The Wall Street Journal is reporting that Walmart plans to eliminate close to a thousand corporate jobs before the end if its fiscal year on January 31, as the company moves "to cut costs and shift its focus to e-commerce ... The plans mark one of Wal-Mart’s largest rounds of corporate job cuts as it works to preserve profits while making the company more efficient and responsive to fast-changing consumer behaviors."
The job cuts, according to the Journal, "will fall broadly but are expected to focus on Wal-Mart’s US operations, including the human resources department, as well as the technology and e-commerce divisions."
The Journal notes that "Wal-Mart employs roughly 18,000 Bentonville-based staff. But the series of reductions show how the retailer is working to maintain profits at a time of change in the industry. Wal-Mart has spent heavily over the past two years to fend off Amazon.com Inc. and smaller, fast-growing discounters like Aldi."
The job cuts, according to the Journal, "will fall broadly but are expected to focus on Wal-Mart’s US operations, including the human resources department, as well as the technology and e-commerce divisions."
The Journal notes that "Wal-Mart employs roughly 18,000 Bentonville-based staff. But the series of reductions show how the retailer is working to maintain profits at a time of change in the industry. Wal-Mart has spent heavily over the past two years to fend off Amazon.com Inc. and smaller, fast-growing discounters like Aldi."
- KC's View:
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It seems to me that this is illustrative of the tightrope that Walmart is walking these days. It needs to make major investments in e-commerce, but also has a cultural imperative to hit certain profit numbers (unlike Amazon, where profits routinely are reinvested in initiatives designed to drive the company forward).
So, as it makes cuts in the organization as a way of trimming costs, Walmart has to be careful not to do things that will hurt the stores and their appeal to shoppers. If the cuts indeed are happening in departments where it can impact the company's people and technology, there is at least the potential that it could push Walmart in a direction that may not be optimal for long-term success.
