Wal Mart's Failure in Korea
Wal-Mart’s Failure in Korea
This case will present Wal-Mart’s unexpected failure to conduct local market research and conform to Korean consumers’ needs and wants.
Introduction:
There are many frameworks that help characterize the differences between different cultures and the way people communicate across different cultures. In our paper we will focus on the differences between Korean and American cultures and what effect these differences might have on conducting business between both sides. We will concentrate on a failure business case of Wal-Mart entry and withdrawl for the Korean market to explore these differences.
Literature Review:
Cultural orientations can be view as lying on a continuum with high – context cultures on one end and low – context cultures on the other. (Hall, 1976). This framework help to summarize how people interact in different cultures especially regarding how they form social bonds, how they perceive responsibility. Empirical research shows that Korean culture is a very high-context culture as opposed to American culture which is very low context (Kim, Pan, & Park, 1998).
Another framework that can be used to classify and measure cultures is Hofstede’s Cultural Dimensions topology. – It would be awesome if you could add something about Hofstede’s thingie.
Confucianism is deeply rooted in Korean culture and from it stems concepts that are akin to the Chinese concept of “face” which is more familiar to western scholars. These concepts of “noon-chi” which is basically situation reading skill and “jung” which is akin to love but represents emotional connection between two people. These concepts, that govern behavior and communication in Korean culture, make Koreans very focused on saving “face”. (Lim & Choi, 1996)
All these differences in culture between America and Korea result in a very different communication style. Koreans are more likely to communicate indirectly and are more prone to be apprehensive about
This case will present Wal-Mart’s unexpected failure to conduct local market research and conform to Korean consumers’ needs and wants.
Introduction:
There are many frameworks that help characterize the differences between different cultures and the way people communicate across different cultures. In our paper we will focus on the differences between Korean and American cultures and what effect these differences might have on conducting business between both sides. We will concentrate on a failure business case of Wal-Mart entry and withdrawl for the Korean market to explore these differences.
Literature Review:
Cultural orientations can be view as lying on a continuum with high – context cultures on one end and low – context cultures on the other. (Hall, 1976). This framework help to summarize how people interact in different cultures especially regarding how they form social bonds, how they perceive responsibility. Empirical research shows that Korean culture is a very high-context culture as opposed to American culture which is very low context (Kim, Pan, & Park, 1998).
Another framework that can be used to classify and measure cultures is Hofstede’s Cultural Dimensions topology. – It would be awesome if you could add something about Hofstede’s thingie.
Confucianism is deeply rooted in Korean culture and from it stems concepts that are akin to the Chinese concept of “face” which is more familiar to western scholars. These concepts of “noon-chi” which is basically situation reading skill and “jung” which is akin to love but represents emotional connection between two people. These concepts, that govern behavior and communication in Korean culture, make Koreans very focused on saving “face”. (Lim & Choi, 1996)
All these differences in culture between America and Korea result in a very different communication style. Koreans are more likely to communicate indirectly and are more prone to be apprehensive about
References: Gandolfi, F., & Štrach, P. (2009). Retail Internationalization: Gaining Insights from the Wal-Mart Experience in South Korea. Review of International Comparative Management. Hall, E. T. (1976). Beyond culture. Garden City, New York: Anchor Press. Kim, D., Pan, Y., & Park, H. (1998). High- versus low-context culture: a comparison of Chinese, Korean, and American cultures. Psychology and Marketing, 15(6), 507–521. Kim, R. B. (2008). Wal-Mart Korea: Challenges of Entering a Foreign Market. Journal of Asia-Pacific Business, 344-357. Lim, T.-S., & Choi, S.-H. (1996). Interpersonal relationships in Korea. In W. B. Gudykunst, S. (. Ting-Toomey, & T. (. Nishida, Communication in personal relationships across cultures (pp. 122-136). Thousand Oaks, California: Sage Publications. Merkin, R. S. (2009). Cross-cultural communication patterns - Korean and American Communication. Journal of Intercultural Communication. Retrieved from Journal of Intercultural Communication. Olsen, K. (2006, May 22). Wal-Mart pulls out of South Korea, sells 16 stores. Retrieved from http://www.usatoday.com/money/industries/retail/2006-05-22-walmart-korea_x.htm?csp=34 Park, H., Hwang, S