Problems faced by Walmart and the steps to overcome those problems Question: What Are The Problems That Walmart Has Faced And What Has The Company Done To Address Them?
SolutionThis essay discusses the recent problems faced by Walmart and the steps taken to overcome these problems.
Problem faced by Walmart is a well known American market leader in the renewable energy sector. But the company has to face a lot of challenges from various parties who criticized Wal-Mart in various contexts. Historically it has to face criticism for not treating employees and suppliers properly and for its environmental impacts. Various parties including labor union leaders, activists and feminists accused that Wal-Mart is engaged in misconduct for the sake of providing low price. Walmart is one of the world’s largest public companies.
Thus it was always a constant challenge for Walmart to maintain careful relationship with the stakeholders. One of the big accusations against Wal-Mart is about its relationship with competitor stake holders. Many of its local competitors and small businesses have to shut down their business due to low price strategy of Walmart. However, Walmart has defended itself stating that its objective is to provide high quality product at low price to the customers.
Another accusation against Walmart is that it put pressure and cost burden on suppliers to achieve its lofty goals regarding low price (Bianco & Zellner, 2003). It forces the suppliers to improve efficiency and if they fail Walmart cease to do take the products from those suppliers as it easily find some other suppliers (Lohr, 2003). Walmart is also criticized for providing low wages and benefits to the employees.
It was often accused for being production organization instead of being employee oriented organization. Moreover, it discourses labor unions. Walmart was also accused for discrimination in workplace and even it had to face class action law suits for such reasons. It was also accused of discriminating among male and female employees (Rock, 2001).
Walmart has to face accusation for employing illegal immigrants in many of its stores. Walmart also has to face accusation and incidents regarding unethical leadership. Moreover, it has to be accused for not practicing a safe environment policy. Despite the accusations and challenges, Walmart has always tries to present it as a socially responsible company.
Steps taken by Walmart to address the problems To face the challenges and pressures for various parties, Walmart has taken new strategy to revitalize its image though diversity, sustainability and charitable giving (Frederick, 2010). To improve its relation with employee stakeholders, Walmart has raised payment in one third of its stores. Moreover, it has also increased the benefit packages. To protect sweatshop, the company has employees an expert of anti-sweatshop. Walmart has taken sustainability policy for being a greener company to address is environmental stakeholders.
The sustainability plan of Walmart focuses on reducing greenhouse gas, increasing energy and eco efficiency, reducing amount of packaging in its supply chain (Kistler, 2010). The company has taken environmental leadership policy to achieve sustainability objectives. To practice social responsibility and corporate ethics, it has launched Global Ethics Office. Moreover, it has taken various steps to improve it social responsibility practice. Moreover, during the global financial crisis, it played a great positive role by supporting community. Despite the criticism of recent years, Walmart has taken steps to improve its relationship with its stakeholders including suppliers, employees and others.
Reference listBianco, A & Zellner, W ,2003, ‘Is Wal-Mart Too Powerful?’, BusinessWeek, no. 3852, p. 100.
Frederick, S , 2010, Sustainability and the Importance ofKistler, M 2010, Walmart’s Sustainability Initiatives Explained, viewed 22 May 2012,<http://www.treehugger.com/corporate-responsibility/walmarts-sustainability-initiatives-explained.html?campaign=TH_rotator>.
Lohr, S , 2003, ‘Is Wal-Mart Good for America?’, New York Times, no. Dec. 7, p. 4.1.
Rock, J , 2001, ‘Can Wal-Mart Succeed in Foreign Soil? , (), p11537.’, Weekly Corporate Growth Report, no. Sep. 17, p. 1158.