1.0. Introduction to the Project
Wal-Mart that is one of the giant industry players in grocery retail has launched a project in 2015. The project was centered on minimum wage hike to make it rise above the federal minimum level of wages. The company raised the salaries of its employee to $9 per hour that is $1.75 above the minimum wage limit defined by the Federal government (Kell, 2016). There are certain factors at the bottom of this wage increase. For example, Wal-Mart is renowned as the largest grocery chain of supermarket in the world, but its compensation plan did not align with its status (before the underlying wage increase). Then, it has always been criticized for its unfair policies towards employees. Protests of different trade unions against Wal-Mart serve as evidence of this fact (Greenhouse, 2014). In addition to this, the importance of corporate social responsibility (CSR) is increasing wherein the growing trends of ethical consumerism are also crucial role players. All these internal and external factors served as the main stimulus for Wal-Mart with regard that project. The project of Wal-Mart is going to be analyzed in the light of project management tools and techniques to understand that how the project is managed and how it could be improved with its outcomes using the project management techniques and tools.
2.0. Constraints
The pay raise project of Wal-Mart has many limitations such as the scope of the project, budget, and time of the project. For the project management team, the most difficult issues and challenges can rise in the tight constraints in terms of the cost, resources, productivity, efficiency, etc. For the efficient practice of project management, the better control of these factors and constraints are very important. The rise in pay could impact the cost and profitability of Wal-Mart; therefore, the constraints were very tight with the project of raise in wages as the company has to increase the wages to $9 for around 500,000 employees and workers, even if the cost of the company could affect. The deliverables and scope of the project were the major limitations of Wal-Mart’s wages project as the company has to increase the minimum wages to $9.
3.0. Cognitive Bias
Cognitive biases are included in the list of the major concerns of the project management as it is the rationality in the project judgments in terms of decision making and planning for the project. The cognitive biases in the project management are identified as of eight types. These eight cognitive biases include anchoring bias, exposure effect, and hindsight bias, halo effect, planning fallacy, sunk-cost fallacy, Availability-related bias and Parkinson’s Law effect (da Cunha & da Moura, 2015). These cognitive biases could impact the project of raise in minimum wages in Wal-Mart. For suppose, the pressure from the unions in the form of protests could impact the decision of Wal-Mart in terms of the rise in wages and the time by which the wages would be raised. The decisions of Wal-Mart were pressurized from unions such as Our Wal-Mart were demanded to increase wages to $15.
The pressures from the stakeholders usually cause the planning fallacy when the decision for the project during the planning phase is being impacted by the pressures from the stakeholders. Other than these biases, the project could also be impacted by the Availability related biases. These biases are caused when the decisions are made based on the examples of the events available to the project team. For suppose, the scope of raise in wages was planned based on the example of other organizations like Costco and traders that have found the high wages as the source of high productivity and saving money (DePillis, 2015).
4.0. Level of Project Difficulty
The level of project difficulty can be categorized into three types include complexities, uncertainties, and level of constraints. The level of difficulty in terms of complexities was high to the project of raise in wages in Wal-Mart. The major complexity was the engagement of the stakeholders in the project such as unions, employees, shareholders, etc. The union and employees were unwilling to participate because they demanded to raise minimum wages to $15. However, the company decided to increase wages to $9. These were the major complex situations for Wal-Mart to lead the project successfully. According to the project management guide, the lack of interest of different stakeholders in the project could lead the project towards failure. The lack of interest of the unions and workers resulted in a lack of satisfaction among workers even after the rise in the pay (Stangler, 2015). It means that the project was not succeeded as it was expected by the company.
In addition to this, the uncertainty from the shareholders could also impact the success of the project. For instance, the increase in wages directly impacts the cost of the business and profitability of the company can be declined. For this reason, the shareholders of Wal-Mart could be de-motivated to invest in the company, and the equity of the company could be declined. The company reported these uncertainties as the rise in wages can kill its profit. The company has reported the worst decline in the stock in 2015 with the rise in the wages (La Monica, 2015). These were the level of project difficulty faced by Wal-Mart with the raise in the minimum wages.
5.0. Seven Level Outcome Evaluations
The success and outcomes of the project are usually analyzed using seven levels of quality and success of the project. These seven levels include Faultless (Perfect), Wonderful (outstanding), Exceeds Expectations, Reasonable, Barely enough (adequate), Failure, and Devastation. The level of the project outcome evaluation can be analyzed based on the project constraints in terms of three factors include time, cost and scope.
The project of raise in wages in Wal-Mart can be facilitated with the barely adequate level as the company made efforts to do little to solve the issue of its reputation. The company increased wages to $9, where the demand was $15. The company ensured that the increase in wages would remain continue and reach to $10 in next year. It shows that the outcome of the project in terms of issue resolved was not fully satisfactory, but neither failed. Therefore, the project achieved a barely adequate level of outcome.
6.0. Risks
The risks are the major factor in the project management that is very important to manage to control their impacts on the overall success of the project. The risks in the project can be categorized into many types such as Known Knowns, Known Unknowns, Unknown Unknowns and Unknown Knowns.
The Known Knowns and Known Unknowns are those things that are known by the project team, whereas, the risks of known unknowns are not known by them. There were many known and unknown risks to Wal-Mart with raise in wages. The known things include improved reputation of the largest retailer and the satisfaction of the employees. The pressure from the union was also known as. Therefore, the company already reported that the wages will further increase in the coming years to control the protested pressures from the unions. However, the high labor cost was the known unknowns as the company knew that the cost can increase but it can create the risks to the project were unknown.
Other than these known things, there were various unknown unknowns and unknown Knowns that could hit the success of Wal-Mart project in many ways. These are considered as the most serious risks in the project management field. The loss in stock and decrease in profit are some of the major unknown risks in the project of raise in wages in Wal-Mart.
7.0. Gathering Intelligence
The collection of knowledge and information to understand the risks to the project is known as gathering intelligence. For the intelligence gathering on the project of raise in wages in Wal-Mart, the project team could collect information in a more legal way. In general, there are four ways of gathering intelligence. These four ways include Competitive Intelligence, Corporate Espionage, Information Warfare and Personal Investigation. The collection of the information available in the public domain and to gather, it legally is known as the competitive intelligence. It is important to analyze the performance and situation of the competitors. Wal-Mart could collect information using competitive intelligence simply collecting data available about the competitors in the market in terms of what wages are they offering and why their workers are satisfied working there. The other techniques are usually considered as illegal that could impact on the image of Wal-Mart immensely.
8.0. Stakeholders
The stakeholders are known as the groups of people that can impact or being impacted by the project. The group having concern or interest in the project or business is known as stakeholders. Any decision in the business of Wal-Mart could impact the major stakeholders include owners, shareholders, employees and customers. Other than these stakeholders, the business could also impact the community, society, unions, country, government, and media.
The underlying project was mainly associated with the employees in terms of the rise in their wages as around 500,000 employees were affected by the decision of the company. The company was aimed to improve its image in the media; therefore the media is another stakeholder to the project. The pressures from the union were included in the major reasons for the decision of the company; therefore, because of the concerns of unions, they are also included in the list of stakeholders. The stock prices are directly impacted by the project decisions; therefore, the shareholders are also included in the list of stakeholders. The company rather than considering a single side of the project was needed to focus on each stakeholder group with significant communication to make their high involvement in the project for the success.
9.0. Change
The change is considered as the constant and continuous part of the project. It is important for the project management to manage the changes required in the project with time. As the company remained unsuccessful even after the celebrations of the rise in pay, therefore, the company decided to raise wages to $10 rather than $9. These changes were also adopted to reduce pressures from the unions that were continuously forcing to increase minimum wages to $15.
10.0. Questions to the Project Manager
There are many questions remained unanswered for the project manager to lead the project of raising wages. Few of these questions include the following:
What are the criteria of success that would indicate that the objectives are met, and benefits are delivered?
The success criteria would help the project manager to understand that how the project would be considered as successful with the rise in the wages of the employees of Wal-Mart. It would increase the chances of success of the project with outstanding outcomes.
Whom to be involved in the project?
Although there are many stakeholders identified, however, the project manager would answer to this question in terms of who would be drivers (people with the interest in the outcome), who would be supporters (people who can support in success) and who would be observers (people having in the project).
11.0. Summary
The analysis of the project shows that the company could improve its projects and its overall success with the help of using more appropriate tools and techniques of project management. With proper scheduling and budgeting, the company could reduce the impacts of the constraints and limitations analyzed to the project. In addition to this, the company could develop a proper plan of communication to communicate with the stakeholders to increase their participation and involvement, so that, the uncertainties and risks from different stakeholders could be reduced. The change in the project could also be managed properly using change management process so that the impacts of the change would be better and the project would be marked as outstanding on its level of outcomes.
12.0. References
da Cunha, J. A. O. G., & de Moura, H. P. (2015, June). Towards a substantive theory of project decisions in software development project-based organizations: A cross-case analysis of IT organizations from Brazil and Portugal. In 2015 10th Iberian Conference on Information Systems and Technologies (CISTI) (pp. 1-6). IEEE.
DePillis, L. (2015). The profit motive behind Wal-Mart’s minimum wage hike. Retrieved June 22, 2016, from https://www.washingtonpost.com/news/wonk/wp/2015/02/19/the-profit-motive-behind-Wal-Marts-minimum-wage-hike/
Greenhouse, S. (2015). Workers and critics greet Wal-Mart pay raise but say much remains to be done. Retrieved June 22, 2016, from https://www.theguardian.com/business/2015/feb/23/workers-activists-Wal-Mart-pay-raise
Kell, J. (2016). More Than a Million Wal-Mart Employees Are Getting a Massive Pay Raise. Retrieved June 22, 2016, from http://fortune.com/2016/01/20/Wal-Mart-employees-pay-raise/
La Monica, P. R. (2015). Wal-Mart: Wage hikes are killing our profits. Retrieved June 22, 2016, from http://money.cnn.com/2015/10/14/investing/Wal-Mart-outlook-wages/
Stangler, C. (2015). Wal-Mart Workers Still Unsatisfied, 7 Months After Widely Celebrated Pay Raise. Retrieved June 22, 2016, from http://www.ibtimes.com/Wal-Mart-workers-still-unsatisfied-7-months-after-widely-celebrated-pay-raise-2106949
