Answer To: Each student group is required to design, create and deliver a ‘role play simulation’ of a...
Sanchita answered on Jul 15 2020
Walmart Investing in India
The Report
Executive Summary
Walmart Inc is one of the biggest retail conglomerates across the world. Walmart is a global multinational Company that has a presence in over thirty plus countries of the world. As of now, it is contemplating to enter a very lucrative and promising market of India.
In the recent years, the Indian economy has expanded and is now the sixth largest country in the world in terms of purchasing power parity. However, despite such great economic achievements, India still lacks many grass-root features and hence making a foray into India would be extremely challenging.
Research and Findings:
India is a low-middle income; developing country. The country has a vast number of populations (about 60%) who are below the age 35. Hence, it can be said that India is quite a young country. Despite being sixth-largest economy, the per capital income of India is one of the lowest in the world. Though, on a promising note, the India has been increasing at a rapid growth rate of 7% and above annually. India became a liberalized economy only 1990s and since then has embraced liberal trade policies and free flow of goods, capital and resources. As of now, in India there is a rule that foreign direct Investment (FDI) in retail industry is limited to 49% (Rienda et al, 2011).
Entering in India is like entering 28 different (as of now, there are 28 states in India) countries at once. It is so because it has been seen that every other state in India is very different from the other in terms of language, culture and even values.
Recommendations
Hold orientation classes: Before entering into India and starting its work operations, Walmart should conduct a week long (as per requirements) orientation program where employees of both the countries will get a chance to better understand the demands, needs, preferences and cultural values of the others.
Phase-wise Expansion: It will be a sound idea for the company to implement its expansion strategy in phases. It should start with the top cities of India like Mumbai, Delhi where the culture is more globalised and people are more urbane.
Merger with a present company: Walmart should tie up with an already existing company in India, Also, It is worthy to note, that 100% FDI in retail category is not yet permitted in India and hence a safer option to make inroads in India is through partnership or collaboration with an existing company.
Table of Contents
Brief overview of the company…………………………………………………………3
Identification of key macro and micro environmental factors…………………………3
Identification of key cross-cultural and HRM issues……………………………..…....5
Recommendations………………………………………………………………………7
References……………………………………………………………………………....8
Brief overview of the company selected for the role play and the home/host countries
The company selected for this purpose: Walmart Inc
The Home Country: America
The Host Country: India
Walmart Inc is one of the biggest retail conglomerates across the world. It is head quartered in Illinois America and is a major retail business house in America. In America, itself the brand is ubiquitous with household shopping and deep discount shopping. Walmart is a global multinational Company that has a presence in over thirty plus countries of the world. In some countries like China, Germany it garnered stupendous success, however in few other countries like South Korea, Russia, It failed miserably. Nonetheless, Walmart is still one the best ranking fortune 500 companies and has strong brand recognition across the globe. One note worthy point to mention is that Walmart has a strong impact on American economy as well, as it is the second largest employer with a employee base spanning over 50,000 workers. The company has a predominantly strong presence in brick and mortar business, however, even in terms of e-commerce; Walmart has a strong presence and gives a strong competition to its arch rival Amazon.
Identification of key macro and micro environmental factors and issues impacting the
selected host country
Macro Factors:
Geographical factors: India is a low-middle income; developing country located in the Asian continent and has strong geographical location from a strategical point of view. It is a peninsula, hence it is surrounded by water on three sides, and thus the country has ample sea...