Strategic Human Resource Management — Summer 2019

Q. 5 Walmart purchased massive quantities of items from its suppliers to form scale economy, and with the efficient stock control system, help in making its operating costs lower than those of its competitors. It also imported many goods from China, “the world factory” for its low cost. Managers engage in three levels of strategic planning the corporate-level strategy; the business-level strategy and the function- level strategy. The functional strategy should serve the overall company strategy, so the corporate strategy could be implemented more effectively and efficiently. The following part we’ll examine the “fitness” of HR practices in Walmart with this theoretical model, which is obviously also the integration process of HR practices with the contingency variables to some extent. From the recruitment. Walmart audit reports which found “extensive violations of child-labor laws and state regulations requiring time for breaks and meals.” Walmart also faced a barrage of lawsuits alleging that the company discriminates against workers with disabilities, for the recruitment of these people means providing more facilities for them and the loss of efficiency to some extent. From training perspective, through training on behavioral requirement for success and encouragement, Walmart tried to adjust the employee behaviors and competencies to what the company’s strategy requires, that is to low down cost more. From the performance management perspective, Walmart made very high demanding standards and job designs. There are so many instances of minors working too late, or for too many hours. Walmart also goes great lengths to reduce cost, cases that women sued Walmart for its discriminated policy against women by denying them promotions and paying them less than men did. From the compensation management perspective, Walmart has also showed very aggressive HR policies and activities. Walmart imported $15 billion worth of goods from china, for not only the strategic consideration of supplier chain economy, but also Walmart has some factories in china, whose products are branded with Walmart name. With this method, Walmart pays much less to Chinese labors in this “world-factory” and earn some advantages, so we could just see how the Walmart corporate strategy is just intensely integrated with its HR policy. In 2002, operating costs for Walmart were just 16.6 percent of total sales, compared to a 20.7 average for the retail industry as a whole, which supported greatly the overall strategy. Walmart workers in California earn on average 31 percent less than workers employed in other large retail business. Actually, with other operating and inventory costs set by higher-level management, store managers must turn to wages to increase profits, and Walmart expects the labor costs to be cut by two-tenths of a percentage point each year. From the employee benefit and safety perspective, workers eligible for benefits such as health insurance must pay over the odds for them. In 1999, employees paid 36 percent of the costs. In 2001, the employee burden rose to 42 percent. While in the US, large- firm employees pay on average 16 percent of the premium for health insurance. Unionized supermarket workers typically pay nothing. Walmart was frequently accused of not providing employees with affordable access to health care, but the top managers and HR managers know their focus was just to try their most to implement Walmart’s corporate strategy.3 It has been argued that doing business in China is particularly difficult because of the higher relative importance of personal relationships (guanxi), as opposed to the specification and enforcement of contracts in the West (Davies et al, 1995). Walmart China has tried every effort to develop good relationships with China government and other influence groups. So, Walmart made this exception of have unionizations is just in accordance with its corporate strategy and HR strategy. If it ignores the Chinese government’s firm rule, its cost would just outweigh what it would save by organizing no unions in its labor relations management as Walmart provides little power for Chinese workers as the unions are controlled by the state. Questions: 1- Identify the challenges your business will face and how it will affect your HRM strategies. 2 - Design HRM strategies to address these business challenge