International Business across borders

The report discusses the different concepts of international business done by Wal-Mart. It includes analysis of foreign entry strategy, competitive dynamics, organisational structure, knowledge management, and innovation. The findings show that the company applies all these themes in the international market.

International Business across borders
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Executive summary
In a dynamic environment, the company needs to take the required steps in the market. The
report is prepared to discuss the different concepts of the international business that is done by
Wal-Mart of the company. The analysis of the key themes that include foreign entry strategy,
competitive dynamics, organisational structure, knowledge management, and innovation has
been done in the report. The findings show that the company apply all these themes in the
international market. It has been found that the company apply acquisition and partnership
strategy to the most for the successful entry. The competitive dynamics are highly intense which
affects the working of the company. It has been found that the hierarchy functional organisation
structure is followed by the company. Innovation and knowledge management is effectively
applied by a company that contributes to the growth of the business.

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Contents
Introduction......................................................................................................................................3
Overview of the company............................................................................................................3
Foreign entry strategy......................................................................................................................4
Acquisition strategy.....................................................................................................................4
Partnership strategy.....................................................................................................................5
Competitive Dynamics....................................................................................................................6
Organisational structure...................................................................................................................7
Knowledge Management.................................................................................................................9
Innovation......................................................................................................................................11
Conclusion.....................................................................................................................................15
References......................................................................................................................................16
Appendix........................................................................................................................................19

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Introduction
The multinational entity or corporation provides properties in at least one of the nation other than
its home nation. The businesses have different offices working in different nations as well as
they generally have a centralized head office from where they can coordinate in global market.
The company that has been selected for this report is Walmart who is an American multinational
retail corporation that is performing the business as a chain of discount department stores,
hypermarkets, grocery stores and many others. The report includes research and evaluates the
multi-national entity addressing the different themes. The major themes that are explained in
terms of the company are foreign market entry strategy, competitive dynamics, and the market
condition that is adopted by MNE that has been selected. Further, the MNEs organisational
structure and the knowledge management and innovation themes that are majorly adopted by the
company for performing the operations in the international market.
Overview of the company
Wal-Mart Company begin with the small discount store and adopted the single selling more for
less that has grown over the last 50 years into the major retailer across world. The company finds
that every week they have approx. 265 million clients as well as the members who visit more
than 11,200 stores that are available under the 55 banners in approx. 27 countries as well as e-
commerce websites in the 10 countries. In the fiscal year 2018, the company was able to attain
approx. $500.3 billion. Along with this, the company employ more than 2.2 million that is linked
across the world (Wal-Mart, 2019). The company has marinated their leading position in the
market by performing activities like sustainability, corporate philanthropy as well as the
opportunity of employees. Wal-Mart company becomes a highly committed company that form

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the opportunities as well as the new values to the customers and different communities present
across the world.
Foreign entry strategy
The market entry strategy is considered as one of the planning distributions as well as the
delivery method of the products and services to the new target market (González-Benito, Martos-
Partal and Garrido-Morgado, 2018). The foreign market entry strategy is adopted by every
company with the motive to expand their business operations. The companies present in the
market can adopt the wide range of strategy which contains direct exporting, licensing,
Franchising, partnership, joint venture and many other (Chetty, Ojala and Leppäaho, 2015). Wal-
Mart Company also adopts the different entry strategy in the market. Some of them are discussed
below -
Acquisition strategy
It is the comprehensive plan that determines and explains the approach of acquisition that the
program management will apply to deal with the different risk to meet the program objectives. In
simple words, this can be said acquisition is when one company make the purchases of the most
or all of another company with the motive to get the control on the company (Hunt, Watts and
Bryant, 2018). Wal-Mart Company becomes the second retail destination in Europe and the
United Kingdom when they brought business. In research, this has been witnessed that the
company entered in UK market in June 1999 by acquiring ASDA Group PLC, which is Britain's
third-largest food retailer. In the year of 1998, the company entered into the market of European
by acquiring Germany with 21-wertkauf hypermarket, one-step shopping centres that provide a
broad variety of the high-quality food as well as the general merchandise (In-Depth Integrative

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Case 2.2, 2019). This acquisition of Wal-Mart with the executive is considered as Wertkauf as an
“excellent fit.”
This foreign entry mode contributed effectively in increasing the position of the company. Also,
the company made a deal with Portugal-based Sonae by making the purchase of more than 140
stores in Brazillian for approx. $757 million in the year 2006. Then, 2009 was the year in which
the company acquired a major stake of D&S 224-store chain for $1.6 billion (In-Depth
Integrative Case 2.2, 2019). In the data, this has been found that the company has acquired
approx. 22 companies and one of the recent acquisitions of the company done by Wal-Mart is
Polymorph in the year April 11, 2019 (Crunch Base, 2019). Along with this, one of the major
acquisitions of the company is by acquiring the stake of 77% of Flipkart that is an Indian largest
e-commerce company in terms of the market share by investing approx. $16 billion.
Partnership strategy
Partnership strategy is applied to the other business or company available in the foreign market is
one of the entry strategies that have been adopted by the companies (Frynas and Mellahi, 2015).
It has been found that Walmart Indian processes were opened a training institute in the area of
Amritsar with the partnership with Punjab as well as in Bharti government. Along with this, the
company also plans to open 10 to 15 openings with help of partnership over the coming three
years. The company adopt a strategy in which they form the partnership with Lojas Americanas
that is considered as one of the leading Brazil leading discount store chain that came into
existence in Brazil. In this, Wal-Mart selects the own 60% of Lojas Americanas that would retain
approx. 40% which is one of the joint ventures.

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Competitive Dynamics
The terms of the competitive dynamics are majorly used to define gamut of reactions and actions
of companies taking the part in the business environment that remain competitive. Wal-Mart
Company also finds the competitive dynamics in the retail industry in which they find the on-
going competition from the companies that are already present in the industry (Pacheco and
Dean, 2015). In the competitive dynamics, it includes the total set of responses and actions of all
the firms that are competing into the market. In the research, this has been witnessed that the
retail industry presently consists of the most intense rivalry as well as the competition that is
present in the world. The major advances that are witnessed include the production, technology
as well as the distribution of the product by doing maximum utilization of resource and form new
strategies faster than its competitors who are present (Markman, Gianiodis and Panagopoulos,
2016). It is true that attracting and developing the potential customers entails the promotion and
generating the awareness among the products and services in such ways that contribute
effectively in attracting the customers and motivating them to form the strong loyalty to the
company.
The major actions that are taken by the retail leaders within the country are related to the pricing,
the value that is offered as well as the services that make all the retail to deal with diverse
competitors present in the market. The major competitors that are witnessed in the retail industry
include K-mart, Wal-Mart, Target and many others (Leinwand and Mainardi, 2010). In this
market, the company Wal-Mart is majorly known because of the everyday low prices of the
products that are majorly offered by them in the market. Along with this, the other companies
like Target and Kmart are major companies who are working as discounted stores for providing
value to their customer. All these companies have a diverse set of the products as well as the

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services that provide the best unique value which involve the use of effective capabilities
(Gillespie, 2015).
In the market, the company target is taking the actions to play the game with the image
advertising that is possible with the mass prestige products sourcing and setting the prices. The
major focus of this company is on youth customers who remain updated with the new technology
and system. In the same market, the actions of the Kmart company is to follow the mass
merchandising company through which they can offer the quality to the customers for their
products through a portfolio of the exclusive brands and labels that makes them unique in the
market (Lamb, Chattanooga and Wheatley, 2017). Thus, they can easily meet the needs of
customers and this action makes them struggle less in the market.
Organisational structure
The organisational structure of the company defines the way activities as the allocation of the
task, coordination as well as the supervision is guided with the motive to accomplish aims and
goals of business. The below given is the organisational structure of the Wal-Mart company: -

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(Source: Hierarchy Structure, 2019)
The above image shows the functional organisational structure in which different departments
are operating under top management.

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(Source: Hierarchy Structure, 2019)
Wal-Mart Company is a recognised American retail operating company who follow the
hierarchy functional structure of an organisation. This structure of the company involves the two
different features that are the hierarchy and functional structure. It has been found that the
hierarchy structure feature is vertical lines of the command that shows the structure. On the other
hand, the functional structure of the organisation has the features that include the groups of the
employees that are fulfilling the particular functions (Hierarchy Structure, 2019). The image
given above shows the hierarchy in which the high authority gives the command to the lower
manager and subordinates to follow the actions.
Knowledge Management
The knowledge management refers to as the process of creating, sharing, using, and handling the
information of the company. It is considered as the approach to accomplish the objectives of the
company by using the information effectively (Hislop, Bosua, and Helms, 2018). In knowledge
management, there are four types of knowledge management, which is considered by the
company, which include creating knowledge, organising knowledge, applying knowledge and
transferring the knowledge. Wal-Mart Company is giant chain stores that have an
overwhelmingly effective program related to the knowledge management that has allowed the
company to manage their advantage over their competitor’s in the market irrespective of the
turbulent economic condition of the company (Webb, 2017). It has been found that the goals of
the business are being accomplished simultaneously by strictly following the vision and mission
of the company.

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 Creating knowledge allows the company to collect information by analysing, needs, and
demand of clients available in market so that company can work accordingly. This
creation of information is not limited to the customers but it also involves employees who
work for the company and identification of their skills and capabilities (Omotayo, 2015).
 This knowledge is organised by them with the help of proper documentation in which
they make the records for the customers. The employee’s record has been prepared which
shows the information that can be utilized by Wal-Mart in their operations.
 The company need to apply the knowledge as the company knows about the needs and
demand of products by the consumer in the market (Girard and Girard, 2015). Thus, the
company apply the same information for providing improved services to the customer of
Wal-Mart. Along with the skills and knowledge of the employees of the company can be
applied with the motive to provide the best value to the customers. These skills will make
the customers feel delighted with the support from the employees within the market.
 The transfer of knowledge is possible with the company as they provide the information
to the customers that they are offering all the products at their stores that are majorly
demanded by them. This makes Wal-Mart company get the attention of their customers in
the market that makes them earn high revenue. Along with this, the promotion tool will
be applied so that Wal-Mart can easily manage the transferring of knowledge. Along with
this, the employees can also transfer the knowledge as well as details to their employees
related to the offers and discounts that they have for their customers present in the
market.
Thus, this is witnessed that stores of the Wal-Mart remain effective and equipped with the
reliable knowledge skills that have contributed in enhancing the efficiency in the service delivery

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as the customer care support with the development of the great competition. The management of
company majorly emphasises on employees due to which they apply transformational leadership
style within the company. The appropriate level of knowledge management within the
organisation has allowed them to deal with all the related issues that are linked with the practices
and functions of the company. The knowledge is used by the Wal-Mart company to take the
essential decision in the market to deal with the issues. Thus, this can be said that Knowledge
management is essential for a business like Wal-Mart.
The company apply this system of knowledge management in Human resource management and
for communication and providing feedback to the employees present within the organisation.
The knowledge about the needs of the employees in the company among different departments
with a different set of skills is identified by the manager of HR and according they apply it to
find the right employee for their company. Similar to this, feedback and communication are
possible within the management with use of effective knowledge management. The knowledge is
used by the mangers of the company through which they can communicate and share the
feedback. For instance: Wal-Mart managers are aware of the work is done by the employees
which include their performance and accordingly they use this knowledge for providing feedback
to the employees of Wal-Mart.
Innovation
Innovation is the process that is referred to like the changes in the processing or forming the
processes more effective by applying the new idea and with the use of technology. In the
competitive environment, the companies are making changes in the strategy by bringing
innovation into it. Wal-Mart Company also applies the innovation within their organisation that

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helps them to work effectively. It has been found that 2014 was a tough time for the company
because the market was Chaotic (Wal-Mart, 2019). The company faced a drop in ROI of
company comparing it with the other years. Wal-Mart faced the number of economic headwinds
approx. the world as it affects them the most. This made the company to adopt the strategy so
that they can bring improvement. In June 2014, Wal-Mart Company begins their process with the
purpose to renovate itself into the tech-innovative business rather than just maintaining some of
the retail stores. On this, the Doug McMillon, Walmart’s CEO said that they form the new
abilities to provide the customer in the new ways (GreyB, 2019). CEO said that it is required for
all to comprehend shift that took place in technology and has affected the retail business. The
company realised the importance of the “Innovation without protection is philanthropy” word
that makes them believe that it is essential to bring innovation and to protect it.
Below are a few ways through which Wal-Mart is changing with the help of innovation: -
 In the year 2018, retail innovation took various forms and this is possible with the
emergence of new technology in the market. Technology like Virtual reality, convenient
apps, and automated assistants are innovatively applied by the company. This makes
Wal-Mart believe that they are making the shopping and working at the company easier
for its clients and associates alike (Wal-Mart, 2019).
 Alphabot is the first technology that is designed as well as created for the company. This
is the innovation in term of technology by automating the key pieces of the Grocery
Pickup process. It assists in preparing the order through online mode even faster by using
the self-directed mobile carts for providing the items that are required from the storage to
organising, assembling as well as delivering it to the vehicle of customers.

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 The company become innovative when they started using VR technology for the training
purpose of the employees within the company (Wal-Mart, 2019). The technology of
Virtual reality has brought the transformation in the company academies trained for the
new jobs. In the year 2018, the company become excited to disclose the fact that they are
associates in every Wal-Mart store present within the country.
(Source: Wal-Mart, 2019)
 Wal-Mart Company is making use of Autonomous Shelf Scanner in their 47 stores
present in the U.S. This technology is providing the associates more time to majorly
emphasis on the serving to their potential customers. Innovation in technology allows the
company to program in such a way that it can help in determining the levels of sock and
prices are labelled correctly or incorrectly. This results in favour of the company as they
get real-time assistance in the store for the inventory (Wal-Mart, 2019).

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(Source: Wal-Mart, 2019)

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Conclusion
At the end of the report, this can be concluded that Wal-Mart is dealing effectively in the market
of the US and they are applying different international strategy to expand its business operations.
The company follow the different international themes that include the foreign entry strategy in
which the company follow Acquisition and partnership strategy that helps them to expand their
business operations in different areas of the market. Along with this, the competitive dynamics
are discussed which shows that the company deal with the different companies which are present
in the industry. These companies are Kmart, Target and others who take the required action
within the market. Along with this, the structure of the organisation is discussed which shows
that company has hierarchy functional organisation structure. The company also adopt
knowledge management as well as innovation that contributes effectively in bringing the
improvement among the operations and performance of the company. The managers of the
company need to keep knowledge of operations and employees. In the end, this has been found
that innovation is applied to make the processes simpler for customers and maintain a
competitive advantage.

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References
Chetty, S., Ojala, A. and Leppäaho, T. (2015) Effectuation and foreign market entry of
entrepreneurial firms. European Journal of Marketing, 49(9/10), pp.1436-1459.
Crunch Base (2019) Acquisitions [Online]. Available from:
https://www.crunchbase.com/organization/walmart/acquisitions/acquisitions_list#section-
acquisitions [Accessed on 18th September 2018]
Frynas, J.G. and Mellahi, K. (2015) Global strategic management. Oxford University Press,
USA.
Gillespie, K. (2015) Global marketing. Routledge.
Girard, J. and Girard, J. (2015) Defining knowledge management: Toward an applied
compendium. Online Journal of Applied Knowledge Management, 3(1), pp.1-20.
González-Benito, Ó., Martos-Partal, M. and Garrido-Morgado, Á. (2018) Retail store format
decisions. In Handbook of Research on Retailing. Edward Elgar Publishing.
GreyB (2019) Strategy Behind Walmart’s Rise: A Tech-Centric Approach [Online]. Available
from: https://www.greyb.com/walmart-strategy/ [Accessed on 18th September 2018]
Hierarchy Structure (2019)Walmart Job Hierarchy [Online]. Available from:
https://www.hierarchystructure.com/walmart-job-hierarchy/ [Accessed on 18th September 2018]
Hislop, D., Bosua, R. and Helms, R. (2018) Knowledge management in organizations: A critical
introduction. Oxford University Press.

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Hunt, I., Watts, A. and Bryant, S.K. (2018) Walmart’s international expansion: successes and
miscalculations. Journal of Business Strategy, 39(2), pp.22-29.
In-Depth Integrative Case 2.2 (2019) Walmart’s Global Strategies [Online]. Available from:
http://mba.teipir.gr/files/3_Wal-Mart.pdf [Accessed on 18th September 2018]
Lamb, N.H., Chattanooga, T. and Wheatley, K.K. (2017) Competitive dynamics: Multinational
firms and competitor’s network in the host country. International Journal of the Academic
Business World, 11(2).
Leinwand, P. and Mainardi, C. (2010) Why Can’t Kmart Be Successful While Target and
Walmart Thrive? [Online]. Available from: https://hbr.org/2010/12/why-cant-kmart-be-
successful-w [Accessed on 18th September 2018]
Markman, G., Gianiodis, P. and Panagopoulos, A. (2016) Factor Market Rivalry and Inter
Industry Competitive Dynamics (No. 1611).
Omotayo, F.O. (2015) Knowledge Management as an important tool in Organisational
Management: A Review of Literature. Library Philosophy and Practice, 1(2015), pp.1-23.
Pacheco, D.F. and Dean, T.J. (2015) Firm responses to social movement pressures: A
competitive dynamics perspective. Strategic Management Journal, 36(7), pp.1093-1104.
Wal-Mart (2019) Innovation [Online]. Available from:
https://corporate.walmart.com/newsroom/topics/innovation [Accessed on 18th September 2018]
Wal-Mart (2019) Our Story [Online]. Available from: https://corporate.walmart.com/our-story
[Accessed on 18th September 2018]

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Wal-Mart (2019) Top Ways Walmart is Changing How Customers Shop [Online]. Available
from: https://corporate.walmart.com/newsroom/2019/01/15/top-ways-walmart-is-changing-how-
customers-shop [Accessed on 18th September 2018]
Webb, S.P. (2017) Knowledge management: Linchpin of change. Routledge.

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Appendix
‘Who wrote which section?’
This report is prepared by the four people (Ankit, Ravi, Peter and Yash) as this is a group
assignment. The work was divided among the four members equally; Ankit has started an
assignment with introduction and completed foreign entry strategy. Further, Ravi has completed
the competitive dynamics and organisational structure section of the report. Yash has completed
the knowledge management section and an overview of the company. Peter has completed the
innovation section and conclusion of the report.