Analyzing Organizational Behaviour: Wal-Mart's Flipkart Acquisition

This case study examines the organizational behaviour implications of Wal-Mart's acquisition of Flipkart, focusing on the changes within both companies, the success of the deal, and the potential cultural differences that may arise. It highlights the need for cross-cultural training programs to address these differences and suggests the implementation of Herzberg's motivation-hygiene theory to motivate employees. The study also explores the future prospects of the merged entity, including Wal-Mart's potential contributions to Flipkart's supply chain and online ecosystem. Ultimately, the acquisition is viewed as a potentially successful venture, provided that organizational behaviour challenges are effectively managed. Desklib provides a platform for students to access this and many other solved assignments and past papers.

Organizational behaviour
Wal-Mart acquired Flipkart

Introduction
 Organizational behavior is referred to as the study of human behavior in
organization settings, the interface between the organization and human
behavior. In the business, the activities of business reflect the behavior of the
company.
 The company that has been selected for analysing the organization behavior
is Wal-Mart who recently takeover Flipkart company.

Wal-Mart acquires Flipkart
 The company that has recently undertaken some major changes in their
operations is Wal-Mart. Wal-Mart Company is an American multinational retail
corporation that operates a chain of hypermarkets, grocery stores and discount
department stores.
 The company recently takeover India's largest e-commerce company Flipkart.

Characteristics of deal
 The takeover includes $2 billion fresh investment as Walmart Company looks
to take on Amazon who is rivals of Flipkart. After this investment, the value of
the company reached $22 billion.
 India is considered as one of the most attractive retail markets across the
world in terms of size, growth rate and opportunity in the e-commerce market.
 CEO of the company stated that this deal will provide the benefits to India in
terms of affordable goods for customers, employment opportunities, quality
products and many others.

Changes within companies
 Wal-Mart acquisition of Flipkart brings the changes in organization
activities and operations because both the companies perform different
functions.
 Flipkart is a well-known e-commerce company due to which they need to
perform the operations through online mode. Though, on the other hand,
Wal-Mart Company performs their operations through physical stores.
This shows that there is a vast difference in their operations of the
business.
 The changes in operations of the company reflect the change in the
organizational behavior of the company.

Success or failure
 US retail giant Wal-Mart Company acquired 77% of the stake in India's
largest online retailer that is Flipkart for approx. $16 billion successfully. This
acquisition took place on 10th May 2018.
 The deal took place successfully after discussing the deal from last 20
months. Though, both the companies are not similar in organization behavior
as there are vast differences.

News related to Wal-Mart
acquired Flipkart
 The economic times has published the news related to the acquisition of
Flipkart by Wal-Mart Company. This news reflects the major changes in the
behavior of the Wal-Mart Company.
 The acquisition was one of the biggest deals due to which this news was
published by different news channels present within the market.

Summary of the event
 Wal-Mart acquired Flipkart at $16 billion for the
stake of 77% approx. in the homegrown e-
commerce company. Considering the fact from
the sources, the value of the deal for Flipkart
Company was $20.8 billion.
 This deal provides the major benefits to the
Flipkart as they can get the source of money
and benefits from different sources. On the
other hand, Wal-Mart Company will be gaining
logistics, storage and deliverability network of
Flipkart.

The event is related to
organisation behaviour
 The event reflects that organization behavior of the company is
related to the event. The acquisition reflects that two companies will
perform their working together.
 Wal-Mart and Flipkart both companies have different organizational
culture because Wal-Mart is a US company and Flipkart is an Indian
company.

Cultural differences
 The culture differences between US and India leads to the
tension/pressure with negative attitudes among the managers, workers
and employees of the company. This will make the managers and
personnel leave the company.
 The company acquire another company to get professional knowledge,
talented personnel and innovativeness. If in case the company found
that managers and personnel are leaving the acquired company then the
deal leads to failure.

Resolution for cultural
differences
 The company should bring the cross culture training program for their
employees and managers.
 Employees and manager will become aware of the culture of each other
companies which will support them to perform the operations effectively.
 It is essential for the company to motivate the employees within the
organization. Wal-Mart needs to implement the motivation theory of
Herzberg's motivation-hygiene theory.

Motivational theory- Two-factor
theory
The theory states that there are numerous factors that are available at the
workplace that leads to the job satisfaction and other leads to dissatisfaction.
 Hygiene factors- These are factors which are required to be present within the
company for motivation. Hygiene factors are pay, status, benefits, job security
and others.
 Motivational factors- The factors will bring the satisfaction and motivation of
employees within the company. Motivational factors are recognition,
responsibility, growth and promotion opportunities.