According to Information Technology experts, the 21st century is characterized by the migration from “…accepted systems and procedures (commercial, administrative, technical) to new ones (electronic commerce, digital cash, teleworking, electronic mail)” which requires a major paradigm shift for both end-users and entrepreneurs who do not want to be left behind in this new era of supercomputers and high-speed Internet (Pathak, 2005, p. 107). Since that time it has become a standard procedure to invest in Information Technology. One of the premier organizations in the United States that fully understood the significance of IT is Wal-Mart. As early as the 1970s Wal-Mart is one of the organizations that valued the importance of IT to enhance its business. The following is an overview of how this particular organization utilized sociotechnical systems principles to become a highly profitable company.
Sociotechnical Systems and the Organization
Before going any further it is important to note that the application of socio-technical system theory is premature if corporate leaders do not have a clear overview of the organization (Daft, 2008, p.284). Leaders must realize that organizations have the following components in varying degrees and combinations: a) an interdependence and interlocking activities; b) role specifications for members; c) division of labor; d) status hierarchy; e) controlling mechanisms; f) a dynamic system which is in a constant state of flux; and g) a system of processing various inputs to produce various outputs (Anaeto, 2010, p.71). It is only after having a bird’s eye view of the whole organization that leaders can begin to design a sociotechnical system mix.
It can be argued that in the case of Wal-Mart the application of sociotechnical systems principles was the inadvertent consequence of the desire to beat the competition. It has always been the goal of the company to offer everyday low prices (Thompson, Strickland, & Gamble, 2008, p. 384). The retail industry is one of the toughest industries to compete in and therefore it was a matter of survival that drove Wal-Mart corporate leaders to find a better way to stay on top. It became apparent to them that technology can be used to improve the efficiency of their workforce. Consider for instance that Wal-Mart began using computers in 1974 and then a few years later the company adopted the use of point-of-sale scanners and bar codes when it was still a relatively new technology (Thompson, Strickland, & Gamble, 2008, p. 384). The purpose is to lower operating costs.
The use of the scanners is an application of socio-technical system theory because it “enhances the quality of working life and the job satisfaction of employees” (Mate & Silva, 2005, p.140). Instead of reading the labels, the price tags, and then punching the values into a cash register, the employees at the check-out counters simply had to point the scanner into the bar code and the process is expedited in a significant way. This was merely the beginning because in 1986 Wal-Mart installed America’s largest private satellite communication network allowing two-way voice and data transmission between headquarters, the distribution centers, and the stores (Thompson, Strickland, & Gamble, 2008, p. 384). Once again this is an example of how the organization created a system that would make it easier for managers to communicate with the company headquarters. Wal-Mart has found a way to increase profit while at the same time demonstrating its commitment to its long-term staff and employees.
Going to the Next Level
Visit any Wal-Mart store and the company’s efficiency is made evident by the number of people going through the establishment daily. Products are being sold and Wal-Mart is making a hefty profit. The low prices and the fast service can easily attract great numbers of loyal customers. Thus, it can be argued that what started as a tool to boost the morale of employees has now created an increase in workload (Giorgini, 2005, p.161). Ironically, the socio-technical system that was established has made life more difficult for the employees. For Wal-Mart to go to the next level when it comes to creating an ideal sociotechnical system, it is imperative to integrate technology that would monitor the fatigue levels of the employees. The purpose of the system is not only to increase revenue but to increase the satisfaction of the employees working there.
It was made clear how Wal-Mart developed socio-technical systems to streamline its operations. The use of cutting-edge technology allowed employees to accomplish their tasks with minimal effort. But this was just in the beginning. The establishment of the sociotechnical systems gave the company so much success that it increased the number of customers shopping at a Wal-Mart store. Thus, it created an indirect result, more people are coming in and the stress levels in the workplace have increased dramatically. This is not the ideal application of a sociotechnical system and therefore requires modification. Wal-Mart must now re-design the system and at the same time, the company has to invest in new technology that would help monitor the stress levels of the employees.
Anaeto, S. (2010). Managing organizational culture for effective communication. The Social Sciences, 5(2), 70-75.
Daft, R. (2008). Organization Theory and Design. OH: South-Western Cengage Learning.
Giorgini, P. (2005). Agent-Oriented Information Systems. New York: Springer.
Mate, J. L. & A. Silva. (2005). Requirements Engineering for Sociotechnical Systems. PA: Information Science Publishing.
Pathak, J. (2005). Information Technology Auditing: An Evolving Agenda. New York: Springer.
Thompson, A. Jr., A. Strickland III, & J. Gamble (2008). Crafting and Executing Strategy: The Quest for Competitive Advantage, Concepts and Cases. New York: McGrawhill.