Final report major business strategy analysis of walmart

Walmart expanded its business operations into foreign markets in 1991, when it entered stores in countries such as Canada, Mexico, getting the best available price from its suppliers, cu

HO CHI MINH CITY UNIVERSITY OF FOREIGN LANGUAGES

- INFORMATION TECHNOLOGY FACULTY OF INTERNATIONAL BUSINESS ADMINISTRATION

-*** -

Major: STRATEGIC MANAGEMENT

<BUSINESS STRATEGY ANALYSIS OF WALMART>

Student’s Names: ID Number

Nguyễn Ngọc Tường Lam - 19DH480066

Nguyễn Ngọc Bảo Trân - 19DH481039

Nguyễn Ngọc Phương Uyên - 19DH481064

Class: KN1902 - Tuesday - Period 7,8,9

HCMC, <12>/<2021>

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TABLE OF CONTENTS

1 INTRODUCTION 2

1.1 Introduce the organization 2

1.2 The Mission & Vision of the organization 3

2 ANALYSIS 4

2.1 INTERNAL ASSESSMENT 4

2.1.1 Management 4

2.1.2 Marketing 5

2.1.3 Finance and accounting 8

2.1.4 Products/operations 9

2.1.5 Research and Development 10

2.1.6 Management Information system 11

2.2 EXTERNAL ASSESSMENT 12

2.2.1 Economic, social, and political factors 12

2.2.2 Porter’s five forces analysis 15

2.3 STRATEGY GENERATION 18

2.4 STRATEGY IMPLEMENTATION 19

2.4.1 Market Segment 19

2.4.2 Product Positioning 20

3 RECOMMENDATON 21

4 CONCLUSION 22

References 24

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1 INTRODUCTION

1.1 Introduce the organization

Wal-Mart is a global organization that specializes in retail operations It is currently the largest retail outlet in the United States, and it holds the record for being the world's largest retail chain Sam Walton created Wal-Mart in 1962, declaring three policy goals that would define his company: individual respect, customer service, and striving for perfection (Walmart, 2015).The corporation

is headquartered in Bentonville, Arkansas The firm's retail operations include

a chain of hypermarkets, grocery stores, and department stores spread around the globe Wal-Mart was named the top retailer in the United States in 1990, according to its dedication to customer service, efficient distribution channels, and controlling costs Walmart expanded its business operations into foreign markets in 1991, when it entered stores in countries such as Canada, Mexico,

getting the best available price from its suppliers, cultivating tight working relationships with key suppliers to generate win-win cost reductions across its supply chain, and keeping its internal operations seamless and efficient It also owns its stock deal directly from manufacturers, avoiding the need to have third parties

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The business pays more attention to even the smallest details in-store layouts and merchandising, utilizing cutting-edge technology and cultivating a culture that values customer satisfaction, hard work, continuous learning, and attempting to pass cost savings on to customers in the form of reasonable prices Walmart's founder, Sam Walton, believes that a successful store can assist people in saving money and living better lives Walmart's purpose is to collaborate with others to achieve that goal by improving people's quality of life It has been integrated into every aspect of the company Walmart is a massive organization that employs millions of employees throughout the world and wants to be the most well-known retailer "in the hearts and minds of consumers and employees"

1.2 The Mission & Vision of the organization

The mission of Walmart is "helping people around the world save money and

The statement is brief but covers a large territory about Walmart's current business activities The company's objective is to provide a diverse range of items at a cheaper price through its retail outlets As a result, customers may save money on their everyday purchases Walmart's Every Day Low Price (ELDP) policy is an important part of the company's overall strategy This phrase also underlines the company's desire for people to "live better." To do this, the company has placed a premium on customer convenience above low-cost items This stated mission, which is also the company's slogan, is a direct result of strategic business decisions "Spend less money Live a better life"

The vision statement of Walmart is “to make every day easier for busy families.” Walmart describes "busy families" as the target of their business strategy The corporation noticed that a substantial percentage of its client base comprises busy families who don't always have time to shop in a conventional store Walmart has already begun to improve its online presence by developing

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its own e-commerce platform, allowing shoppers to purchase things online without having to commit any time or effort Walmart is trying to give a variety

of options for customers to save money when shopping at the store Customers

site, the company has lately built a speedy distribution method Customer orders will now be delivered in less time As a result, Walmart's goal is to broaden its value offering while sticking to its Every Day Low Price strategy

Walmart has been shown to be the best retailer for decades, and Sam Walton's vision and mission objectives have been realized since the company's establishment in 1962

2 ANALYSIS

2.1 INTERNAL ASSESSMENT

2.1.1 Management

Planning:

Walmart's planning function is primarily reliant on the company's pricing policy

In order to attain low prices for the company's products, the company's managers must devise strategies to minimize the cost of inputs (Fishman, 2006) Walmart must therefore evaluate competition prices when planning and estimate the earnings it expects to make by selling its products at the established price

Organizing:

Jobs at Walmart are assigned based on the talents and experience of the employees According to various needs, resources are distributed to each branch

Motivating:

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Walmart's leadership invites employees to participate in the decision-making procedure Walmart places a premium on communication between management and employees, and every stakeholder must be involved Employees can participate in the decision-making process, which boosts morale as they work toward attaining goals, they have established for themselves Additionally, the organization provides online training possibilities for its staff, ensuring that they remain effective and productive

Staffing:

Labor productivity is one of the most important factors of a company's efficiency and cost structure Walmart focuses on training employees so that they can do everything well and save money in order to boost labor productivity Walmart offers employees training and personal development opportunities such as online courses on the company's website, mentoring programs, and skills assessments

to assist them accomplish their career goals Furthermore, Walmart encourages its staff to come up with new ideas If an employee has a sales or cost-cutting suggestion, word will get around quickly More sales, lower costs, and increased production are all achievable with a system of 11,000 stores and nearly 2 million employees

Controlling:

During the process of discharging this responsibility, Walmart considers both internal and external variables As part of an internal controls, the company's management employs an inventory monitoring system and cameras, as well as performing frequent work performance evaluations The business also assesses the financial accounts, turnover ledgers, production records, and market fluctuations on a regular basis

2.1.2 Marketing

Walmart's marketing strategy divides its stores into divisions in order to surround clients and familiarize them with its stores Walmart three different stores format

Walmart operates around 11500 stores globally under 63 banners in 28 countries, including 4600 Walmart stores in the United States, 650 Sam's Club locations, and “6,200” Walmart International locations Walmart's strategy is based on the psychology of customers; if ease and coverage are in place, customers will prioritize using products As a result, Walmart's number one ranking in the United States is a significant achievement

Using e-commerce as a marketing tactic

Walmart promotes itself by offering a variety of sales incentives, such as product bundles and low prices Walmart's advertising and marketing mix includes an ambitious branding strategy Customers are attracted to an e-commerce website

by receiving presents Walmart has a price plan that leads to the company's greatest revenue

Websites utilize slogans like "Buy it before it runs out" to entice users to purchase Walmart goods without hesitation in order to avoid expiration However, regardless of any other marketing technique, Walmart's most essential marketing strategy is "Everyday Low Price."

Walmart uses a multitude of platforms to market, such as television advertisements, billboards, social media, and even their e-commerce platform Customers who shop online may expect the greatest level of service thanks to

Diverse activities that appeal to all customer “segments”

Walmart has gained a sizable market share by selling practically everything to almost everyone The organization makes every effort to suit the needs of various market sectors Discount stores, Walmart supermarkets, Sam's Club warehouses (selling bulk goods), and neighborhood markets are just a few examples of

various sorts of retailers available

90 percent of Americans, according to Charles Fishman, reside within 15 miles

of at least one Walmart store Walmart is like a colossal retail behemoth, slowly infiltrating each population's market and customers' lives Customers' ability to buy has continuously increased in tandem with the company's sales since then Walmart followed an antiquated expansion strategy in the early years, operating stores in tiny, rural towns before expanding into urban regions

This reduces operational expenses and ensures that all store locations are within

a hundred miles of the distribution center, allowing for cost savings and the avoidance of stock shortages Walmart expanded throughout the world after qualifying for business Walmart's enormous number of items allows it to make significant profits, even if individual item margins are lower than competitors

Choose from a variety of payment options, including the flexibility to pay outright or in installments for larger items (appliances or furniture, et cetera) Walmart's marketing strategy is quite modest, yet the corporation has had a lot of success in attracting a large number of potential customers

Supply chain management using the most up-to-date technology devices,

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Walmart's supply chain management system is often regarded as the world's most advanced Walmart was a pioneer in collecting detailed product information electronically and sending it to a central database Walmart's objective is to conquer the broad world of commodities that it oversees, establishing a foundation for necessary items, how much is enough, and when customers require them

Walmart estimated a 16 - percent reduction in inventory in locations equipped with current RFID equipment in the first eight months of 2005 Walmart can trace items as they move from the distribution center to vehicles for delivery to retailers using RFID technology

Walmart's operations also include the utilization of its own trucking fleet The carrier must have three years of driving experience and a total mileage of

“250,000” miles Managing its own fleet eliminates the need for third-party shipping, resulting in significant cost savings Walmart's delivery expenditures

had risen to 1.7 percent of sales by 1989

2.1.3 Finance and accounting

Figure 2.1: Liquidity Ratios

Figure 2.5: Growth “Ratios”

2.1.4 Products/operations

Process and Capacity Design

Throughout this strategic decision area, Walmart's operations management uses

storefronts and e-commerce operations, the company's process and capacity design for maximizing area, manpower, as well as material is based on behavioral observation of customers and staff Walmart's human resource capacity planning is based on forecasting The firm's human resource procedure and product manufacturers increase in tandem with the retail business Walmart additionally utilizes shop resource tracking to alert company executives about conserving or altering usable capacity designs, which serves to relieve concerns throughout this operations business decision sector

Inventory Management

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Throughout this strategic decision area of operations, Walmart concentrates on the

vendor-managed stock approach, vendors use the firm's computer systems to decide when to supply items derived from real stock levels Throughout this way, Walmart

quantities of stock on both sides of the transaction, aiding cost-cutting measures These methods assist in optimizing the operating productivity and effectiveness of the retail organization in this area of operations management administration

Quality Management

To manage this decision area in business management, Walmart employs three levels of quality requirements The bottom rung encapsulates the majority of clients' minimum quality expectations Almost all of Walmart's brands, including Great Value, are still found on this shelf The middle level specifies industry average quality for low-cost stores This layer is used for a variety of products along with work performance goals for Employees, especially salespeople Inside the retail sector, the top level establishes quality standards that are higher than the industry average This layer is only applied to a limited fraction of Walmart's output, like Sam's Choice goods This three-tier strategy satisfies quality organization goals inside the key planning of an organization throughout the retail commercial enterprise

2.1.5 Research and Development

Walmart’s Research and development mostly focuses on crowd management

and social media shopping tools,

Walmart's research and development concentration were on social media technologies (I R A V Z Pavlidis,2015) The computer-implemented technique for information gathering shielded here entails evaluating a person's online social media activities, recognizing ideas for every textual activity utilizing natural language processing as well as calculating candidate results for various ideas, and afterwards trying to generate user interest profile for a consumer based on defined

in immediately identifying a troublesome cart that may make customer aggravation

or suffering, preventing them from purchasing farther

2.1.6 Management Information system

Walmart's information system has an organizational structure of frameworks, separated into levels, in which the company distributes and organizes authorities and responsibilities in relation to its information line It specifies the scope, duties, powers, and responsibilities of the delegation, control, coordination, and information flow between levels Walmart has created an organization whose operational structure is fully dependent on its objectives and strategy thanks to the decentralized mechanism in this information system Decision-making power, as

concentrated at the highest level of management This centralized organization has shown an open decision-making channel from the Chief Executive Officer to the executive boards and then to the appropriate branches

At the David Glass technology center in Bentonville, Arkansas, Walmart's information systems department employs roughly 3,000 people Their information systems department is organized in a hierarchical structure, with positions such as business analyst, senior business analyst, manager, senior management, and lower management The arrangement allows them to track productivity metrics and budgets, allowing them to track and monitor operations more efficiently

Despite having technologized everything related to management and information systems, Walmart's data management, business is still split into two sections:

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infrastructure and software These two departments are responsible for the company's three pillar functions: planning, sales analysis, and operational development

Walmart's information system is set up as a pipeline from the Chief Information Officer (Rolin Ford), who reports directly to the Chief Executive Officer (Mike Duke) and collaborates across divisions

Jane Data Center is Walmart's data center, with 460 terabytes of storage Jane data center is considered as an enigmatic symbol because of its digital power, and it has helped Walmart become one of the world's top retailers Walmart has been processing computer modeling data such as Gauss programming and Gaussian data

to help determine sales, earnings, and distribution channels for Walmart locations for years, according to various sources Walmart also uses a Gaussian software with

a linear method to deal with skewed data

Walmart uses data from barcodes as a source of information Retailers can now create several forms of information for their products using barcodes Walmart is a pioneer in the invention and deployment of advanced technology for inventory management and supply chain optimization, and it can efficiently regulate barcodes Walmart's success is measured by their exceptional use of information technology

in their business, and the key to Walmart's development is the use of barcodes, which no one, no organization can do without Which company is more adept at using barcodes than Walmart? Walmart is currently adopting RFID tags for radio frequency identification, which is a popular identifying technology

2.2 EXTERNAL ASSESSMENT

2.2.1 Economic, social, and political factors

Social factors comprise all elements that might influence Walmart's market

strategy, development, and success connected to the consumer lifestyle, culture, and behavior