Walmart Case Study
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Archie Carroll and Milton Friedman agree on the “Economic/Must-Dos” and the “Legal/Have-Tos” of a company. The difference between the two theories is Carrolls focus on what a company does after it maximizes profits. Carroll draws attention to the “Ethical/Should-Dos” and the Discretionary (Philanthropic)/Might-Dos” as part of a company operating with social responsibility (Wheelen, 2010).
Social responsibility compels a company to consider ethical standards in the conduct of operations. Additionally, social responsibility compels organizations to consider the impact it has on consumers, employees, suppliers, and the surrounding community. When companies undertake Discretionary/Philanthropic activities, they establish and cultivate a positive relationship with the people and community.
Furthermore, Archie Carroll classifies managers based on three types of moral values: moral, amoral, and immoral (Stanwick, 2010). Immoral managers conduct themselves in such away as not to consider the impact to others. Their actions run counter to what is socially accepted as right or ethical. Amoral managers are ethically neutral. Their focus is not on what is ethical, but they do not intentionally make unethical decisions. Moral managers are informed about ethics and include ethics in their decision-making process.
So are the ethical issues Wal-Mart faces really any different from other large retailers? I contend that most of the ethical issues Wal-Mart faces are the same issues that other large retailers face. However, I believe that based on Wal-Marts size and profitability, it receives greater scrutiny and media coverage than other large retail chains.
When a companys takes in $11billion in profits, yet is still mired by controversy over worker compensation, gender bias and a lagging healthcare compensation package, they set themselves up for scrutiny. As described by Archie Carroll, legal responsibilities are the “Must-Dos” (Wheelen, 2010). Companies do not have a choice about this particular matter, because current laws and regulations direct them to do so.
Large companies like Wal-Mart are not exempt from fair employment treatment laws. Large companies should be the ones setting the example for the industry they lead. When it comes to Wal-Mart, the company has greater control of every aspect of their business from production and delivery to the market share of every item offered in every store. According to Wal-Mart Watch, the company is invested in real-time data collection, and that data is collected, stored and analyzed at the corporate headquarters. So it makes absolute sense to hold Wal-Mart accountable for all of the unethical and bad business practices executed in all of its stores.
Wal-Mart has a compliance issue and a values & culture issue. The first instance of trouble noted in the case study draws attention to “off-the-clock” work, where Wal-Mart managers demanded and directed employees to complete assignments even after the employee had completed their work shift and clocked-out. The case also describes lock-ins and one-minute clock-outs as further evidence of unethical behavior. These types of unethical activities violate current wage laws. Wal-Mart has a legal responsibility to compensate its workers for the time they work and to not abuse their workforce.
Wal-Mart violates several other legal responsibilities, including sexual discrimination, child labor laws and undocumented workers. First, Wal-Mart has faced numerous complaints and lawsuits revolving around gender discrimination. According to the Impact Fund, 92% of Wal-Mart cashiers are female, while only 14% of Wal-Mart managers are female. Moreover, female workers earn 37 cents less than their male counterparts. The court decision in the case of Duke vs. Wal-Mart demonstrates that Wal-Mart has mistreated its female workers. Moreover, in their efforts to drive prices lower to steal market share away from competitors, Wal-Mart engages in child labor when it does business with developing nations
I do not agree with an affirmation from Wal-Mart that its female employees are not interested in management positions. Evidence identified in the case study demonstrates that Wal-Mart has issues when it comes to gender discrimination. Furthermore, it has admitted that it failed to adequately advertise for its Management Training Program. The companys gender-based wage discrimination bleeds over into its failure to promote female workers from within its ranks.
From a values perspective, Wal-Mart continues to say through their actions, that the company takes precedence over the employee. The success of the store/company is more valuable than the individual employee. This feeds into the maltreatment exercised by store managers. The corporate headquarters sends the wrong message to management when it demands that labor costs not exceed a certain percentage, but does not offer training and options to assist managers maintain that objective. Therefore, management culture is negatively impacted because store managers feel compelled to do unethical things like lock-ins and one-minute clock-outs to help keep labor cost down.
Taking care of employees is very important. However, I do not believe that Wal-Marts health-care policy is an ethical issue at this point in time. I believe this falls