Wal-Mart Tries to Modify Corporate Culture

[Betsy]

Excerpts from an article By ANNE D'INNOCENZIO, AP Business Writer

Is Wal-Mart recasting itself as a friendly neighbor? It's the latest course change by the world's largest merchant as it tries to modify its corporate culture — and the perception that it's a ruthless competitor obsessed with maintaining its dominance of the retail industry.

Wal-Mart's proposal to help rival small businesses, from bakeries to hardware stores, focuses on blighted urban markets where the retailer plans to open 50 stores within the next two years. The efforts will range from giving those businesses financial grants to producing free radio ads that will be broadcast on its stores' radio network.

And the company, which has long been shrouded in secrecy, is trying to appear more transparent. It's holding its second annual media conference starting Tuesday near its Bentonville, Ark., headquarters, to share information about the company, from its plans to improve its stores to updates on its employee health care proposals.

The changes are Wal-Mart's response to critics, particularly union-backed groups, who have long argued that the company has exploited the business model of folksy founder Sam Walton, putting profits before its own employees and towns and cities where it does business.

"The notion that Sam Walton cared about its workers, and the community, those positive aspects have gone," said Chris Kofinis, spokesman for WakeUpWalMart.com, a campaign group funded by the United Food and Commercial Workers. He described the recently announced moves as a series of public relations stunts.

Analysts say that although Wal-Mart is used to succeeding, it has no guarantees in this endeavor, especially since its core business model — built around offering incredibly low prices — won't change.

Some analysts say Wal-Mart actually won't be fixated in the future on offering the cheapest prices, but will try instead to offer the best value in different merchandise categories. A few years ago, customers would not have imagined Wal-Mart selling $5,000 diamond rings or $2,000 plasma TVs, but the retailer is now offering attractive deals in more upscale products.

"I think that Wal-Mart has come to the realization that it cannot be focused on low-prices alone," said C. Britt Beemer, chairman of America's Research Group. "They need a broader offering."

Wal-Mart, whose officials declined to be interviewed, has a lot at stake. Its stock has fallen 20 percent over the past two years, and is now trading at about $45. And the company is finding it harder to sustain profit growth in the high teens as in previous years as it struggles with higher expenses.

Wal-Mart has also had very public legal problems, from child labor law violations to charges of gender discrimination. It's also fighting legislation aimed at making the company more generous with its health care benefits; the legislation was in response to charges that many Wal-Mart employees have had to turn to state Medicaid programs for health care.

Meanwhile, the discounter also faces very vocal opposition to some of its store openings and suffered embarrassing revelations that former top executive Tom Coughlin stole money from the company.

That's why some critics look at some of Wal-Mart's recent generous overtures with skepticism. Opponents have also questioned the company's recently announced improvement of health care benefits for part-time workers, which includes shortening the waiting time to be on the company's health plan. Opponents say that move is undermined by Wal-Mart's much less publicized plan to rely on more part-time workers, who are less expensive than full-time workers to keep as they don't enjoy the same level of benefits.

[Savonarola]

Betsy, can you give us a specific source/citation for this material, or a link to the article if it's online? Is the thread title identical to the AP article title? If so, please clarify.

--Sav in semi-moderator mode

[Dardedar]

DAR
Betsy, have you seen the movie new movie about Wal-Mart: "The High Cost of Low Prices"? I have a copy I can give to you.

D.
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[Betsy]

Yahoo! News link

I didn't put it because it's from yahoo, which apparently moves around and you didn't like it last time.

RE: Wal-mart documentary, no I didn't see it, nor did I see the counter-documentary in Wal-Mart's favor. I just thought this was an interesting development about Wal-Mart and a local news topic, the article brings up pros and cons, so it might spark a good discussion....

Edited by Savonarola 17Apr2006 1143: shortened link

[Dardedar]

RE: Wal-mart documentary, no I didn't see it, nor did I see the counter-documentary in Wal-Mart's favor.

DAR
I have heard interviews with the creators of both movies. In fact I called into one radio show and talked briefly with Greenwald the creator of the anti-Walmart movie.
I would have liked to have seen the pro-movie as well but it is hard to get and the fellow that rented the theater in BV to show it was charging $10. I have heard the fellow who did the pro Walmart qualify his documentary as a defense of the Wal-Mart system of business and their high efficiency, business model etc. He also said that he thought they were currently being badly managed in that the company was handling public relations very poorly and making some really big idiotic blunders (which is perhaps the main point of Greenwald's documentary).
I am not anti-Walmart at all but I thought except for fairly obvious cheap shots the movie was very informative and fair. I learned a lot.

Basically for about 10 billion, less than 1/12 of the wealth of just the Walton family, they could fix every problem addressed in spades and would have a great reputation to go along with their very successful business model.

D.

[Savonarola]

I didn't put it because it's from yahoo, which apparently moves around and you didn't like it last time.

Always cite an article if you're not the author, or provide a link to where that information can be found. I only added one last time because you had linked to the main Y! News page, and the story would have been off that page in a matter of hours or days, meaning readers wouldn't have been able to find it by following that link.

[Barbara Fitzpatrick]

I read the "leaked" email of the W-M person who was investigating the healthcare issue - she informed the "brass" that 40% of W-M employees were on state healthcare programs. The Wal-Mart Watch people shafted her for one of her suggestions (make sure there is a physical component to all positions so only healthier people would qualify), but she put in a couple of good ones. The one about a shorter waiting time before part-timers would qualify for healthcare is the one they are actually talking about, but she also suggested putting clinics in the stores - and if they did that, as a bene for the employees, but open to the public as a walk-in clinic, would pay for itself by about the month after it openned its doors. Of course they aren't planning on doing that - it would cost something up front.

[Hogeye]

Here's a review I wrote of the anti-Walmart movie:

The High Cost of Wal-Mart Bashing