Since 1962, Sam Walton grew Wal-Mart to be a financial success within the USA, to the point of saturating the retail market. The decision to go global came in 1991 with the hopes of having the same amount of success that Wal-Mart has had for nearly 30 years. Having to work within the social-cultural environment has been challenging for Wal-Mart domestically and globally. These challenges created only minor set backs for the superstore giant. Learning from its experiences, good and bad, Wal-Mart continues growing as the largest retailer in the world. Wal-Mart’s social-cultural values have worked well for them.
When a company is looking at its beliefs, they must consider their employees and the customer. Wal-Mart took this seriously. They based their culture on three basic beliefs: service to their customer, respect for the individual, and striving for excellence. They built that from a foundation of personal and moral integrity, honesty, and fairness. Wal-Mart created a Statement of Ethics to guide its employees on how to provide the best customer service to the customers and to the company. Wal-Mart also created global ethics to abide by the local laws and regulations of that country.
If their Statement of Ethics is too relaxed, the employee must adhere to the local laws. Wal-Mart provides a global ethics office for employees to consult with if in doubt. There are many areas in the social-cultural environment that need to be considered domestically and globally. When Wal-Mart decided to go global, it followed its model that works so well here in the states. Without evaluating the culture, Wal-Mart almost failed when it expanded into Mexico. Luckily, after reworking their business model to fit into Mexico’s environment, they turned around what could have been a business disaster.
That’s not to say they didn’t learn from their mistakes. Wal-Mart expanded into Germany, but success was not in their sights. They once again used what worked in the states and could not recover from the devastation of not evaluating the German culture. Unfortunately, Wal-Mart had to pull out of Germany, but learned a very powerful lesson. Wal-Mart is now very successful in several other countries just as they are here in the states. Wal-Mart was most likely relying on the fact that cultural convergence is becoming more prevalent globally.
Meaning basic human needs are universal in nature. This type of model may work for companies such as Coca-Cola or McDonald’s, but has not worked for Wal-Mart. When providing goods and services, a company must look at work relationships, food choices, leisure activities, the roles of each gender, life expectancy, concern for the environment and so on. These are only to name a few. Wal-Mart has now found a way to create a model for each global market they enter into looking at their social-cultural needs. This is why Wal-Mart continues to be the world’s largest retailer.
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