...the early 1990s to rejuvenate sales and growth. However, on July 30th, 2006, Wal-Mart had announced that it was selling its operations to German retailer Metro. In May of same year, Wal-Mart had also announced that it was selling its 16 stores in South Korea, admitting another internationalization failure. What went wrong with Germany? Wal-Mart had underestimated its German competitors, the power of German shoppers, cultural differences and the power of labor unions in Europe. The company did not expect that these differences would impede its ability to apply in Germany what worked so well in the United States. German competitors offered very low prices, while German shoppers had shown how demanding they can be and that they buy products predominantly based on price; even if that meant going to a few different retail stores during their shopping trip. German shoppers were also not accustomed to workers putting their groceries in shopping bag. Moreover, German regulations limited Wal-Mart’s ability to offer extended weekend hours and sell merchandise below cost. Strong labor unions limited the ability to contain operation costs. During its time in Germany, Wal-Mart had four presidents in eight years, which marked an organization disaster. But it is also not the only company that found German retail market challenging. Uniliever and Nestle also had to retrench from the German market. However, Wal-Mart today operates in 11 countries, comparing to Carrefour of France which...
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...22 pages Table of Contents Introduction 2 Case presentation 2 The Wal-Mart concept 3 Institutional challenges [to be deleted] 4 Cultural challenges [to be deleted] 4 German market 5 Theoretical Background 5 The cultural perspective 6 The institutional perspective 9 Case Analysis 12 The cultural perspective 12 The institutional perspective 15 Recommendations 19 Cultural 19 Institutional 20 Limitations 22 Cultural 22 Institutional 22 Conclusion 23 References: 25 Introduction The purpose of this paper is to address and analyze the challenges Wal-Mart faced during its entrance into the German market in the late 1990s. We have analyzed this with the following problem in mind: “Which aspects, both cultural and institutional, led to Wal-Mart’s failure in Germany and what should they have done instead?” We will approach this problem by outlining theoretical frameworks for analyzing cultural and institutional aspects of a company. We will then employ said theories in order to analyze the case of Wal-Mart’s failure in Germany. Finally, we will come to a conclusion concerning what they should have done as they entered into the German market. Different forms of distance CAGE, Taste and deep-seated preferences, strong national identities, management lacks diversity, mismatch, handling cultural and institutional distances is the essence of international management. Did Walmart start in culturally proximate markets? Customer bahaviour...
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...to have a proper flow of work within the organization. On the other hand maintaining an employee involvement strategy is also an important task of every organization. The given study will help to generate an idea about the mentioned countries which are China, India and Germany address the related issues regarding leading and managing people. By conducting these studies an overall idea about the communication strategy of the organization will also be identified. Table of Contents Executive Summary 1 Introduction 3 Employee’s Involvement Strategy within the Organization 3 Concept of Leading and Managing People 4 Theoretical exploration of potential opportunities/challenges in China, India and Germany 5 Communication Taking Place in the Organization 7 Relevant scenarios in terms of opportunities and challenges of HR 8 Recommendations 10 Conclusion 12 References 13 Introduction One of the main notions of the given study is to provide a brief overview about the topic related to leading and managing people. The situation of this study is designed in such a way where it has been told that after getting a promotion to be the head of the HR department with its other branches in China, India and Germany it is asked to do a research study in which it is important to illustrate the employee involvement strategy. The given study will also include proper application of motivation, participation along with that work performance of the employees. One of the most important...
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...Different dimensions of culture Cultural differences between countries can be difficult to work through for businesses. The actions and believes of others in different cultures can be shocking and sometimes viewed as unethical by other cultures. Imagine the problems these differences can create when in negotiations with a different culture. Working through those differences has become a necessity for business today in the fast growing global market. To successfully do business in the international market it has become critical to understand other cultures that you may be doing business with. To fully understand different cultures we need to explore the dimensions of different cultures. To effectively begin to understand different cultures you will need to identify whether the culture is a high-context culture or a low context-culture. In high-context culture, people rely heavily on nonverbal and subtle situational messages when communicating with others (Kreitner, 2009 pg 97). This type of culture is highly important when doing business in Japan and Hong Kong. People from low-context cultures convey messages and meaning primarily with words (Kreitner, 2009 pg 97). This type of culture is highly important when doing business in Germany and Great Britain. To gain even further in-depth understanding of other cultures we will look at nine different dimensions. The first dimension to focus on is the power distance. This dimension analysis the extent to which the less powerful...
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...Culture Project | U.S. | Germany | Greeting | In the U.S., when you greet another person, you can typically offer a handshake. This is a very common form of greeting. There are some instances where you may be meeting a friend of a friend or a family member of your friend where they will ask for a hug, but is not seen very often. Hugs are typically reserved for family or feminine friends while kisses are reserved for couples. Eye contact is also a sign of respect. Avoiding eye contact usually shows weakness, timidness, or even a lack of self-esteem.www.nativeforeignermag.com/2012/06/4-ways-to-greet-an-american/ | The German culture actually has very few differences when it comes to greetings. You can’t really go wrong with a firm handshake and good eye contact. The biggest difference between the two cultures comes between hugs and kisses. Most German men consider hugs too feminine whereas some males in the U.S. could turn a handshake or “fist bump” into a brief hug with a pat on the back. Kisses are very unusual in Germany. Kisses are almost always reserved for people VERY fond of you.German.about.com/od/vocabularytips/a/Learn-German-Greetings.htm | Homes | In the U.S. many people are pretty open and this is even seen in your home. Many homes are designed in an open way and often without many doors. Typically the only time you find doors closed in an American home is when they want privacy in the bathroom or bedroom. In some U.S. households, your street shoes are taken off...
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...establishing a Greenfield production facility overseas. Acme is expanding its international program. The two selected foreign countries for which the steering committee has proposed to start operations in are Germany and Japan. A comparative analysis between the two counties will include the currency of each country, trade policies, and cultural variables that can affect the operations and profitability of the production facility. This paper is meant to discuss which of the two countries are recommended to begin the production facility in. Germany Germany, a federal republic, has the largest population of all the European Union, or EU. Germany has the world’s third largest economy, and it produces automobiles, engineering products, electronic equipment, communications equipment, chemicals, and pharmaceuticals. The most widely spoken language in the EU is German (Germany, Europa, 2013). Currency / Trade Because Germany is a part of the EU, its currency is the euro. Germany has relatively few non-tariff barriers and has an intact three-tiered system of public, private, and cooperative banks. Germany has a heavily regulated labor relations and the launching a company with complete licensing requirements requires no minimum capital (Germany, 2013 Index, 2013). Culture Germany is a planning culture who is all about forward thinking. There is a lot about the greeting, meeting, and eating with the...
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...INDIVIDUAL ASSIGNMENT Topic: Build a strategic HR management program for a German company in which most employees are Christian. Nowadays, business becomes internationally over the world. People can come a foreign country and setting up their business activities oversea. There are a lot of important matters that need to be considered before opening business in the foreign country. Human resource management (HRM) is one of such important matters that essentially contribute to the furture business success. Building a strategic HRM program will be very neccesary from the start for business establishment. The HRM shall be discussed in the following paragraphs, especially for a German company. Summary instroduction about Germany Germany covers an area of about 357,000 square km in the central part of Northern Europe. The German population is estimated at 80.5 millions. Christianity is the dominant religion, with 65 to 70 percent of the population. The official language is German. Germany was a founding member of the European Community in 1958. It is part of the Schengen Area, and has been a member of the eurozone since 1999. It is a member of the United Nations, NATO, the G8, and the G20. Germany is a highly developed country in the EU. Germany in Hofstede cultural dimensions According to Hofstede model, Germany has cultural dimensions such as: low power distance, high individualism, high masculinity, high uncertainty avoidance and high longterm orientation. (See...
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...HUMAN AND CULTURAL VARIABLES IN GLOBAL ORGANIZATION. This episode is one of the many other similar ones which underscore the HR Challenges in preparing people for Cross Cultural working. Organizational culture is one of the latest concepts in the fields of management and Organizational Theory. Culture which is popularly called as "Shared values and Beliefs" fulfills important functions. 1. It conveys the sense of identity for organizational members. 2. It enhances social system ability. 3. It facilitates the generation of commitment to some thing larger than self. 4. It serves as a sense of making device that can guide and shape behavior. As business become more globalize, developing and training people across cultural boundaries is becoming increasingly important. Culture of the country is an important determinant of behavior of people, and not being sensitive to these differences can often result in misunderstanding and embarrassments and even in loss of efficiencies. For instance cultures differ widely in terms of concepts of time. Besides the obvious implications for punctuality, the difference also lies in how people from different cultures use their time. An understanding and sensitivity to such cultural differences in behavior and orientations is necessary perquisites to develop cross cultural competencies. The roots of cultural differences in the business practices lie much deeper. Business cultures in different countries are molded not just by the behavior of...
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...successful in business internationally is to understand the role of culture in international business. Whatever sector you are operating in, cultural differences will have a direct impact on your profitability. Improving your level of knowledge of international cultural difference in business can aid in building international competencies as well as enabling you to gain a competitive advantage. However, on the one hand where it is important to be aware of cultural differences of different countries, on the other, it is also hard to be aware of every single aspect of each country’s organisational culture. Therefore, you should be aware of the key factors that have a direct impact on business. These are: Communication is the key to success for any business, whether you are operating nationally or internationally, but when operating internationally it becomes even more important due to language barriers. Passport to Trade 2.0 project aims to remove this barrier by providing training materials in the languages of the country you are operating. Being aware of basic customer needs is an important aspect as this will give the advantage of conveying your message. In simple terms, if you are aware of the customer’s cultural background, then you will be able to adopt better and more suitable advertising methods. Body language is another key factor in cultural difference. As different countries have different ways to convey or share their message, for instance in Germany people tend...
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...| Introduction: Definition Cultural Diversity From our increasingly diverse domestic workforce to the globalization of business, cultural competence is arguably the most important skill for effective work performance in the 21st century. According to de Woot (2000), companies in the industrial, financial and service sectors have to cleared most obstacles in the globalization process: that of size, that of time, that of complexity, and finally that of information and communication. Because of the differences in cultures, there might be some kind of misunderstanding among people working in the same organization due to their different values, beliefs, backgrounds, etc. To avoid cultural misunderstanding and turn cultural diversity to advantage, in this workshop we will provides a general definition for “culture” as well as for “diversity”, discusses the benefits of diversity in the workplace, the challenges of managing a diverse workplace, and presents effective strategies for managing diverse workforces. Definition of culture According to Kroeber und Kluckhohn (1952, p. 357) “Culture consists of patterns, explicit and implicit, of and for behaviour acquired and transmitted by symbols, constituting the distinctive achievement of human groups,.., the essential core of culture consists of tradition, ideas and their attached values, culture systems may considered as products of actions and also as conditioning elements of future action” Furthermore, managers often see...
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...Germany Risk Analysis MGT/448 Smita Poddar December 15, 2014 Germany Risk Analysis Germany is the selected target country for DIRECTV’s latest expansion. The German economy, political structure, regulatory, financial, cultural, and competitive landscape requires an objective analysis to determine the appropriate strategy and plan for market introduction. Other parts of the assessment include taxation, marketing mix, distribution options, supply chain, and environmental factors. Political, Legal, and Regulatory Exchange Germany as part of the European Union (EU) is a relatively low risk target for political considerations with Forbes citing the region has the most positive regional outlook with 47% of member countries exhibiting a decline in risk ratings (Rapoza, 2013). A.M. Best (2014) rated Germany as one of the best in nine areas with the only exception attached to labor flexibility. See Figure 1 below. Figure 1 from A.M.Best (2014) Repatriation of Funds Foreign direct investment is setting up a business or the purchasing of assets in a foreign location or across national borders. DIRECTV has decided to initiate business in Germany to allow customers access to entertainment choice and convenience at home. The risk of exchange and repatriation of funds are the penalties involved. Germany has been a country that is highly developed as well as having a high-cost economy. Companies face the risk of 35% taxation in the U.S. for bringing profits back home...
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...company globally over the next few years. In order to properly and successfully expand the business, the managers of PPQ must be trained in multiculturalism and diversity management; which have large playing factors in whether or not the company will be successful abroad. The executives of PPQ Auto Parts must fully understand and be aware of any political and economic distress that could potentially affect the company’s expansion as well. When considering expanding a business abroad, especially for PPQ, individuals should look into the possible issues the host foreign country could face as a result of the expansion. There are many issues that must be addressed such as: the strategy to enter and expand, the trends within the foreign land, the different marketing approaches to reach the niche consumers, political and social climate, taxes, legal system, location, differences in culture, host country’s available workforce. As many individual know, all countries are different, slight or considerable, there are many issues that a company can face, especially within the cultural barriers and diversity issues. Cultural barriers and diversity issues are commonly encountered by international, multinational and global organizations. Culture is immensely important and should be treated as such by the PPQ representatives. Culture is the beliefs and certain behaviors of a specific group. Cultural barriers that are mishandled can easily deteriorate any successful company. “Managing the...
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...COLLEGR DUBLIN Cross Cultural Management FT-UCD BBSMKT-22 Chen Lihuan 2950 words CT0203124 UCD ID: 14207863 Case 1. Question 1A) Figure 1.0 Hofstede’s Five Cultural Deminsions for Germany, UK, USA and Japan. (Data from Geert-hofstede.com,n.d) Figure 1.0 is a bar chart that presents the full data of all four cultures. (Germany, UK, USA, and Japan) Other than two dimensions (Individualism and uncertainty avoidance) that have been discussed in the case, the rest of the three dimensions will be discussed in following article. Masculinity Masculinity shows whether the society is driven by competition or quality of life (Geert-hofstede.com, n.d). According to figure 1.0, all four cultures are masculine culture. USA scored at the lowest of 62, followed by Germany and UK at the score of 66. The highest score in Masculinity is Japan, at 95. Although Japan has an extremely high score at Masculinity dimension, due to its collectivism, there are not much intense competitions between individuals. Power Distance Power distance is referring to how people within the society react to unequal power distribution. The higher the score is, the higher acceptability for unequal power distribution by the society will be. This time, UK and Germany again scored at the same...
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...Case Study: Wal-Mart’s failure in Germany Wal-Mart Stores, Inc. is the largest retailer in the world, the world’s second-largest company and the nation’s largest nongovernmental employer. Wal-Mart Stores, Inc. operates retail stores in various retailing formats in all 50 states in the United States. The Company’s mass merchandising operations serve its customers primarily through the operation of three segments. The Wal-Mart Stores segment includes its discount stores, Supercenters, and Neighborhood Markets in the United States. The Sam’s club segment includes the warehouse membership clubs in the United States. The Company’s subsidiary, McLane Company, Inc. provides products and distribution services to retail industry and institutional foodservice customers. Wal-Mart serves customers and members more than 200 million times per week at more than 8,416 retail units under 53 different banners in 15 countries. With fiscal year 2010 sales of $405 billion, Wal-Mart employs more than 2.1 million associates worldwide. Nearly 75% of its stores are in the United States (“Wal-Mart International Operations”, 2004), but Wal-Mart is expanding internationally. The Group is engaged in the operations of retail stores located in all 50 states of the United States, Argentina, Brazil, Canada, Japan, Puerto Rico and the United Kingdom, Central America, Chile, Mexico,India and China Wal-Mart’s entry and operation in Germany Wal-Mart’s initial entry into German market was through the acquisitions...
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...users and this occurs mostly in the electronic sector. Online shopping is more convenient and time saving which appeals to young people. Although old people tend to shop in regular shops, more and more young people prefer shopping online rather than in shops. • Counterfeit goods: In regions like Asia but also throughout the world, a large number of original goods are copied by look-alike products. This is positive for the costumers, because usually the look-alike products are much cheaper, but on the other hand it influences the original produts’ producers a lot, because a lot of people are price seekers which means they tend to buy goods which are cheap. STEEP Analysis We chose to do the STEEP Analysis, because it touches all the aspects which will give us a good overview about the external factors which impact Elecdyne. 1. Social Because of hectic lifestyles more and more people tend to use electronical devices in order to keep in touch with everybody. This means there is a great demand for electronic goods. Also increasing urbanization leads to the demand of communication between each other. 2....
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