Walmart Negative Effect

2435 words 10 pages
Introduction:
In 1950, Sam Walton opened Walton’s 5 & 10; a convenience store aimed at providing customers with low cost goods. Unlike other convenience stores of its time, Sam Walton gained a competitive advantage by implementing innovative business models within his operations and finance departments (complex supply chain management and low profit cost-cutting schemes, respectively). Over the next 65 years, Wal-Mart grew to be the largest corporation in the United States with over 5,000 stores and a staggering 1.2 million employees. In fact, Wal-Mart’s staff accounts for 1% of the United State’s working population (Blodget, 2010). Unfortunately, such an enormous presence, combined with negative reviews, has turned Wal-Mart into the
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As discussed earlier, research has shown that opening a Wal-Mart is often disadvantageous for a neighborhood. Additionally, organizational issues can be seen by analyzing Wal-Mart’s leadership. For instance, in the last 14 years, the CEO position has changed 4 times and yet the the brand continues to decline. This is an indication that the organization has a leadership problem. In Organizational Change, Burke explains that “Leadership matters…[and that] evidence shows that it can hurt an organization badly or destroy it completely” (Burke, 2014). According to Wal-Mart, the current CEO “believes in everyday low cost and everyday low prices, but only if accomplished through everyday integrity” (Wal-Mart, 2015). However, each year Wal-mart is sued 5,000 times which is an indication that the public disagrees with the CEO’s interpretation of integrity (Riper, 2005). If Wal-Mart does not have a social responsibility for the communities in which they reside, then the corporation is not violating any codes of conduct. The ultimate goal of a for-profit corporation is to increase profit and satisfy the shareholders. As such, Wal-Mart does not have any legal obligation to satisfy social requirements so long as the company is in good legal standing. For this reason, it would be in the best interest of the company to take over an entire competitive landscape. Additionally, it would be in the best interest of the company to

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