Walmart: Organizational Structure & Organizational Culture

Walmart organizational structure and organizational culture, and recommendations
Inside a Walmart store in Miami, Florida. Walmart’s organizational structure is adequate, but the company needs to improve its organizational culture. (Photo: Public Domain)

Walmart’s organizational structure determines the company’s business activities. Its organizational structure also imposes limits on how the business addresses its problems. In relation, Walmart’s organizational culture determines the way people respond to challenges in the workplace. The resilience of the human resources of the company partly depends on the mindset supported through the organizational culture. Nonetheless, the long history of Walmart in succeeding and continually growing internationally shows that the firm’s organizational structure and organizational culture have been helpful in bringing competitive advantage and success. Such organizational structure interacts with the organizational culture to maintain the significant competitive advantage of Walmart.

Walmart’s leadership position in the retail industry and its potential long-term success are linked to the beneficial combination of the company’s organizational structure and organizational culture.

Walmart’s Organizational Structure

Walmart has a hierarchical functional organizational structure. This structure has two features: hierarchy and function-based definition. The hierarchy feature pertains to the vertical lines of command and authority throughout the organizational structure. For example, except for the CEO, every employee has a superior. Directives and mandates coming from the top levels of Walmart’s management are implemented through middle managers down to the rank-and-file employees in Walmart stores. On the other hand, the function-based definition feature of the company’s organizational structure involves groups of employees fulfilling certain functions. For example, Walmart has a department for the function of human resource management. The company also has a department for the function of information technology, and another department for the function of marketing. These are just some of the numerous function-based departments in Walmart’s organizational structure.

The main effect of Walmart’s hierarchical functional organizational structure is the ability of corporate managers to easily influence the entire organization. For example, new policies and strategies developed at Walmart’s corporate headquarters are directly passed on to regional managers down to the store managers. In this way, effective monitoring and control are achieved through Walmart’s hierarchical functional organizational structure. However, a downside of this organizational structure is that it has minimal support for organizational flexibility. The lower levels of the organizational structure cannot easily adjust business practices because of the lengthy communications and approval process involving the middle managers and corporate managers at Walmart’s headquarters.

Walmart’s Organizational Culture

Walmart’s organizational culture has four main components. These components guide employees’ behaviors. The components are also identified as Walmart’s beliefs:

  1. Service to customers
  2. Respect for the individual
  3. Strive for excellence
  4. Action with integrity

In terms of service to customers, the company prioritizes customers in its operations. Walmart also recognizes the contributions of each employee to the success of the business. In addition, the firm strives for excellence in the performance of individuals, teams, and the entire organization. In terms of maintaining integrity, Walmart promotes the virtues of honesty, fairness, and impartiality in decision-making.

Recommendations on Walmart’s Organizational Culture and Structure

Walmart’s organizational structure is ideal for the company’s type of business and global scope of operations. However, Walmart can improve in applying its beliefs in the context of its organizational culture. These beliefs are ideal. Still, the company is frequently criticized about its failure to address employees’ concerns regarding low wages. Such criticisms point to the difference between the belief of respect for individuals in the organization’s culture, and the actual treatment of the employees. Thus, a suitable recommendation for Walmart is to implement more effective measures for fulfilling the respect for the individual component of the organizational culture.