Business Case: Wal-Mart

Purpose and Value of Conducting Diagnosis

One of the main reasons for companies to conduct Organizational Diagnosis would be for them to have enough room to improve their effectiveness through gathering and evaluating information which will be used in establishing a course of action that will address problems of a given company. Moreover, various special procedures are used in order to collect vital information of the company that might be helpful in formulating a solution to address a given issue/concern.

The conduct of organizational diagnosis also serves as a tool in order to motivate the employees of a given company to learn and participate in the change process of their company. In addition to this, the conduct of organizational diagnosis would be helpful for the management of a given company since it provides the management of a given company an idea of the existence of a problem and for the employees to be informed about their roles in the change process of the company.

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In other words, organizational diagnosis is vital to many companies especially in determining the existence of problems in the company which others might have overlooked (Dow Chemical Company 2003).

Evaluation of Organizational Diagnosis Model

Force Field Analysis

This is an effective organizational diagnosis tool especially in determining factors that contributes and hinder for an organization to undergo the process of change. In other words, this organizational diagnosis is only useful if the goal of the management is to pinpoint the drivers and hinders for their organization to undergo the process of organizational change and not the process of change per se.

Leavitt’s Model

This organizational diagnosis model provides a clearer analysis factors that affects the performance of a given organization. Most of the factors that were identified by Leavitt are internal factors, yet there is no clear and concise explanation of the relationship of various factors from one another since he only explained the interdependency of each factors from one another on a general sense.

Likert System Analysis

This organizational diagnosis method can be useful if the management aims to determine if there is indeed a problem on the communication processes of various management level of the company as well as the perception of employees to the upper management and other top executives of the organization. Read about Factors that Hinder Effective Communication

Open System Theory

On the other hand, the Open System Theory can only be used if the organization being considered includes the environment as one of the major factors that affects the entire organization. Moreover, this organizational diagnosis method put premium on environment as the main factor in fueling transformation in a given organization.

Weisbord’s Six-Box Model

One of the weaknesses of this organizational diagnosis is the fact that the model omits many interconnections between the boxes of the model which can be vital in determining the real interconnections of various categories of a given organization. Nevertheless, Weisbord Six-Box Model can be useful in determining the relationship of the internal and external factors of a given organization. This is to provide the organization if they still conform on “what should be” and “what is” questions.

Congruence Model for Organization Analysis

This model conforms to the open system theory and very much similar to Leavitt’s model and Weisbord six-box model. This model can be useful in determining the “congruence” of each system parts of a given organization. The only thing that seems to be negative in this model would be the fact the proponent was not able to consider the link or connection between the “paired links” or those system parts that are paired together based from their congruence to one another.

McKinsey 7S Framework

This organizational diagnosis was identified to be useful in determining the right allocation of resources of a given company in terms seven variables namely: structure, strategy, systems, skills, style, staff, and shared values (Prescott et al, 2008). On the other hand, one weakness of this model would be – not including the external factors on the variables that affects a given company, though the proponents of this model do acknowledge the presence and influence of external factors to the performance of the company.

Tichy’s Technical Political Cultural Framework

This organizational diagnosis model overlooks the possibility that businesses have difference orientation and nature which affects the degree of influences of one factor to another. For instance, it was stated, based on the illustration provided from the text, that task has strong impact on prescribed networks and organizational processes.

While on reality, there are those companies wherein task factor has a weak impact on prescribe networks and organizational processes. In other words, Tichy’s Technical Political Cultural Framework will not always hold true on other businesses specifically those businesses that do not conform on its degree of impacts of a given set of factors.

High Performance Programming

This organizational diagnosis only focuses on the internal stability of a given organization. It was identified that external factors are not being considered among the factors that affects or influences the performance of a given organization. In other words, this only can only be useful if the aim of the diagnosis is to determine if whether or not there is an internal instability on a give company by examining various factors/variables namely: high performing, proactive, responsive, and reactive; as well as empowering, purposing, and coaching.

Diagnosing Individual and Group Behavior

This organizational diagnosis, for the sake of simplicity, omitted some factors like the divisional level of performance. The main focus of this method is on the organizational, group, and individual level of performance. In reality, divisional level of performance does exists especially for large corporations wherein it is divided into divisions that specializes in a specific field, e.g. marketing, purchasing, production etc. in this regard, this organizational diagnosis method can only be successfully used in organizations with no divisions or organizations that are not divided into departments. Nevertheless, this model is effective when it comes to determining the performance condition of organizational, group, and individual level of a given organization.

Burke-Litwin Causal Model

This organizational diagnosis can be successfully used in determining the links of various factors/variables of a given organization. Moreover, this model provides enough room for organizations to identify the important variables and linkages on a given business such as internal and external variables (Burke, 2002). In other words, this model considers the fact that even organizations possess unique nature and factors embedded on the organization being questioned. On the other hand, one of the weaknesses of this model would be the need for further empirical investigation and causal modeling to ensure the reliability and effectiveness of the model.

Ease of Implementation and Applicability

Considering that the organization that will be considered in this case is Wal-Mart – known for being the major retail store in the United States and serves as the market leader when it comes to size and volume revenue, it is therefore important to determine which among the identified organizational diagnosis methods are more likely applicable of the nature and characteristics of Wal-Mart (Fishman, 2003).

Based from the evaluation of various organizational diagnosis models on the previous pages and considering the fact that Wal-Mart is a large company and pose as the market leader of retailing industry, it is therefore clear that Burke-Litwin Model would be the most appropriate method in organizational diagnosis of Wal-Mart. Burke-Litwin model, though the said model needs further empirical studies and causal modeling, this model considers almost all of the factors that are vital in determining the performance and spotting of problems of Wal-Mart.

Wal-Mart still treasure and lives under its traditional culture of providing cheap products in the market, get large volume of products from suppliers in order to get more discounts, and providing low wages to minimize costs and maximize their profits (Luce, 2005). In addition to this, the external factors, e.g. environment, affects largely on the performance of Wal-Mart especially in the international market since it also operates in other countries. The internal factors are also considered in B-L model which makes it fit to Wal-Mart.

On the other hand, models such as Force Field Analysis, Leavitt’s Model, Likert System Analysis, and Open System Theory are either too simple to fit to Wal-Mart or the links between the factors are not well established, there is bias in assigning factors that will have a greater impact to a given organization, or the model does not capture the majority of the factors that greatly affects the performance and operations of Wal-Mart.

References

1. Burke, W. W. (2002). Organization Culture: Theory and Practice. SAGE.
2. Dow Chemical Company (2003) Organizational Diagnosis. Retrieved July 23, 2008, from http://www.astd.org/NR/rdonlyres/53AF420B-1861-4ABE-97DC-283859DB715D/0/Dow2003EIPEntryOrganizationalDiagnosis.pdf
3. Fishman, C. (2003). The Wal-Mart Your Don’t Know. Retrieved July 23, 2008, from http://www.fastcompany.com/magazine/77/walmart.html
4. Luce, S. (2005). Welcome to Wal-Mart: Always Low Prices, Always Low Wages. Retrieved July 23, 2008, from http://findarticles.com/p/articles/mi_m1132/is_11_56/ai_n27867566
5. Prescott, R. K. et al (2008). Human Resource Transformation: Demonstrating Strategic Leadership in the Face of Future Trends. Davies-Black Publishing.

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