Walmart is one of the retail companies that every individual has heard of. The Walton family are the founders of the company, which came into existence back in 1962. Since Walmart was founded, it grew to be one of the largest multinational retail corporations in the world. Let’s know about Walmart’s Organizational Structure.
Talking about Walmart’s organizational structure then it has got a hierarchical functional structure. Without a proper organizational structure, it will be quite difficult for businesses to run smoothly. However, in the case of Walmart’s organizational structure, there are two features. The two features are hierarchical and function-based definitions.
The hierarchical feature is one of the most common features which can be found in most businesses. The chain of command remains vertical when it comes to the hierarchical featured organizational structure. For example, each employee working in the organization will have a direct superior except for the CEO.
Why Walmart’s Organizational Structure Is Hierarchical?
Walmart has grown to be a huge business, and a tremendous amount of credit goes to its organizational structure. The organizational structure of Walmart is hierarchical because top-level managers influence middle-level managers.
As mentioned earlier, this hierarchical feature of organizational structure is one of the most common organizational structures for most businesses and organizations. This structure is less hectic to the middle-level managers and the other lower-level employees.
The top-level managers will develop new directions and authorities that they will be delegating to their lower-level managers. The middle and lower-level workers will have to obey them and work accordingly.
The hierarchical organizational structure has its benefits, which is why most businesses and organizations tend to follow them. For example, Walmart’s daily business has been smooth due to this type of organizational structure.
However, one of the disadvantages of this kind of organizational structure is that it has less support for organizational flexibility. The lower-level workers or employees have to experience a long chain of communication. The lower-level workers also find it difficult to adjust to the business practices because of this type of organizational structure.
The Organizational Culture of Walmart
Walmart has got four primary components of its organizational culture. These components have their features and functions and add value to the work. These components help guide employees working in the organization. The following are the components of Walmart:
- Service to the customers
- Respect for individuals
- Strive for excellence
- Action with integrity
Walmart prioritizes when it comes to serving its customers. Customers are the only source of income for every business in the world. Therefore, Walmart’s every operation is done to satisfy its customers with their service.
The company recognizes its valuable customers who have contributed to the success of the company. However, Walmart also believes that it is also the employees who have worked hard to run smoothly. The working team at Walmart strives for excellence and maintains integrity in the organization.
Why Do Customers Feel Walmart Is A Good Company?
Walmart knows how to do business even when there is tough competition in the market. Walmart has been in the market for more than 50 years and has constantly offered its best services to its customers.
Customers feel happy about their services, and it has become a plus point for Walmart to get loyal customers. The customer base of Walmart is becoming stronger each day because of its quality of service and goodwill in the market.
Walmart is doing good in the market today because they have minimized their operating cost. In addition, they have pushed down the wages of the employees working for their organization as much as possible legally.
Walmart’s Successful Business
It’s not easy to sustain in the market when you have a lot of competition. However, Walmart was intelligent to use specific strategies to overcome all the hurdles of competitors in the market. Walmart focussed on their work and everything else that was directly related to their daily business.
To minimize its operational costs, Walmart had reduced its employees’ wages. The company also gave certain benefits to its employees just like any other company.
Other than that, Walmart focussed on advanced supply chain management. As a result, Walmart is not the industry leader for nothing because they made sure to remain competitive in the market.
Walmart made an effort to reduce more costs by making proper supply chain management. As a result, Walmart found out that it helped them save transportation, storage, and labor costs.
Walmart’s other strategy included dealing with the manufacturers directly. This was the strategy that Walmart had been applying since the 1980s. As a result, several large companies now depend on Walmart for generating their revenues.
Being one of the largest retail stores in the world, Walmart was good at bargaining and leveraging power. Since most manufacturers could earn revenues only because Walmart had a deal with them, they had to accept all the terms and conditions made by Walmart.
Walmart is also a great organization to work for because it gives its employees the opportunity for personal and professional growth. So if you are planning to work for Walmart, then you should go for it.
Benefits of Hierarchical Organizational Structure
There are benefits of maintaining a proper hierarchical organizational structure, whichever type of company is. For example, Walmart effectively benefitted from the hierarchical organizational structure because it had experienced senior-level managers to guide its business.
Clear lines of authority and reporting are being done within the organization of Walmart, and even today, it is the same thing. As a result, there have been fewer arguments over a business decision because of the organizational structure.
Walmart also had to face a downside because employees started to leave the organization due to their low wage structure. In addition, many employees working for the company had shared that the company had a low quality of health care and the working conditions were also poor.
Walmart’s Competitors
Walmart faced tough competition in the market, and even today, many companies are direct competitors of Walmart. Some of the competitors of Walmart include the following companies:
- eBay
- Ascena Retail Group
- Kroger
- Lowe’s
- Costco
- Target
eBay might be an online company, but it has got its reputation in the market, which became a significant competitor for Walmart. But, Walmart grew up to be the biggest retailing market only because they offered lowered price services to its customers.
Conclusion
Walmart is one of the best retail companies that you will ever come across. However, with growing competition, Walmart has proved to be dominant in the market today. Working for Walmart might not still be a good idea, but looking from the customers’ viewpoint then the company is excellent.
As of this year, the company has earned more than 500 million in revenues. If you want to work as an employee for Walmart, you should consider thinking about it a little bit before applying for it. You will have other choices too if you want to work for similar companies.
Frequently Asked Questions
- Why are customers satisfied with the services of Walmart?
Ans: Customers are satisfied with the services of Walmart because Walmart offers products at low prices. This is also one of the reasons why Walmart is doing better than most of its competitors.
- How Amazon proved to be better than Walmart?
Ans: Amazon is one of the direct competitors of Walmart. Walmart did not have good warehousing locations that Amazon possessed. However, Walmart is still trying to compete.
- What is the organizational structure of Walmart?
Ans: Walmart has a hierarchical organizational structure. There are two features of Walmart’s hierarchical structure consisting of hierarchy and function-based definition.
- What happens if an organization has a hierarchical type of organizational structure?
Ans: Organizations having the hierarchical type of organizational structure follow a chain of command. The chain of command starts from the top-level executives to the regular employees.
- Which companies are the direct competitors of Walmart?
Ans: The following companies are the competitors of Walmart:
- eBay
- Ascena Retail Group
- Giant Eagle
- Lowe’s
- Target
- Costco
- Kroger
- When and by whom was Walmart founded?
Ans: Walmart was founded back in 1962 by Sam Walton. Currently, the owners of Walmart are the Walton family.
- How can I ask a question about a product at Walmart?
Ans: Customers can visit its website page, or they can call for queries regarding a product at Walmart.