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Walmart Failure in Germany

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Many companies’ ambitions to position themselves (profitably) in foreign markets or to establish themselves as “global players” have been thwarted by their inability to fully understand and to adapt to the specific conditions of doing business in other countries, exposing their profound lack of intercultural competence and management skills.

This is exactly what happened to Wal-Mart Germany. To begin with, it appointed four
CEOs during its first four years of operation. The first was Rob Tiarks, a US citizen and a Wal-Mart, Inc. senior vice president who had previously supervised around 200 US
Supercenters from the company headquarters in Bentonville, Arkansas. Not only did he not speak any German. Due to his unwillingness to …show more content…

• So far Wal-Mart Germany has not succeeded in delivering on the second part of its value proposition – “excellent customer service” – either. By contrast the company has repeatedly been rated as only just or even slightly below average in terms of overall consumer satisfaction (Table 7).67 In our view, this is because
Wal-Mart’s traditional US-centered view of customer service, enshrined in some of its famous/notorious basic beliefs and rules, is only partly compatible with the expectations of German consumers. This is in particular true of the famous “tenfoot- rule” (“three-meter-rule” in metric Germany) and the institution of the
“greeter” (which, in the meantime, have been largely abolished after shoppers unaware of its key role in Wal-Mart’s service concept had repeatedly complained that they had been harassed by strangers on store premises). While yielding little tangible economic benefits – German consumers have been accustomed for decades to shopping at self-service formats without any staff assistance

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