Walmart is in the process of cutting 20% of its leadership staff above store level, as reported by a field executive for the retailer. Within the next three weeks, the company will reduce its total number of regional markets from 450 to 350, which will eliminate approximately 300 executive positions by the beginning of October.
In fact, the retailer has been so focused on this initiative to cut staff that it eliminated two regional directors in Florida and one in South Carolina even as Hurricane Irma was approaching.
This reduction in staff is reportedly the result of an edict to cut expenses quickly. The cuts will save Walmart from having to pay out bonus money and vested equity moving into Q1 2018.
When all the cuts are finalized, Walmart will have been reduced from six divisions to four in the U.S. and from 50 regions to 40. Moving forward, Market Managers will shift from managing between eight and 16 stores to possibly more than 20: That’s one HR professional per 6,000 to 7,000 employees. “The entire field HR community is worried whether they will have a job and what that job might be,” the executive said.
Regional store management and HR overall has been a weak link in the Walmart organization during the past several years. “Three of the most senior folks in Walmart U.S. had zero HR experience prior to their current roles,” the executive told Retail TouchPoints in an exclusive interview. “They don’t seem to want or need HR leadership — they just want people to ‘execute the plan,’” he stated.
In another move to cut expenses, Walmart may be axing half of the new Fresh Operations Managers (as many as 150) it hired within the last six months. These executives were hired to train associates in the stores on the value and benefits of selling fresh produce. The original plan, reported by Fortune in February 2016, was to hire “hundreds” of Fresh Operations Managers.