Walmart employs a hybrid hierarchical-matrix organizational structure to manage its global operations across three main segments. Doug McMillon assumed leadership of Walmart in 2014 and introduced initiatives to improve customer service and employee satisfaction. When expanding internationally, Walmart utilized strategies like low pricing, acquisitions, and joint ventures, which were successful in some markets like Mexico but not others like Germany, where cultural and leadership challenges arose. Walmart has since learned lessons around effective research, leadership, and employee training and development for new markets.

1. WALMART’S
GLOBAL
LEADERSHIP
STRATEGY

2. OUTLINE

3. INTRODUCTION

4. COMPANY’S
HISTORY &
TIMELINE

5. CORPORATE STRUCTURE
Walmart is an International
Company with a hybrid
hierarchical organizational
structure that operates as a
matrix that combines multiple
approaches.
The company is led by President
and CEO, Douglas McMillon.
The following slides will show
the progress of the company
and how its’ leader has steered
the company into different
jurisdictions as well as the
strategies implemented that
either led to its’s success or
failure.

6. Walmart is a multinational corporation with a hybrid hierarchical structure. Due to the
company's scale, it functions as a matrix structure that incorporates multiple methodologies.
Walmart employs over 2.2 million people worldwide, and as a result, there is no other
organizational structure in place to assure effective management.
GLOBAL LEADER
Dough McMillan assumed Walmart’s leadership position in February 2014, and he
introduced a range of initiatives including:
 Enhancing the priority for customer service.
 Developing employees job satisfaction and efficiency via employee training and
development and increasing wages of floor-level employees.

7. The company’s operations in the world are divided into three main segments:
1. Walmart U.S. Stores – operates in all 50 states and Puerto Rico. This represents more than
60% of the company’s sales, both physical and e-commerce stores.
2. Walmart International – present in 26 other countries, with supercenters, supermarkets,
warehouse commerce and e-commerce presence in 10 countries. This accounts for 25% of the
company’s sales.
3. Sam’s Club – This is membership only shopping and it is present in 44 states in the U.S. and
Puerto Rico. This club offers grocery and consumables and accounts for about 12% of net
sales.
COMPANY’S OPERATIONS

8. After expanding
globally in 1991,
Walmart
experienced
considerable growth.
The company then
extended its markets
by purchasing viable
companies and
learning new
concepts from other
countries, both of
which aided the
company's market
expansion
significantly.

9. GLOBAL LEADERSHIP STRATEGIES
 CANADA – because the business environment in Canada was very close to the United States and according
to management it was an easier destination for a new entrant.
 MEXICO – it was an attractive market for the company due to its large population. Walmart was successful
in Mexico because the larger the population the more likely the demand for goods and services.
This low-price model is a major strategy that was used by Walmart when venturing into new international
markets. The company when introducing its products into new global markets took the option of selling the
products at low prices so as to acquire a bigger market share and penetrate deeper into the market with ease.
Clearly, this strategy worked effectively in some markets such as the US but was not as successful in other
markets, for instance, China and UK.
In another strategy, the company successfully entered into joint ventures so as to introduce products in foreign
markets. Strategically, the company used discounting, which proved to be successful in some regions. However,
it was unsuccessful in others. After failing in Germany, the company strategized by adopting a leadership
strategy and applying effective leadership theory in its day-to-day operations. This has resulted in tremendous
changes in its current new markets.

10. GLOBAL EXPANSION STRATEGIES
 As shown in the table above, the Company diversified its international operations rapidly to various
countries.
 When venturing into new international markets, the company’s strategy is to adopt a low-price
Model is a major strategy.
 In order to penetrate different markets, the company adopted different modes of entry depending
on the market they were trying to enter.

11. After expanding
globally in 1991,
even though there
was growth over the
three segments in
terms of profits,
overall, the total
company increase
declined drastically
even though there
was an upturn in
2012 the graph
shows the
considerable decline
after the
appointment in 2014
of the new CEO.

12. CULTURAL PROBLEMS IN INTERNATONAL MARKET
Walmart International employed American employees, however, this did not work effectively in some of the
foreign markets, for instance, Germany. Leadership theory, generally calls for not only sound management
practice but also sensitivity to diversity. In the case of entry into Germany, the management process of
employees in America is different from the German market and or other foreign markets.
 Most countries embrace employee feedback; however, this was not the case with Walmart International.
Instead of requesting feedback, top management made all the decisions and therefore failed to engage
subordinates as well as other lower cadre employees.
 Another cultural problem faced by the company was the language barrier, this resulted in poor
communication between customers and American employees working in the foreign markets.
According to stakeholders’ theory, Walmart should have welcomed diversity in its human resource to serve the
interests of both customers and staff.

13. STRATEGIES – SUCCESS OR FAILURE
 The company succeeded in most of the foreign markets by introducing products at low prices. In fact, its
success in Mexico was influenced by the country’s large population. Its’ expansion in Mexico was fast, and
this pivoted into a joint venture with retail conglomerate Cifra, which resulted in Walmart acquiring majority
shares. Presently, Walmart has its businesses operating in more than 145 cities in Mexico. A low pricing
strategy is a well-known marketing tool, it facilitates products and services to penetrate the market faster due
to their affordability to their target market. The strategy adopted helps in combatting competition, thereby
increasing the volume of sales and profitability.
 Walmart also utilized offering discounts which prove to be a very effective tool in some foreign markets;
however, this same strategy proved unsuccessful in other countries, for example, Germany. Walmart
struggled for many years in Germany, until they were forced to sell its shares to Metro Supermarket, a
competitor. The company’s stakeholder theory did not work well with most employees in Germany. In fact,
the company was delinquent in addressing employees’ values and interests. One such instance was the close
control management strategy that Walmart adopted but the employees in Germany did not welcome this as
they are accustomed to freedom in their work.

14. LESSONS LEARNT
 Leadership and Management – Walmart's entry into Germany resulted in a very costly struggle. In hindsight, the
company’s failure to analyze Germany’s local market and culture before venturing resulted in a continuous impact of
poor management and leadership. Both employees and customers alike, claimed to be very frustrated, therefore
showing that Walmart had failed in corporate social responsibility. Effective leadership and management are generally
essential tools in businesses since they highly determine the company’s future survival and success. Applying this to
Japan, where the company was again blamed for its poor leadership and management strategies.
 Research and Development – Despite challenges faced in Japan the company survived. In fact, Walmart has even
announced profits after focusing on strategies that promoted the satisfaction of stakeholders’ interests. As such, any
company intending to enter a new market should conduct proper research and development prior to doing so. The
advantage of this would be to acquire proper knowledge of the market, customers, suppliers, competitors as well as
other relevant information. Prior to entering the new market, Walmart should have keenly carried out these strategies.
 Highly Trained and Qualified Personnel – Failure as reported in both markets was a result of poorly qualified
personnel and poor treatment of employees. In order to cater to and enhance the employee-employer relationship
and employee-client relationship effectively, employees require effective and quality training. Moreover, a highly
qualified management team is also very important, more so when starting a new business in essence to making the
right decisions as well as putting the right strategies into action.

15. SUMMARY

16. THANK YOU

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