Question

Outline strategies on how the firm should respond to the changes in the economic indicators with the goal of maximizing revenues in the years ahead. How have they done in the past? What is their current state? What kinds of plans and possibilities do they have for the future? Is there room for improving what they do? Should new ventures be added or old ones subtracted? Then, discuss the firm’s global operations, and their influences on the regional and national levels. You also need to assess the value of multiculturalism and diversity in operating (managing) a company in a global environment.....my company chosen is Walmart

Answer 1

The Regional Strategy

Broadly speaking, regional strategies can be classified into five types, each with distinct strengths and weaknesses. I have ordered the strategies according to their relative complexity, starting with the simplest, but that does not mean companies necessarily progress through the strategies as they evolve. Whereas some companies may indeed adopt the strategies in the order in which I present them, others may find themselves abandoning more-advanced strategies in favor of simpler ones good business is about striving to maximize value, not complexity. And capable companies will often use elements of several strategies simultaneously.

Disappointment with strategies that operate at a global level may explain why companies that do perform well internationally apply a regionally oriented strategy in addition to—or even instead of—a global one. Put differently, global as well as regional companies need to think through strategy at the regional level.

The leaders of these successful companies seem to have grasped two important truths about the global economy. First, geographic and other distinctions haven’t been submerged by the rising tide of globalization; in fact, such distinctions are arguably increasing in importance. Second, regionally focused strategies are not just a halfway house between local (country-focused) and global strategies but a discrete family of strategies that, used in conjunction with local and global initiatives, can significantly boost a company’s performance

The Portfolio Strategy.

This strategy involves setting up or acquiring operations outside the home region that report directly to the home base. It is usually the first strategy adopted by companies seeking to establish a presence outside the markets they can serve from home. The advantages of this approach include faster growth in nonhome regions, significant home positions that generate large amounts of cash, and the opportunity to average out economic shocks and cycles across regions.

A good example of a successful portfolio strategy is provided by Toyota’s initial investments in the United States, which seemed tied together by little more than the desire to build up a manufacturing presence in the company’s most important overseas market. What prevented this approach from destroying value was Toyota’s distinct competitive advantage: the celebrated Toyota Production System (TPS), which was developed and still works best at home in Japan but could be applied to factories

The Hub Strategy.

Companies seeking to add value at the regional level frequently begin by adopting this strategy. Originally articulated by McKinsey consultant Kenichi Ohmae, a hub strategy involves building regional bases, or hubs, that provide a variety of shared resources and services to local (country) operations. The logic is that such resources may be hard for any one country to justify, but economies of scale or other factors may make them practical from a cross-country perspective.

Hub strategies often involve transforming a foreign operation into a stand-alone unit. In the early 1990s, for instance, Toyota began producing a limited number of locally exclusive models in its principal foreign plants—previously a taboo—thereby signaling the company’s intention to build complete organizations in each of its regions. These plants thus started to serve as regionally distinct hubs, each with its own platform, whose products were designed for sale within the region.

Defining Regions

As companies think through the risks and opportunities of various regional strategies, they also need to clarify what they mean by the word “region.” I have so far avoided a definition, although most of my examples imply a continental perspective. My goal is not to be elusive but to avoid restricting the strategies to a particular geographic scale. Particularly with large countries, the logic of the strategies can apply to intranational as well as international regions. Oil companies, for example, consider the market for gasoline in the United States to consist of five distinct regions. Other large markets where transport costs are relatively high in relation to product value, such as cement in Brazil or beer in China, can be similarly broken down.

The general point is that one can interpret the regional strategies at different geographic levels. Assessing the level—global, continental, subcontinental, national, intranational, or local—at which scale is most tightly tied to profitability is often a helpful guide to determining what constitutes a region. Put differently, the world economy is made up of many overlapping geographic layers—from local to global—and the idea is to focus not on one layer but on many. Doing so fosters flexibility by helping companies adapt ideas about regional strategies to different geographic levels of analysis

        The value of multiculturalism and diversity in operating a company in a global environment

The concept of multicultural and diversity management encompasses acceptance and respect, recognition and valuing of individual differences. Diversity is defined as differences between people, that can include dimensions of race, ethnicity, gender, sexual orientation, socioeconomic status, age, physical abilities, religious beliefs, political beliefs, or other ideologies. Multiculturalism refers to the existence of linguistically, culturally and ethnically diverse segments in an organisation.

Diversity management is defined as, "the strategic alignment of workforce heterogeneity to include and value each employee equally on the basis of their diverse characteristics, and to leverage organisational diversity to enhance organisational justice and achieve better business outcomes. This has a strong focus on policies and programs that allows a company to fit people into an organisation. It is centered on surface-level differences and integration that centers on the company-specific culture. Typically, the company that uses multicultural and diversity management does not focus on minimizing the challenges within the cultures; rather they attract various employees and find methods to assimilate them into the company culture.

Ongoing globalization, increasing scale of migration, demographic changes, emerging markets and technology evolution lead to continuous change of the labor environment of contemporary organisations. The necessity of managing diversity and multiculturalism goes far beyond human resource management. Organisations can benefit from it with an increased level of innovation, improved employee engagement, better customer relationships and satisfaction, increases in operating profit and market share, and by achieving competitive advantage in the market.