Geert Hofstede, a Dutch researcher, identified five dimensions of cultural variation in values in more than 50 countries and three regions (East Africa, West Africa, and Arab countries). Initially, he relied on a database of surveys covering, among other things, the values of employees of subsidiaries of IBM in 72 countries (Hofstede, 2001; Hofstede & Hofstede, 2005). He analyzed 116,000 questionnaires, completed in 20 languages, matching respondents by occupation, gender, and age at different time periods (1968 and 1972). Over the next several decades, he collected additional data from other populations, unrelated to IBM, but matched across countries. Hofstede’s five dimensions reflect basic problems that any society has to cope with, but for which solutions differ. They are power distance, uncertainty avoidance, individualism, masculinity, and long-term versus short-term orientation (see Figure 17.1). These five dimensions were verified empirically, and each country could be positioned somewhere between their poles. The dimensions are statistically independent and occur in all possible combinations. Other researchers generally have confirmed these dimensions (Barkema & Vermuelen, 1997; Gerhart & Fang, 2005; Sondergaard, 1994; Triandis, 2004). Figure 17.1 The Five Dimensions That Hofstede (2001) Identified in Assessing Cultural Differences Across Countries Power distance refers to (a) the extent to which members of an organization accept inequality and (b) whether they perceive much distance between those with power (e.g., top management) and those with little power (e.g., rank-and-file workers). Hofstede found the top power-distance countries to be Malaysia, Guatemala, and the Philippines; the bottom ones were Austria, Israel, and Denmark. Uncertainty avoidance is the extent to which a culture programs its members to feel either comfortable or uncomfortable in unstructured situations (those that are novel, unknown, surprising, different from usual). Countries that score high on this dimension (e.g., Greece, Portugal, Belgium, and Japan) tend to rely more on rules and rituals to make the future more predictable. Those that score low (e.g., Singapore, Denmark, Sweden, and Hong Kong) tend to be more pragmatic. The United States scores low on this dimension. Individualism reflects the extent to which people emphasize personal or group goals. If they live in nuclear families that allow them to “do their own thing,” individualism flourishes. However, if they live with extended families or tribes that control their behavior, collectivism—the essence of which is giving preference to in-group over individual goals—is more likely (Triandis, 1998). The most individualistic countries are the United States and the other English-speaking countries. The most collectivist countries are Guatemala, Ecuador, and Panama. Hofstede’s fourth dimension, masculinity, is found in societies that differentiate very strongly by gender. Femininity is characteristic of cultures where sex-role distinctions are minimal. Masculine cultures tend to emphasize ego goals—the centrality of work, careers, and money. Feminine cultures, by contrast, tend to emphasize social goals—quality of life, helping others, and relationships. Hofstede found the most masculine cultures to be Japan, Austria, and Venezuela, whereas the most feminine were Sweden, Norway, and the Netherlands. Finally, long-term versus short-term orientation refers to the extent to which a culture programs its members to accept delayed gratification of their material, social, and emotional needs. Countries scoring highest in long-term orientation include China, Hong Kong, and Taiwan; Pakistan, Nigeria, and the Philippines score at the opposite end. Americans tend to be relatively short-term oriented. There have been a number of critiques of Hofstede’s work (Ailon, 2008; Baskerville, 2003; Eckhardt, 2002; Kitayama, 2002), yet his typology remains remarkably influential (Bhagat, 2002; Kirkman, Lowe, & Gibson, 2006), both in science (Oyserman, Coon, & Kemelmeier, 2002; Schmimmack, Oishi, & Diener, 2005) as well as in practice (Bing, 2004). In a comprehensive meta-analysis of almost 600 studies based on Hofstede’s cultural-value dimensions (except for long-term versus short-term orientation, for which there were too few studies), representing more than 200,000 individuals, researchers drew the following conclusions: First, cultural values predict country-level differences best (average metacorrelation of 0.35), and individual-level differences less well (average meta-correlation of 0.18). Second, the predictive power of the cultural values was significantly lower for personality traits and demographic characteristics for certain outcomes (job performance, absenteeism, turnover), but it was significantly higher for others (organizational commitment, citizenship behavior, team-related attitudes, and feedback seeking) (Taras, Kirkman, & Steel, 2010; Taras, Steel, & Kirkman, 2012). Hofstede’s work is valuable because it provides a set of benchmarks against which other studies can be organized conceptually. For example, the Global Leadership and Organizational Effectiveness (GLOBE) research project (one of the most comprehensive studies yet) categorized countries on nine cultural dimensions: assertiveness, future orientation, gender differentiation, uncertainty avoidance, power distance, institutional collectivism, in-group collectivism, performance orientation, and humane orientation (Dorfman, Javidan, Hanges, Dastmalchian, & House, 2012). Those dimensions reveal much overlap, even synthesizing, of the factors reported by Hofstede. They help us to understand and place into perspective current theories of motivation, leadership, and organizational behavior. Running Head: WALMART ANALYSIS FOR LEADERSHIP Walmart Analysis for Leadership Final Paper Darien Greene BUS 621 Leadership and Teamwork Dr. Allen 12-9-2019 1 WALMART ANALYSIS FOR LEADERSHIP 2 Introduction Walmart is a multinational retail company that is American by origin and operates a series of grocery and departmental stores. The headquarters of the company are located in Arkansas. Sam Walton built the company from 1962 and incorporated it in 31st October 1969. The corporation also runs and owns Club warehouses. From records dating 31st October 2019, wall mart holds and manages 11,438 clubs and stores in twenty-seven countries across the globe under fifty-five different names. Walmart is the company’s name for the operation in Canada and the United States. Other names correspond to various countries, which include Walmart de Mexico Centroamerica operating in Mexico. Seiyu group working in Japan, Asda was running in the United Kingdom, Best Price operating in India and other operations in South Africa, Chile, Argentina, and Canada. The company holds the top position in revenue collection globally, as indicated by the Fortune Global 500 2019 list. Walmart holds the first position globally as the leading private employer globally, with over 2.2million employees. The company is publicly traded in the New York stocks market, but it is family-owned thus run by the Walton family. The family heirs hold possession of over fifty percent ownership through the family-owned Walton enterprises and also through personal individual holding. The company got listed in the NYSE in 1972, and by the year 1988, it was ranked as the most profitable retail company in the United States. The companies venture outside the United States have seen mixed results with establishments in China, Canada, the United Kingdom, South America and Central America recording great success while investment attempts in South Korea and Germany terribly failed. The aim of this analysis is to ensure that teams entrusted with leadership fully understand the complexities of venturing to new markets, and in this case, Egypt. WALMART ANALYSIS FOR LEADERSHIP 3 Analysis of Leadership Models Leadership models are not styles that are developed for handing out orders or bossing employees around but styles that ensure the cooperation and coordination of various teams within an organization with the aim of achieving the objectives of the company. The forms must involve the development of skills and leadership principles that enable a person to establish their position as a leader. Shared Leadership This kind of model involves the vesting of leadership powers to a group instead of an individual. The system of leadership shows lots of flexibility and has capabilities of withstanding sudden organizational structure changes. This leadership model is known to foster a strong cooperative and collaborative spirit among employees, thus resulting in increased productivity of employees (Wert, 2018, p.22). The kind of leadership advocated by this model ensures that proper decision-makers are spread across all significant steps hence achieving improved quality control. In this model, employees are left to apply their own creativity resulting in high-quality outputs and better processes. A model is an option that Walmart could use in Egypt, especially in the Entry stage, where other styles might come in after the company settles in the country. Laissez-Faire Leadership In this model of leadership, the supervisory role of a leader is minimal as the company relies on members of the team exercising their initiatives, thus playing more significant roles in decision-making processes. The style is having a very high potential for success where the employees have high levels of individual talents and are applicable by Walmart in the Egyptian situation. This would apply only if the team is first guided by some sets of principles developed at WALMART ANALYSIS FOR LEADERSHIP 4 the company level and ensures the continued working of all the organizational systems. This kind of leadership allows for increased freedom, something that excites the majority of stakeholders and employees (Herman, 2018, p.168). This action further encourages the employees and the stakeholder to achieve their targets and spur creativity and innovation, thus pitting the company on fast lines of growth. The shared leadership model would be more suitable in dealing with employees and stakeholders in Egypt as the culture of the country is based on a long history of formal education and ventures in sales, thus ensuring the company of a constant supply of motivated and talented employees and stakeholders. Leadership Competencies Beneficial to a leader in Egypt The environment presented by the Egyptian retail market is that of high competition and great potential, especially following the culture of the Egyptians where visiting grocery stores is a must as their foods are comprised of vegetables and spices going with the majority of their cuisines. Leaders in this region must, therefore, possess qualities that would act in favor of Walmart in ensuring market penetration and growth( Qoura, 2016,p.77). The potential leader in this region must display Social intelligence: this is the potential to understand social situations and changes and the ability to work in areas of massive cultural diversity effectively. The skills of social information allow the leader to deal with sensitive social situations, especially in areas where people take traditional cultural practices seriously. This quality would help the manager easily engage with the Egyptian employee and stakeholders, thus helping push the agenda of the company. WALMART ANALYSIS FOR LEADERSHIP 5 Interpersonal skills: This skill refers to the relational oriented aspects of an individual. The top leadership must possess excellent socialization skills, especially when entering new markets to ensure that they are able to effectively associate with the influencing figures in the society towards the achievement of the organization's goals(Stephan, 2016, p.515). The Egyptian community is primarily influenced by the decisions of community elders like the majority of Arab and Islamic countries. Thus good relationships with the elders would ensure guaranteed success for the company. Intelligence/ Emotional skills: the ability to understand emotional situations, communicate at emotional levels and be in line with personal emotions directly relates to the personal charisma of the leader(Jackson, 2016, p.34). Charismatic leaders have higher chances of achieving their targets as they Can connect with employees, customers, and stakeholders, thus finding standard solutions to diverse issues and thus ensuring the success of the company. Prudence: The ability to be wise and visualization of issues from other people's perspectives. This ability is essential in all leaders as it helps them consider the points of view of other persons. This ensures a connection with all employees and stakeholders, thus ensuring the achievement of the company's objectives. Courage: the notion of courage lies with the ability to make calculated moves and stick in one's personal beliefs. This quality is essential since the character that a leader displays to their subjects have a direct effect on the characteristics of the employees and stakeholders in the work environment. A fear which is the opposite of courage makes it difficult for individuals to take initiatives and thus unable to advance the interests of the company, especially in anew environment. WALMART ANALYSIS FOR LEADERSHIP 6 Cultural Leadership Concepts Application in Egypt Cross-cultural leadership requires the psychological skills that enable people to understand the interactions of individuals from different cultures. This kind of leadership is essential, especially to leaders who work in the global market where regions are melting pots of cultural interactions. A leader hoping to practice in Egypt must be in a position to comfortably interact with people of Arabic culture and Islamic religion. They must understand the dominant lifestyles in the land and hence tailor the products of the company to satisfy the requirements demanded by such groups. A good example is the Sharia compliance of meat and animal products that all Islamic followers require for the foods at a sale to be accepted for consumption. The assumption that a successful manager in one country will automatically succeed in the next. The challenges posed by the Egyptian Market are entirely different from those that you would face in countries like India, Argentina, or the United Kingdom. Leadership skills and Practices Applicable to Egypt Communication: Communication is an essential skill as the leader must have the ability to follow the right channels of passing information in a clear way to the employees and stakeholders for group cohesion and deliverables achievements. Motivation: The potential leader in the country must possess the skill of motivating his employees to empower them and give them positive energy to achieve the objectives of the company. Delegating: excellent delegation skills remove the bulk of workload on the leaders hence helping them focus on the more pertinent issues. Situations where leaders are present on all occasions and WALMART ANALYSIS FOR LEADERSHIP 7 responsible for the supervision of all actions, lead to reduced creativity and motivation in the group. A leader working in Egypt must be able to delegate some duties to trusted employees. Positivity: Positive attitudes in a leader goes a long way in helping achieve what previously seems impossible. It is thus mandatory to have positive leaders if we are to ensure the success of the company. Trustworthiness: The quality of integrity determines whether the employees and stakeholders can trust the leader in the country in the company. The kind of leader that is required in Egypt is one who I true to his word since the majority of the community member traditionally value gentleman agreements. Creativity: The potential leader must display creative skills that help him come up with tailormade solutions to new challenges. New markets are bound to pose new challenges, and hence the leaders must be ready to rise to the occasion when the situation calls. Feedback: The ability of a leader to pass on useful information to his team is an essential aspect of the new market. communication and input from the leadership must aim at helping the employees achieve their objectives by identifying their weaknesses and working on possible solutions Responsibility: The responsibility of all leaders must be of the highest level. This is because all the employees look up to their leaders, for evaluation of the standards that they should keep. It is necessary for leadership to show responsibility if they expect the employees to follow suit. WALMART ANALYSIS FOR LEADERSHIP 8 Preliminary Analysis of Egypt Egypt is an Arabic country that is located on the North-Eastern end of the African continent. The Sinai Peninsula region of the state extends into the Asian continent, thus making it a country that traverses two continents at the same time. It borders with Israel and the Gaza strip, which is considered as Palestinian territory. The country is the home to the Suez Canal, and thus the majority of trade vessels in the world have to pass through its regions. It is a regional economic powerhouse with a rich history going back to thousands of years. The rich culture of the people inhabiting the country is historically entrenched in the major religious books of the Bible and the Quran. The educational system in the country is superb, and its universities are responsible for producing the highest number of graduates in Africa. The country has an estimated 100 million inhabitants with significant economic activities being trade, tourism, manufacturing, and Agriculture. Although a large part of the country is covered in the desert, the country has an all-year-round supply of freshwater from the river Nile that runs across Africa. The country has enjoyed good economic progress since the ouster of the dictatorial president by the military. Economic prosperity in the country is attributable to the increased trade traffic in the Suez Canal, where the government collects enough revenues to spar economic growth. The employment levels in the country are relatively good and thus having a population whose spending power is far beyond that of many African countries. The selection of the country is due to the rising spending power of the newly created middle-class citizens and also as an alternative option of relocation for the diminishing South African investment. The presence of the company in Africa is an integral part of the global image of the company and also future expansion. The majority of the European and American markets are saturated, thus leaving the Africa continent as the only market with potential growth value. WALMART ANALYSIS FOR LEADERSHIP 9 Dimensions of Culture in Egypt The cultural orientation of the Egyptian population is affected by the rich Islamic culture and the long traditions in the country ranging for thousands of years the cultural theories the global theories applicable in Egypt include • Individualism vs. Collectivism The individualism theory in Egypt suggests that local workers engage in their activities independent of their coworkers, while collectivism indicates that the worker in the country work with a certain level of interdependency(Quora, 2016, p.489). The Egyptian workers from the research are more individualistic characters with high competitive levels, thus suggesting that the new market is likely to have an ample supply of qualified and motivated workers who can follow the policies of the company without the threat of external influences. • Masculinity vs. Femininity The Egyptian population is mostly based on the Islamic faith, which is traditionally a patriarch tradition. The woman in the country is expected to work in roles that support the success of men. Therefore, it would be advisable for the company to select male leaders in the country to avoid possible culture crush with the locals. • Uncertainty Avoidance This factor aims at establishing the comfort that employees display when confronted with change. The recent political incidences in Egypt that involved riots speaks much of the culture WALMART ANALYSIS FOR LEADERSHIP 10 where individuals have become more receptive to change. In fact, the majority of the employees would be very supportive of expected changes in the company. Conclusion The possible venture by Walmart into Egypt represents a high possibility of potential in the retail business. This is mainly attributable to the high level of education in the country where the majority of the people are conversant with the American culture. The reception of American brands such as P&G has been okay, suggesting that Walmart should not have troubles in establishing itself in the market. The major challenge for the company is the level of competition in the market. Walmart has to go the extra mile to attract and retain the Egyptian customer. The company must take advantage of the growing spending power among the Egyptians and thus provide an option of good quality retail products and world-class customer experience. The African and Asian regions represent the enormous unsaturated market in the world. Entry into the area guarantees Walmart's chances of future growth and hence, possibilities of increased profitability. The sizeable Egyptian population guarantees of the ready market with compliance with the Islamic culture being one of the major bridges that the company should consider using to beat the competition. The expected growth due to changes in the political regime makes Egypt a significant attraction to investors. WALMART ANALYSIS FOR LEADERSHIP 11 References Wert, J., Sowcik, M., & Niewoehner-Green, J. (2018). [WC313] Leadership Skills Series# 2: General Leadership & Purpose/Values. Herman, R. D. (2016). Executive leadership. The Jossey-Bass handbook of nonprofit leadership and management, 167. Qoura, O., & Khalifa, G. S. (2016). The Impact of Reputation Management on Hotel Image among Internal Customers: The Case of Egyptian Hotels. International Journal of Heritage, Tourism, and Hospitality, 7(2). Stephan, U., & Pathak, S. (2016). Beyond cultural values? Educational leadership ideas and entrepreneurship. Journal of Business Venturing, 31(5), 505-523. Jackson, T. (2016). Paternalistic leadership: The missing link in cross-cultural leadership studies? WALMART ANALYSIS FOR LEADERSHIP 12
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