MANAGEMENT OF STRATEGY

Management of Strategy

Management of Strategy

Activity - Case Study Analysis (Strategic Actions)

Question 1: Review Wal-Mart's business-level and international strategies and evaluate their potential for success.

Wal-Mart always strives to “provide quality products at an everyday low price and with extended customer service” (Marquard, 2010). In order to achieve this, they have adopted a series of strategies which range from loyalty programs for customers to e-tailing. Some of the major strategies include building divisions, which include: smaller stores built in small communities with a population of less than 5000 people; this strategy allows Wal-Mart to give special attention to customers in smaller markets in rural America. Customers have to pay a membership fee to be a part of the club in which they get to buy goods in bulk. Supercenters are another division in Wal-Mart whereby groceries, are combined with general merchandise “giving customers a one-stop shopping experience” this “one-stop” convenience has appealed to a large number of customers thereby making the supercenters to become one of the most important retail concepts on the landscape. The International division has basically allowed the company to maintain a strategic competitive focus on global positioning.

Another Strategy adopted by the company is e-tailing. Wal-Mart now operates online under walmart.com which is basically seen as another store possibility. Walmart.com combines technology and retailing in order to provide customers easy access to more things at Wal-Mart 24hours a day, 7 days a week. The most important and probably most ruthless strategy adopted by Wal-Mart is predatory pricing. The company basically places its price very low, in some cases way below their cost of acquiring the product. This enables the company to establish itself as the “low-price leader” in the local market thereby attracting more customers to the store (Soderquist, 2010).

Question 2: Based on your complete assessment, present your recommendations ……, establish direction for the company, and maximize the value of the firm.

Wal-Mart should consider launching the “smart choice” concept they have in China to other countries also. This would help them penetrate the convenience store market and they have the potential of being successful seeing as they are the leader in low prices. Also the company should drop overseas markets that have not performed well and focus on growing those that have done really good such as China and India. The store can also choose to expand to other areas where the population is big and their product line will be appreciated, one of those areas could be Africa (Nelson, 2006). With e-tailing growing really fast, Wal-Mart should expand its online store and offer better delivery services and a greater product line for the consumers.

The main factor where the company lacks behind its competitors is its human resource policies and remuneration packages. The major weakness of the company is that it cuts the non-cash benefits of employees, which reduces their level of satisfaction and as a result, the employees get de-motivated. The Federal Equal Employment Opportunity has penalized Wal-Mart for discrimination against the ...