While most companies are thinning their ranks in management, Walmart store managers can now earn up to $620,000 per year in annual compensation. An unnamed Walmart spokesperson tells the Wall Street Journal that the base pay for managers has increased from $130,000 to $160,000 per year – with a salary cap at just north of $250K. But there’s more where that came from: the extra comp and bonuses comes in the form of stock grants and incentives. U.S. president and CEO John Furner announced some powerful incentives for these managers, who are managing hundreds of employees and millions of dollars in retail revenue.
“Beginning this year, a Walmart manager will be given an annual grant of Walmart stock, based on their store format,” he shared in a video. The minimum bump is $10,000 per year, every year, for a Hometown store manager – these are smaller stores that may not have a pharmacy or grocery items. “For a Supercenter, it will be $20,000 each and starting this April,” he said. “It’s a far more complex job than when I was managing a store,” Furner remarked, a reference to the fact that he started with the company as an hourly associate in 1993. “We ask our managers to own their roles and act like owners,” he says with a smile, “and now, they will literally be owners.” There’s a bonus opportunity to earn up to 200% of salary, in addition to the shares of stock.
Aligning Roles and Defining Values, at Walmart
The boost for managers is a shift in priorities, as Walmart invests in what it values most. Across the company, the company is adjusting its priorities. Walmart’s return to office policy made headlines when the Chief Technology Officer at Sam’s Club resigned as a result. The policy mandated that headquarters employees, especially executives, need to relocate to the company’s mother ship, based in Bentonville, Arkansas. Cheryl Ainoa, the CTO in question, said she would rather quit than move to Arkansas, according to Bloomberg. The company announced plans to cut hundreds of jobs in October, which might sound like a lot. But for the largest private employer in the U.S., with over 2 million workers globally, the moves were a minor restructuring.
The company just opened its new Home Office this week, a sprawling 350-acre campus with on-site childcare, global food service, a hotel and miles of bike paths. The new office is a few miles away from where legend Sam Walton launched the company that would turn into Walmart.
While some companies are cutting back on managers, management at Walmart is receiving a significant salary boost. Why? Is Walmart over-paying? The compensation shift is an alignment of values. Clearly, Furner values ownership. He recognizes the responsibility of the manager role, because he’s done the job. He wants managers to participate in an ownership philosophy as well as its rewards.
The message for leaders is: you aren’t over-paying when you are investing in your values. What’s the price of engagement? Customer service? Repeat business? The question of salary is often a focus on what it is that you can’t afford to lose. While numerous companies are slicing and dicing their management ranks, Walmart is investing in them. The initiative towards ownership is what will define the future of work, at least for Walmart managers. Return to office mandates are part of the package – which, for store managers, seems quite lucrative. Working in the office isn’t going to be a fit for everybody. For leaders, there’s a compelling message here: how are you investing in your company’s values? Beyond the mission statement, it’s useful to put your money where your mouth is – especially if you value your people. How are you working to incentivize the behavior you want, and to reward the people that matter? That investment in people – especially managers – is an important value at Walmart, it seems.
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