Wal-Mart Reorganizes U.S. Operations
By Tom Ryan
Wal-Mart Stores is consolidating some of its operations,
while dividing the country into three regions with separate presidents. The
overhaul is expected to help the retailer in catering to local tastes, finding
real estate in saturated markets, developing and empowering local store talent,
and expanding e-commerce.
Under the structure, logistics, real estate and
store operations will all now be overseen by Bill Simon, its chief operating
officer. Each region will have a real estate team dedicated to determining
the best locations to build new stores or studying new store formats that might
be suitable for the local market. Eduardo Castro-Wright, vice chairman, said
this part of the restructuring is "intended to gain alignment in the critical
new store decision process by integrating Wal-Mart’s realty division with store
operations and logistics."
On the merchandising front, SVP of store merchandise
operations Andy Barron will oversee merchandise strategies for three new business
zones: Walmart West, Walmart South and Walmart North. Each zone will have its
own president, who will work with merchandising teams to stock items that match
local tastes. Jon Fleming, chief merchant, in a statement said Mr. Barron’s
team "will design merchandise strategies for each of Walmart US’s new geographic
business units and translate those strategies into executable, customer-focused
programs. In addition, the in-store presentation and store groups, currently
in the customer experience organization, will move to [Mr. Barron’s] store
merchandising execution team, close to our business units. For merchandising,
this means we’ll be even more connected with operations – and with our customers."
reorganization is also expected to "develop and grow our talent more quickly
and provide opportunities throughout the organization," according to Mr. Simon.
He added, "By reducing our market managers’ span of control, they will be able
to focus on developing their store managers and to implement new productivity
initiatives. The net impact will be stronger store managers with significantly
more growth opportunities in the future."
Wal-Mart also changed its regional
general manager structure by adding smaller regions at the senior director
level to augment VP regional general managers. Mr. Simon said, "This move creates
a stepping stone for market managers to gain leadership experience as they
grow. We have also changed the regional general managers’ span of control,
to allow them to develop their market managers with a laser sharp focus."
Wal-Mart created Global.com with a goal of developing and executing a global
strategy for e-commerce; establishing cross-functional and cross-border relationships;
and creating technology platforms and applications across Wal-Mart’s markets.
changes come nearly one year after Mike Duke became Wal-Mart’s CEO.
Questions: What do you make of Wal-Mart’s U.S. reorganization? Where
do you expect it will achieve the greatest efficiencies? What challenges
do they face in execution?
change memo from Mike Duke – Wal-Mart Stores
change memo regarding Wal-Mart US from Eduardo Castro-Wright – Wal-Mart
change memo from Bill Simon – Wal-Mart Stores
change memo from John Fleming – Wal-Mart Stores
change memo regarding e-commerce from Eduardo Castro-Wright – Wal-Mart
Combining Some US Units in Streamlining Move – The
Wall Street Journal