achieve and they are usually a cluster of interrelated programs which are reflective and give leadership direction and pointers. Objective are detailed, time-bound and assessable activities that determine whether or not a goal was successfully completed. Usually objectives are clearly linked to goals, have deadlines and are measurable (Goals and Objectives, n.d).  

Wal-Mart goals and objectives are reflective of the company’s mission and vision. At Wal-Mart the main objectives and goals are to reduce emissions in their operations by close to 20%, have their half of their operations powered by renewable energy , eliminate waste in their landfills, reduce environmental  impact in their operation , support dignity of employees , engaging in community leadership and improving lives in communities (Wal-Mart Inc. ,2017).

Wal-Mart’s objective is to keep their costs relatively low as compared to rivals on the market. For costs to be low other companies like Mc Donald’s were known for notoriously paying their employees meagre salaries as a cost cutting measure. Another objective Wal-Mart live by is to dominate the retail industry. Wal-Mart leadership is known for their innovation which has seen the retail giant competing with online giants like Amazon Inc. This Company uses cost-leadership generic leadership to achieve economies of scale. The use of the golden rule is another goal the company has worked hard to instill in their employees (Wal-Mart Inc., 2018).

Leadership Assessment/Plan

At Wal- Mart Inc. any individual with interest in a leadership post has to go through assessment tests. Wal-Mart Inc. has its own leadership assessment tests which are called Wal-Mart Tactical Leadership Assessment tests which contains situational questions that covers topic ranging from critical thinking, customer service, communication and effective leadership. . (Grumm, 2019). As the Wal Mart hierarchy goes up, so do the leadership assessment. The company chair is also subjected to assessment by the board members. Usually this assessment is done through dialogue, focusing on how far the company went as far as achieving the organizational goals and objectives. The constructive criticism given to the Chairman provides feedback that enables the company to enhance performance and achieve high performance

Leadership Is a Process, Not a Position

Leadership Is Everyone’s Business

Walmart uses two of leadership types. Participative and democratic leadership. These two leadership styles are almost similar and they are built on the same values and principles. When it comes to decision making in participative leadership, the final word is from the leader. Participative leadership has proven to be effective at Wal-Mart Inc. as it has been yielding continuously positive results. Through contributing towards solutions and ideas, Wal-Mart employees’ moral, motivation and sense of commitment is increased as they have a sense of purpose. Thus the ample interaction among Mc Million, his followers and Wal-Mart Inc. helps in developing effective communication and feedback channels

Wal-Mart practices an open door policy and this has led to the success of the participative leadership in style. In addition to the above mentioned benefits, this style of leadership is effective when managing change. Wal-Mart followers are susceptible to both leadership change and operational changes. The open door policy thereby allows all followers to freely communicate and contribute without being criticized, as this all-inclusive approach to leadership is everyone’s business. What makes this all-inclusive approach to leadership be effective is the fact that Wal-Mart Inc. uniformly applies the golden rule to leadership which emphasizes on all individuals treating each other in the same manner they would also want to be treated(Wal-Mart , 2018).

Mc Million, a business graduate developed his leadership skills from the education he acquired and the ample experience he got while working for Wal-Mart. As an individual who had been the president and CEO of Wal-Mart International and Sam’s club he had benefited from both leader development and leadership process which makes him the great leader he is today. For Mc Million, his leadership assessment is measured by the performance of Wal-Mart Inc. as a whole.

Focus on the Leader

Leadership is a continuous process which include learning and development. The fact that this is an ongoing process ensures that there are certain aspects that have to be put into consideration. Leaders have to be self-aware so that they know how to be effective. A leader who knows his strengths and weakness is better able to manage his emotions and reacts better to the ever-changing environment.

The president and Chief Executive Officer at Wal-Mart Inc. is Doug McMillon. Mc Millon’s career at Wal-Mart started when he was a teenage boy when he applied to be a summer associate. He opted to work for Wal-Mart over Mc Donald’s’ because the company paid more .This gentleman has worked for this organization his entire life, showing that the Wal-Mart values and organizational culture are deeply embedded in his DNA. His stunt with leadership started in 2005 when he led Sam’s Club which is one of the many subsidiary companies of Wal-Mart. It was in 2014 that he was promoted to be the Wal-Mart’s fifth chief executive officer (Walmart Inc., 2018).

Dough McMillon depicts a lot of qualities in his leadership style, which is probably the main reason behind his tremendous success which lead to his rise upon the ranks of Wal-Mart leadership. Dough McMillon’s inspirational leadership story is a great reflection of how great leadership style, values and ethics can lead an organization towards high performance, organizational performance and leadership development.

Under Doug Mc Million’s leadership, Walmart has possessed the capacity to unite its coordination systems, stores and ecommerce in exceptional approaches to make it simpler for clients. Walmart is typically occupied with very nearly 260 million customers shopping at the association’s stores every week in the twenty seven countries (Walmart Inc., 2018).Wal-Mart has interactions with their customers through the e-commerce services through the e-commerce services the company offers.

After McMillon took the leadership post at Wal-Mart there has been tremendous changes he inspired as far as e-commerce in the organization. Wal-Mart International has grown tremendously and is in twenty seven countries. As a long serving member McMillon has proven to possess extensive knowledge of the organizational culture, company values and the direction which Sam Walton had when he founded the discount stores which later grew into being one of the retail giant known today.

Power and Influence

                                           Expert                   Legitimate                  Transformational

                                            Referent                  Beauractratic              Participative

McMillon socializes power when leading Wal-Mart Inc. Socializing power helps the organization perform better as it is not centered at one place but include delegation and devolution .As a transformational and democratic leader, McMillon uses beauracractic leadership in its minimum. Transformational leader are charismatic and get ideas through brainstorming with followers. They ensure that followers are informed, duties and responsibilities are shared for better decision making and that there is an enabling environment for participation. This leads to enhances motivation and sense of purpose for Wal-Mart employees (Antoniades, 2017).

 As the leader he uses a healthy amount of legitimate power and influence. McMillon uses referent power, expert power and legitimizing tactics to influence his internal and external followers. His personality as an outgoing leader makes it possible for him to reap the fruits of referent power. Referent power thrives where there is mutual trust, respect and loyalty hence the leader’s interpersonal skills gives him an advantage .Referent power is inclined towards employee empowerment and this increases the levels of commitment and motivation.(Lena, 2016).

Leadership and Values

McMillon’s values as a leader have had an impact on his leadership style and contributed towards the success he has garnered at Wal-Mart Inc. A  Leader’s values and ethical code are probably the contributing factors of how the particular leader exercises their power and influence. The most important and critical key in leadership is to ensure that the leader sets the moral pace and dictate the ethical stance that the organization will take. A leader should be an empathetic visionary who is consistent and has high levels of ethics to succeed in creating a relationship of mutual trust between themselves and the followers (Hughes, Ginnet, & Curphy, 2018).

When McMillon took over the leadership ship at Wal-Mart Inc., the company was facing problems on their own. Employees were grumbling over poor working conditions and low wages and the company was constantly in the media being constantly critized for filing its employees. As an ethical leader McMillon increased the salaries of all associates and ensured that health insurance was part of the benefits that all associates had. Before McMillon Wal-Mart had scrapped off health insurance from its part time associates, who had to depend on government health insurance, a move that angered the taxpayers. The empathy he has a listening leader made him to listen to the plights of the workers hence the increase in salaries and overall improvement in employee productivity which is reflected by the retail giant’s overall performance.

  In addition to the above McMillon has been consistent in his moral reasoning. His knowledge of the importance of the relationship between values, ethics and leadership has seen him go out of the norm and shaking up Wal-Mart leader than ever before. Wal-Mart extensively practices the golden rule as they emphasizing on the workers treating each other in the same way they would want to be treated. This principle-centered leadership has seen the application of the code of ethics in everyday decisions made by the leader and the organization. At Wal-Mart the rule of law prevails, ethical reporting of accurate information consultation and integrity are the most emphasized values at the organization.

The organization pays equal money for same amount of work, promotions are based on merit and there are equal chances for all at Wal-Mart. At one time when giving an interview, the leader, McMillon   told the crowd that he was still shocked that we are after such a long time America has employers who are discriminating towards protected classes and women. (Massmart & Wal-Mart.2017). The above show how much Mc Million’s moral compass and values will lead this retail giant towards unspeakable success.

Leadership Traits

Leadership traits are part of leadership attributes. Traits approach has since time immemorial been associated with leadership success and effectiveness leading to high performance. The recurrence trends when a leader influences followers create a pattern which then feeds into leadership behavior (Hughes, Ginnet, & Curphy, 2018). As a leader Mc Million incorporates intelligence, personality and emotional intelligence when leading Wal-Mart. Mc Million has worked tooth and nail in building his reputation and the corporation. This leader is a likable, relatable individual who stays leads a low key life, staying away from scandals and this makes his clean identity make him effective in his leadership.

In addition to the above, Mc Million acknowledges the importance of intelligence and leadership at Wal-Mart. This University of Tulsa MBA graduate headhunts Business graduates from high profile universities such as Stanford University (5Walmart Inc., 2018). As a leader he appreciates the importance of analytic and creative intelligence .As an individual who has worked his entire life at Wal-Mart Mc Million’s practical knowledge is unquestionable. As a leader he knows the organization’s weaknesses and strengths and continually works towards achieving that .Throughout his leadership at Wal-Mart, Mc Million’s traits show that he is a knowledgeable leader who is aware of the benefits of intelligence in leadership which include effective problem solving creativity and novelty in crafting solutions, better judgement and make decisions through predict the environment and the market.

Mc Million is a leader who is rated high in all the five factors of the OCEAN model. His high levels of openness to experience are reflected in how he does things differently from the previous leader of the organization. He is open to trying new things which add value to the organization’s performance. His extraversion is seen in the way he interacts with his followers and customer. Mc Million is the type of leader who frequently visits different departments to find out their challenges they face daily. He gets along well with his followers and is not afraid to get ideas from anyone, including delivery staff. He takes criticism well as he remain calm when he is being bashed by the media, showing that his level of neuroticism is high. He remain focus and goal oriented in his leadership path.

Leadership Behavior

Leadership behavior is the direct or indirect reaction to the application of a leader’ traits which include experiences, knowledge, creativity, ethics, values, and beliefs. With the passage of time, experience, knowledge and interests, leaders better recognize the most suitable leadership behavior to both weak and strong situations (Hughes et al., 2018). Mc Million’s practical knowledge of how Wal-Mart has been run has contributed towards his success as an effective leader. At a time where Now Orleans was devastated with the effects of hurricane Katrina, Wal-Mart extended a hand by donating to the hurricane victims in 2005. A year after being appointed the Wal-Mart CEO he donated twenty five million ten years after the tragedy. Wal-Mart has also become more actively involved in community building through its social corporate responsibility programs showing that this leader is not only concerned about profits but at the same time community leadership (Good News Network, 2015).

Focus on the Followers

Motivation.

Wal-Mart has about 1.4 million employees in the United States and 2, 3 million worldwide, and it is the biggest retail store. The biggest employer is motivating its people. Wal-Mart starting following step to motivate employees: change its internal employee network, and changing publishers to beefing up in store books. Allowing managers have the higher right of green-light items, encouraging employees to promote items in their stores. Also, give store managers and employees credit for Wal-Mart online sales which come from their local areas.

Satisfaction.

Wal-Mart was offering $9 an hour, higher than $7.25 federal minimum wages (Mitchell, D. 2015), about 500,000 employees or one-third of Wal-Mart affected. Wal-Mart said short-term hit would make long-term benefits, longer-tenured, well-trained employees can bring more customers. The wage increase will eat Wal-Mart $1 billion. Wal-Mart spends more money on online sales, the satisfaction of the retailer fell by 1.7%, but online retailers rose by 5.1%, it is a great thing.

Performance.

The Wal-Mart Academy is providing two to six weeks training program to help supervisors, assistant managers, and department managers improve themselves. They also help their employees with an education plan, such as offer discounted college tuition, books, and fees; help employees access to a coach and help employees through the process of choosing and applying for college.

Focus on the Situation

Characteristics of the Situation.

Wal-Mart has a unique phenomenon that it is the only one in some many corporations rely on a low wage, and import cheaper product from foreign nations or requires manufacturers and suppliers decrease their price. Wal-Mart focuses their business on specific merchandise category, not sell wide ranges of consumer products. However, Wal-Mart’s discount strategy ensure the company can control of retail industry, and demand suppliers lower their price. Wal-Mart occupies 20% of U.S.’s retail, but it still controls a tiny part of the retail industry, around 4% of global retail sales. How to increase its global retail sales share is a big problem for Wal-Mart now.

Contingency Theories of Leadership

The Contingency Theory of Leadership states that a leader’s effectiveness is contingent upon with how his or her leadership style matches to the situation (Leadership Theories, n.d). Wal-Mart needs a leader who can handle this situation, and make a massive change in business. Changes always with pain. “There is no one best style of leadership” (Fiedler’s Contingency Model, 2016)

Leadership and Change

Walmart CEO McMillon said “strategic decisions are positioning the company “for success in the future,” even while delivering results and supporting communities now across the globe.” and “So we are a growth company, we just happen to be a big one.” (CEO McMillon Says, 2016) Walmart leaders willing company have changed, all changes will make Walmart better, and McMillon believes Walmart’s internal change will make Walmart unique. Every organization’s transformation is trying to build new capabilities to meet the customers’ expectations, in this fast-paced life.  Same as leadership, leaders have to learn more new knowledge from their studies, and work experience. Changes can help leaders lead companies in a fast developing lane. Walmart is looking for success in the future, they did not look at short term, and they are looking at business in long-term development.

Leadership Skills

Results of the assessment

What’s your take Ji?

Summary and Conclusion

Walmart Inc.’s leadership has helped the company to transform into the retail giant that it is today. Dough Mc Million, the company leader has used a wide array of factors to enhance and maintain high performance. The participative leadership at Wal-Mart has led to the involvement of all stakeholder and thus have made leadership everyone’s business in the company. The leader’s ability to identify the right sources and bases of power and influence has led to the tremendous growth of the company.

As an ethical leader Dough Mc Million has ensured that there is fairness in employment opportunities and remuneration to all employees in the company. This business administration savvy by profession has seen the organization using leadership traits such as practical and creative intelligence into the creation of sustainable solution to everyday problems the company faces. Thus the values and personality of Mc million has enabled him to effectively use credibility and yet be effective at the same time.

The company’s leader uses remuneration and tangible and intangible benefits during the follower’s motivation process. Employees who are motivates are empowered and have high levels of satisfaction which is a great benefit to the organization. These employees have ownership of the company projects, the maintain high levels of customer service and they are more willing to go an extra mile as far as performance. This positively impacts the departments and teams they belong to. When employees are happy and productive, this positively reflects on the leadership performance and the company becomes the preferred place to shop by customers. Walmart has seen changes in leadership and aspects such as ecommerce being introduced but because of good leadership employees were trained and adapted to the changing environment without Wal-Mart losing revenue and their customer base.

Thoughts and Recommendations

• Introduce the lead the market or match the market approach to pay as competitors like Costco and Target are ahead of Wal-Mart in terms of remuneration and benefits.
• Ensure that the corporate vision statement is rounded and inclusive of  employees ,existing and target employees information  as they are important followers of the company
• Mission statement to include the people aspect. The only way to ensure that customers save money and live better is not possible without Wal-Mart employees.
• Leadership to continuously empower employees through training, development and education so that they meaningfully contribute towards leadership performance and overall organizational goals.
• Leadership to be effective in being the yardstick for moral and ethical example

References

• Antoniades, G. (2017). Leadership styles. Retrieved from https://www.slideshare.net/mbagasas/leadership-styles-71094515?next_slideshow=1
• Bariso, J. (2018). Walmart just made a huge announcement that will completely change how you think about Walmart. Retrieved from https://www.inc.com/justin-bariso/walmarts-ceo-made-a-huge-announcement-that-will-completely-change-how-you-view-walmart.html
• CEO McMillon Says Walmart Embracing Change, Positioning For Continued Success. (2018). Retrieved from https://news.walmart.com/2018/06/01/ceo-mcmillon-says-walmart-embracing-change-positioning-for-continued-success

• Ferguson, E. (2018, August 22). Wal-Mart’s mission statement & vision statement, generic & intensive strategies. Retrieved from http://panmore.com/walmart-vision-mission-statement-intensive-generic-strategies
• Fiedler’s Contingency Model Matching Leadership Style to a Situation. (2016, November 3). Retrieved from https://www.mindtools.com/pages/article/fiedler.htm
• Goals and Objectives. (n.d). Retrieved February 1, 2019, from https://resources.saylor.org/wwwresources/archived/site/wp-content/uploads/2011/06/BUS208-4.2.pdf
• Good News Network. (2015). Wal-Mart gives $25 million to disaster recovery on hurricane Katrina anniversary. Retrieved from https://www.goodnewsnetwork.org/walmart-gives-25-million-to-disaster-recovery-on-hurricane-katrina-anniversary/
• Grumm, B. (2019). Wal-Mart – tactical leadership assessment test. Retrieved from https://www.scribd.com/doc/262112911/Wal-Mart-Tactical-Leadership-Assessment-Test
• Hughes, R., Ginnet, R., & Curphy, G. (2018). Leadership: Enhancing the lessons of experience.  New York: McGraw-Hill Education. 
• Is Wal-Mart Unique?  (2004). Retrieved from https://www.pbs.org/newshour/economy/business-july-dec04-unique_08-20
• Leadership Theories – In Chronological Order. (n.d.). Retrieved February 1, 2019, from http://www.leadership-central.com/leadership-theories.html
• Lena, F. O. (2016). Referent leadership. Retrieved from https://www.slideshare.net/FabienneOuapouLena/referent-leadership
• Massmart & Wal-Mart. (2017). Code of ethical conduct. Retrieved from https://www.walmartethics.com/uploadedFiles/Content/Massmart_SA.pdf
• Meyer, P. (2017, March 25). Walmart’s stakeholders: Analysis & recommendations. Retrieved from http://panmore.com/walmart-stakeholders-analysis-recommendations
• Mitchell, D. (2015). Wal-Mart’s problems go beyond underpaid workers. Retrieved from http://time.com/3715877/walmart-satisfaction-index/
• Neff, J. (2011, November 28). Sleeping giant at Wal-Mart wakes — Its vast workforce. Retrieved from https://adage.com/article/news/walmart-motivating-mobilizing-workforce/231210/
• Ranjan, R. (2015). Leadership is actually a process, not a position. Retrieved from https://www.linkedin.com/pulse/leadership-actually-process-position-rohit-ranjan
• Walmart Inc. (2014). Leading. Retrieved from https://walmartmanagementwalmart2014.wordpress.com/part-5-leading/
• Wal-Mart Inc. (2017). Shared value priorities and aspirations for 2025. Retrieved from https://corporate.walmart.com/2017grr/priorities-and-aspirations-2025
• Walmart Inc. (2018). Doug McMillon. Retrieved from https://corporate.walmart.com/our-story/leadership/executive-management/doug-mcmillon/