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Organizational Changes In Wal Mart Essay

2756 words - 11 pages

1. Introduction
Since it has been proven that an otherwise high performing company can experience a sudden overturn in fortunes, managers should be vigilant so as to prevent, or reverse, any unfavorable trend through adopting necessary organizational changes. According to Oslon, Van Bever & Verry (2008) study, notable companies underwent such an experience due to very specific reasons. Particularly, they identified premature abandonment of organizational core business as one of those reasons. This is precisely the case in Wal-Mart. Nevertheless, further damage can be prevented by uncovering the main causes of the problems, and hence determining the appropriate organizational changes needed to be adopted (Wal-Mart Watch, 2007; Chew, Joseph, Cheng, Lazarevic, 2006; Sohal & Durian, 2006).
2. Wal-Mart Stores, Inc
In line with the principles of effective management of organizational change, the report will analyze the current state of Wal-Mart. It will mainly focus on its operation in the US, highlighting any potential dangers and/or problems. Finally, it will suggest needed changes.
2.1. Background
From 1962 (when it opened its first store in Rogers Ark) up to recently, Wal-Mart has evidently enjoyed unprecedented success. The company grew from a local retail store to become not only the largest retailer in the country, but also an organization with a global presence and reputation (Hayden, Lee, Mcmahon & Pereira, 2002). With a history of surpassing sales target, it appeared almost certain that the trend would progress in the new millennium. However signs of danger begun to emerge as early as 2001, when for the first time it missed out on its sales target (Wal-Mart Watch, 2007). Oslon, Van Bever and Verry (2008) noted that when a negative trend is experienced, managers usually blame external factors as oppose to evaluating their actions and/or internal factors. Specifically that is what happened at Wal-Mart when the negative trend progressed (Wal-Mart Watch, 2007). The weather, economic conditions, and gas prices, were majorly blamed (Blueocean, 2011).
2.2. An Evaluation of the Causes of Declined Performance
2.2.1. Poor Strategic and Operational Planning
Most companies that pre-maturely abandon their core business, and hence experience a decline in revenue and general growth, usually they do that due to poor strategic planning (Oslon, Van Bever & Verry). Apparently that appears to be exactly the case in Wal-Mart. This can be fully ascertained by utilizing the model of organizational level of analysis developed by Beckhard and Harris (1987). According to this model successful formulating, implementing, and sustaining organization changes follow a three step process; that is analyzing the present state, determining the transition state, and finally establishing the future state of the organization (Wheeler, 2001; Gerster & Lewin, 2000).
Susanto (2008) to some extent agrees with this model. He elaborates that successful organizational...

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