CASE INCIDENT 1 Sprucing Up WalmartFor more than half a century, Walmart has prided itself onproviding value to customers by being a low-price leader.But the consumer mindset is changing. Now "value" alsomeans convenience, ease of finding what you want, andthe ability to get exactly what you want when you want it.Nationwide dollar-store chains often have lower prices thanWalmart, so that point of competitive advantage is fading.And thanks to Amazon.com and other online retailers, con-sumers can shop from home whenever they like, compareprices, and know immediately what is available.Contrast this with the experience many Walmart shop-pers previously had when they entered a store-low inven-tory, disorganized aisles, unhelpful staff, and an overalldepressing atmosphere. The company's online presencewas about the same. The site was difficult to navigate, andattempts to search for products were frustrating at best andmore often fruitless.Named Walmart's CEO in 2014, Doug McMillon setout to change this situation. "What people think aboutthe company is important," he noted. And at the moment,people weren't thinking about value and low prices whenthey thought about Walmart. McMillon enacted a numberof changes. First, the company had earned a reputationof treating its store employees poorly-low wages, fewbenefits-while profits were in the billions of dollars, soWalmart announced it would increase its minimum wage.So clothing rules were relaxed, more variety in music wasintroduced, and thermostats were adjusted. The companyhopes improving employee morale will translate into a bet-ter experience for customers, thereby changing some ofthe negative images.Walmart's Web presence was another target for bigchanges. Amazon is the store's biggest competitor, andMcMillon wanted to offer customers more items, pickupoptions, and ways to meet their needs and demands-forexample, an online grocery ordering service. This means anew way of thinking about marketing and inventory acrossthe board.McMillon was able to see how consumers havechanged not only what they want but also the way theywant it-whether from the hands of happy employees orwith the simple click of a mouse. The question remains:Will his actions be enough to change the way consumerssee Walmart?Questions:17-14. What key factors do you think prompted Walmartto change? Do these factors exemplify the changepressures discussed in the chapter? Why or whynot?17-15. What results from Walmart's changes do youpredict?17-16. Describe how McMillon acted as a change agent inthis situation.Second, the company asked for and paid more atten-tion to employee feedback. Recurring issues includedthe dress code, store music, and even store temperatures.Sources: Based on S. Halzack, "Why Walmart Is Ditching Its Celine Dion Soundtrack and Getting a DJ"Washington Post, June 3, 2015, http://www.washingtonpost.com/news/business/wp/2015/06/03/why-Walmart-is-ditching-its-celine-dion-soundtrack-and-getting-a-deejay/; B. Ritholtz, "Walmart Learns toLive without Everyday Poverty Wages," Bloomberg View, June 11, 2015, http://www.bloombergviewcom/articles/2015-06-11/Walmart-lives-without-everyday-poverty-wages; and B. O'Keefe, "TheMan Whok Reinventing Walmart," Fortune, June 4, 2015, http://fortune.com/2015/06/04valmartceo-doug-memillon/.

Walmart has been a leader in providing value to its customers at low cost.But with the changing…

CASE INCIDENT 1 Sprucing Up Walmart For more than half a century, Walmart has prided itself on So clothing rules were relaxed, more variety in music was providing value to customers by being a low-price leader. introduced, and thermostats were adjusted. The company But the consumer mindset is changing. Now "value" also hopes improving employce morale will translate into a bet- means convenience, case of finding what you want, and ter experience for customers, thereby changing some of the ability to get exactly what you want when you want it. the negative images. Nationwide dollar-store chains often have lower prices than Walmart, so that point of competitive advantage is fading. changes. Amazon is the store's biggest competitor, and And thanks to Amazon.com and other online retailers, con- McMillon wanted to offer customers more items, pickup sumers can shop from home whenever they like, compare options, and ways to meet their needs and demands-for prices, and know immediately what is available. Contrast this with the experience many Walmart shop- new way of thinking about marketing and inventory across pers previously had when they entered a store-low inven- the board. tory, disorganized aisles, unhelpful staff, and an overall depressing atmosphere. The company's online presence changed not only what they want but also the way they was about the same. The site was difficult to navigate, and want it-whether from the hands of happy employees or attempts to search for products were frustrating at best and with the simple click of a mouse. The question remains: more often fruitless. Walmart's Web presence was another target for big example, an online grocery ordering service. This means a McMillon was able to see how consumers have Will his actions be enough to change the way consumers Named Walmart's CEO in 2014, Doug McMillon set see Walmart? out to change this situation. "What people think about the company is important," he noted. And at the moment, Questions: people weren't thinking about value and low prices when 17-14. What key factors do you think prompted Walmart they thought about Walmart. McMillon enacted a number of changes. First, the company had earned a reputation of treating its store employees poorly-low wages, few benefits-while profits were in the billions of dollars, so 17-15. What results from Walmart's changes do you Walmart announced it would increase its minimum wage. Second, the company asked for and paid more atten- 17-16. Describe how McMillon acted as a change agent in tion to employee feedback. Recurring issues included the dress code, store music, and even store temperatures. to change? Do these factors exemplify the change pressures discussed in the chapter? Why or why not? predict? this situation. Sources: Based on S. Halzack, "Why Walmart Is Ditching Its Celine Dion Soundtrack and Getting a DI" Washington Post, June 3, 2015, http//www.washingtonpost.com/news/business/wp/2015/06 03/why- Walmart-is-ditching-its-celine-dion-soundtrack-and-getting-a-deejay; B. Ritholtz, "Walmart Learns to Live without Everyday Poverty Wages," Bloomberg View, June 11, 2015, http://www.bloombergview com/articles/2015-06-11/Walmart-lives-without-everyday-poverty-wages; and B. O'Keefe, "The Man Who's Reinventing Walmart," Fortune, June 4, 2015, htp://fortune.com/2015/06/04/walmart- ceo-doug-memillon/.