In the last half century, the world’s largest retail sector has had difficulty spreading internationally into other markets. The domestic (US) achievements were either successful or struggling in foreign markets for many reasons. China was one of the hardest places that the retail store could not manoeuvre on the Asian market in particular. As anticipated, Managers thought that the cultural success in companies carried out in the US could be reciprocated in China. Thus, the current paper aims to evaluate the socio-cultural issues that have hindered and promoted al-Mart in both China and US as global and domestic cluster countries respectively.
The business culture failures in China as a result of the American model include the following. First, Huang and Yu (2015), state that, Chinese employees do not appreciate Wal-Mart’s incentive mechanism which has predominantly succeeded in America under the slogan “on-site guidance and encouragement”. The Chinese employees love to have a position marked on cards and not just names and photographs. These actions only increase their resentment leading to poor reception of the business in the country in all the stores. In other words, they feel their culture appreciates when someone is viewed in terms of their position to their places of work but Wal-Mart does not recognize this cultural deficiency.
Other than that, Wal-mart only takes about 20% of all of its employees as full-time workers as a measure to reduce operating costs and meet the desire of offering cheap products to their customers for continued global competitive edge (Huang and Yu, 2015). But as far as Chinese employees are concerned, the approach only works on American soil and not in China. They feel there is a lack of a sense of belonging to the job since they are mainly part of a casual workforce and their daily energies are never recognized on a permanent basis. As a result, the approach does not meet the requirement being set by the employees since the company is busy trying to strategies on ways of expanding further while forgetting the internal customers who are their employees.
As Wal-Mart continues to grow in its significance in other markets the Chinese one by 2014 had only 405 stores because of poor customer reception. There is a need for the CEO of this great retail industry to consider the preferences of Chinese consumers. According to Trefis team (2014), the Chinese consumer is more concerned with the experience they get in the shops which, they believe should match the culture of China and not the western one. The approach has been successful in one retail outlet, the Sun-Art retail group, which grasped the Wal-Mart’s model and incorporated a Chinese touch to its products leading to many customers streaming into the retail outlet (Trefis Team, 2014).
Domestically, Wal-Mart US has faced the greatest challenge of negotiating the issue of diversity within its workforce. While American culture is largely facing a dynamic shift in terms of sexual orientation, it is expected that a big retail outlet such as Wal-Mart, can have these issues as part of its business culture. But instead, women and heterosexuals are largely discriminated from specific positions leading to a disgruntled workforce in America. The issue has led to several lawsuits especially from women, stating how their former employer failed to recognize them for positions and pay, due to their gender (Hays, 2004). The only success in terms of cultural diversity is the role plays conducted in the organization and the concept of “public servant leadership” but pressure is unto them to reflect the cries of women and the LGBTs at work.
In line with the responses of my colleagues, Wal-Mart remains a distant from realizing success with regards to cultural differences in both Chinese Market and partly America. The organization needs to strategize so that the appealing product experience required by the customer in China is met and employees get appreciated for the little they bring on board. In America, diversity is needed and sensitivity to employee incentives should be increased even further.
Hays, C.L. (2004). Social Issues tug Wal-Mart in differing directions. The New York Times. Retrieved from: http://www.nytimes.com/2004/06/30/business/social-issues-tug-wal-mart-in-differing-directions.html?_r=0
Huang, J. & Yu J. (2015). Wal-Mart development in the Chinese market: Problems and countermeasures- Based on the enterprise culture and ethics. International Business and Management, 10, (2): 11-15. Retrieved from: http://www.cscanada.net/index.php/ibm/article/viewFile/6806/pdf_132
Trefis Team (2014), Challenges Wal-Mart faces in Mexico and China. Forbes. Retrieved from: http://www.forbes.com/sites/greatspeculations/2014/04/02/challenges-wal-mart-faces-in-mexico-and-china/#580099184e48