Cultural Impact on Business: A Case Study of Walmart Corporation

This essay analyzes the impact of cultural differences on Walmart's business strategies, particularly in international markets like Germany. It examines how Walmart's attempt to transfer its corporate culture and low-cost model from the US to Germany faced challenges due to differing cultural values and norms. The analysis draws on Hofstede's cultural dimensions, focusing on individualism versus collectivism, to explain the difficulties Walmart encountered. The essay highlights the importance of understanding cultural forces in shaping the relationship between a company and its consumers, noting that the individualistic approach of American culture contrasted with the more group-oriented culture of Germany, affecting employee performance and customer perception. Ultimately, the essay concludes that cultural awareness is crucial for business success and failure, emphasizing the need for businesses to adapt their strategies to align with the cultural values of their target markets. Desklib provides access to similar essays and solved assignments for students.

The Impact of Cultural Difference on Business in WALMART

Contents
Introduction......................................................................................................................................1
Analysis...........................................................................................................................................1
Individualism & Collectivism..........................................................................................................1
Conclusion.......................................................................................................................................2
References........................................................................................................................................3
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Introduction
Globalization has been able to create a major achievement in the world, where there is a great
understanding of cultural differences which only helps in increasing the company success. The
globalization leads to increased diversity with market that provides the opportunity for the
business. The example of Walmart which is a largest retail chain details with the cultural
differences in the Asian market. It was been analyzed that the company cannot directly and
easily handle the transfer of corporate culture with the lower costs and a higher bulk model from
US to Germany.
Analysis
As per the analysis, the company growing international have been increasing with opening and
creating opportunities to create the sales and then promote the brand as well. The culture leads to
adding a dimension with making it difficult for the other countries. The culture is comprised of
the values and norms. The global environment requires a business to understand the cultural
forces that leads to shaping the relationship between company and its consumers. Hence, there
are different ranges of norms which are set for a particular business that require a need for
determining different value assumptions. Considering Hofstede research show on how the
national culture affect organization workforce, we see that there are cultural changes which play
an important role in company internationalization (Hofstede, 2011). The theory is based on
comparing companies like Wal-Mart which tries to impose the norms for the different foreign
markets. Hofstede looks for the sub-cultural and the regional differences, industry and the
organizational differences mainly.
Individualism & Collectivism
We see that the Americans are independent and self-determined when compared to Germany
people, where there are different workforce work in groups (Zaheer, Schomaker & Nachum,
2012). The cultural dimensions provide the means to construct the cultural clusters of countries
in the and across the countries. The clusters are for identifying the areas which require
development to reduce the problems. The examples are related to advertising the model of
making ads which are relative to certain dimensions set culturally (Tjosvold, 2017). The
collectivist cultures place the care for the group and the need for consensus. According to
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individualism chart, there is a major difference in United Stats and Germany where Germany
scored 67 and US 91. It is seen that the German individuals hold the private success with
individual moralities that are important. The Germans suppose that there is a need to fulfill the
desires to work in a group key with own thoughts and if there are individual successes which are
positive, then the group performance will also increase. However, US individualism is highly
accepted and respects (French, 2015). The culture of privacy is important in the workplace,
where there are people working from poverty to wealth. Wal-Mart requires individual work by
German workers, where the desires of the employees in Germany were not met by Wal-Mart,
that could have affected the performance as well as the worker behavior. Apart from this, the
manager who was assigned could not speak German. Hence, there was a large gap in between the
employees and the manager, and so the employees might have felt like the outsiders (Thomas &
Peterson, 2017).
From the different customer perspectives, there are different events of business for Walmart
which are not received completely in Germany. Here, the culture is defined as individualistic and
self-assured with proper interaction. There is a need to focus on how one can handle the
applicability to the issues (Stahl & Tung, 2015). German culture is not completely familiar for
different emotions in the business and it completely neutral. It is considered as strange where the
Germans are doing shopping. It has been seen that US is the mixture with a higher masculinity
and also a higher individualistic vitality in the world. They tend to prefer for living in order
which can lead to an increase in their individual traits. There are different norms, values and
beliefs which are set and supported by the national and the social cultural variables that mentions
about establishing the time, work, change and materialism (Trompenaars & Hampden, 2011).
According to Global Leadership and Organizational Effectiveness, there is a need to focus on
planning the long run projects to properly conceptualize and validate the cross-level between the
cultural and the societal effectiveness. There is a need to focus on how Walmart does not match
interests with German national and social culture variables but affect the employee performance
directly (Leung & Morris, 2015).
Conclusion
Culture is considered as an important aspect for the business life where the business need an
interface with people, customers, employees or the stakeholders. The focus is on how the culture
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is considered an important factor for the success and business failure (Ollier & Foucreault,
2017). The culture helps in explaining about different groups to perceive the things and then
performing things differently from the other groups.
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References
French, R. (2015). Cross-cultural management in work organisations. Kogan Page Publishers.
Hofstede, G. (2011). Dimensionalizing cultures: The Hofstede model in context. Online
readings in psychology and culture, 2(1), 8.
Leung, K., & Morris, M. W. (2015). Values, schemas, and norms in the culture–behavior nexus:
A situated dynamics framework. Journal of International Business Studies, 46(9), 1028-
1050.
Ollier-Malaterre, A., & Foucreault, A. (2017). Cross-national work-life research: Cultural and
structural impacts for individuals and organizations. Journal of Management, 43(1), 111-
136.
Stahl, G. K., & Tung, R. L. (2015). Towards a more balanced treatment of culture in
international business studies: The need for positive cross-cultural scholarship. Journal
of International Business Studies, 46(4), 391-414.
Thomas, D. C., & Peterson, M. F. (2017). Cross-cultural management: Essential concepts. Sage
Publications.
Tjosvold, D. (2017). Cross-cultural management: foundations and future. Routledge.
Trompenaars, F., & Hampden-Turner, C. (2011). Riding the waves of culture: Understanding
diversity in global business. Nicholas Brealey International.
Zaheer, S., Schomaker, M. S., & Nachum, L. (2012). Distance without direction: Restoring
credibility to a much-loved construct. Journal of International Business Studies, 43(1),
18-27.
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