People First, Profits Will Follow

People First, Profits Will Follow

Alexis Panteleakos

        Walmart excels at profitability, but could use a lesson in putting people first.  Barbara Ehrenreich found this out firsthand working at Walmart attempting to survive on minimum wage for her book Nickel and Dimed: On (Not) Getting By in America.  Founder of Walmart, Sam Walton, and his family sit comfortably with billions of dollars in the bank.  However, the average Walmart associate only earns about $27,000 per year.^[1]  Associates struggle to make ends meet and must rely heavily on government assistance programs to supplement Walmart’s meager wages.  Walmart minimizes costs with strict time management reducing time theft, overtime, and benefits eligibility.  Walmart also experiences high turnover as a result of its practices and policies.

        Low-skilled workers fill most Walmart associate positions.  Almost anyone can qualify for Walmart associate positions making everyone easily replaceable.  Also, taking employment at will into consideration virtually extinguishes any type of job security that may exist at Walmart.  Job security suffers even with government policies to help protect employees from certain types of discrimination.  A Walmart associate will always walk on eggshells knowing termination might occur without “just cause”.  Associates exist only as a cost to Walmart – labor.  Time equals money.  Walmart prevails at reducing costs by nearly eliminating the possibilities for time theft and overtime pay.  

These practices exhibited by Walmart put profit first and people last.  A company benefits economically from a people first strategy because “…economic success is linked to fair labor practices when employees and managers are considered critical stakeholders for the long-term viability of their companies.”^[2]  Rosabeth Moss Kanter argues that associates should also receive employability security through transferable skills and abilities learned on the job.  Employability security allows for adaptability in ambiguous and changing times.  Associates need consideration as valuable assets instead of as costs that need minimizing.  Shareholders naturally receive value too when associates maintain appreciation as individuals.

All stakeholders need acknowledgment in order for a company to realize true success.  The interests of all stakeholders carry importance and require thoughtful consideration.  Jeffery Pfeffer concludes that, “…without good employees, a company will fail, just as it will fail without customers, and fail if it does not think strategically about its products and services.”^[3]  A professional demonstrates the model for employees.  A professional possesses trained skills and also commits to excellence making him/her employable.  Good employees will in turn seek tenure resulting in commitment, high-productivity, and investment in the company.  This requires Walmart to view associates under a new light.  Instead of seeing associates as costs needing reduction, Walmart must view associates as valuable assets critical to Walmart’s success.  Associates present an opportunity for competitive advantage and a means to distinguish Walmart from their competition.  Walmart must reevaluate its structure and values in order to truly put people first because actions speak louder than words.  Simply calling their workers “associates” as opposed to “employees” only creates implied value, but nothing tangible.  True value lives in the actions of a company.