Is Wal-Mart Good for America? Essay

This direct advert from Wal-Mart burst Sam Walton, was placed at the top of their website to nform its consumers of their general wariness philosophy. It is meant to instill a feeling of comfort that such an enormous transnational retailer still manages to hold on to its sm some(prenominal) town founders values. Provide people with the utmost possible prices on items that they need, whatsoever the cost. This slogan of always providing the basebornest prices has made Wal-Mart the largest retailer on the orbiter and they generate billions of dollars in profit annually.But is Wal-Mart good for America? On the surface it would seem that providing a customer with an item at the basebornest possible revailing question, one must more closely examine the mechanisms by which Wal- Mart is able to provide merchandise at such arrangement basement prices. Providing people the lowest possible prices, whatever the cost. In this case, these low prices are being provided at the cost of the environment, Wal-Mart vendors, Wal-Mart employees, and even the American levy kick iner.As the Wal-Martization of America is forcing businesses to outsource their Jobs oversees Just to stay solvent, it nominates a problem present back home of people not being able to pay their bills and maintain adequate living standards. Is Wal-Mart creating the greatest good for the greatest derive? Or are they Just creating the greatest good for their executives and investors? This reflection idea will attempt to analyze and answer these questions as we dive tardily into the culture of Wal-Mart and its effect on society domestically, as well as globally.The two dominant points of view used to analyze sesss and their overall project could be summarized by the terms stockholder and stakeholder management. The former was championed by the known economist Milton Friedman. He believed that a corporations primary and perhaps ole answer is to maximize profits for stockholders (Arnold, Beau champ Bowie, 2013) Friedman would view Wal-Mart as a corporation that acts solely in the best rice beer of their stockholders.Wal-Mart is notorious for not pay their employees very high employs and not offering much to their employees in terms of retirement benefits and health care coverage. At least when compared to separate successful competitors such as Costco, Wal-Mart clearly comes up short in this department. The latter point of view mentioned was made popular by Edward freeman in his essay, Managing for Stakeholders. In it he argues that the primary responsibility of the executive is to create as much value for stakeholders as possible, and that no stakeholder interest is practicable in isolation of the other stakeholders. (Freeman, 2007) When we speak of stakeholders, we are referring to the five base groups that stand to gain or lose from corporations. These groups are customers, suppliers, employees, the local companionship and the stockholders. Freeman argues tha t no one stakeholders interest should be interpreted at the cost of the others and that all must be considered by a corporation when it comes to making the best decision.While the Friedmanite view has been seen as the real dominant view on corporations and their purpose, the stakeholder view on management has been gaining travel over the last thirty years and cannot be underestimated or undervalued these old age as companies struggle to stay competitive in a large global economy. In terms of all stakeholders involved, both Friedman and Freeman would retain that Wal-Mart is acting in the best interest of their stockholders primarily.This benefit to the shareholders is at the expense of all the other stakeholders. The customers will take over due to the lack of uality of items purchased. Wal-Mart outsources a great deal of their take to China to save on campaign and production costs. As a result, the common saying you get what you pay for holds true. These items that Wal-Mart sells in their stores tend to be of inferior quality, and that quality is passed on to the consumer. The employees suffer because they are not able to earn a decent wage to live on.According to an article written by Wayne Cascio, Decency Means more than Than Always Low Prices A Comparison of Costco to Wal-Marts Sams Club, he indicates that The age is hardly enough to live on these long time with gas prices where they are and the average cost of living going up. I know I couldnt live on 10 dollars per hour. These low wages actually end up costing the American tax payer in the forms government assistance programs such as Medicaid and aliment stamps. In a study conducted by the Institute for Labor and workout at the University of California, Berkeley, taxpayers subsidized $20. million for medical care for Wal-Mart employees in that evidence alone. (Cascio, 2006) Suppliers suffer because they are forced to accept the ontracts that Wal-Mart offers them to provide their products in their stores that fundamentally eat up their profits. The local community suffers because when a new Wal-Mart is built, smaller stores struggle to stay competitive due to the fact they cant asseverate up with the prices that Wal-Mart charges for their product. They do not have the ability to outsource production and so they eventually go out of business.While Friedman and Freeman would believe that Wal-Mart is primarily serving the interests of their stockholders while disregarding all other stakeholders, fanny Boatright would ffer an alternative hypothesis on the issue. In his article, whats wrong-and whats right-with stakeholder management, he argues that a business organization in which managers act in the interest of the shareholders can also be one that, at the same time, benefits all stakeholder groups. (Boatright, 2013) He goes on to provide his definition of what a firm is and what their purpose should be. Boatright defines a firm s a nexus of contracts between a legal entity called a firm and its various constituencies, which include employees, customers, suppliers, investors, and other roups. (Boatright, 2013) It is believed that by each group providing their own services in a juncture effort with a firm, that the greatest financial return will be achieved. From Boatrights point of view, he would view the business philosophy of Wal-Mart as one that does benefit all the stakeholders. Customers benefit by having more purchase power. They can walk into a Wal-Mart and purchase more items than they could at any other retailer.