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HR Management

Walmart’s Global Strategy

Walmart’s international division has an important job. With 80%of the retail industry’s growth coming from outside of the UnitedStates, WalMart international’s $137 billion in international salesin 2014 -  29% of sales overall - is a key driver ofoverall revenue growth. To drive this performance, DavidCheesewright, CEO of WalMart’s international division, is focusingon current operations in growth markets and e-commerce.

Shopping trends indicate that what customers buy is changingfast, and that they are quickly switching to online shoppingplatforms. After decades of work trying to develop a foundation inthe Chinese market, Walmart is consolidating its portfolio ofstores in that country, closing nonperforming retail stores andinvesting in successful ones. To enter the Chinese e-grocerymarket, Walmart holds a 51% stake in Yihaodian, which has postedtriple-digit growth—twice the market rate.

The company’s operations in Brazil and Mexico are experiencingslowing growth, in part a result of economic cycles and theirbrand’s lifecycle, but they still offer the opportunity to developstrong, mature

businesses. International expansion comes with country specificchallenges. After experiencing too many regulatory difficulties inIndia, Walmart canceled plans to open retail stores there. Instead,Walmart India is focusing on business-to-business sales.

Although Walmart has successfully dominated the U.S. market, ithas found that expanding its reach across the globe does not alwaysfit with its strengths. In addition, navigating the variety ofeconomic and regulatory requirements across different countriesadds significant complexity to the company’s operations. Finally,gaining access to and managing workforces with different values,cultures, and languages present tremendous challenges.

1)    What strategies should a company useto determine which countries it should expand into?

2)    How can a company assess how culturaland economic differences might impact its ability to succeed indifferent countries?

3)    What things can companies do to managea global workforce more effectively.