Human Relations in Organizations: Applications and Skill Building 8th Edition by Robert Lussier

Exercise 20

Wal-Mart: People or Profit?
Wal-Mart Chief Executive Lee Scott seems to have a real problem. His firm has been accused by many in the press of numerous unethical business practices dealing specifically with employees. These include hiring illegal immigrants, busting unions, locking employees in the building when taking inventory, denying meal breaks, paying subsistence level wages while providing no benefits, and following hiring practices that discriminate against employees based upon their general health.
CEO Scott has taken steps to bolster Wal-Mart's public image and address the treatment of its employees. For example, Wal-Mart's Web site states that the typical Super Center raises or gives $30,000 to $50,000 a year to local charities ranging from youth programs to literacy councils, while saving working families over $2,300 per household. Wal-Mart also claims to have competitive wages, a flexible schedule, and good benefits including family care and college tuition reimbursement.
So with all of this good news, what could be the problem? Investors looking at the firm's stock price are less than happy. Over a five-year period, Wal-Mart's stock hit a high and dropped close to its five-year low. Analysts are now claiming that CEO Scott has been paying too much attention to the company's lackluster public image and human relations, and not enough to its lackluster bottom line.
If you attended an annual Wal-Mart stockholdersmeeting, what would you tell CEO Scott to do?