Experimental DesignThe research into Walmart has been approached from a variety of methods. These methods include different sources and approaches to data, as well as their interpretation. At this point, we must trace causal connections between these different findings. While some data has been interpreted, the entirety of the Walmart information has not been subject to a cause and effect analysis. So in the first place, we hope here to consider much of the data already collected and interpret it through a cause and effect experimental design.
This sort of analysis may be performed through a statistical design. However, that does not lend itself to the variety of data collected. Subjective and qualitative information such as that gathered through interviews does not transfer well into the numerical or statistical experimental design. Therefore, in this causal research, I will identify the variables and their outcomes and then trace patterns in the level of outcomes by changing the variables. This experimental design will produce reliable results that show the different causal aspects on much of the phenomena observed within Walmart. Within the causal data calculations section, I will present the information with a special focus on causes and effects. Connections between these variables and their significance will be explored and interpreted in the causal data interpretation section.
Causal Data Calculations
As observed in our explanatory research, Walmart’s main marketing strategy of offering lower prices than their competition draws customers in the door and often times away from competitors who are in turn, forced to consequently lower their prices to maintain competition with the retail giant. On the other hand, the lowering of prices is not to be seen as strength but a source of weakness for the company. These price cuts have the potential of hurting the company’s sales and revenue and may be disastrous for the company’s growth (Massengill 2013).
The next calculation to discuss is the way that Walmart treats its employees. One interviewee discusses the amount of shame leveled at the employees and the demands that Walmart places on them. The walk of shame is just another means that Walmart has of making team members feel as though they do not matter and are expendable, thus further increasing their high turnover rates. Turnover among full-time employees increased from between 30-45% in 1995 to almost 56% in 2000. Today, the turnover rate is at an all-time high of 60% and the cost of replacing the 600,000 – 700,000 employees that leave Wal-Mart each year is estimated at $1.4 billion (Lavierie 2015).
Yet there is another factor at work here. The average hourly wage of a WalMart worker was only $9.68 until just this year when the average was raised to $13.38 per hour. Much better, however still far less than the U.S. average of $17.80 per hour. Only 45% of Wal-Mart’s employees are covered by the company’s health insurance plan. In 2002, WalMart spent an average of $3,500 on health benefits per employee, which was 40% less than the average U.S. corporation spent, and 30% less than the industry average; and in 2005, that spending dropped to $2,700 per employee (Johansson 2005). These are the two variables that may relate to the high turnover among Walmart employees, which I will discuss further below.
Causal Data Interpretation
These calculations presented above mark two of the key causal aspects to Walmart. The company is most well known for its low prices but also for its controversy about employment. I will interpret the two calculations above and then consider further implications for other causal relations that our findings about Walmart have produced. For the first data calculation, the issue of lowering prices at Walmart, we have a single variable, the cutting of prices, and two different outcomes. It seems that low prices at Walmart cause more people to come in the door. However, it also causes other companies reduce prices and forces Walmart into a position that inhibits its growth. The conclusion about growth seems to be questionable. For other sources of data show that Walmart continues to grow with the rest of the retail industry, as demonstrated in our Raw Data analysis. Thus, it seems that the primary causal connection is between the low prices and the insurgence of customers.
The second calculation above is between the wages paid to Walmart employees as well as their treatment by the company, and then the subsequent high turnover rate. The sources of information above have already offered some level of evaluation about the data. They claimed that the wages were in some way problematic, as Walmart employees were underpaid. However, the employees were also underappreciated. The question is, how do these two factors, whether positive or negative, relate to the clear outcome: the high turnover rate among Walmart employees? I think that this must account for the attitudes of the employees and cannot be reduced to a simply calculation in numbers. The loyalty and the posture of the employees at Walmart might very well influence their approach to the work regardless of any input by the management of the company. Thus, it seems that Walmart might pay its employees a low wage but this does not necessarily correlate to a high turnover rate. The nature of the work, such as many unskilled labor jobs, will play a key factor here. This brief but direct look at the causal connections in the Walmart data collected shows some firm connections between cause and effect but also introduces new question and avenues of research.
- Johansson, E. (2005, November). WAL-MART: ROLLING BACK WORKERS’ WAGES, RIGHTS, AND THE AMERICAN DREAM. Retrieved April 9, 2016, from http://www.jwj.org/wp-content/uploads/2013/09/WalmartReport_RollingBack_lowres.pdf Erin Johansson is a Research Associate for American Rights at Work
- Lavierie, M. (2015, March 19). Higher wages and employee turnover. Retrieved April 09, 2016, from https://operationsroom.wordpress.com/2015/03/19/higher-wages-and-turnover/
- Massengill, R. P. (2013). Wal-Mart wars: Moral populism in the twenty-first century.