Efficiently Inefficient

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Is training Wal-Mart employees even efficient?

Frederick Taylor, the father of scientific management, would be perplexed to look at Wal-Mart as an organization. Taylor believed an organization could scientifically analyze the tasks of its workers to streamline processes to maximize output and minimize input. Wal-Mart strategy of low-cost goods using new technology to minimize costs, including its economies of scale and just-in-time inventory management, is the envy of the operational management world. As part of our Bucknell management education, we have studied Wal-Mart from numerous angles, but Barbara Ehrenreich colorfully paints a picture of what a low cost strategy does to an organization’s workers in her book Nickel and Dimed (accurately subtitled On Not Getting By in America). She also points out that an organization that is centered on cutting costs, wastes so much of its own time. But can the strategies of America’s largest private employer be wrong?

Ehrenreich decides, as a journalistic experiment, to find the highest paying job she can without having a formal college education nor much work experience while sustaining herself on these wages. She hoped to find insight on how America’s lowest paid workers survive. For class, we read a selection about Ehrenreich taking a job as an “associate” at a Wal-Mart in Minnesota. Enhreneich is assigned to the women’s clothing section. Her job was to replace clothing back onto the racks and shelves. She describes the lack of direction in of her job as well as the stress of having a never ending supply of clothing to replenish.

“And always there are the returns, augmented now by the huge volume of items that have been tossed on the floor or carried feckless to inappropriate sites. Sometimes I am luck to achieve a steady state between replacing the returns and picking up times strewn on the racks and the floor. If I pick up misplaced items as quickly as I replace the returns, may cart never emotions and things back up dangerously at the fitting room, where Rhoda or her nighttime replacement will is likely to hiss.”

Notice how there seems to be a lack of process in Enhrenceich’s description. Taylor stressed the “importance of indentifying work tasks and then making that method the standard (Organizations and Organizing 35).” Enhreneich describes a day long training sessions where she is trained mostly in company policy and ethics, opposed to being taught about the best way to do her job. She is also threatened never to dollop in “time theft,” or not working on company time. As an organization that is operationally focused on process control, there seems to be little structure in the front-office (the store). This is not in congruence with rational system perspective, which states that “organizations are instruments designed to attain specified goals (Organizations and Organizing 35).”

Or is it?

Wal-Mart has a low-cost strategy, which as obvious as it sounds, is meant to provide goods for the lowest cost as possible, and usually will sacrifice service and quality for cost. So why wouldn’t Wal-Mart care about how efficiently its employees work? The average Wal-Mart employee takes home about $250 for a full week’s worth of work (hourly rate is about $6-$7.50 according to PBS) and Wal-Mart has a 70% turnover rate. Could this mean that the investment in teaching efficient processes to workers is more expensive than letting workers figure out their own, relatively adequate system, especially if 7 out of 10 employees who they teach will quit anyway? I am not sure I have an answer for that question, but I am doubtful that Wal-Mart management would overlook this fact. I am sure Frederick Taylor would also be just as perplexed.


7 Responses

  1. Evan! Love the picture! Maybe you can do a mini workshop in class!

  2. I really liked this, it made me think back to when I read Cheaper by the Dozen. The dad is obsessed with getting his children to be super efficient, but I’d have to imagine the time he spent figuring out ways to shave seconds off tasks couldn’t have been worth it.

  3. I love that picture it relates so much to what Blaire wrote regarding workers happiness, it really is like WalMart is “forcing” their employees to be happy and positive about their low wage jobs and just in case they forget, why not put a big sign on their back to remind them.

  4. That brings up a great point about employee and corporate relationships. It seems like companies are always looking to not only have satisfied customers, but also satisfied employees. But as we see in this case, Why? It seems Wal-Mart ignored that all together in its pursuit of profit.

  5. It’s also pretty interesting to consider why Wal-Mart is so good at what it does. They have what I believe is the second largest information system in the country (behind the government) and have mastered the art of inventory and supply chair management. Could it be possible, or even imaginable that Wal-Mart could significantly reduce the number of employees, thereby reducing costs, and still be equally as efficient. IF this would be possible and Wal-Mart is employing thousands of people they technically don’t need to – maybe Wal-Mart isn’t the big bad wolf.

  6. Even though Wal-Mart employees all these people, something is certain wrong (Inefficient) with the way they treat their employees- because not only their turnover rate is huge, but also the amount of lawsuits they have to face “everyday” is daunting – maybe if they did followed Taylor and actually explained what the worker would be doing, people would have an ‘exact’ idea of what to expect from their jobs

  7. This is definitely a puzzle, and your title capture sit beautifully.

    One issue that comes to mind is the basis of evaluation. If Wal-Mart can be profitable, and unthreatened by any competitor, with current practices, than there is little cost to the ineffecient practice of disposable workers who figure out their own one best way.

    Or, given the level of detail complexity she described in sorting the clothes (floral bras, ribbed pastel halters, half clam digger hip hugger double soy half caf pants!), there may be no single Taylorist algorithm or routines that would optimize sorting, especially relative to cheap labor.

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