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Walmart. An Emerging International Giant - Essay Example

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Wal-mart has always been alert in developing new retail concepts based on the consumer trends. However, its internationalization process has not been as smooth. Firms with distinctive technological, marketing and managerial capabilities are more likely to achieve success in international expansion. …
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Walmart. An Emerging International Giant
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Download file to see previous pages Wal-mart expected that all its strengths and retailing knowledge could help them leverage operations overseas and achieve instant success. They expected that they benefit from their brand image as they had earned a decent reputation in the United States. However, not all of its strategy brought them success.
2. Culture of learning and innovation
2.1 Learning through experience
Learning through experience is the best method, according to Senge but organizations seldom experience the consequences of their decisions (Smith, 2001). Thus, adaptive learning or single-loop learning must be supported by generative learning or double-loop learning. When changes become necessary people respond to the change in an ad hoc manner. Without any planning change is executed. Whether single- or double-loop learning can occur only when an organization realizes that learning must occur.
An organization with the culture of learning and innovation would learn through every experience including international expansion. Wal-mart realized that its existing strategy did not fetch them the desired success and hence learned from its failures. They started learning through experience at different locations and this is known as reverse learning when firms are exposed to diverse knowledge inputs located in foreign markets (Saloman, 2006). This to a large extent depends upon the export strategies adopted that influence the flow of knowledge and thereby affect innovative productivity. Sometimes the geographic location imposes constraints on acquiring knowledge and information. This can be overcome by hiring local employees and benefit from their expertise. However, Wal-mart did hire local people in Brazil but could not benefit as the focus was on achieving sales volume. They realized that they needed to hire professionals and they started doing so from competitors. This does not demonstrate a culture of learning and innovation. Firms can also acquire knowledge from technology spillovers from competitors (Saloman, 2006). They can also access knowledge through joint-venture local partners. An organization with the culture of learning would also acquire knowledge from customers and customer specifications stimulate innovation. Wal-mart was only trying to develop a culture of learning as they sought to hire professionals from competitors. Theirs can be classified as single-loop learning because they did not generate something new. Wal-mart made no attempts to seek local skills and nor was the location choice based on information availability. Firms do seek to acquire knowledge before they enter a foreign location but to what extent they use this information is not known. Many however, seek to innovate with the knowledge acquired in advance. Again, customers across countries do not share identical tastes and hence the product requirement would vary across nations and cultures (Saloman, 2006). Wal-mart did not take into account ...Download file to see next pagesRead More
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