Market Entry And International Strategy For Woolworths In Russia

This assignment is worth 45% of the total marks for this subject. This assessment task relates to all 6 Learning Objectives for the subject.

Continuing with your chosen firm and country used in Assessment Item 2, you will now need to prepare a second report for the company which:

• recommends the most appropriate entry mode, corporate and business level strategy and human resource approach
• outlines the international strategy for the company/organisation
• outlines the multinational structure for the company/organisation; and
• provides recommendations for motivating and leading cross cultural staff.

The structure of your report is outlined in the "Presentation" section below.Online submission via Turnitin is required for this assignment. Details will be provided by your subject lecturer.

Rationale

This assessment task will work towards assessing the following learning outcome/s:

• be able to evaluate the implications for managing teams and businesses in a globalised world.
• be able to evaluate the main theories, concepts and models of culture and use these theories to make recommendations regarding management of cross-cultural communication, negotiation and conflict resolution in a multi-cultural team environment.
• be able to investigate cultural differences in relation to decision making, motivation and leadership and recommend management strategies for Human Resource policy and leadership of cross-cultural teams.
• be able to effectively communicate recommendations regarding the viability, form and function of a firm's international operations.

This assessment task is designed to: 

• encourage independent research into the cross-cultural management issues of doing business in a particular country
• allow you to apply your understanding of macro-economic issues when recommending strategies for international operations
• provide you with experience in writing an authentic workplace report that includes recommendations and justifications which are based on research and analysis.

Summary of the macro environmental issues relevant to Russia

The report will be based on the analysis of the ways by which a global organization can plan to enter the market of a new country with the help of effective market entry based strategy. The company that has been considered for the analysis is Woolworths which currently has its operations in Australia and New Zealand. The organization is planning to further expand its market and operations with the help of proper international market entry. The recommendations that will be made in the report will be based on the most appropriate mode of the entry of Woolworths in a completely new market area (Doz, 2017). The processes that can be used by the company in order to manage the cross-cultural teams are also considered to be important factors that need to be considered in the report.

Woolworths has acquired the position of one of the largest supermarket based chains in Australia. The organization mainly operates more than 900 stores all over the country. Woolworths relies on its 115,000 members in order to provide the best services to the customers in Australia. The company has been working closely with the Australian farmers and growers in order to offer the best quality of products to the consumers. The collaboration of Woolworths with the farmers and growers has been able to provide the company with a position of the fresh food people of Australia (Woolworthsgroup.com.au., 2018).

4. Summary of the macro environmental issues relevant to the country

As discussed by Buckley and Ghauri (2015), the macro environment of Russia is affected by different factors which include, the political and the legal environment of the country. The political changes which have been taking place in Russia have been able to play a key part in the ways by which different organizations that operate in the country are affected. The foreign relationship based strategy that has been developed by the government of Russia has provided major chances to the global organizations. The development of technology is also supported by the government and this is able to ensure the growth which has been showed by the economy.

As argued by Angwin and Meadows (2015), the relationship which is shared by Russia with the other countries has also proved to be effective and supportive for the global organizations. The legal conditions of the country on the other hand have changed in order to follow the capitalist regime developed in Russia. The economic freedom based index of Russia has been ranked at the 107^th position and the growth of Russian economy has been reduced due to the transitions which have taken place. The cultural aspects of Russia are divided into various parts which include, folk dancing, arts, cinema, politics, animation and ballet.

5. Recommendations based on the entry with justifications

According to Azmeh and Nadvi (2014), the economic and political analysis of Russia has been able to depict that the growth of the economy is quite slow due to implementation of market capitalist regime. The control of government over the market has also been able to slow down the growth based on entry of different organizations. The political conditions of the country are also not quite stable in nature and have been able to affect the operations of different organizations. The development of policies and procedures which will be implemented in the operations in Russia are also heavily dependent on the government of the country. The high rates of corruption in the country have been able to affect the methods by which Woolworths operates in the industry. The legal considerations which need to be made by Woolworths in its operations in Russia are able to affect its operations in a huge way.

Recommendations based on the entry with justifications

As argued by Bamiatzi et al. (2016), the most appropriate mode of entry for the organization in Russia is joint venture with an organization that already operates in the country. The merger of the operations of Woolworths with a Russian organization will play a key part in the ways by which the firm can manage different issues which take place due to the political and legal factors. The major objectives of Woolworths that will be fulfilled by entering the market with the help of joint venture include, reward or risk sharing, market entry, joint development of products and sharing of technology. The alliance will prove to be highly favourable for the ways by which Woolworths aims at developing the operations in Russia. Woolworths will be able to analyse the market and choice of consumers easily with the help of joining its operations with a local organization.

According to Barrales?Molina, Martínez?López and Gázquez?Abad (2014), the partner organization of Woolworths will play a key part in the effective growth of regulations and policies which can be implemented by the operations of the company in Russia. The most important advantage which will be provided to Woolworths by the joint venture based organization is based on the development of resources in the new market area. The joint venture related agreement can be made by the company for a short term or long term basis. The short term agreement will enable Woolworths to operate solely after it is successful in understanding the market in an appropriate manner. This will play a key part in the methods by which Woolworths is able to develop its position in the country in an effective manner.

6. International strategy for the company

According to Coviello (2015), the international strategy that will be implemented by Woolworths in the retail industry of Russia will be able to play a major role in the operations of the company. The strategy needs to be implemented in such a manner which can depict the local choices and demands of the customers. The main aim of the company behind the development of an international strategy which includes local choices is providing tough competition to the local companies which offer similar products and services. Woolworths will however maintain the focus which it has always provided to the customers. The orientation of the company towards the customers is thereby considered to be an important part of the international growth based strategy.

As argued by Cuervo-Cazurra et al. (2016), the service which is provided by the company to customers is an significant factor which affects its operations in the new area of the market. The international strategy therefore needs to depict the local needs and culture which is followed by people in the country. The procurement of fresh products has proved to be a major success factor of Woolworths in the ways by which it plans to operate in the industry.

The organization will thereby need to include this factor within the international strategy that will be implemented in Russia. The development of an effective supply chain is considered to be a major part of the international strategy implemented by Woolworths. The organization thereby needs to develop an effective supply chain in order to offer the products to customers in the most effective manner.

International strategy for the company

7. Multinational structure for the company

According to Dai et al. (2014), the development of a multinational structure is able to play a main part in the ways by which organizations are able to operate in different global locations. The global organizations thereby need to develop the structure in such a manner which is able to facilitate different operations effectively. Global organizations need to adjust to the different external factors which are able to affect the operations and levels of profitability as well. Woolworths will thereby need to develop the organizational structure in such a manner which will deepen the involvement of the company in that particular area. The reporting based structures of the company will be quite different in the global locations as compared to the local areas.

As discussed by Dant and Grünhagen (2014), the growth of an organization is able to affect the structure which is developed in the global areas. The structure which has been implemented by Woolworths is hierarchical in nature and the reporting system is followed in the company. The non-executive directors of the company and the chairman report to the CEO of Woolworths. The general managers of different departments and the directors also report to the CEO of the company. Woolworths can implement the same structure in its operations in Russia. The hierarchical structure will be followed in an effective manner with the help of focus on the different groups of customers.

The management can provide different positions to the heads of various departments which will be helpful in the proper maintenance of operations. The local involvement can be increased by Woolworths with the help of proper development of the structure of the company. The management can also include local employees within the organization so that they are able to understand the needs and demands of the consumers in the country. The international division of the organization will be developed in order to maintain the operations of Woolworths (Doz, 2017).

8. Strategies and methods used for the leadership and motivation of the cross cultural teams

As discussed by Hitt (2016), Woolworths is an Australian organization which is planning to expand its operations in Russia. The management of cross-cultural teams is considered to be a major part of the proper development of operations of global organizations. The levels of trust which have been developed within the employees in the organizations are affected in a huge manner by the cultural differences. The development and creation of trust is quite difficult for the management of global organizations. The management thereby has to face effective levels of challenges while operating in the multicultural teams.

According to Holmes Jr et al. (2018), The challenges that will be faced by the company based on proper management of the teams can be solved with the help of proper communication. The management of Woolworths can thereby take the following steps in order to maintain the multicultural members of the team.

• The members of the team need to make efforts in order to know each other and learn their journey effectively as well. The employees need to be provided with effective levels of encouragement in order to use the knowledge and skills. The multicultural teams consist of individuals who possess unique skills which can prove to be beneficial for the members.
• The management of the company can take different steps in order to understand the employees and their needs in an effective manner. The members need to be provided with effective levels of opportunities so that they are able to show their individual talents (Hotho, Lyles & Easterby?Smith, 2015).
• The structure of the cross cultural team needs to be developed in order to ensure the success of the organization. Woolworths needs to aim at providing an effective direction to the team so that the members are able to access the information and resources effectively. The diversity levels within the organization are thereby able to affect the ways by which decisions will be made in Woolworths.
• The management and members of the team need to understand the differences which exist between the cultures which are followed by them. The best method which can be applied in order to solve the issues based on miscommunication are based on proper implementation of self-service based software by Woolworths. The members of the cross cultural team are able to know each other with the help of this software (Jannesson, Nilsson & Rapp, 2016).
• The management of the organization needs to develop clear rules and regulations and further maintain them as well. The team leader in Woolworths has the major responsibility of developing clear and effective norms that will be implemented in different operations. Woolworths is known in the Australian retail industry for managing the levels diversity within the organization in an effective manner. The company will thereby be successful in managing the multicultural teams in an effective way (Laufs & Schwens, 2014).
• The proper development of personal bonds within the employees will also be able to play a key part in the management of the members. The individual levels of connections will be able to bring high levels of collaboration among the employees. The collaboration based levels will be able to affect the wats by which the decisions are taken within the organization.
• The management and leader of the multicultural teams need to solve the conflicts and issues which can take place within the organization. The different levels of conflicts that can thereby take place within the multicultural members are able to affect the operations in a huge manner (Leonidou et al., 2017).

According to Mainela, Puhakka and Servais (2014), the cross cultural management and development of effective teams will thereby be able to play a key part in the ways by which the firm operates in the industry. The cross cultural team will be able to provide major levels of benefits to the organization based on the ways by which different challenges can be faced by the company. The cultural differences between the two countries namely, Australia and Russia are quite evident and these differences can affect the ways by which Woolworths manages the teams.

Multinational structure for the company

As discussed by Morschett, Schramm-Klein and Zentes (2015), the levels of motivation which are provided to the multicultural teams are able to play a major in the operations of international organizations. The process of motivating these employees who belong to different cultures is quite challenging in nature. The management of Woolworths can thereby implement some effective motivation based techniques which will be able to play a major role in developing common traits. The different techniques which can be implemented by the company in order to maintain the operations of multicultural teams are as follows,

• The proper definition of the culture and analysing many other differences including the race, colour and sex is an important technique. The employees will be able to understand the wants and demands of the customers in an effective manner (Zander, McDougall-Covin & Rose, 2015).
• The management can also conduct a survey in order to learn the different preferences of the employees based on their work based styles. The ways by which the managers and supervisors are able to provide their feedback based on different aspects of the organization. The proper survey of opinions of the employees is also considered to be an effective technique of providing effective motivation (Nuruzzaman & Singh, 2017).
• Woolworths needs to utilize different talents of the multicultural workforce in order to motivate them to provide their best levels of performance. The employees thereby need to provide their suggestions based on the levels of their comfort (Zander, McDougall-Covin & Rose, 2015).
• The development of cross-departmental focus based groups can prove to be a major technique based on motivating the employees effectively. The different departments will thereby be provided with various responsibilities which are required to be fulfilled by them (Raghunath & Rose, 2017).

As discussed by Rugman and Verbeke (2017), the leadership of different multicultural teams will play a key part in the operations of the company. The most important part of the leadership quality which needs to be possessed by the leader of these teams is transformational leadership. The transformational leaders are able to manage the teams in an effective manner with the help of proper communication levels and sharing the vision of the company. The development of a common vision is thereby able to play a main role in the methods by which the firm is able to operate in the industry. The multicultural teams in Woolworths will thereby be managed by the transformational leaders effectively which can further help in the proper management of the multicultural teams within the company.

9. HR recommendations

The international human resource management of the organizations are able to play a key part in the operations of multinational corporations in modern business environment. The IHRM based functions are thereby based on different activities which include, staffing policies, selection, recruitment, motivation, remuneration, development and training, performance appraisals, foreign assignments and industrial relations. The development of the technologies including computer based technology, telecommunication and lower costs are major factors which affect the organizations which operate on a global basis (Shenkar, Luo & Chi, 2014).

The human resource management based activities that will be performed by Woolworths in the new area of its operations are based on different factors that include, division of the products, global division of the area and the global matrix structure. The HRM based policies which were used by Woolworths in the operations in Australia can be transferred to its operations in Russia. The various policies thereby include, the physical layouts, the leadership style and motivation, entitlements of the holidays and the quality circles (Solberg, 2017).

The different staffing based methods that are used by the global organizations include, geocentric, polycentric, ethnocentric and regiocentric. The process which will be used by Woolworths will be the geocentric approach, where the company will be able to hire the suitable employees without considering their nationality. Woolworths will thereby implement this strategy in order to hire the suitable employees in different positions with the help of proper recruitment based strategies (Trigeorgis & Reuer, 2017).

10. Marketing based considerations

According to Wang et al. (2014), the marketing based strategies that have been used by Woolworths are based on the dynamic business based environment. The changes which have thereby taken place within the external business based environment are able to affect the marketing strategies of Woolworths. The marketing based strategy of Woolworths has been able to provide highest levels of importance to the customers. The marketing based strategy of Woolworths which can be implemented in the retail industry of Russia will also be based on the customers and their needs and demands.

Motivating and leading cross-cultural staff

As discussed by Yan and Luo (2016), the organization will offer different discounts with the help of its website and apps in order to attract the customers towards the products that are offered to them. Woolworths will also use the feedback which is provided by the customers in order to achieve the highest levels of services which can be offered to them. The growth of Woolworths is also based on the methods by which the firm is able to satisfy the huge base of customers in an effective way. Woolworths will provide high levels of importance to the customer first strategy and the fresh products which are offered to the customers. These factors will thereby be highlighted effectively within the marketing operations that are conducted by the company within the retail industry.

11. Conclusion

The report can be concluded by stating that the operations of Woolworths within the retail industry of Russia will be supported by the human resource functions of the company and the strategies related to marketing which are implemented. The external environment based factors in Russia are able to affect the policies and regulations are able to affect the operations of Woolworths in a huge manner. The entry mode that will be used by Woolworths is based on a joint venture with a local organization. This process will play a key part in the methods by which the firm can establish its operations in the industry with the help of joint venture.

The levels of investment made by the company for entering the Russian market will be quite low due to joint venture. The international strategy of Woolworths is also suitable for the company to expand its operations in the retail industry of Australia. The human resource functions will also be able to a main part in the development of effective operations of the company in Russian retail based industry. The marketing activities of Woolworths will also play a major role in the ways by which the company can expand its operations in the industry with the help of its proper processes.  

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