Wal-Mart: A Case of Employee Discrimination

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Case Details:

Case Code : BECG024
Case Length : 16 Pages
Period : 2001 - 2002
Pub. Date : 2002
Teaching Note :Not Available
Organization : Wal - Mart
Industry : Retail
Countries : USA

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Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Wal-Mart in Trouble Contd...

Meanwhile, Wal-Mart categorically denied that its labor practices were unethical and illegal and that its employee hiring and promotional practices were biased. The company dismissed the lawsuits as baseless and said that the litigation was nothing but a ploy to squeeze money out of it.

Background Note

In 1962, Sam Walton (Walton), along with his brother Bud Walton established the first Wal-Mart store in Rogers, Arkansas, US. When he established the first Wal-Mart retail store, many people told him that operating a discount store in a small town would not be profitable enough in the long run. However, Walton strongly believed in his business model. Ignoring the critics, he continued to focus on providing good service to customers through his retail stores. Walton understood the importance of building good relations with both employees and customers. He relied on three basic principles to build his retail business: Respect for the individual, Service to customers and Strive for excellence. Thanks to this people-centric philosophy, Wal-Mart registered sales of $ 1 million within one year.

By 1967, Walton had established 24 Wal-Mart stores, which had combined sales of $ 12.6 million. This success prompted Walton to expand Wal-Mart operations to other places. Over the years, Wal-Mart expanded its operations to many US states and other countries (Refer Exhibit I for Wal-Mart's timeline).

From the very beginning, Walton laid down two rules that guided Wal-Mart associates (hourly employees were called 'associates') through their work. The first being 'The Customer is always right,' and the second being 'If the customer happens to be wrong, refer to rule No 1.' He encouraged associates to discuss problems openly and created a highly participatory, entrepreneurial and goal oriented environment. Wal-Mart's manpower policies encouraged its employees to make decisions, take risks and even commit mistakes in the cause of customer service. Walton formulated a mission for his associates 'get them, keep them and grow them.' Walton described his relationship with his employees as a 'partnership'...

Excerpts >>


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