Running head: LITERARY REVIEW

Literary Review

Week 2: Learning Team Project Part 1

RES/320
Date
Instructor

LITERARY REVIEW

Literary Review
Many companies tend to focus heavily on customer satisfaction, which
is important for maintaining customer loyalty, but they tend to forget about
those who interact with customers on a day-to-day basis. Front-line
employees are the face of the company and their actions, or lack thereof,
are representative of the company as a whole. For this reason it is imperative
that companies not only focus on customer satisfaction, but also on the
satisfaction of their employees. In this literary review we will focus on the
retail giant, Wal-Mart, and discuss how they can measure and improve their
employee satisfaction. The articles in this review will provide a snapshot of
Wal-Marts troublesome treatment of employees and its effect on customer
satisfaction, offer an approach to measure employee satisfaction, and
recommend answers to the managerial question: How do we improve
employee satisfaction in Wal-Mart stores, thereby improving the customer
experience at the stores?
Wal-Mart: Employee Satisfaction Snapshot
While Wal-Mart has been one of the nations top retailers for the past
several decades, but they are now starting to experience the demands of a
customer base that is not just looking for a good deal. The retailer has been
trying to win customers on low-costs alone, but the consumer public just isnt
buying it. According to Gogoi (2007), many of Wal-Marts workers feel
outright hostility toward the company, and, by extension, they often treat

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customers with indifference or worse. Customer service in the stores has

been on a steady decline for the past twenty years. In 1995, Wal-Mart had a
customer satisfaction index rate of 81, but by 2007 they had dropped to a
low of 72. This large of a deficit in customer satisfaction is primarily driven
by the customer-employee engagement, which is severely lacking. With
opportunity to improve in several areas, employee morale and satisfaction is
where they would see the biggest bang for their buck. Shoppers are moving
along to higher priced retailers like Target, because of the overall
atmosphere of the store and the support they receive from store associates.
As one employee replied to a survey request by saying I dont care. If WalMart doesnt care about me, why should I care (Gogoi, 2007)? When
employees feel unappreciated and undervalued, they then treat their
customers with the same type of attitude.
This article shows the significant impact that employee interaction with
customers is having on overall company results. With a reduction of almost
10 points on the customer satisfaction scale, it is obvious that there is
tremendous opportunity to improve employee satisfaction, thereby
improving customer satisfaction with Wal-Mart. By providing more support, a
positive work environment, and an environment of care and concern for
associates, Wal-Mart has an opportunity to bring customers back to their
stores and enjoy the benefits.
Wal-Mart: The High Cost of Low Morale

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In 2011, Wal-Mart associates completed their first independent poll.

Using this tool, they identified their top three things that should be changed
at Wal-Mart as: 1) improved pay for associates, 2) treat the associates with
more respect, and 3) improve overall staffing levels in the individual stores.
All three of these areas have a direct impact on the way employees feel
about their job and their employer. This attitude is then projected outwardly
toward the customers in Wal-Mart stores.
Also included in the same results, the associates said that low staffing
has impacts on store appearance and customer service. Although Wal-Marts
CEO touted that 86% of employees love their job, in the independent
survey 84% said they would move to another company if they could. One
has to ask how these numbers exist if 86% truly did love their job. With
more than 70% of employees currently being paid less than $12 per hour
(Marshall, p11), it is difficult to find people that can be retained long-term to
perform a high quality job with such low wages. The overall reduction in staff
has been one of the largest contributors to the decrease in employee morale
and satisfaction. Wal-Mart has opened more than 400 additional stores in
the US in the past few years, but theyve reduced the number of employed
associates by more than 20,000. As one store manager said, With fewer
associates responsible for more areas of the store, there is simply less time
for customer service.

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This article made it clear that there is a disparity between what

associates actually think and what the corporate office at Wal-Mart wants
people to think. With a large majority willing to leave the company as soon
as another opportunity comes available, Wal-Mart should take this as an
alarming reality to the state of their business. When people only work there
until they can find something better, they should not expect their customers
will have a positive experience.
Measuring Job Satisfaction
In reviewing the article, A factor-analysis approach to job satisfaction,
by Husain Mustafa and Ronald D. Sylvia, it was found that the key purpose of
the research was to suggest a potentially operational scheme for analyzing
employee satisfaction, need fulfillment, and their organizational
determinants (Mustafa, 1975, p. 166). The participants in the study were
employees of the Public Works Commission in a moderate-size city in North
Carolina. Participants included individuals from differing backgrounds of
ethnicity, seniority, educational level, and age groups. The study provided
participants with a questionnaire involving the need for choosing a level of
agreement from 1 to 7, and was provided in a group setting by supervisors.
The questions were based on Maslow-type needs and Herzberg-type
motivational factors. The questionnaire also included open-ended questions
requiring a written response. The authors considered the findings to be
significant. They feel the findings do not confirm the hierarchical or bipolar

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paradigms of the Maslow-type needs and Herzberg-type motivational factors.

The findings also led to hypotheses that do not agree with assumptions of
motivational theories, which indicate a need for further research. The
authors suggest the most significant finding to be that social variables in
the work situation evoke a substantial measure of satisfaction (Mustafa,
1975, p. 170). Another finding considered to be significant is that working
conditions and certain attendant rewards, such as going-home time, do play
a major role in determining job attitudes (Mustafa, 1975, p. 170). Overall,
this study supports that the best measure of job satisfaction is the personal
perception, and therefore responses of the participants (Mustafa, 1975, 171).
This literature is relevant to the topic of employee satisfaction at WalMart in that the researchers were able to appropriately measure job
satisfaction of employees with their study, and, based on their results, the
best way to measure employee satisfaction is to have the employees in
question participate in a study of this nature.
A Successful Survey
Determining how to measure employee satisfaction is only half the
battle. Researchers must also develop a successful survey that will gather
the information needed to answer the managerial question. In the article,
Employee Survey Success: The 3 A's of Employee Satisfaction Surveys,
Kevin Kruse discusses three key elements to a successful survey; annual,
accountable, and action. Kruse suggests that surveys should be conducted

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bi-annually, or annually at the very least. This way, companies can get a
snapshot of employee engagement throughout major changes such as
layoffs, mergers, and product incentives (Kruse, 2012).
The survey results should not only be shared with senior executives,
but with all managers as well. This way, managers can be held accountable
for their individual results and take the necessary steps for improvement.
Most of the emotion of employee engagement comes from ones
relationship with their manager; not informing each manager of their own
individual results (and how it compares against the companys overall
results) takes away the important tool of self-awareness. Without an
individual score, engagement becomes some abstract company initiative
(or worse, an HR issue) instead of an everyday metric for improvement
(Kruse, 2012, para. 3)
Finally, Kruse states that individual managers should conduct action
planning meetings with employees to inform them of the survey results.
Employees are then responsible for the formulation of ideas that will solve
issues reported in the survey. Managers will facilitate the action planning
meetings in order to ensure action is taken on suggestions (Kruse, 2012).
Including employees in the solution-finding process makes them feel valued,
thereby increasing employee satisfaction.
This article is relevant to the topic of employee satisfaction at Wal-Mart
because it gives a basic framework of how to conduct successful surveys

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that produce tangible results. Including these three elements in our research
findings will assist us in providing our overall recommendation to Wal-Mart
for the improvement of employee satisfaction.
Happy Employees, Happy Customers
Consumer satisfaction is an important element of business in modern
commerce. Wal-Mart has always been interested in the opinions of their
customers, as any other retailer should. As stated on a few researches WalMart has received very low ratings if not the lowest in the past few years.
The information in this analysis could be helpful to point the areas where
Wal-Mart could focus their efforts to improve their customer satisfaction
ratings. Dirk Dusharme, the editor in chief of Quality Digest Magazine
compared Wal-Mart and Target in their 2007 retailer customer satisfaction
survey. The results of his comparison showed how customers prefer Target
for their service, wider aisles, layouts, lightning, but mostly for the
employees helpfulness and cordiality. Most of the positive feedback about
Wal-Mart was in regards of convenience and price.
A significant 27 percent of the complaints are related to poor customer
service, unknowledgeable or inattentive staff, and even rudeness. In that
same survey 15 percent complained about poor quality and overseas
products that does not necessarily comply with federal regulations that all
products manufactured in the US has to comply with. This means that
according to the article published by Quality Digest magazine, Wal-Mart

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should improve their customer shopping experience by maximizing their

personal customer service and the appearance of their inventory.
Alexander Hess from 24/7 Wall St. wrote an article for the USA Today
where he pointed nine retailers with the worst customer service satisfaction
rates according to studies results of The Customer Satisfaction Index. WalMart has the top spot on the list, which means they have the worst customer
service in the industry. Hess stated that Wal-Mart has received the worst
ratings since 2007 between department stores and those have not made a
difference in their strategies for improving their customer service. Also this
company has received the worst qualifications between supermarkets since
2005. The article also qualifies Wal-Mart e-commerce as a not particularly
impressive, meaning that the company could make better use of that
resource and increase their sales and take advantages of the services they
could provide.
SIS International Research published an article that listed eight ways to
boost customer satisfaction in retail. Basing their selection of options on the
common expectations of todays customers and market, the list stated that
these suggestions could attract new customers and maintain the current
ones. Targeting indirect customers (children), self check-outs, positive online
shopping experience, adding interest to check-outs with fun products and
entertainment, living up to an established quality of service, more customer

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convenience, employee coaching, and member benefit programs are the

eight suggestions of SIS to improve customer satisfaction.
Wal-Mart might have already some of these features on their planning
but an organization like them should consider revising these suggestions.
These articles show that customer satisfaction in Wal-Mart has been in
constant decline for the past decade. They should consider how to address
the issues they have with customer service and improve the shopping
experience. However, the customer convenience, which is already one of
their fortes, could improve their performance; for example, more
maintenance and entertainment in check-outs.
Work Environment and Employee Satisfaction
The article, Relationships between Office Characteristics and
Employee Reactions: A Study of the Physical Environment by Oldham and
Rotchford, was reviewed (Oldham & Rotchford, 1983). This study looked at
employee reactions such as satisfaction, behavior during discretionary
periods, and spatial markers in relation to work environment aspects such
as office density, workspace density, office darkness, accessibility, and
openness. This study also looked at how much three sets of intervening
variables explained these relationships (Oldham & Rotchford, 1983, p. 542).
These variables were interpersonal experiences (conflict, friendship
opportunities, agent feedback), job experiences (task significance,
autonomy, task identity), and environmental experiences (crowding,

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concentration, privacy) (Oldham & Rotchford, 1983, p. 542). The

participants were 114 employees of a clerical nature from 19 different
offices. 93% of participants were women. The participants were supplied a
Job and Workplace Survey in groups of 2-15 in size. This questionnaire
addressed the intervening variables, satisfaction variables, and
discretionary-time variable (Oldham & Rotchford, 1983, p. 547). These
questionnaires were not anonymous, but participants were informed their
responses would be confidential. The characteristics of darkness,
accessibility, openness, office density, workspace density, and spatial
markers at the workspace were assessed by researchers while employees
were away at lunch.
The findings of this study show that office design can significantly
affect employee reactions in offices, as can darkness level. The findings also
indicate that the characteristics of the offices affect employees reactions
based on their work experiences. Overall, the results indicate that more
research is needed in these areas. This work of literature is pertinent to Team
As research in that it indicates work environment as an aspect to be
examined in determining employee satisfaction and potential changes to be
made in an effort to improve employee satisfaction.
Friendly Boss
In the article Improve Employee Satisfaction, Brian Ochalla suggests
that getting along with the boss improves employee satisfaction. Having

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open lines of communication, empowering and supporting employees,

recognizing their achievements, and offering opportunities for advancement
are some of the ways management can reduce turnover rates and increase
job satisfaction (Ochalla, 2004). These relationship building strategies have
been shown to increase production and customer satisfaction. Employees
want to be valued members of a team and have their contributions make a
difference. Scheduling regular meetings with employees to share questions,
concerns, and ideas can strengthen employee involvement. Allowing
employees to take on more responsibility giving them the flexibility to make
decisions on their own will make them feel empowered. Managers should
also praise employees for their accomplishments and reinforce the behaviors
they would like others to emulate. An occasional free lunch or movie passes
are rewards that are low-cost, but great motivators (Ochalla, 2004). Lastly,
this article suggests that managers should invest in their employees by
offering training and development that help employees build new skills.
This article is relevant to the topic of employee satisfaction because it
offers a few solutions to Wal-Marts managerial problem. A friendly working
environment that promotes growth, empowerment, and communication will
definitely improve Wal-Marts treatment of employees. Combining these
suggestions with those from the other articles will give Wal-Mart a good road
map to improving their employee satisfaction ratings.
Conclusion

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In conclusion, this literary review covered some of the issues Wal-Mart

faces with employee satisfaction. This, in turn, has caused a decline in the
quality of customer service provided by the employees and a 10 point drop
on the customer satisfaction scale. To measure job satisfaction, a factoranalysis approach was shown to be the most adequate for our research
needs. To succeed in this measurement, an application of the three As
(annual, accountable, and action) would ensure continuous insight into the
managerial problem and its solutions. Lastly, a review of articles providing
solutions to employee satisfaction issues gives the Wal-Mart management
team options for a resolution to the problem.

References
Dusharme, D. (2007). Customer Satisfaction Survey. Quality Digest.
Retrieved from
http://www.qualitydigest.com/may07/articles/06_article.shtml
Gogoi, P. (2007, October). Wal-Mart: A Snap Inspection. Bloomberg
Businessweek. Retrieved from
http://www.businessweek.com/stories/2007-10-02/wal-mart-a-snapinspectionbusinessweek-business-news-stock-market-and-financialadvice

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Hess, A. (2013). 9 retailers with the worst customer service. USA Today.
Retrieved from
http://www.usatoday.com/story/money/business/2013/03/16/9-retailersworst-customer-service/1991519/
Kruse, K. (2012, September 18). Employee Survey Success: The 3 A's of
Employee Satisfaction Surveys. Forbes. Retrieved from
http://www.forbes.com/sites/kevinkruse/2012/09/18/employee-survey/
Marshall, J. (n.d.). The High Price of Low Cost. Retrieved from
http://makingchangeatwalmart.org/files/2011/10/The-High-Price-ofLow-Cost.pdf
Mustafa, H. & Sylvia, R. D. (1975). A factor-analysis approach to job
satisfaction. Public Personnel Management, 165-172.
N.A. (SIS International). (ND). 8 Ways to Boost Customer Satisfaction in
Retail. Retrieved from
http://www.greenbook.org/marketing-research.cfm/boost-customersatisfaction-in-retail
Ochalla, B. (2004). Improve Employee Satisfaction. Credit Union
Management, 27(1), 6. Retrieved from
http://search.proquest.com/docview/227771859?accountid=458
Oldham, G. R., & Rotchford, N. L. (1983). Relationships between Office
Characteristics and Employee Reactions: A Study of the Physical
Environment. Administrative Science Quarterly, 28(1), 542-556.

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