Wal-Mart Case Study Essay Example
1. What were the main elements of the control system that Sam Walton created?
It is evident that Sam Walton believed in the importance of control systems in an organization; as he established certain strategic control systems in the company. Walton wanted everyone within the organization to be committed to Wal-Mart's goal "total customer satisfaction", and the strategic control systems were set accordingly.
There are various elements of control systems used in Wal-Mart which are:
Personal Control
An example is when there is an underperforming store; top managers visit these stores in order to lend their expertise to the employees there. Moreover, they fly on monthly basis to various Wal-Mart stores locations to check their performance.
Output Control
The company managers and even associates can share financial information through a sophisticated companywide satellite system including store profits and inventory turnover rates. Behaviour Control
There is a system of behaviour control in the company such as rules and budget in order to shape and predict employees' behaviour. Each store performs the same activities in the same way, and all employees receive the same type of training in order to behave in the same way with customers. This is how Wal-Mar was able to standardize its operations and therefore save a lot of extra costs. Using Information Technology
IT control systems are integrated with almost with all the other control systems. For example, Wal-Mart has a sophisticated satellite system used for their output control systems.
Strategic Rewarding Systems
The company is using a linking performance to reward strategy in order to raise performance; where managers' performance and ability to meet goals and targets are linked to their pay raise promotion. Besides, employees in Wal-Mart have a share in the company's stock which encourages them to raise their performance level and set their objectives on the long-term.
Wal-Mart's
It is evident that Sam Walton believed in the importance of control systems in an organization; as he established certain strategic control systems in the company. Walton wanted everyone within the organization to be committed to Wal-Mart's goal "total customer satisfaction", and the strategic control systems were set accordingly.
There are various elements of control systems used in Wal-Mart which are:
Personal Control
An example is when there is an underperforming store; top managers visit these stores in order to lend their expertise to the employees there. Moreover, they fly on monthly basis to various Wal-Mart stores locations to check their performance.
Output Control
The company managers and even associates can share financial information through a sophisticated companywide satellite system including store profits and inventory turnover rates. Behaviour Control
There is a system of behaviour control in the company such as rules and budget in order to shape and predict employees' behaviour. Each store performs the same activities in the same way, and all employees receive the same type of training in order to behave in the same way with customers. This is how Wal-Mar was able to standardize its operations and therefore save a lot of extra costs. Using Information Technology
IT control systems are integrated with almost with all the other control systems. For example, Wal-Mart has a sophisticated satellite system used for their output control systems.
Strategic Rewarding Systems
The company is using a linking performance to reward strategy in order to raise performance; where managers' performance and ability to meet goals and targets are linked to their pay raise promotion. Besides, employees in Wal-Mart have a share in the company's stock which encourages them to raise their performance level and set their objectives on the long-term.
Wal-Mart's