Walmart Finally Gets It: Employees Matter

19 Oct

For years, Walmart has had tough labor practices and been heavily criticized for them. For example, it has been sued by many women for unequal pay and promotion opportunities, fought hard against employees unionizing, paid low wages, etc. But, now Walmart is loosening up; and it realizes that happier employees can mean happier customers due to better customer service. It has even brought back store greeters in many locales where they had been eliminated to reduce costs. Yes, this comes at a time when U.S. revenues have been weak.

As Neil Irwin reports for the New York Times:

“A couple of years ago, Walmart, which once built its entire branding around a big yellow smiley face, was creating more than its share of frowns. Shoppers were fed up. They complained of dirty bathrooms, empty shelves, endless checkout lines, and impossible-to-find employees. Only 16 percent of stores were meeting the company’s customer service goals. The dissatisfaction showed up where it counts. Sales at stores open at least a year fell for five straight quarters; the company’s revenue fell for the first time in Walmart’s 45-year run as a public company in 2015 (currency fluctuations were a big factor, too).”

“To fix the situation, executives came up with what, for Walmart, counted as a revolutionary idea. As an efficient, multinational selling machine, the company had a reputation for treating employee pay as a cost to be minimized. In 2015, Walmart announced it would pay its workers more. Executives sketched out a plan to spend more money on increased wages and training, and offer more predictable scheduling. The results are promising. By early 2016, the proportion of stores hitting their targeted customer-service ratings had rebounded to 75 percent. Sales are rising again.”

“An employee making more than the market rate, after all, is likely to work harder and show greater loyalty. Workers who see opportunities to get promoted have an incentive not to mess up, compared with people who feel they are in a dead-end job. A person has more incentive to work hard, even when the boss isn’t watching, when the job pays better than what you could make down the street.”


Click the image to read a lot more from Irwin.


A Walmart trainee perfecting a cereal display in Fayetteville, Arkansas. Credit Melissa Lukenbaugh for The New York Times

A Walmart trainee perfecting a cereal display in Fayetteville, Arkansas. Credit Melissa Lukenbaugh for New York Times.


10 Responses to “Walmart Finally Gets It: Employees Matter”

  1. Matthew Pontbriand October 19, 2016 at 4:35 pm #

    I think a reason why Walmart was able to be so hard on employees was that their employees do not necessarily have to be skilled in many aspects of work, or even in one specific area because the job is pretty simple. Walmart also hires a lot of employees, and is usually in large areas so finding someone to replace a disgruntled employee would be pretty easy. Another thing about Walmart as a whole is that it is so large so job security even though you have a low end job is pretty strong due to the fact that Walmart has such low prices people will always shop there.

  2. Minghao Frederic Wang October 19, 2016 at 6:18 pm #

    I barely go to Walmart. if I need something immediately, I will choose Stop & Shop or maybe 7-11. And if I’d like to buy food for the family, I will choose Costco, of course.

    I remember Walmart is facing another problem at the same time which is the decreasing of physical stores. According to USA Today, Walmart plans to close 154 stores in the future in the U.S.

    Anyway, business is cruel.

  3. Emily Baksic October 20, 2016 at 12:25 pm #

    I think Walmart has finally realized that they need to treat employees and customers right in order to receive good business. Of course people are going to go to Walmart for their low prices, but now Walmart has an even greater opportunity to increase their profits due to new, fair treatment. Studies have even shown the people go to businesses that behave fairly and ethically. I think that Walmart still treats other production and manufacturing companies poorly, but at least they are on the right track with positivity towards employers and customers. Not only are they bringing back the greeters, but Walmart is also making sure more products are in stock and the stores are cleaner. I think this will also increase profits and help refine the stereotype of Walmart.

  4. weiqingsun October 23, 2016 at 8:58 pm #

    I think Walmart is not only bad in the way they treat their employees, but also the product they sell. They are the not the best quality store, they are not the best priced store, I really wonder why Walmart stands so many years and even so popular in China. I know there is a company called Hai Di Lao in China, which is a chain hot pot restaurant. Customers are really gods there not only because the company set the rule for employees, but also the employees are really positively stick to it. The reason why employees are so loyal to the company is because Hai Di Lao treat their employees very well. For example, the employees have their own deluxe rooms and nannies to cook and do laundries for them. The company itself basically does not worry about the revenue, but the employees do. So we can see how important it is to treat employees well.

  5. Brittany Liscoe October 27, 2016 at 2:08 am #

    Its obvious that there is a prominent correlation between the success and downfall of a company and treatment of that company’s employees. Employees have much more power over the success of a company than most people understand. The service they provide has the ability to make or break a company’s relationship with a particular customer. It puzzles me how Walmart can risk business so carelessly by providing unfit working conditions for their employees. I understand that they make cutbacks in an effort to save revenue but don’t they get that they’ll lose the money they save through lack of sales as a result of providing a less adequate shopping experience?

  6. Palak Patel October 28, 2016 at 3:01 pm #

    I remember going to Walmart when I was younger and it seemed to be more of a happy place. I remember the greeters outside of the door who made a very warm and friendly impression walking in. I also remember those yellow smiley stickers that kids would get. Since that time, I believe that the image of Walmart has severely changed. It has gone to a warm and friendly atmosphere to almost a dirty and smelly vibe. In my experience, I almost always choose other stores to go to.

  7. janet narain October 31, 2016 at 2:09 pm #

    I personally hate walmart. I avoid the restrooms, the employees seem miserable, and the lines are ridiculous. Better treatment towards employees definitely has an effect on how well a store is run. Shelves will be stocked faster, they would treat customers better, and this would lead to a higher customer satisfaction. The way employees are treated is directly related to customer service.

  8. mia fabiani November 7, 2016 at 7:15 am #

    I shop at Wal-Mart very sparingly and I would not associate it as the most friendly retail corporation. However, their efforts to address their poor customer satisfaction and in turn their low revenues is reassuring to a regular customer but also a customer, like me, who does not shop their very often. I fully believe that a successful shopping experience is largely due to being surrounded by welcoming and content employees. Also, regardless of whether the products in the store are on the expensive or inexpensive end of the spectrum should not determine the kind of sentiment an employee should harbor. The incentives for employees such as increased pay, training programs, and expected schedules represent stability and security, which can cause a pronounced change in employees’ actions, and exactly what Wal-Mart is seeing today.

  9. victoriauportfolio December 1, 2016 at 11:45 pm #

    This article proves the importance of treating your employees well. This is the starting point for most companies. When employees are treated well they do well. This translates to highly motivated employees and an increase in sales. There is a trickle down effect. It is good to see that Walmart has finally realized this and has taken steps towards helping their employees out, this will prove to only benefit them in the long run.

  10. Matt Romeo December 13, 2016 at 12:33 pm #

    It is so important for upper management to treat their employees well. While Walmart is not the most exciting job, these people do work extremely hard. I am glad they are being treated a little better, and that the employees are now treating customers better. Sales have also increased since the wage raise due to better customer service, a win-win for upper management and the store employees.

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