LVMH Company’s Global Management

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Introduction

LVMH is a France-based company known for wines and spirits. LVMH manufacturers have also expanded their operations in other foreign countries like United States, United Kingdom, Africa, and Asian countries.

France cultural values

The best way to analyze France cultural values is by using Hofstede’s model (Piepenburg, 2011). In this respect, the following cultural dimensions will be critical in understanding the county’s cultural values.

Power dimension

France has a score of 68 in terms of cultural power dimension index (Patel, 2007). From this perspective, inequality among society members is prevalent. Individuals perceived as superior are not accessible from a hierarchical perspective. An example of such inequality is evidenced in administrative powers given to authorities in government departments and crucial economic sectors. In organizations, managers possess immense power, and the flow of information follows the organization hierarchy.

Individualism

France has a score of 71 in terms of cultural individualism index (Patel, 2007). From this context, it is clear that the country’s culture is individualistic, and people often subscribe to their own private opinion. This means that organizations contract services, thus providing autonomy and independence to workers. In most cases, people prefer communicating directly. Workers are managed individually and recognized for their work performance.

Masculinity

According to Hofstede’s cultural model, France is not a masculine country. Femininity defines the quality of life in the country. This means that the country does not harbor competitive and ambitious instincts among individuals. The country’s social welfare system advocates that people should work for 35 hours a week. From this perspective, competition among workers is discouraged. Organizations prefer being supportive, especially in resolving work-related conflicts. The country has a femininity index of 43 (Patel, 2007).

Uncertainty avoidance

The country has a higher score of 86 on the uncertainty avoidance index (Patel, 2007). This means that the country is keen on responding to uncertainties through education and other forms of training. France-based business organizations prefer planning and expertise in handling changes that affect their security, policies, and performance.

Long-term orientation

France is a conventional country in terms of traditions and culture. Therefore, France can be termed as one of the societies that are short-term oriented (Patel, 2007). From this perspective, the country depends on short-term results. An example of such is exhibited by companies’ evaluation method of using quarterly results. In any case, society is highly sensitive to current social trends. Immediate gratification and self-reliance are common features in France culture.

LVMH products and services

LVMH produces a wide range of wines and spirits. An example of a popular product produced by the company is champagne. Other products made by the company include clothes made and leather apparels. The company has invested heavily in the fashion industry and has been involved in manufacturing designer clothing lines.

Other important products manufactured and sold by LVMH include perfume and cosmetics. LVMH has also unleashed notable designer watches for both men and women. For a long time, LVMH has also been involved in buying and rebranding jewelry for sale. LVMH is known for its involvement in selective retailing.

LVMH provides a wide range of services. Such services are offered through LVMH subsidiary companies like Miami Cruiseline Services. LVMH group of companies offers services in the hospitality industry. Examples of such services include catering services in luxurious hotels and ships. Example of services offered by LVMH and the subsidiary companies include watch repair and the making of designer clothes and apparels.

Advantages of global activities

LVMH global markets are instrumental in the improvement of the company’s products and services. The global markets help the company to grow and foster better ideas in developing effective products. LVMH has been able to harness and use various cultural dimensions from other countries to achieve competitive marketing strategies.

Also, LVMH has been able to achieve a competitive edge over other companies within the same industry. LVMH Company has been able to spread its marketing risks beyond France. This has made the company specialize in markets, products, and services that are value-adding. LVMH marketing strategy and global market expansion have been instrumental in improving customer awareness.

This has been made possible by the strategic location of subsidiary firms all over the world. The use of online stores has also been essential in harnessing customer awareness all over the world (Dholakia, 2002). It is essential to note that LVMH’s global activities have greatly increased the company’s profits and reduced costs.

Global marketing strategies

LVMH manufacturers have used branding as a strategy for global marketing. Today, LVMH has a consistent brand culture that is familiar to all consumers (Douglas & Craig, 1995). Lack of a consistent brand culture can be detrimental to an international organization. In essence, a consistent brand culture makes a company stand out among its competitors in the global markets. This means that such a brand culture must be communicated in a language that resonates and is familiar to everyone.

Product location using strategically located distribution and subsidiary firms across the globe is essential. LVMH has used this strategy to ensure that products and services available in the market are strongly felt. The integrated global marketing mix used by the company has been significant in ensuring customer satisfaction in each market segment.

The use of foreign products has been significant in gaining a market entry advantage in foreign counties. That has been made possible by obtaining a license to manufacture products in other countries under the same brand name. This has saved the company from hefty production costs and instead increased its global marketing initiatives.

LVMH organization structure

LVMH has over 31 subsidiary companies that operate in different parts of the world. LVMH is managed by a board of directors who form an executive committee. LVMH has over 2400 stores across the globe, and each is headed by a manager. The manager oversees stores operations. LVMH products are sold through boutiques, which are strategically positioned in luxurious stores, malls, and hotel lobbies. LVMH is owned by shareholders across the globe.

Global human resource challenges

LVMH has faced challenges in lacking qualified experts and managers in various divisions and production lines at various global locations. Moreover, the company has faced challenges in countering the impact of conventional career development strategies used in other countries. Aligning foreign cultural values to those of the LVMH Company has been difficult.

Future challenges at the global level

The entry of LVMH into global markets will be met by cultural, political, and economic challenges. Moreover, the competition at the global level is intense and requires effective market entry strategies. Maintaining a strong brand culture at the international level will also be a challenge for the company.

Interest in a career with the company

Yes, I would prefer working with the company in the future. The company’s production technology is advanced and appealing to young professionals. Moreover, LVMH is a reputable organization that harnesses talent, professionalism, and competency.

References

Dholakia, N. (2002). Global e-commerce and online marketing: Watching the evolution. Westport, CT: Greenwood Publishing Group.

Douglas, P., S. & Craig, S., C. (1995). Global marketing strategy. New York, NY: McGraw-Hill.

Patel, T. (2007). Stereo types of intercultural management: A dynamic appreciation of viability of French-Indian strategic alliances. Amsterdam, AMSTR: Eburon Uitgeverij B.V.

Piepenburg, K. (2011). Critical analysis of Hofstede’s model of cultural dimensions. Berlin, BER: GRIN Verlag.

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