Global HRM Strategies For Expanding Companies: The Case Of Walmart In Canada, India, And The UK

Key Objectives and Components of Global Compensation

The report focuses on the global HRM strategies that mangers of organisations need to focus in order to expand its dominance. As observed by Collings, Wood and Szamosi (2018) every organisation aims to expand to territories that are different from the host country. This helps in enhancing the capability as well as the resources that are owned by a company. At the same time, the brand image of a company can improve if it manages to implement its strategies properly while expanding into the global market. The report focuses on the application of global HRM strategies that a reputed company can undertake to gain success.

The company in focus is Walmart, one of the most reputed companies in the retail industry. The report analyses the effectiveness of Walmart at its host country, US while at the same time analyses its effectiveness in foreign countries such as India, Canada and the UK. This can help in understanding the differences that exist in the cultural aspects of the countries and the manner in which Walmart can mitigate the changes and ensure that it gains success in these countries as in the US. For this reason, the report takes into consideration the application of various models such as Hofstede’s to understand the difference.

Furthermore, the report analyses the impact that the difference in cultural and institutional setting may have on the company and the manner in which it can be mitigated. The impact of talent development and compensation in these three countries is examined and an appropriate HRM strategy is suggested for the company.

Walmart is an American retail company that is situated in Bentonville, Arkansas. The company was set up in 1962 under the name Walmart Inc. It changed its name to Walmart Stores Inc in 1970. Walmart is a public company that is traded under the NYSE (Walmart.com 2018). The popularity of the company has grown since its inception and currently Walmart stores are located all around the world. Reports have suggested that the number of stores of Walmart throughout the globe is about 11, 718. Walmart is famous in about 28 different countries and operates under 59 different names (Walmart.com 2018).

Walmart is a retail store and some of the products that are served by the company include electronic goods, home furniture, clothes, footwear, jewellery, grocery and many more. It is for this reason that the company can include versatility and ensure its success in the world. It has been reported that Walmart is the largest company in the world in terms of the revenue generated with US$500 billion. It has over 2.3 million employees across the world and investments made outside of UK, have seen mixed results (Walmart.com 2018). This is mainly due to the change in cultural aspect as well as the manner in which organisational policies and protocols are followed.

Different Approaches for Designing Global Compensation Packages

The countries in which Walmart has seen success includes Canada, UK and China, while ventures in countries like Germany, South Korea and India the company have managed to gain less success.

Canada is located in the North part of North America just below the US. Most of the time the Canadian culture has been said to be different from that of the US but despite this, a company like Walmart had gained huge success in the country. Canada is the second largest country by area with population being sparse mostly because of the dominance from forests. The GDP of the country is estimated at $1.847 trillion with a per capita income of $49,775 (Tradingeconomics.com 2018). Despite its sparse population, Walmart had gained success in the country mainly due to the slight similarity in the work culture.

India is a vast country that is situated in South Asia. It is the seventh largest country by area and the second most populated country with over 1.2 billion people residing in the country (Economictimes.indiatimes.com 2018). The GDP of the country is estimated at $10.385 trillion with an estimated per capita income of $7,783 (Economictimes.indiatimes.com 2018). One of the biggest disadvantages that foreign companies face in the country is the dense population along with a challenging climatic condition. At the same time the culture of the country and the people are different from that operated in the United States. Hence, Walmart had faced problems while trying to adjust to the limitations of the country.

The United Kingdom is dominated by the constitutional monarchy and a parliamentary democracy. It is a costal country, which is considered as the 12^th longest coastline in the world. In terms of population, it is the 21^st most populated country with a GDP of $2,914 trillion (Tradingeconomics.com 2018). The per capita income of the UK is estimated at $44,117 (Tradingeconomics.com 2018). In the case of Walmart, the company had faced success during its expansion. This is mainly because the organisational culture of UK can be attributed with that of the US. Hence, expansion and growth in the country have been one of the biggest success stories of Walmart.

The reason for the choice of these three countries is the fact that the success and failure of Walmart can be related. It has been seen that the company had success in UK and Canada while in India it had less success. The impact of the challenges faced in terms of work culture, population is discussed in the report, and comparison with the US work environment is made. Hence, it can be said that these countries provide proper analysis of the topic.op, livi, gdp, industries Germany, South Korea and India the company have managed less successS.ries such as India, Canada and

Cultural Impacts of Compensation Design

In order to understand the impact of the cultural and institutional setting of the host and abroad countries a comprehensive analysis can be made by implementing Hofstede’s model.

Figure: Comparison between host and abroad countries

(Source: Hofstede 2017)

The analysis show in Canada, power distance is marked with interdependence and value is placed more in egalitarianism. According to Armstrong and Taylor (2014), the low score suggests that the superiors of an organisation are always available and it is for this reason that Walmart had success in the country. The comparison with the US culture shows that the power distance between the countries is almost equal. The power distance also confirms that the two countries believe in individualism, which means that focus in more towards attaining individual goal than the goal of the organisation.

Canada is also characterised by moderate masculinity, which signifies that the people strive for achievement and success in both work as well as other fields. In the US however, this masculinity is high which means that more passion exists in the work undertaken (Bratton and Gold 2017). The uncertainty avoidance suggests that Canadian culture is focused on welcoming new ideas related to innovation. It is for this reason that success of Walmart in Canada had been the greatest.

At the same time, the people in Canada provide emphasis on learning the truth, which is different from that of the US, as people in US, is more inclined to live in a world of analysis even if the information is true. The level of indulgence is high which suggest that Canadian people are inclined to balance the work life culture. This again is similar to that of the culture practised in the US. Hence, the cultural dimension of Canada can be considered as similar to that of the US and it is for this reason that Walmart had managed to gain success in the country.

In the case of India, it is seen that the power distance in the culture is much higher. This is an indication that the Indian culture pays respect to the hierarchy within the organisations and is depended on the power and decisions taken by the boss. This has a major impact on the lives of the employees as the decisions of the owners of the companies. However, as observed by Brewster, Chung and Sparrow (2016) the Indian culture follows both individualistic as well as collectivistic trait, which suggests that the employees prefer to be involve in a larger framework in which every individual needs to play a vital role.

Developing a Strategic Global Reward Management System

This is different from that followed in the US, as the people in the country and in the organisations are more self centred. The Indian people tend to display a sense of masculinity with the type of power they possess and the success. This attribute can be related with the US culture as the US culture also displays power. As stated by Marchington et al. (2016) the main reason for the failure of Walmart in India is its ability to accept uncertainty. Unlike in the US culture, the ability to accept uncertain levels in terms of trying new things is rejected by India. Hence, new changes for the good of the employees are received negatively, which causes a stagnant in the work force.

At the same time, India is a religious centred country and the concept plays an important role in the type of products manufactured and the services rendered. Hence, scientific data does not affect changes in decisions regarding the welfare of a company. According to Brewster et al. (2016), the Indian culture is more towards the resistance and is full of pessimist. Unlike in the US, motivation among the Indian people is low. Hence, employees in a company like Walmart lacks motivation and has to work in an environment that is negative in nature as well as have a cultural restraint in every decision taken by the company. It is for this reason that the company had failed in India.

In the case of UK, the analysis shows that the country is similar to that of the US. The people in the UK believe that the inequalities need to be minimised and that power distance should not exist between people. At the same time, the country is more inclined towards developing the personal capabilities of people rather than combine for a collective purpose. As stated by Reiche et al. (2016) this is one factor that had played a huge role in the success of Walmart in the UK, as the culture of the US are replicated and this helped the employees in adjusting to the level of workforce within the organisation.

At the same time, UK has a masculine society that is driven in terms of success and power. This can be considered as another cultural attribute that is similar to that of the US. However, the uncertainty avoidance is low which suggests that the people in the country take decisions based on the situation present. Thereby a stable work culture or work ethic is not followed and this can cause a great deal of hindrance for the employees of Walmart as adjustment in the work needs to be made on a frequent basis without prior knowledge.

Walmart’s Success and Challenges in Canada, India, and the UK

The long-term orientation suggests that UK has a dominant preference, which is much higher than that of the US. It links the present and future with its past so that mistakes can be avoided. This is different from the US, as the people in the county tend to have a low sense of orientation within the organisations. Another point of similarity between the two countries is the indulgence, which suggests that work-life balance in the UK is similar as in the US (Albrecht et al. 2015). The employees of Walmart can realise their potential at the work place and at the same time enjoy life by having a proper leisure period. Hence, it is for this reason, Walmart is considered to have a huge success rate in the country.

Therefore, it can be said that the employees of Walmart are affected by choices of the country and the culture. On one hand, adjustment in the Canadian and UK culture had been easy as the cultures are similar to that of the US and on the other hand, the Indian culture had been difficult due to its beliefs and restrictions. Hence, as observed by Brewster et al. (2016) the success rate is high in the UK and Canada than in India.

Having analysed the differences in the human resource management of the three countries along with the host country of Walmart, the focus can be shifted to understanding the difference in the global labour relations that exist in the countries. According to Storey (2014), it is necessary that the organisations remain open to doing business abroad so that it can benefit from the resources and capabilities that are available in the markets of the foreign territories. However, it is also essential to understand the concept of global international relations in the countries in which organisations seek to expand its horizons.

In the case of Walmart, the global relations need to be compared with the countries in which it has expanded its business. As pointed out by Jackson, Schuler and Jiang (2014) the US holds an antagonistic trade unionism. The level of tolerance of trade unionism in the US is low as compared to the UK. The low bargaining coverage of the trade unions present in the country may hamper its relations with the UK. It has been seen that in the UK, national and industry pay bargain are directed outside the knowledge of the managers of the organisations. Therefore, for Walmart operating in the UK, opportunities can be provided for the employees to gain payment from the unions as well as the organisations.

Differences in Cultural and Institutional Settings and Their Impact on Talent Development and Compensation

However, a completely different scenario presents itself in India. As stated by Purce (2014) political influence is one of the main attributes that define the global relationship that exists between countries. In India, the influence of politics is high and it is necessary that the companies acquaint itself with the political structure to remain successful. Unlike in the UK however, employees do not receive payment from the unions. Therefore, employees working in Walmart located in India were deprived from the payment that can be generated from establishing a global relation. Hence, with the decrease in labour force in the company located in the country, Walmart had to suffer loss while operating in India.

On the other hand, the state of unionism in Canada is similar to that of the US. Therefore, unionism is sanctioned by the organisations and this provides an opportunity to remain consistent with the market forces that exist in the country. Nankervis et al. (2016) stated that despite Walmart being more popular in the UK due to the vast similarity of the work culture, unionism similarity brings the organisation more success in the Canadian market.

In such cases, the role of the managers is to remain flexible to the option of unionism within the countries. It is essential to abide by the rules of the country but at the same time ensure that the culture of the organisation is not disrupted. As stated by Wilton (2016) success and failure do not always depend upon the level of unionism that exists in countries. Therefore, unionism alone cannot be considered as a reason for the failure of Walmart in India. One of the changes that could have been made by Walmart in India is that policies regarding unionism could have been set so that political forces could be kept away.

The Hofstede analysis has shown that maintaining an US-based work culture in India can be challenging for Walmart but the ability to ensure that the damages of the unionism are managed can be made. At the same time in the case of the UK, the difference in the unionism and the unrelenting role of the managers may have cost Walmart a chance to gain more profit. However, satisfaction of the employees were attained which can be considered as a bonus for the company. As pointed out by Taylor, Doherty and McGraw (2015) the similarity of labour relations with Canada can be used by the managers of Walmart to establish itself as a strong force in the market.

Hofstede’s Model: Analyzing Cultural Dimensions

It can be done by ensuring that the transfer of labour between the borders taken places in the hopes that it strengthens the political relationship as well an organisational relationship between the two countries. Hence, it can be said that different labour unionism across countries can have different impact on the success of an organisation. It is important to analyse the impact and make changes based on the impact. The reason for the mixed success of Walmart in the countries can be attributed to the changes in culture as well as the role played by the managers in mitigating the challenges (Johnson and Szamosi 2018).

In order to gain success in a market it is necessary for organisations to maintain and develop talents that can replicate the cultural wellbeing of an organisation as well as help it to grow in the market (Kramar 2014). However, challenges in the form of expansion and dealing with varied cultural differences may act as differences within the organisations. In the case of Walmart, the differences in the cultural aspects of the countries in which it operates provide it with challenges of developing talents and maintain a compensation strategy.

In this case, the possible opportunities provided by the host country of Walmart can be taken into consideration. As stated by Tyson (2014) talent development in the US normally depends upon the type of work that is undertaken by the employees. In the case of the employees working at Walmart, the managers of the company provide them with an opportunity to remain flexible by taking on challenging roles within the organisation. Such an attribute can be credited with application of uncertainty avoidance, which denotes that the people in the US are capable of undertaking challenging tasks. Similar acceptance of changes can be seen in countries like Canada and UK and therefore, the development of talent is high in these countries.

Baum (2016) stated that in the case of India it is the opposite, as in the country in talent is withdrawn due to lack of opportunities. Political influences, cultural barriers and the inability to make decisions based on the understanding of the situations compel employees working in the Indian companies to seek opportunities in other countries. Similar situations arising in Walmart had played a huge role in the failure of the company in the country. Hence, it can be said that talent development is effective in for the increased opportunity of success in the market.

Appropriate HRM Strategy for Walmart

The compensation strategy needs to be based on the practises that are adopted by the countries. Nel et al. (2014) observed that pay incentive is higher in countries like India but low in the US. At the same time, long-term emphasis of pay is lower in countries like UK and US as compared with India. Seniority variable for the decision of pay is also high in the country due to its collectivism culture rather than in the countries that have individualist culture. Hence, it can be said that the compensation benefit that can be derived in India by the employees is lesser than that of the US or UK or Canada.

Hence, the talent and reward strategies that are adopted by the US are mainly based on the motivation factors of the employees. The positive influence is that employees are given an opportunity to grow and at the same time, the culture that helps in maintaining work life balance can be attained. However, the negative influence is the low compensation benefit that may have cause employees to remain dissatisfied with the work and aim to seek other professional fields with proper compensation benefit (Bolman and Deal 2017).

After the analysis of the impact of culture and its influences in the employees of Walmart, it can be said that suitable HRM strategies can be recommended for the development of the company in the three countries. According to Shields et al. (2015), recommending an HRM strategy can be difficult as it requires constant analysis of the flexibility with which changes take place in the market. However, with the stability related to the application of expansion of Walmart in various countries, the recommended strategies can be continuous improvement of the work force as well as learning development. The reason behind the selection of these two strategies is that it is essential for Walmart to learn from the mistakes that it made while operating in India.

At the same time, continuous development can help it to adapt to the changing nature of business and analyse the business environment before investment. It can also help Walmart to ensure that the strategies regarding talent management and compensation benefit be improved so that employees in the US feel more secure about the job that is assigned to them. Hence, the application of these HRM strategies can help Walmart to adapt to the cultural change and gain competitive advantage in the market of business. The application of the HRM strategies can help in the development of other companies in the market as well.

Based on the analysis of Walmart and the problems it had faced particularly in the Asian countries like India, it can be said that the best practises that can be developed for improving the conditions of Walmart can be acquiring a continuous development process. As pointed out by Sanders and Yang (2014) it is essential for managers to be alert while developing processes that can suit the work force of an organisation. In my opinion, such development process needs to be undertaken by Walmart by first analysing the environment of the target country. This can provide a strong and clear idea about the success that can be expected.

One of the reasons for the failure of Walmart in India is the inability to adjust to the cultural requirements of the country. Challenging factors such as the restrictions of cultural beliefs, inability to accept changes, political interference and the population have played a major role in the failure of the country. However, the compensation policy that is provided in a free manner by the country could have been used to salvage the failing standard of the company. In this case, I believe that the management of Walmart needed to be practical in implying the changes in the strategic development.

An observation made by Cooke, Saini and Wang (2014) is of the opinion that managing the talent within the business needs to be done by taking into consideration the interests of the employees. Thereby, promotional strategies that can be adopted for the development of the employees need to be applied by the managers of Walmart. I believe that failure to incorporate proper talent management strategy had led to the failure of the company in the markets of India. However, the success of the company in other countries like Canada and UK has been high resulting in the failure to be insignificant in the eyes of the managers.

This success strategy needs to be considered by the managers of Walmart so that application of continuous development can take place. Apart from the fact that Canada and UK have similar cultural interests, the fact that the company could apply its thought process is one of the best strategies that has been adopted. Hence, I can say that these management practises can help Walmart built a strong base of work so that it can replicate its success in other markets. My further analysis has shown that Walmart had failed to incorporate its workforce in other Asian countries such as Korea.

Therefore, I can say that Walmart need to implement its success strategies in the market so that it can continue to dominate in the market. The variance in the compensation benefits in each country can be considered as a backlog for the company as it needs to abide by the policy of the Government. However, a proper analysis of these factors that affects the business environment need to be taken into consideration so that expansion of the company can be done without any hindrance.

Conclusion

It can be concluded from the analysis that Walmart is one of the most popular companies that help in the growth of the retail industry. The expansion in other areas of the country can help in enhancing the reputation of the company and at the same time ensue that resources and capabilities of the company grows. Hence, it is necessary to consider the factors that affect the cultural dimensions of the company and help it to gain success in a foreign land. In this regard, a proper HRM strategy can be adopted for the development of the company.

The adoption of continuous improvement and learning development can help in the growth of the company in other countries. The analysis has suggested that the reason behind the failure of Walmart in the Asian countries is its inability to adjust with the scenario that is present in the country. Hence, it is necessary that proper analysis of the Indian market is taken into consideration so that development of the company in the Asian market can take place. In this case, the effective application of Hofstede’s cultural dimension can provide Walmart with an opportunity to develop in the challenging conditions of the Asian market.

At the same time, the success of the company in UK or Canada can be taken into account for identifying the talents that the company possess. This can help in maintaining the success of the company along with the development of opportunities to recruit more talented individuals. The fact that the cultural dimensions are similar to the US makes it possible for the employees to work with a clear state of mind in these countries. However, differences in terms of unionism can be considered as one factor that may bring about hindrance in the development and retention of talents in the organisation.

Therefore, conclusion can be made that the effectiveness of the Hofstede model can help in analysing the possible countries in which Walmart can expand its territories. It is necessary that every employee be given equal opportunities in the work place and at the same time have a proper work-life balance. Motivation is essential for success and in the case of Walmart, the motivating factors across the countries can be considered as challenge to be provided in the organisation. Hence, it is necessary to develop proper actions so that such challenges can be mitigated in an easier and efficient manner.

In the light of this analysis, it can also be stated that proper application of HRM strategies can help Walmart to develop its business. It is essential that Walmart consider the importance of talent development as well as respecting the policies and procedures that are followed in different countries. This can help in gaining an idea about the opportunities that can be developed in the market and prevent the company from failing in conditions that are challenging and varies a great deal from the US work culture. Hence, the application of the recommended HRM strategies can help Walmart immensely.

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