Operational Issues: Walmart and Riordan

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Table of Contents

Abstract
Problems Faced By Riordan
Problems faced by Wal-mart
Problems Faced By Both Firms
Recommendations and Conclusion
Reference List

Abstract

The purpose of this business report is to analyze and evaluate the challenges faced by Wal-mart and Riordan, firms that operates in two different countries. Wal-mart is among the largest firms in the US, a position which it has earned through its marketing approach including low priced products, just-in time delivery, and its organizational behavior. It operates in major countries such as China, Canada, Brazil, Japan, and United Kingdom.

On the other hand, Riordan manufacturing is based in China and specializes in the production of plastics which are distributed in many parts of the world. Its product range includes plastic beverage containers, plastic fan parts, and custom parts for automobiles. Major customers for these products are in the aviation industry, appliance manufacturing, automobile industry, and bottlers of soft drinks.

Both firms face similar challenges although they operate in different countries. Most of these problems are political, legal, and environmental. The building blocks of a successful global business company starts with a sound strategy, which incorporates structural, leadership and cultural forces the business needs to take into consideration. This report gives some of the problems faced by these two firms in their operations.

Problems Faced By Riordan

These challenges can be summarized as follows:

Discrimination lawsuits through employee malpractice
Corporate social responsibility issues, and
Ethical dilemmas

Riordan faces Public relation issues mostly arising from these malpractices. The procedure for handling these issues are defined in Riordan’s Business Continuity Plan (BCP), which is a systematic strategy detailing how to mitigate those risks. The risk in a leaning strategy is in determining which activities are not critical to the core competence of the firm. If a firm mistakenly cedes out crucial activities it can severely cripple its long-term strategy (Mintzberg, et al 2003).

Problems faced by Wal-mart

Government regulation
Restriction on foreign ownership
Requirement of skilled labor
Opposition in its expansion strategies

Wal-mart faces similar problems as the ones faced by Riordan manufacturing. First there is the government requirement which it has to adhere to before being allowed to expand its services, increased capital costs, requirement of skilled labor force, and rivalry from other firms.

To add to these risks, the company is not guaranteed of a ready market in these areas making it a risky undertaking. Most of its expansion strategies are normally opposed by activities claiming that if new stores are opened, they will result in traffic congestion, poor public relations, and low wages (Wal-Mart Stores, Inc. 2008).

Problems Faced By Both Firms

Both firms have to abide by all state and local laws and enact a complicit information security policy, which will encompass all their corporate culture as a whole and applied to all new locations. Their risk management plans have to include training sessions for all managers on good ethical decision-making. Management needs to be taught contingency plans for looming risky situations and the steps necessary to mitigate them.

The simple steps are basic awareness of the ethical perspectives that serve as the foundation of good moral and ethical decisions, the art of explaining the principles of their position, and the application of understanding of an ethical decision that establishes those three principles into an action for the things they do on a daily basis (Mintzberg et al 2003).

There are also risks associated with innovation in which the companies continuously work to improve the product, as well as a lot of capital investment and strategy that takes place in this process. The simple changes or adjustments in existing products, services, or processes are called incremental innovation (Campbell & Craig 2005).

In launching a new product, Riordan and Wal-mart need a contingency in place for market and technology risks. Market risks come from uncertainty with regard to the presence of a market, its size, and its growth rate for the product or service in question, that is, do customers exist, and will they buy it? (Pearce & Robinson, 2009).

The risk emanating from technological assessments is the uncertainty of how the technology will evolve, and the complexity through which technical standards and dominant designs or approaches emerge. Some other identified challenges are unforeseen events such as hurricanes, fires, and manmade disasters.

Recommendations and Conclusion

Globalization of businesses is occurring rapidly in this day and age of fast paced technological advancements and endeavors. However, the success of business is measured by the strategies being deployed. The Business Continuity Plan provides the manual for addressing any possible risk management issues the business could face.

Continued evaluation of financial and operational performance ensures the business stays on top of their game tackling issues before they become major problems affecting the success of the business. Global marketing strategies call for developing strategies to develop and build brand image and loyalty among customers (Omolewu, 2007). This includes developing the positioning strategies as compared to competitors worldwide. Branding and positioning strategies must fit the product and the company across multiple countries.

Because Riordan’s and wal-mart’s primary customer base are global customers, advertising campaigns must be similar. In general, the goal is to seek mixed strategic alliance. The best option would be a strategic alliance with the goal of acquisition. The advantages of strategic alliances are significant for even greater economies of scale. Mixed Strategic alliances are effective at managing uncertainty, risks, and sharing cost.

Reference List

Campbell, D. J. & Craig, T. (2005). Organizations And The Business Environment. New York: Butterworth-Heinemann.

Mintzberg, H., et al (2003). The Strategy Process: Concepts, Contexts, Cases (4th ed.). New Jersey: Pearson-Prentice Hall.

Omolewu G. (2007). Global Strategic Management Is The Key To Business Success. Wilberforce University, Ohio. Web.

Pearce, J. A., & Robinson, R. B., (2009). Strategic Management: Formulation, Implementation, And Control (11th ed.). New York, New York: McGraw-Hill.

Wal-Mart Stores, Inc. (2008). Financial Reporting: Full 2008 Annual Report. Web.

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