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Wal-Mart Throws Lifeline to Managers

April 15, 2005
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Barraged by class-action lawsuits, negative press and criticism from unions, Wal-Mart is throwing its managers and human resources staff a lifeline.

In the next several months, the Bentonville, Arkansas-based retailer is planning to hire hundreds of staff to support its in-store workers, managers and human resources administrators.

Wal-Mart also is looking at how it can build technology platforms to improve communications between employees and managers and is increasing the frequency of its employee satisfaction surveys to keep tabs on potential issues and overall morale.

“People expect more”
The initiatives come on the heels of a string of class-action sex- and wage-discrimination lawsuits and increasing union organizing activity. On top of all that, in March former Wal-Mart vice chairman Thomas Coughlin resigned from the board after the company said it had found abuses of his expense account.

Susan Oliver, Wal-Mart’s senior vice president of human resources, speaking at a human resources industry conference in New York this week, says the initiative is not just a response to criticism over its employment practices. It’s indicative, she says, of Wal-Mart’s recognition that if it doesn’t improve, it will lose the war for talent, which it believes will only become more intense in coming years. “The one thing we have learned from our critics, even in those situations where we believed that they were off-base, is that Wal-Mart’s size and industry leadership means people expect more of us,” she says.

The company is currently conducting a pilot in Southern California, where it has assigned a human resources executive to each of the state’s districts, each of which contains eight to 10 stores. If successful, Wal-Mart will expand the initiative to Northern California and eventually across the country, hiring at least one human resources staff member for each of Wal-Mart’s 500 districts. Oliver says the company has more than 3,000 “personnel associates” that reside in its stores, and that “we need to supplement them on a district level.”

The district human resources support staff will help to ensure that Wal-Mart’s recruiting, selection and interviewing processes are effective and that the store’s staffing needs are met, Oliver says. The company will gauge the success of the pilot program by monitoring turnover, which currently is a little below 50 percent. “We want to impact turnover by at least 10 percent,” Oliver says.

Wal-Mart also has created a five-person team of human resources professionals with legal backgrounds who are available to answer managers’ concerns and questions regarding employment matters 24 hours a day, seven days a week from the home office. If a store manager, for example, hires a physically disabled worker and needs information on how to best accommodate that worker, the manager can call the team for assistance, Oliver says.

“Our theory is that we want our managers to never have a situation that they don’t feel like they have someone to call,” she says. “The labyrinth of regulations, law and policy is so great today that we want them to have someone that they know is their lifeline on any employment issue.” Wal-Mart is discussing how much it will expand the team to respond to the needs of its managers and has not yet made a decision.

Reducing error
On the technology front, Wal-Mart is creating a career portal to allow employees to apply for management positions in other geographic areas and be notified automatically when desired positions are available.

The company also is automating the system by which employees put in for days off to make sure that their requests are processed efficiently. The current paper-based system is not efficient and has more room for error, Oliver says.

Oliver says the budget for these projects is still being determined, but she adds that the increased focus on employee retention will provide a return on investment that will make up for the costs. To go on achieving financial success, Oliver says, “we know that we have to be not just attractive, but really attractive as an employer of choice.”

Jessica Marquez

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