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Panmore Institute

BUSINESS, MANAGEMENT

Walmarts HRM: HR Planning, Job


Analysis & Design
UPDATEDSEP 1, 2015 | ANDREW THOMPSON

A Walmart store in Quebec, Canada. Walmarts human


resource management has comprehensive efforts for human
resource planning and job analysis and design. (Photo: Public
Domain)

Walmarts human resource management


is a critical success factor for the
business. The companys retail service
offers goods in a way that is convenient
and efficient for shoppers. In this service
context, Walmarts human resources
directly determine business output. The
companys human resource management
aims to maximize employee performance
to correspondingly maximize capacity for
sales. Human resource planning and job
analysis and design are some of the major
components of Walmarts human

resource management strategy. Through human resource planning, the firm develops an
adequate workforce. Through effective job analysis and design, Walmart ensures that
job descriptions and specifications relate with the HR needs of the organization. These
components of human resource management influence how Walmart maintains its more
than 2 million employees to provide adequate service to an expanding population of
target consumers.
This article is part of a series on Walmarts Human Resource Management:
1. Walmarts HRM: HR Planning, Job Analysis & Design
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2. Walmarts HRM: Recruitment, Selection, Employee Retention


3. Walmarts HRM: Training, Performance Management
4. Walmarts HRM: Compensation, Career Development

Walmarts Human Resource Planning


Forecasting. Walmarts human resource management forecasts its workforce needs to
ensure capacity to address changes in consumer demand. While other forecasting
methods and techniques are also used, these three are the most notable at Walmart:
1. Bottom-up approach
2. Trend analysis
3. Delphi method
The bottom-up approach analyzes human resource needs starting at the lowest level of
the organizational structure. Walmarts human resource management objective for this
approach is to ensure that all levels of the organization have adequate employees based
on HR needs at the frontline (e.g. hourly sales employees). The company starts
forecasting HR needs of frontline employees. Walmarts HR managers then proceed to
analyze HR needs at the next higher level of the organizational structure. This human
resource management approach ensures that all human resource needs at the lowest
levels of Walmarts organizational structure are supported through an adequate
number of employees at the upper levels of the organizational structure. On the other
hand, trend analysis is used in human resource management to predict future HR needs
based on current needs. For example, Walmart analyzes the series of recent HR changes
and uses this information to extrapolate future HR needs. A current trend that shows an
increasing demand for human resources indicates a larger workforce requirement in the
future. Walmarts human resource management uses trend analysis to determine HR
needs along with the companys global expansion. In addition, the Delphi method
forecasts future HR needs based on expert opinion. Walmarts human resource
management uses the Delphi method to ensure adequate human resources in
establishing new brands, stores or other facilities. For example, HR experts can opine
about the HR needs in opening a new Walmart store of a certain size. The companys
human resource management applies the Delphi method to estimate the number of
employees needed in each type of job, such as supply chain jobs, inventory jobs, and
sales jobs.
Surplus & Shortage of Employees. Walmart faces minimal concerns about the shortage
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of employees, especially sales personnel. The company receives a continuous influx of


applicants for sales positions. However, Walmart experiences HR surplus when
aggregate consumption declines. Such surplus is a challenge to human resource
management because it translates to lower HR cost-effectiveness. Walmart uses the
following approaches to determine HR needs and prevent surpluses or shortages:
1. Sales performance analysis
2. Turnover rate analysis
3. Gap analysis
Walmarts human resource management changes recruitment efforts based on changes
in sales performance, which is an indicator of HR needs. Turnover is the rate at which
Walmarts human resources leave and/or are replaced. Turnover, together with the rate
of recruitment, is an indicator of changes in the size of the companys workforce.
Walmarts human resource management ensures that the recruitment rate is
commensurate to the turnover rate. If the turnover rate is lower than the recruitment
rate, Walmarts workforce increases in size. An increase in workforce size usually
happens when the company expands or opens new stores. In addition, Walmarts human
resource management uses gap analysis to determine the gap between HR needs and
actual HR capacity. A significant gap means reduced HR cost-effectiveness or
inadequacy in meeting organizational needs. Walmart uses gap analysis to decide on
changing recruitment efforts. The company has a gap allowance or threshold. When the
HR gap exceeds the threshold, Walmarts human resource management increases or
decreases recruitment efforts.
Balancing Supply and Demand. Walmart balances HR supply and demand by adjusting
the compensation strategy and recruitment efforts. These adjustments are based on
trends in internal human resource demand and the rate of applicant entry. Thus, the
firms human resource management uses the following approaches to balance HR supply
and demand:
1. Changes in recruitment
2. Changes in compensation
Changes in recruitment are Walmarts main approach to balance HR supply and
demand. The companys human resource management changes the recruitment rate to
address workforce requirements. Walmart can easily adjust its recruitment efforts
without significantly impacting financial performance. In prioritizing changes in
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recruitment to balance HR supply and demand, Walmarts human resource management


minimizes changes in the firms compensation strategy. On the other hand, changes in
compensation are also used to prevent an imbalance in HR supply and demand.
Walmarts compensation strategy is designed to minimize HR expenditure. This strategy
agrees with the companys cost leadership generic strategy. When HR supply becomes
inadequate, Walmarts last resort is to increase wages. Theoretically, higher wages
attract more applicants. Walmarts human resource management uses this second
approach to effectively compete in the labor market.

Job Analysis and Design at Walmart


Organizational Design. Job analysis and design are successfully implemented in
Walmarts human resource management through the companys organizational
structure, which is a hierarchical functional structure. This organizational structure
makes it easy to specify distinct characteristics for each job. The structure has clear lines
of authority, lines of communication, and lines of command. Walmart has clear and
distinct definitions for every job position and level of the structure. In effect, the firms
human resource management minimizes uncertainty in job analysis and design.
Methods of Job Analysis. Walmart uses work-oriented job analysis and workeroriented job analysis. The company applies work-oriented job analysis for sales
positions. The purpose of this method is to provide information about tasks and
outcomes. Walmart applies this method in the form of interviews and direct
observations. The companys human resource management uses direct observation of
sales personnels activities. Interviews are conducted to analyze the jobs of team leaders
and supervisors. This method enables Walmarts human resource management to
establish expectable job outcomes. On the other hand, the worker-oriented job analysis
method provides information on interpersonal, cognitive and perceptual abilities.
Walmart uses this method to analyze managerial jobs. A specific application of this
method is through the Work Profiling System (WPS), which is designed for managerial
positions. This method enables Walmarts human resource management to pinpoint the
necessary capabilities of managers, such as store managers and corporate managers.
Job descriptions. As the largest retailer in the world, Walmart has a wide variety of job
descriptions. Nonetheless, the firms human resource management uses the following
variables as criteria for job descriptions:
1. Position
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2. Functions
3. Duties
4. Performance standards
5. Job factors
6. Job knowledge
For managerial positions, Walmart emphasizes analytical and problem solving
knowledge, skills and abilities (KSAs). In contrast, for sales personnel, the company
emphasizes job knowledge and interpersonal skills. Walmarts human resource
management considers interpersonal skills essential in sales personnel, who directly
communicate with customers.
Job specification. The company has a wide array of job specifications. However, in
general, there are essential attributes and desirable attributes included in all job
descriptions. For sales positions, Walmarts human resource management specifies
essential attributes as follows:
1. Communication skills
2. Knowledge of the business
3. Knowledge of products
These essential attributes are necessary in all sales employees throughout the
organization. However, there are also some attributes classified as desirable. These
attributes are preferred but not necessary for a sales employee to effectively fulfill his
job. Walmarts human resource management specifies desirable attributes as follows:
1. Likeable and sociable qualities
2. Multi-tasking skills

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TAGS:
CASE ANALYSIS,CASE STUDY,HR MANAGEMENT,HUMAN RESOURCES,RETAIL INDUSTRY,STRATEGY
,WALMART,WALMART HUMAN RESOURCE MANAGEMENT
PUBLISHED: SEP 1, 2015
UPDATED: SEP 1, 2015
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Institute and its author/s. Copyright by Panmore Institute - All rights reserved.

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