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Quanchi Retailer’s Management: Problems and Solutions Case Study

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Updated: Aug 1st, 2020


Quanchi Retailer is one of Asia’s giant multinational retailers, and it has particularly attained its tremendous success by leveraging e-commerce and technology in its business processes. The company has an online store through its interactive website, where customers from 89 countries across the world can order products and have them delivered from the company’s closest physical stores and warehouses. The logistics department of the online retailer has received numerous awards over the past decade, and it serves as a role model for other companies in the industry.

The growth strategy of the company includes the expansion of its capabilities to deliver products and services to consumers in different countries, and it has recently adopted an approach to develop at least three physical stores in the developed economies across the world, which would serve as regional delivery points. Quanchi established its first physical store in Boston, Massachusetts in 2016, and it is apparent that the challenges that the company has been faced in its human resource department are a major threat to its success in the region.

Management Challenges

When the company identified the United States as a potential location to service the entire Northern American region, the CEO of Quanchi Retailer introduced the idea that it would be easier to use expatriates in the entire human resource base. The idea was to retain Chinese employees in all departments, with the hope that they would develop high-performance teams because the lack of diversity implied that there would be limited internal cultural barriers (Ferraro & Briody, 2017).

However, while the American store did not have any internal cultural barriers, there was a failure on the part of the company to facilitate the appropriate mechanisms to nurture leadership talents on the part of the human resources. This led to a low commitment to achieving the organizational goals, and a relatively low motivation level for the employees. The company would later start employing Americans, which has introduced more cultural challenges.

Additionally, the company faced a high level of cultural problems emanating from the consumer base. The interaction between the employees and customers in the physical store and the online platform has been associated with numerous challenges.

One of the prevailing issues is the language barrier, whereby the customer care reviews of the company have been associated with numerous complaints of the employees not being able to communicate effectively with the customers because they are not fluent in English (Ferraro & Briody, 2017). Moreover, the cultural beliefs and social expectations of the employees at the company are extremely different from the customers in North America.

The recruitment process at the company is still based on developing a workforce that is entirely Chinese, and since there has been an increase in the turnover rate in this region, replacing team members has affected the cohesion of the workforce. There have also been numerous complaints from the expatriates that the company has a very poor compensation and benefits program compared to other companies in the region. This has made it easy for the current employees to grasp any chance they get to work for other companies in the United States. There is a clear indication that the company might have to develop a better reward and motivational approach because current surveys reveal that the employees are not satisfied with their workplace.

HR Problems

The human resource management approach that has been traditionally used by Quanchi Retailer inclines toward allocating tasks and responsibilities to teams, rather than individuals. This implies that the employees are not individually accountable to various responsibilities, and this is one of the major loopholes in influencing high performance among the employees. Judging the performance of this branch on the basis of teams gives the employees the freedom to be moderately productive without accounting for their performance.

It is also apparent that the Chinese employees are accustomed to keeping face, which implies that they rarely openly reveal disappointment or excitement when doing their work (Schmiedel, vom Brocke, & Recker, 2013). This has made it relatively difficult for the human resource management function to identify the satisfaction level of the employees, despite several surveys revealing that the employees require motivational programs.

The collectivist culture associated with the Chinese people has also been inherited in the company, which implies that the company rarely recognizes individual efforts and achievements. This is quite demoralizing, especially when the expatriates have been exposed to the American culture, where individualism is highly embraced. Since August 2016, the company started employing Americans, and this has led to the development of a higher level of culture shock for the expatriated management functions, as well as the American employees (Schmiedel, vom Brocke, & Recker, 2013).

There is a prevailing conflict between the American employees and the management because they believe that things should run differently. The espoused values advocated by the management function have been met with high resistance, especially from the American workers. The company has also been associated with hiring lowly qualified employees because they are willing to work with low salaries and limited chances of growth in their careers.


The prevailing issues in the company’s management function can be solved by introducing diversity in the function. Having some management roles shared by American employees can facilitate the missing link in the development of organizational values. The traditional approach in management has inclined toward the Chinese culture and this is a major problem for both the American employees and the entire consumer base of the company in North America. It is imperative for Quanchi to look into establishing a human resource management function that will focus on incorporating the cultural values of the American employees while considering the requirements of the expatriates.

The management function of the company must also adopt the approaches used by other retailers in the region in managing human assets. For instance, instead of embracing the traditional collective accountability paradigm, the company should start applying an individualistic approach to allocating responsibilities. This will facilitate a higher level of motivation for the employees (Adekola & Sergi, 2016).

However, this approach should also be associated with an enhancement of the rewards for the employees. The high turnover rate will be fixed by providing the employees with an environment associated with tolerance to diversity, and the provision of training and development programs to enhance communication skills, as well as other relevant skills for the business. Training and development programs are required for the current workforce because recruiting new employees is relatively expensive. Firing the current workforce might also have detrimental repercussions on the reputation of the company.


Cultural barriers and management issues are the prevailing issues at Quanchi. It is apparent that these issues can be eliminated through the development of a management and leadership function that is not exclusively expatriated. Including managers from the host nation is a viable approach toward bridging the cultural barriers that are facing the company. This implies that the company must look into embracing diversity and aligning its values and strategies to the requirements of the employees and the consumers.


Adekola, A., & Sergi, B. S. (2016). Global business management: A cross-cultural perspective. London: Routledge.

Ferraro, G. P., & Briody, E. K. (2017). The cultural dimension of global business. Didcot, U.K: Taylor & Francis.

Schmiedel, T., vom Brocke, J., & Recker, J. (2013). Which cultural values matter to business process management? Results from a global Delphi study. Business Process Management Journal, 19(2), 292-317.

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