Organizational Change Process

1. Kysandra Callison, Terrilyn Green, Donna Mickens, Monik Vega, and Sandra Wynn Organizational Change Process AET 560 May 30, 2016 Dr. Christine Nortz

2. The Walmart organization began operations as a retail business in 1962 in Rogers, Arkansas. Sam Walton, a dedicated and visionary leader founded the company and “started small, with a single discount store and the simple idea of selling more for less” (Walmart.com, 2016). As a result of this visionary leadership, Walmart evolved into the largest world retailer. The retail giant provides numerous products and services such as grocery items, tire centers, nail and hair salons, fast food restaurants, vision care, and online shopping. “Nearly 260 million customers visit more than 11,500 stores in 28 countries and e-commerce sites in 11 countries each week” (Walmart.com, 2016). Walmart’s “fiscal year 2016 revenue of $482.1 billion employs 2.3 million associates” (Walmart.com, 2016) across the globe. The large organization experienced overwhelming growth and success. However, due to global trends in technology, competition, and other factors, a careful review of their portfolio indicated a need for organizational change. Organization Overview “Leading through technology” Walmart This presentation will explore and define the scenario concerning Walmart’s strategic organizational change process. It will include two researched-based theories to facilitate the change process, a training program based on those theories that use job performance to measure the desired change, strategies that will overcome employee resistance and create commitment. An incentive plan for employee buy-in, challenges, and benefits of teamwork in the organization, a shared diagnosis leading to change and continuous improvement is also explored.

3. Scenario Walmart, the world’s largest retailer, announced plans to close 269 stores globally. “Approximately 16,000 associates will be impacted, 10,000 of them work in the U.S.” (Walmart, 2016). Even though numerous stores are closing, Walmart “plans to open stores worldwide in the coming fiscal year”(Walmart.com, 2015). The retail giant conducted a review of the store’s portfolio and presented a strategic outlook and growth plans for the future. Their plan is “part of a framework designed to drive sales growth by strengthening the U.S. and e-commerce businesses” (Walmart.com, 2016). The organizational change was initiated in response to the aforementioned trigger event. Walmart is now tasked with shaping the organizational context to motivate, encourage, and support the internal desire of employees to change their behavior consistent with this shift in demands with the new company strategy(Spector, B. 2013): Enhance store experiences Strengthen Supercenters, optimize Neighborhood Markets Leverage the unique supply chain Build deeper digital relationships with customers Walmart.com. (2016)

4. Putting Theory Into Practice "Successful organizations cannot remain static if they hope to continue that success; they must change in order to keep up with a changing world” (Spector, 2013, p. 3)

5. Investing in New Technology • Building customer digital relationships • Improving site experiences and apps • Enhancing store experiences • Enhancing convenience and time • Making shopping faster and easier

6. Theory Rationale • Technology changed customer shopping • Changed nature of relationship • Convenience of shopping online • E-commerce disrupts costs • Customers have higher expectations • Walmart is implementing strategies • Meeting new expectations • Improving customer service • Improving product availability • Reducing checkout line wait times • Utilizing technology • “We recognize our situation has changed and we’re responding accordingly.” Doug McMillon, CEO (BusinessInsider, 2015)

7. Putting Theory Into Practice “Transformational change seeks to motivate employees to change their behaviors; not to force, coerce, or trick them into changing” (Spector, 2013, p. 14)

8. Theory Rationale Transformational Change Motivates Employees • Cuts and layoffs at the corporate level • Supporting those impacted • Placing workers in nearby locations • Effective strategic renewal efforts • Establish and Discuss (Change) • Positive Motivation • Employee Satisfaction • Lead through Experience and Competence • Involve Employees in Design/ Implementation Strategies • Identify and Empower Strong Change Agents

9. Promoting a Community of Shared Learning A Training Course for Walmart Employees Image: blog.walmart.com

10. Use of sample display tablets in the upgraded Walmart stores; Enhance the shopping experience for the customers Supply Chain Greeters Sales Associates Online associates Training Promoting a Community of Shared Learning Training Delivery Modality Training Target Audience Trainer Led Lecture Think-Pair-Share Discussion Flipped Classroom Walmart levels of leadership chosen to implement organizational change

11. Training Goals and Objectives • Goal: Enhancement of the store experiences utilizing display tablets with food demonstrations • Objectives: Provided with a display tablet, job aid, digital software, and peer evaluation, the greeters, sales associates, and stockers will properly perform food demonstrations with a display tablet in a group simulation with 100% accuracy. • Goal: Strengthen Supercenters, optimize Neighborhood Markets, ensure stocked shelves and increased product selection • Objectives: Through intensive training & use of handheld devices, employees will be able to verify stock availability at the beginning and throughout each shift.

12. Training Goals and Objectives • Goal:Build deeper digital relationships with customers. Employees to host mini DIY digital workshops that can be accessed on the Walmart website • Objectives:Given the Walmart Smart database, computer, and digital software, all employees will receive extensive technology training and be expected to develop competency in the use and instruction of every device available throughout the company. Additional training will be provided in the access of manufacturer technical support so all staff will be able to effectively assist customers in obtaining necessary technical assistance beyond Walmart corporation capabilities. • Goal: Leverage the company’s supply chain; increase types of products Walmart’s brand Great Value offers • Objective: Through training on all Great Value research and development products and visiting brand manufacturers, supply chain employees will demonstrate product and brand knowledge by active participation in simulations, group practice, and testing with 95% accuracy

13. Training Instructional Technological Models

14. Training Instructional Technological Models • Minimal Lecturing • Guest Speaker • Role Playing • PowerPoint Presentations • Laptops • Computer Projectors Walmart’s President and CEO C. Douglas McMillon Image: walmart1percent.org

15. Communication Training Length: 4 hrs. 20 Trainees per session per store Tuesday, July 14 Thursday, July 16 Monday, July 20 Make-up sessions: Scheduled by management • Training Department send email: • Scheduled dates and time • Hyperlink to shared drive for sign-up • Contact Communications Coordinator to submit information in Walmart newsletter • Post training course requirements on the company website Training Start Dates Image: workplacecommunicationblog.blogspot.com

16. Measuring Training Success Kirkpatrick’s Training Evaluation Model • Employee/employer establish performance goals • Employee performance metrics are based on output, quality, costs, or time • Compare difference between employee performance before training to their post training performance • Training coordinators and supervisors utilize rubrics (scoring guides) to evaluate/ grade employee performance • Use customer satisfaction surveys • Trainee evaluations • Determine ROI with increased employee performance metrics GoSignMeUp.com

17. Organizational Change Strategies • Know the pros and cons of implementing changes. • Address employees issues and concerns. • Select change agents to help manage planning and implementation. • Communicate the new plan and ideas fully to the staff and listen to their feedback. Overcoming Resistance Image: actioncoachpamholien.com

18. Organizational Change Strategies “Individual incentives will be most effective in shaping behavior when the individual controls the outcomes being measured and rewarded, when the outcomes are tied to improved performance, when the evaluation of an employee’s contribution is perceived as being valid, and when the difference between rewards for high and low performance is significant” (Spector, 2013, p. 139). Employee Incentives Extrinsic Rewards Intrinsic Rewards

19. Organizational Change Strategies Create Commitment

20. Use of Teams During the Change Process Seven Factors Critical to Team Success • Clear and engaging direction • A real team task • Rewards for team excellence • The availability of basic material resources to do the job, including the abilities of individual team members • Authority vested in the team to manage the work • Team goals • The development of team norms that promote strategic thinking • Activity - In pairs discuss a time when you worked in a group where one of the critical factors to team success were being used.

21. Use of Teams During the Change Process Characteristics of Highly Committed Change Teams • 10 or fewer members • Meetings/Attendance • No information is off limits • Accountability • NO secrets or surprises • Straight talk • Fast decisions • Paid on total results • Activity - Discuss in small groups how these characteristics could benefit teams • Popcorn share benefits with whole class Why Change Teams • Some projects are too big • Important task for change leaders • Understand change goals and objectives • Differentiation and execution of tasks • Control over the decision quality

22. Shared Diagnosis in the Change Process

23. Employee Performance Rubric Customer Survey Questionnaire SUBMIT

24. Diagnostic Interviews The Purpose and Choice of Interviewers • Gauge employee behavior • Gauge organizational function • Avoid trivial questions • Focus on relevant performance based issues • Choose interviewers from among employees Methods to Obtain Data • Abstracting constructive data • Individual or small group interviews • Structured - All employees • Unstructured – A few general questions • Open dialogue • Thought-provoking questions (probing) Image: sevenpillarsinstitute.org

25. Behavioral Observations • Discussion and Determination of current job procedures • Gap Analysis to determine where new procedures need to be added • Implementation of new work flow • Shadowing to ensure all procedures are followed through appropriately • Feedback & Reflection • Eliminates self-reporting • Observe actual behavior of varying groups • May observe unobtrusively or by active involvement • Unstructured – A few general questions

26. Conclusion Walmart is considered the world ‘s largest retailer and to continue making an impact, organizational change is necessary. A review of the store’s portfolio helped with the creation of a strategic plan that will enhance the store experience, build deeper digital relationships with customers, strengthen Supercenters, and help leverage the supply chain. This presentation defined and explored researched-based theories that facilitate change process, a training program that can be used to measure job performance for Walmart’s desired change, strategies that will overcome resistance and create employee commitment. The incentive plan provided for employee buy-in, the outlined challenges, and benefits for teamwork, and shared the diagnosis such as employee performance rubrics, customer surveys, questionnaires, behavioral observations, and diagnostic interviews. These adjustments lead to change, and continuous improvement should provide an efficient mechanism for Walmart’s organizational change and a new strategy, thus resulting in the domination of the retail market space.

27. References Baird, N. (2015). Forbes. Retrieved from http://www.forbes.com/sites/nikkibaird/2015/10/15/walmarts-struggle-isnt-(Speabout-ecommerce-its-about-price/#59a63e426e0d Cawsey, T. F. (2012). Organizational change: an action-oriented toolkit (2nd ed). Retrieved from The University of Phoenix eBook Collection database. GoSignMeUp. (2014). Kirkpatrick philips model. Retrieved from http://www.gosignmeup.com/kirkpatrick-phillip-model/ Grill-Goodman, J. (2015). Five ways Walmart. Retrieved from http://risnews.edgl.com/retail-news/Five-Ways-Walmart-is-Investing-in-Technology103008 Gustafson, K. (2014). CNBC. Retrieved from http://www.cnbc.com/2014/01/31/time-to-close-wal-mart-stores-analysts-think-so.html Knoll, Inc. (2016). Three keys to successful change readiness surveys. Retrieved from http://www.knoll.com/media/783/514/wp_ManagingChange_ThreeKeys.pdf Magloff, Lisa. (2016). Examples of transformational changes, Retrieved from: http://smallbusiness.chron.com/examples-transformational-change-18261.html Peterson, H. (2015). The Business Insider. Retrieved from http://www.businessinsider.com/Walmart-outlines-strategies-for-growth-2015-2Cawsey, T., Desczka, G., & Ingols, C. (2012). Organizational Change, An Action-Oriented Toolkit (2nd Ed.). Thousand Oaks, CA: Sage. Reuters. (2016). New York Post. Retrieved from http://nypost.com/2016/01/15/thousands-to-be-laid-off-in-walmart-downsizing/ Souza, K. (n.d.). Govtslaves.info. Retrieved from http://www.govtslaves.info/Walmart-sams-club-expected-to-make-significant-corporate-job-cuts/ Spector, B. (2013). Implementing organizational change: theory into practice, 3rd Ed. Upper Saddle River, New Jersey: Prentice Hall. Survey Monkey. (2016). Collaborate on surveys with your team. Retrieved from http://www.surveymonkey.com/mp/enterprise/features Walmart. (2015). NYSE:WTM 22nd Annual Meeting for the Investment Community [PowerPoint slides]. Retrieved from https://cdn.corporate.walmart.com/b8/c9/d42965ea4d7e9a4a5ec891cbabe5/doug-mcmillon-2015-analyst-meeting-presentation.pdf Walmart.com. (2015). Walmart strategy drives growth and sustainable returns plans, 20 billion share repurchase program over two years. Retrieved from http://news.walmart.com/news-archive/2015/10/14/walmart-strategy-drives-growth-and-sustainable-returns-plans-20-billion-share-repurchase-program-over-two-years Walmart.com. (2016). Walmart continues sharpened focus on portfolio management. Retrieved from http://news.walmart.com/news-archive/2016/01/15/walmart-continues-sharpened-focus-on-portfolio-management Walmart.com. (2016). About us. Retrieved from http://corporate.walmart.com/our-story