Supply Chain Disruptions at Walmart and the Boeing Company: When saying “I’m Sorry” is Not Enough

Supply Chain Disruptions at Walmart and the Boeing Company: When saying “I’m Sorry” is Not Enough

Dr. Denise Gates-Mayweathers

DOI: https://dx.doi.org/10.47772/IJRISS.2024.8090246

Received: 08 September 2024; Accepted: 17 September 2024; Published: 19 October 2024

ABSTRACT

This chapter explored the salient themes emerging as disruptions in the supply chain management at Walmart and the Boeing Company. It examined how both companies have responded to highly publicized disruptions in their supply chains, compromising customer satisfaction. Thousands of complaints against Walmart could be classified as: 1) Profiling (allegations of theft, race-based refusal of services, locking up goods); 2) Damaged goods; 3) Billing issues; 4) Delivery problems / Missing goods; 5) Communication barriers due to delayed, inconsistent, or incoherent messages; and 6) Employee complaints. Walmart’s typical response was an apology, a courtesy gift card, or to settle lawsuits. In the case of Boeing, investigations unveiled deception in business practices which resulted in inaccurate information being shared with regulating agencies as well as poor coordination of repair efforts, lack of documentation, ineffective communication, or neglect. Boeing’s problems led to catastrophic failures, for which Boeing has paid billions of dollars in damages and agreed to strict monitoring.

INTRODUCTION

When you step onto an airplane, how important is it to you to go from point A to point B without any glitches? Well, in January 2024, a door plug blew out on an airplane in Portland, Oregon. In 2019, hundreds of planes were grounded due to software issues causing crashes that killed 346 people. Boeing, a company that manufactures airplanes, has come under scrutiny for catastrophic supply chain problems. “Boeing made the first deliveries of the 737 Max, an update to the 737 jet, in 2017. Two years later, hundreds of Max planes were grounded worldwide after the crashes in 2018 and 2019 that killed 346 people.” (Rapier and Rains, Business Insider, 2024). Could these crashes have been prevented? Did disruptions in supply chain management factor into the equation?

Similarly, when you enter your favorite grocery store to buy food, how important is it to you to have quality items you want in stock and at an affordable price? (Gates, 2011/2024). How important is it that you are treated with dignity and respect while shopping? Walmart has endured a plethora of complaints about its poor treatment of customers, low quality products, etc. Does it matter how retailers treat you? Is poor customer service enough to make you abandon a store?

The issues described above point to a problem with supply chain management (SCM). Supply Chain Management (SCM), a term coined by Keith Oliver in 1982, has to do with the entire process of getting information, materials, products and services to the intended customers around the world (Mangan et al, 2021; Parnell, 2021). It “is the process of planning, implementing, and controlling the operations of the supply chain with the purpose [of satisfying] customer requirements as efficiently as possible” (Oliver and Webber, 1982). Supply Chain refers to the systems that reveal the flow of goods and services, info, and financials regarding a particular company based on resources and capabilities. Supply Chain Management has to do with the management of the entire supply chain process with a focus on keeping customers happy while remaining efficient and profitable (Yerpude et al, 2023).

Supply chain management fundamentally shapes how consumers experience companies. When supply chains are compromised, customers suffer, and sometimes those consequences are fatal. It is imperative to examine the existing supply chains of a major retailer as well as an airplane supplier as these companies have an international presence, and they could impact lives on a global scale. Walmart, a mega-retailer founded by Sam Walton in 1962, and Boeing, an airplane manufacturer which was founded in 1916 by William E Boeing, have made international headlines for supply chain flops that have garnered the attention of customers worldwide. Studying these supply chain issues may serve to enhance understanding of how customers experience these companies and offer guidance on how these corporations can improve outcomes and provide customers with better experiences.

Past research has examined how Walmart is profitable utilizing the low-cost strategy (Parnell, 2021) and pointed out complaints from Walmart associates regarding low pay and poor benefits plagued the company for years (Vogel, 2023). For example, Segal (2022) explored complaints of discrimination from Walmart employees. More specifically, the Equal Employment Opportunity Commission ruled that Walmart violated the civil rights of an African American female employee based on the intersection of her race and gender. The woman was denied promotions and subjected to negative differential treatment while working at Walmart. However, the gap in the research seems to be how customers, not necessarily employees, experience Walmart’s supply chain management as it related to customer service and other issues. In this paper, it will be important to examine Walmart’s history with customers as they interact with Walmart associates, so one can determine if interactions have changed over time.  Similarly, past research has pointed out the problems stemming from the Boeing company, but current research needs to address how Boeing responded to recent catastrophic failures in its supply chain management (Shepardson, 2024) in order to recover from the disruptions in their supply chain. Consequently, rooted in Porter’s Five Forces Model and Supply Chain Management (Parnell, 2021), this paper will examine supply chain disruptions at Walmart and the Boeing Company, paying particular attention to how these companies overcame these obstacles.

LITERATURE REVIEW

The following paragraphs will unpack the extant literature on supply chain management, Walmart’s supply chain issues (NBC, 2021; Meza, 2018), Boeing’s problems manufacturing planes (Shepardson, 2024), and Porter’s Five Forces Model (Parnell, 2021). The Five Forces Model by Porter will be utilized to make sense of the challenges faced by each company.

Porter’s Five Forces Model

According to Parnell (2021), Michael Porter’s Five Forces Model is a reputable framework that can be utilized to assess the projected profitability of a company. It can be employed to determine how to strategically position a company in a dynamic market and maintain a competitive advantage. A company’s success in a given industry often is contingent on what Porter refers to as the five forces: 1) barriers to entry, 2) threats of substitutes, 3) bargaining power of buyers, 4) bargaining power of suppliers, and 5) intensity of existing rivalries (Parnell, 2021). Porter’s Five Forces Model “offers organizations a systematic approach to assessing their competitive environment and making strategic decisions that can influence their long-term success” (Dandoo & Watt, 2024, para 3).

By managing relationships with suppliers, companies can control costs and maintain a competitive advantage. Too much reliance on a single supplier gives the supplier a lot of control. However, if products and services can be obtained from various suppliers, companies have more options and greater control (Dandoo & Watt, 2024). The authors went on to suggest that companies, such as Walmart and Amazon, devise solid strategies to outperform the competition.

In the retail world, competition is intense. Businesses of all sizes demand consumers’ attention, often resulting in price wars and thin profit margins. Dominant companies in this sector—including Walmart and Amazon—use various strategies to outshine their rivals. They often lower prices, optimize their supply chain and expand their product offerings, which makes it difficult for small businesses to compete with them (Dandoo & Watt, 2024, para 24).

Dandoo and Watt, 2024 maintained that:

Customers in the retail industry are discerning and price-sensitive, which leads to significant buyer power. Brands that excel in customer service and provide exceptional experiences, such as Nordstrom, can command premium prices and build brand loyalty (paragraph 26).

Ultimately, stellar customer service and exceptional experiences can inspire brand loyalty. Porter’s Five Forces Model can be utilized to assess the success or performance of companies such as the Boeing Company and Walmart. The Boeing Company supplies airlines with airplanes, and the pressures to produce quality products in a timely manner may have caused Boeing to compromise its supply chain.

Supply Chain Management

Supply chain management has to do with the planning and managing the process of getting the right products and service to the right customers, in the right way, at the right time (Oliver & Weber, 1982; Mangan, Lalwani, & Calataud, 2021). Parnell (2021) said a company’s success is contingent of the quality of its supply chain as suppliers control prices, quality of products, number of products produced, where products are sent, and timeliness of production (when products are produced). Suppliers can influence the company’s ability to differentiate products and services from the competition and improve the quality of products and service offered to customers. Consequently, supply chains can shape customer outcomes and control the quality of service provided to customers.

The quality of service and the quality of relationships cultivated with existing and prospective customers can significantly influence purchasing decisions (Prentice et al, 2023). Therefore, the ways companies treat customers can enhance or diminish their perceived quality of care. Additionally, the responsiveness of supply chains to environment, supply chain members, stakeholders, and consumers via engagement can shape the overall quality of an organization’s success, according to (Richey et al., 2022; Kamalahmadi et al., 2022; Kaur, 2022).

To be successful, companies must simultaneously coordinate several components of the supply chain and get them all right. Companies need the: 1) RIGHT product; 2) RIGHT quantity; 3) RIGHT conditions; 4) RIGHT place; 5) RIGHT time; 6) RIGHT customer; and the 7) RIGHT price (Chartered Institute of Logistics, 2019). To achieve this balance of getting all the elements in the process right, organizations must have systems in place to facilitate that success. For example, looking at the challenges to the supply chain management of Walmart and Boeing, several issues emerged that pointed to compromised service because something was not right.

Boeing Company

The Boeing Company is an aircraft manufacturer that makes planes for airlines such as Southwest, United, Alaska, and American (Rand, 2024). Because these major airlines use Boeing planes, it’s prudent for consumers to be aware of safety issues as they relate to supply chain management. Larios (2024) emphasized several problems with Boeing’s supply chain management, resulting in fatalities. Larios (2024) said labor shortage issues caused communication failures, which meant that information was not being conveyed in a timely manner or at all. Then they had software issues. Glitches in software are a major concern when the product is an airplane that has the potential to cause fatal damage. Some people contend that the recent problems with Boeing’s supply chain emerged when Boeing tried to save money by relying on sensors in lieu of redesigning the planes to accommodate larger engines. These new sensors took control away from pilots and resulted in catastrophe after catastrophe as the sensors provided faulty data (Larios, 2024; Shepardson, 2024). The outcome was that planes crashed, and hundreds of people died. Other individuals have argued that Boeing relied too heavily on the influence of team members with MBAs who wanted to cut costs and not enough on engineers focusing on safety. Boeing was said to have engine casting delays in addition to defective parts from one supplier and trouble meeting deadlines, according to Larios, (2024). The supply chain disruptions were obvious.

The compromised customer service and the massive supply chain challenges landed Boeing in court where they were held accountable for their actions. While they settled with the family members of passengers who died, they also had to explain why the crashes took place. Boeing admitted in court records that the company engaged in dishonest means to defraud a Federal Aviation Administration group that assessed their airplane, the 737 Max. The deceptive communication from Boeing caused the FAA to have “’incomplete and inaccurate information’ about the plane’s flight-control software and how much training pilots would need for it’” (Inc. Best in Business, 2024, paragraph 3).

Shepardson (2024) said Boeing made several fatal errors. According to court records:

Boeing failed to ensure employees documented removal of parts during manufacturing of an airplane and it did not ensure mechanics and inspectors who stamped they completed work had actually done so (Shepardson, 2024, paragraph 7).

The airline had a history of false stamping at some of their factories whereby they suggested that some tests had been completed when in fact they had not. A South Carolina factory was the culprit of said misconduct (Shepardson, 2024).

In a similar situation, two astronauts, Suni Williams and Butch Wilmor, are currently stuck in space due to malfunctions on a Boeing aircraft that surfaced before and after launch (Griffin, 2024). NASA stated that the astronauts have been stranded in space since June 6, 2024, which is a few months as of October, 2024, at the International Space Station after an anticipated 10-day stay to test the aircraft. The aircraft had so many malfunctions that the astronauts were not comfortable taking it home in its current condition. They must either repair the existing aircraft or have someone rescue them in another aircraft. NASA has decided the two stranded astronauts will stay in space until 2025 because it’s too risky to bring them home on the Boeing aircraft due to malfunctions (Dunn, 2024). Cooper (2024) revealed that a SpaceX Dragon spacecraft will bring the astronauts home in 2025. The astronauts have reported that they are working on research and other important tasks while in space, and they indicated that they planned to vote from space in the United States’ presidential election in November. They are confident that they can safely return home on the SpaceX aircraft, thanks to Elon Musk who founded SpaceX in 2002.

Walmart

Walmart is a mega-retailer that has been in the media for disruptions in their supply chain management and/or poor customer service. The media conveyed a slew of offenses that have made shopping and working at the retailer untenable for some people (KPIS / CBS News, 2020; CBS News, 2019). This paper will focus primarily on how consumers experienced Walmart, examining its history comparing it to present times.

A salient theme that emerged in publications about experiences with Walmart had to do with African American shoppers. For example, African American shoppers experienced disruptions in supply chains and less than stellar customer service when it came to locating products endorsed by African American entertainers. A video posted by NBC Los Angeles (2024) depicted an African American man being told by Walmart employees that they did not have in stock the Snoop Cereal, which was a new cereal brand endorsed by the entertainer Calvin Cordozar Broadus, Jr., known professionally as Snoop Dogg. It turned out the several cases of cereal were in the store, but Walmart employees were telling customers it was out of stock. Walmart associates also misrepresented the price of the cereal, telling customers the cost was higher than it actually was. Moreover, when one customer found the product in the store himself, he quickly learned that it had been there several months even though Walmart told shoppers it was out of stock, according to NBC Los Angeles (2024) and other sources such as the video posted on social media by MasterP (2024), whose actual name is Percy Robert Miller. Attorney Ben Crump alleged that Walmart discriminated against Snoop Dog and Master P because they are African American. This civil rights attorney is suing Walmart on behalf of Snoop Dog and MasterP for racial discrimination due to the mismanagement, misplacement, and misrepresentation of their cereal being sold by Walmart.

In a related case, Attorney Gloria Allred helped African American women settle a case accusing Walmart of placing African American beauty products in a locked case and out of reach from customers. Attorney Allred said Walmart’s store policy to lock up Black hair products, handed down from the corporate offices in Arkansas, perpetuated the stereotype that African Americans are thieves, according to Meza (2018). The female shoppers said they felt like they were being treated like criminals, yet they had no criminal records. The haircare products for African American/Black women were in a locked case while the products for other women were easily accessible (Meza, 2018). African American women were expected to wait for Walmart associates to open the locked cases and then escort customers to the checkout lanes as if African American customers could not be trusted to not steal.

The culture of racism at Walmart was perpetuated in other ways as well. Walmart is notorious for singling out people from traditionally marginalized groups and insinuating that they are violating shopping codes. Many people who are African American/Black reported being followed around the stores as they shopped (Choi, 2020; Price, 2022). Numerous complaints from African Americans allege racial profiling. One African American man said Walmart security followed him around the store like he was going to steal something (Choi, 2022). When the security officer shadowed him, without provocation, as she bounced a large ball, the customer asked security to identify herself after she stopped him. She replied that she did not have a name. She refused to identify herself as she followed the family man from aisle to aisle at Walmart (Choi, 2020; KPIS / CBS News, 2020).

In another instance, according to Price (2022), an African American Walmart shopper was harassed and discriminated against by Walmart security, and the offense resulted in a lawsuit.

Walmart has been ordered to pay $4.4 million to Michael Mangum, who filed a lawsuit against the supermarket chain last year after an employee racially profiled him. Mangum, who is Black, sued Walmart after he alleged that he was followed by a security worker in a Wood Village, Oregon store, per CBS News. In court documents, Mangum said he went to the Walmart location to purchase a light bulb for his refrigerator [when he noticed] security worker Joe Williams following him around the store. He then confronted the worker, who threatened to call the police if he did not leave. When he refused to leave the premises, Williams allegedly said he would tell authorities that Mangum threatened him with violence (Price, 2022).

Echoing the same sentiments of negative differential treatment, Walmart employees made derogatory comments to African American shoppers and blatantly called them racial slurs, as caught on camera, according to ABC 7 (2023). Goldberg (2022) reported in the Los Angeles Times that a Walmart employee accused an African American shopper of stealing as he was leaving the store with his receipt in hand. An employee stopped the shopper to search his bags. During this encounter, a slanderous comment was made: “You people [are] always trying to steal.” This comment was made prior to obtaining evidence to substantiate the allegation. This episode ended with the Walmart employee calling the African American shopper a “Nigger,” which was captured on video. The Walmart employee falsely accused the customer of theft and called him a racial slur during the confrontation (Goldberg, 2022).

In yet another case of marginalization, two African American women were falsely arrested and accused of shoplifting by Walmart associates only to be released by police when all the items in their bags matched items listed on their respective receipts, according to ABC 13 Houston (2020). The women described the event as “really embarrassing.” They said Walmart had handcuffs on them, and everybody was walking by looking at them. The women had not shoplifted. Adding insult to injury, Walmart broke some of the items the women had purchased in the process of confronting the women. Walmart later reported that the retailer replaced the broken items.

Handbury (2021) revealed that two African American men, a former police officer and a pastor, were falsely accused of stealing when they went to Walmart to return a television, they had purchased earlier that day. The television did not work properly, so they took it back only to be cursed at by a Walmart employee and placed under arrest. The two men are now suing Walmart (Handbury, 2021). Moreover, footage from several videos on YouTube revealed that Walmart stopped shoppers and falsely accused them of stealing or suggested that they had previously been trespassed from the store when in fact they had not. Walmart perpetually arrested the wrong people. In many instances, Walmart security failed to ascertain the identities of customers prior to arresting them such as in the case with an Asian man who was wrongfully arrested, according to Richey (2022).

Another video shows a Walmart security guard stopping an African American shopper as he was leaving the store. The off-duty officer did not have probable cause to stop the driver, so when the officer asked the driver for his identification, the driver asked what compelled law enforcement to stop him. The officer replied that the driver looked suspicious. The driver said, “Suspicious of what?” The officer was not able to provide an answer. In the video “Cop stops black man for looking suspicious” posted Nov. 18, 2019, on YouTube, an African American man captured a police officer on video yelling at him and saying he could do anything he wanted to because he was a police officer. The officer was in violation of the customer’s right because he did not have a lawful reason to pull the Walmart customer over. Therefore, Walmart said they fired this officer.

A hostile climate toward African American shoppers was evident in a 2010, CBS News story featuring a Walmart employee making the following statement over the intercom: “Attention Walmart Customers: All Black people leave the store now.” Customers said they were appalled and disgusted by the message. The culture of racism at Walmart also was perpetuated when a newsletter from Walmart on the first anniversary of George Floyd’s death, got sent to potentially millions of Walmart customers via email with the greeting: “Welcome to Wal-mart, Niggers!” (Spencer, 2021).

A Houston, Texas customer stated that he was harassed by a Caucasian woman while shopping. A store security camera captured the woman on video leaving a derogatory note on the shopper’s truck while he was inside the store shopping with two children. The note, which was posted on social media, said, “George Floyd Nigger,” according to Boudreaux (2020). The customer said the store manager cooperated with him as he called the police to report the incident.

African Americans are not the only target of marginalization. A Caucasian woman successfully sued Walmart for tarnishing her reputation by falsely accusing her of theft. The fraudulent charge compromised her ability to secure employment, and it diminished her standing in the community (Brady, 2021). The woman was accused of stealing items she had paid for prior to leaving the store when the scanning device in the self-check out lane froze. However, this did not stop Walmart security from arresting her and charging her with theft (Brady, 2021). She won over two million dollars in the lawsuit against the mega-retailer.

Many people have complained about Walmart (Choi, 2022; Handbury, 2021; Spencer, 2021). According to the Better Business Bureau, nearly 14,000 people have complained about Walmart in the last three years, and the average customer review was 1.08 out of 5. Hundreds of complaints against Walmart are pending and several lawsuits against the retailer have been filed. Moreover, the Better Business Bureau maintains that the Department of Justice is suing Walmart for alleged violations related to the distribution of controlled substances. Clearly, Walmart has room for improvement when it comes to their customer service and supply chain management. Future research needs to examine the extent to which Walmart and the Boeing Company have problems with supply chain management and customer service issues, and how prevalent are these concerns. More specifically, how have these companies overcome these obstacles to maintain their respective competitive advantages.

Consequently, the purpose of this paper is to examine the supply chain disruptions and consumer concerns of two large companies, Walmart and the Boeing Company. Both of these entities have been in the media frequently due to alleged violations of codes governing how people are treated or for failure to comply with safety codes.

RESEARCH QUESTIONS

• How has Boeing addressed salient supply chain disruptions and compromised consumer care?
• How has Walmart addressed salient supply chain disruptions and compromised customer service?

METHODS

The Boeing Company and Walmart have been at the center of several customer complaints that stemmed from disruptions in their supply chain management. Walmart has been the target of numerous complaints in the last several years. While many of those complaints may have been logged directly with the mega-retailer, some were reported to the Better Business Bureau, and others have been reported in the media. This paper encompassed a content analysis of the complaints filed against Walmart with the Better Business Bureau within the last three years. The complaints were reviewed and classified into various categories.

With respect to Boeing, this paper evaluated some of the extant publications on their supply chain issues and incorporated the company’s responses to their growing problems with supply chain management. Much of this research was published in the media. Boeing has tried to be transparent about the process, giving others an opportunity to learn from their mistakes.

FINDINGS

Boeing Company

The Boeing Company has been in the media for its catastrophic disruptions in their supply chains. According to Shepardson et al (2024), Boeing was deceptive in its business practices and knowingly withheld information from airlines, pilots, and inspectors. Vital information was withheld, and this crucial communication could have saved a life had it been shared with pilots or the Federal Aviation Administration (FAA).

Boeing was accused of misleading the FAA about aspects of the Max before the agency system, called MCAS, that could turn the plane’s nose without input from pilots if a sensor detected that the plane might go into an aerodynamic stall (Shepardon et al., 2024).

Boeing has been transparent about the problems leading up to the crashes and the company is being held accountable by the Justice Department. Consequently, “the manufacturer will plead guilty to conspiracy to defraud the United States and pay a fine of $243.6 million, according to court filing (Shepardon et al., 2024). Moreover, Boeing has agreed to spend at least $455 million within the next three years to enhance their safety and compliance initiatives. The company will be on probation and be subjected to independent monitoring to ensure that compliance standards are met.

Maruf and Isidore (2024) reported that Boeing accepted responsibility for their wrongdoing and vowed to do better in the future. Representatives for the airplane maker released the following statement: “We will continue to work transparently with our regulators as we take significant actions across Boeing to further strengthen our safety, quality and compliance programs” (Maruf & Isidore, 2024, paragraph 4).

Boeing is under strict monitoring processes to ensure coordinated efforts to comply with safety regulations. Isidore and Muntean (2024) assert that past supply chain problems emerged when multiple teams working on aircraft did a poor job of communicating and coordinating changes. For example, when the door on one aircraft was removed to work on another problem with the plane, the teams neglected to document this change so that the bolts could be reassembled by the new team working on the aircraft (Isidore & Muntean, 2024). Had the proper paperwork been filed, workers would have known to secure those bolts prior to the aircraft being used to carry passengers. Better coordination and communication will enhance efforts to ensure compliance with safety regulations.

Additionally, two astronauts are currently stuck in space due to malfunctions on a Boeing aircraft. However, SpaceX, a private spaceflight company founded by Elon Musk has joined the effort to help rescue the astronauts by 2025 (McFall-Johnsen, 2024). Astronauts Butch Wilmore and Suni Williams have been in space since June 5, 2024. They traveled to the International Space Station aboard the Boeing Starliner, aircraft manufactured by Boeing, for a trip that was supposed to span less than 10 days. Now it appears that the astronauts will not return to Earth until 2025 with the help of SpaceX due to a helium leak in their original Boeing aircraft. NASA is taking precautions to keep the astronauts safe while they repair the existing aircraft and make plans for an alternative route home. NASA has decided not to attempt a rescue of the astronauts until 2025 (Dunn, 2024).

Walmart

Research question two asked how Walmart addressed a salient supply chain challenge? One of the salient concerns regarding Walmart’s supply chain management has to do with the mismanagement or products commonly utilized by African Americans and poor customer service. Customers have difficulty obtaining desired goods because of disruptions in supply chains that have caused clients to not receive the desired products or services. Additionally, Walmart employees have reportedly engaged in conduct so egregious that customers are not permitted to access the goods and services they desire. Many customers have complained of racism, sexism, and other offenses. The disrespectful conduct is so pervasive that it has made the national news in the United States.

After evaluating the complaints against Walmart on the website hosted by the Better Business Bureau, the complaints could be classified, according to the Better Business Bureau, as: 1) Product issues, 2) Service repair issues, 3) Delivery issues, 4) Billing issues, 5) Customer service issues, 6) Order issues, and 7) Sales and advertising issues.

However, the author classified the complaints as follows: 1) Racial profiling (allegations of theft, race-based refusal of services); 2) Damaged goods; 3) Billing issues; 4) Delivery Problems / Missing goods; 5) Communication barriers due to delayed, inconsistent, or incoherent messages; 6) Employee complaints. The quotes taken from the following paragraphs were taken from the Better Business Bureau’s webpage. See the figures enclosed at the end of the document for more detailed complaints against Walmart as well as some of the responses Walmart provided. Again, those excerpts were taken from the Better Business Bureau.

RACIAL PROFILING AND/OR PRESUMPTION OF THEFT

Some customers reported being treated like thieves. They were followed around the store as they shopped, or they encountered barriers to shopping that diminished the quality of their experiences, such as when desired products were locked away like customers might steal them. It appears that some customers regarded their lived experiences negatively. They reported racial profiling, allegations of theft, race-based refusal of services, etc. For example, clients noticed that purchased goods could not be returned to stores even with a receipt when stores were located in neighborhoods populated predominantly by non-dominant racial groups such as African Americans or Latino Americans. Customers also reported being treated as if they were going to steal even when they had no intention of stealing.

Profiling customers

Beauty products were locked up and out of reach

 Treated like thieves at self-check out

Items can’t be returned in minorities communities even with a receipt

Walmart responds to allegations that items can’t be returned

While theft is a legitimate concern for retailers, customers at Walmart were offended when the retailer treated them like thieves. Walmart responded to this challenge by explaining their policies and offering customers strategies to overcome concerns such as by shopping at a different Walmart when one Walmart refused to honor a refund policy. The solution created an inconvenience to the customer, but it at least allowed them to ultimately get what they wanted.

DAMAGED GOODS

Another theme that emerged from the research was damaged goods. Customers complained of spoiled food, expired food, rodents in food, and broken or damaged goods. One customer suggested that the only thing fresh about Walmart meat was the sticker on the package. Below are some excerpts taken from the Better Business Bureau complaints.

Only thing fresh about the meat was the stickers

Spoiled Salmon

Rodent in flour

Crushed and broken cookies

Broken items were common. In addition to the food items noted above, clients also complained frequently about Walmart selling them damaged televisions. In the literature review of this paper, we discussed how two African American men were arrested trying to return a television that did not work. Similarly, another customer discovered that his television was substandard. Customers reported being told to photograph or video any damage, but Walmart frequently suspected clients had damaged goods after they left the store. One man who tried to return a damaged television was denied the return of the $600 item. He said he was watching television one evening when the screen separated from the back of the television. Suspicious that the customer damaged the television himself, Walmart denied the return. This customer’s only recourse would be to file a claim with his renter’s insurance policy or homeowner’s insurance.

Clients also complained frequently of Walmart damaging their vehicles when they took their cars to Walmart for routine service such as oil changes or tire installation. Walmart was notorious for forgetting to replace caps on oil, causing engine oil to seep out and cause damage. In some instances, Walmart accepted responsibility for damage when they could review footage from store security cameras, offering clear and convincing evidence that Walmart was at fault. However, collecting money for damages proved to be a long and tedious process. Customers often could not get Walmart executives on the phone, or months would go by without communication from Walmart. The neglect compelled some customers to contemplate legal action. Others filed complaints with their personal insurance carriers even though they believed
Walmart was responsible for damage. Customers maintained that the fastest way for people to contact Walmart would be to send registered mail to the CEO.

Ultimately, customers were disturbed by damaged goods and sometimes were suspected of damaging the goods themselves when they tried to return items to Walmart. Moreover, the process of getting compensated for damage Walmart caused to cars during repairs tended to be unusually long. The duration of time taken to pay for damage caused to property of customers compromised perceived quality of care.

BILLING ISSUES

Several customers had billing issues. The most salient billing problem was that Walmart charged customers for items they did not receive. The problem typically emerged when customers ordered products online that Walmart charged them for but never delivered. Moreover, some customers reported that Walmart charged them random in store fees that nobody at Walmart could explain. Customers generally noticed these random charges after reviewing their receipts after the transactions were complete. (Some customer who don’t reconcile their receipts may not even realize that Walmart charged them for items they never got.) Fortunately, Walmart typically agreed to remove these charges at the requests of customers. However, refunds took up to 10 business days to be credited back to bank cards. This means Walmart tied up funds from their customers and neglected to provide the desired goods. The entire ordeal was an inconvenience to customers.

Billing issues were closely tied to delivery issues as the failure to deliver products often resulted in billing issues for Walmart.

DELIVERY PROBLEMS / MISSING GOODS

Customers stated that goods ordered from Walmart never made it to their homes. One customer, featured in the quote below, said he ordered 34 items only to have 11 of them delivered. It took hours to get a refund, he said. Customers suspected that Walmart delivery services were either stealing items or leaving products are the wrong addresses. Another customer complained of Walmart leaving his groceries at a laundromat in lieu of leaving the food that the customer’s home. The customer who relied on delivery services due to illness said he had to haul large cases of water and groceries back to his apartment.

Delivery problems were exacerbated by communication barriers encountered when customers called the retailer to discuss the problems.

COMMUNICATION BARRIERS

Several customers complained about communication barriers due to delayed, inconsistent, or incoherent messages. Customers had to call Walmart numerous times for assistance when items were missing or when they were charged for items not received. They typically had to speak with multiples people before issues were addressed or resolved. Moreover, customers got inconsistent messages from Walmart associates, and sometimes they got no messages at all. Many consumers complained of the delays in getting communication from Walmart spanning months in some cases. Then others said they encountered language barriers as associates were difficult to understand due to language barriers or heavy accents. Some representatives were not fluent in English or their accents were so thick that Walmart customers could not comprehend what they were saying. This problem has a relatively easy fix. Customers can call and speak with someone else. However, the concern was that when customers requested other employees, they were subjected to retaliation as Walmart associates would cancel orders or make it difficult to submit subsequent orders.

Communication barriers due to delayed, inconsistent, or incoherent messages

Communication was a barrier for some customers. Among the individuals complaining about Walmart were Walmart employees and vendors.

EMPLOYEE COMPLAINTS

Walmart employees complained about a variety of topics. Some complaints were about being hurt on the job, not knowing where to go for training, not being able to reach their supervisors with work-related concerns, and damage to their vehicles in the parking lot while they were working. They expressed concern with the Better Business Bureau because they felt neglected at work. Walmart was slow to respond to workers, and in some cases, employees did not get a response at all.

To summarize, complaints against Walmart were classified as: 1) Profiling (allegations of theft, race-based refusal of services, locked up goods); 2) Damaged goods; 3) Billing issues; 4) Delivery Problems / Missing goods; 5) Communication barriers due to delayed, inconsistent, or incoherent messages; and 6) Employee complaints. Walmart typically responded to complaints with an apology, as well as a courtesy card of $5, $10, or $25. Sometimes Walmart explained their policies or directed customers to other stores for better service. In some instances, when employee conduct was so egregious that acts could not easily be overcome with a mere apology, Walmart terminated employees. For example, in cases where customers were called derogatory comments or racial slurs or fraudulently accused customers of stealing, Walmart has been known to offer apologies, terminate employees, and/or settle lawsuits.

Moreover, Walmart has created a video to help educate others about diversity and to explain how the retailer promotes diversity within the company. This video seems to be Walmart’s response to the ongoing climate issues creating disruptions in the process of obtaining goods from Walmart. However, some may perceive the video as a publicity stunt as Walmart brags in the video of being among the leading companies in the United States who employ African Americans. Walmart appeared to publicly praise themselves for hiring African Americans while privately mistreating many of their African American customers and employees. Future research could examine if resolutions vary across races and genders. The Better Business Bureau did not log the race and gender of complainants. However, some consumers revealed their races and/or genders in the comments left. Given that some customers alleged race-related negative differential treatment when it came to accepting returns from customers, perhaps future research could examine the differences in how disruptions were resolved.

DISCUSSION

The purpose of this chapter was to explore salient themes emerging as disruptions in the supply chain management of The Boeing Company and Walmart. The paper examined how both companies have responded to obstacles in their dynamic markets as well as internal quality control issues, compromising customer service. Complaints against Walmart could be classified as: 1) Profiling (allegations of theft, race-based refusal of services, locking up goods); 2) Damaged goods; 3) Billing issues; 4) Delivery problems / Missing goods; 5) Communication barriers due to delayed, inconsistent, or incoherent messages; and 6) Employee complaints. Walmart tended to apology, offer a courtesy gift card, settle lawsuits, etc. Walmart also created a video promoting diversity to combat the culture of racism.

However, the ongoing complaints against Walmart suggested that the mega-retailer was not doing enough to combat racism. Perhaps Walmart executives can examine their hiring practices and improve their selection processes, so as to avoid adverse selections. Skills-based interviews and training may assist them with this objective. Moreover, the video made public by Walmart promoting diversity seemed more like a public relations stunt than an actual training video. Perhaps Walmart could actually train their staff to treat customers with dignity and respect. This means teaching Walmart associates to stop using racial slurs in the presence of customers and to find other ways to control and manage their assets without racial profiling. For example, perhaps all haircare products can be locked behind a counter with an associate on duty to dispense products as needed.

If company cultures reflect the values of their founders and leaders, then Walmart’s leadership team may want to model greater respect for customers. Walmart’s low prices have given the mega-retailer a competitive advantage, but the poor customer service and racism have given them more lawsuits than they may care to admit. Treating customers like criminals when they have no criminal records creates a hostile shopping environment, the kind of climate that astute shoppers may simply avoid.

Additionally, Walmart may want to examine its existing return policies to ensure that consumers are not adversely and unfairly impacted. For example, some customers perceive that when stores are located in predominantly African American or Hispanic communities, Walmart associates are less likely to accept returns even when customers have receipts. Asking a customer to travel to another location for a return or basic transaction is unreasonable. Compromised customer service is enough to compel some consumers to substitute Walmart products and services with other retailers such as Amazon, Target, Costco, etc. Walmart’s low-cost strategy is not enough. If Walmart wants to gain a larger share of the market or to avoid subsequent legal action, perhaps the retailer can pair their low-cost strategy with better customer service.

In the case of Boeing, investigations unveiled deception in business practices which resulted in inaccurate information being shared with regulating agencies as well as poor coordination of repair efforts, lack of documentation, ineffective communication, or blatant neglect. Boeing’s problems led to catastrophic failures, for which Boeing has paid billions of dollars in damages. Boeing also remains under strict monitoring to help ensure compliance with safety standards.

Boeing can improve by not compromising safety in order to save money. Some have argued that this outcome resulted because the company had more business associates than engineers making decisions about how to design planes. The FAA and the courts have intervened to help keep Boeing accountable. These accountability measures have encompassed, but are not limited to, strict monitoring of supply chains as well as inspections of planes before they take off. These measures will help ensure that Boeing puts passengers first.

An interesting point about Boeing is that passengers may not be regarded as their primary customers. Boeing may see the airlines who purchase their planes as their primary customers, and the passengers of the airlines as secondary customers. As a result, Boeing focuses on the deadlines and pressures placed on them by the airlines, and perhaps the company needed to be reminded that passengers were ultimately their customers. If the aircraft is of poor quality, the passengers are the ones who suffer. Future research could determine if Boeing is making the necessary improvements and to explore if passengers are more reticent about discussing future plans to travel via Boeing aircraft given its existing reputation. However, Boeing does appear to be committed to making the necessary changes, and the fines the company incurred for their failures are probably a constant reminder.

This study is limited in that it does not include all the complaints against Walmart and Boeing. While plane crashes tend to make the national news, many complaints against mega-retailers like Walmart are not publicized, and therefore said concerns are not available for scrutiny. Future research could collect complaints directly from Walmart in lieu of relying primarily on the Better Business Bureau as many customers may not take the time to file formal grievances. Some customers just simply stop shopping at a retailer where respect is no longer being served.

IMPLICATIONS AND CONCLUSION

This paper has identified supply chain disruptions at Walmart and the Boeing Company. Both companies have taken measures to address the concerns such as product defects, hostility toward customers, poor customer service, safety issues, billing issues, interpersonal challenges, etc., by apologizing, implementing plans for improvement, offering courtesy gift cards, settling lawsuits, enhancing communication, establishing accountability programs, etc.

Perhaps future research could examine how Walmart associates are socialized to treat consumers as well as other associates (Gates, 2009, 2011; 2023a; 2023b; 2024). The organizational socialization model devised by Gates (2009, 2023, 2024) suggested that workplace interpersonal interactions sometimes encompassed marginalization as people strive to make sense of their organizations and their respective roles by interacting with others.

Learning the norms and expectations of an organization is vital because organizational socialization may shape the standard of excellence employed when connecting with the end user, the customers. When organizational members are not properly trained to co-exist respectfully with other employees and customers, they are likely to engage in activities that don’t reflect well on companies. Moreover, when it comes to Boeing, the role of organizational socialization could be teaching employees and leaders that passenger safety is paramount. Offering strategies on what that looks like must remain a priority at all levels of the organization. Boeing has agreed to strict monitoring, better communication, and greater accountability. The other component of that growth could be organizational socialization. What messages are Boeing leaders sending employees about the quality of excellence warranted when creating aircraft that could potentially cost a life when a mistake is made. Employees might be afraid to admit mistakes to their bosses or to seek guidance when needed for fear of loss of employment (Gates, 2019). Perhaps a culture of profoundly enhanced questioning and communication could be embraced. Maybe planes can be inspected and double inspected in case something was missed. Boeing already adheres to a standard on the ground whereby passenger planes are inspected before they take off. Those inspections may need to start and be repeated prior to the planes being delivered to airlines and then repeated after they arrive. Perhaps pilots also can be trained to help inspect aspects of the planes so that several people are checking and re-checking so as to help ensure passenger safety.

As for Walmart, many disruptions in supply chain management seem to be rooted in a culture of racism wrapped in low prices. Walmart may need to be reminded that low price does not have to mean low quality of customer service. Perhaps low-paying jobs with poorly trained employees often lead to poor customer service. If the cost of more training and better customer service means higher prices (Parnell, 2021), this might be a worthwhile investment as Walmart has lost millions of dollars in lawsuits, stemming from allegations of civil rights violation, fraudulent prosecution, loss of reputation, legal fees, etc. Walmart definitely has disruptions in their supply chain. The company’s desire to adequately address them remains to be seen. Some of the complaints of marginalization shared by Walmart customers years ago are still prevalent concerns for the company today. To summarize, Walmart is cursing their customers out, and Boeing is killing theirs. Clearly, saying “I’m sorry” is not enough. Better hiring practices, more extensive training, and more focused organizational socialization efforts may help augment the work Walmart and Boeing already are doing to combat the problem. Ultimately, Walmart and Boeing are two highly successful companies; however, should that success come at the expense of loyal customers.

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FIGURES

The following excerpts were taken from the complaints left on the Better Business Bureau’s webpage.

Walmart locks up items.

Neglect

Inconsistent Communication and Failed Delivery

Profiling / Followed around the store

Spoiled Food / Bad Food / Rodent in Food / Damaged Food

Only thing fresh about the meat was the stickers

Spoiled Salmon

Rodent in flour

Crushed cookies

CHARGED FOR ITEMS NOT PURCHASED

DELIVERED ITEMS TO WRONG ADDRESS / CHARGED FOR ITEMS NOT RECEIVED / UNPROFESSIONAL

Poor Customer Service / Poor exchanges and delayed customer service

Poor Customer Service and Language Barriers

Property Damage / Car ran into home / Treated like thieves and car damage

Walmart employees complained about the mega-store

ABOUT THE AUTHOR

Dr. Denise Gates-Mayweathers is a business professor, prolific author, and consultant, specializing in organizational socialization and strategic management. Dr. Gates has an earned doctoral degree as well as a post-doctorate in organizational communication and management. A graduate of the University of Missouri-Columbia, Dr. Gates is known for her organizational socialization model, which was published by the Publishing House of South China University of Technology and utilized by MBA students. A 2023 publication about her organizational socialization model offered the salient themes that emerged from the examination of the lived experiences of nearly 150 professionals from various industries. That empirical research supported Dr. Gates’ existing framework on organizational socialization, and it illuminated a variety of workplace betrayals designed to impede career success. Dr. Gates has authored and co-authored a plethora of academic publications over the years, and her research has been presented at national and international conferences. Ultimately, Dr. Gates is inspired to help organizations draw the greatest value out of people with her research, instruction, and consulting.