Integrated Perspective Business
The firm is virtually the largest in the global retailing industry with more than two million employee base both in the US and on the global platform. Despite going through numerous hiccups in determining an appropriate form of retail outlet to adopt, Wal-Mart has significantly evolved and is currently occupying one of the most comfortable niches in the retail business. With enormous ambitions to take over the market leadership in the retail industry, the retailer has consistently engaged in the exploitation of every opportunity and space available in both America and the global market which has earned it a unique brand name. The essential strategy the company adopted was to establish a solid ground in the home soil by concentrating on building the local US market before venturing into the overseas markets.
The exploitation of the home market enabled Wal-Mart to amass a wealth of experiences and resources to invest abroad. Wal-Mart’s Internal and External Environment Analysis As a global player in the retail industry, Wal-Mart needs to be looked at from both the internal and external perspective to sufficiently understand its operations. The strengths and opportunities are the general overviews of what an insider at Wal-Mart would highlight while the weaknesses and threats are the critical perspectives of the firm which criticize the various approaches and business concepts adopted by the firm. The most appropriate business tool to use in analyzing a company’s internal and external environment is the SWOT analysis tool (Shabanova et al. Wal-Mart’s SWOT provides an insight on the interaction of the internal and external forces which are significant in establishing its strategy in the global retail industry.
Essentially, Wal-Mart’s market expansion entirely depends on its ability to leverage on its strengths. Furthermore, this cost leadership strategy makes the rivals to copy Wal-Mart’s business model easily. The retailer’s poor remuneration to its staff has been attracting high employee turnover which further burdens it for frequently training its employees who end up quitting their jobs. It is alleged that the firm pays its staff poorly to compensate for the thin profit margins. Another key weakness is that Wal-Mart is slow in embracing e-commerce and has been overtaken by competitors such as Amazon. c) Wal-Mart’s Opportunities Wal-Mart’s opportunities revolve around improving its business practices and expansion. Wal-Mart’s Marketing Strategies Wal-Mart has been consistent in applying its domestic strategy in formulating its global market policies.
To a greater extent, transporting the domestic strategies to the international markets has been effective even though many of the strategies are not possible on the global platform. According to Brennan & Lundsten (2009), Wal-Mart’s global structure is highly multifaceted and fragmented which significantly varies from its systematic and analytic growth in the US domestic market. Over the years, Wal-Mart has been employing an array of global entry strategies some of which worked effectively while others failed. Every business enterprise making a move to enter into the global market faces a plethora of choices including joint venture, acquiring an existing player, building a merger with the existing player or starting Greenfield operations by either partnering with another player or alone (Govindarajan & Gupta, 2002).
The company’s technological edge is driven from its inventory control, logistics and distribution. Wal-Mart is one of the first big retailers to adopt a bar-code technology across all its distribution centers as early as 1980s as an attempt to reduce labor costs involved in processing shipments (Vance &Scott, 1994). As technology continue to evolve, the firm has been working to ensure that it keeps its customers closer to their individual stores. Currently, Wal-Mart is at the forefront of the efforts to adopt the most advanced technologies such as Radio Frequency Identification which is an innovation that can facilitate the tracking of inventory, sales and shipments. The company is also has the reputation of being one of the best technology-driven retails which operates the most advanced private satellite communications networks in the whole globe.
Globally, Wal-Mart has more than 2. 5 million employees in more than 27 countries. These workers are employed on both part-time and fully-time basis with average hourly wages. In most states, Wal-Mart is a household name, attracting both low-earning and middle class citizens who visit the wide-spread subsidiaries to shop because of the low and affordable prices of the products. Nonetheless, Wal-Mart is known for its famous ant-union labor practices which has been significantly affecting its works’ wages. Wal-Mart‘s critics have pointed that the firm is not cognizant of the legal business law concept and the extent of damage its negligence can cause. The firm lacks a competent and experienced legal team to give expert legal advice and execute the frequently arising legal issues to thee advantage of Wal-Mart.
While it is expected that a larger employer like Wal-Mart inevitably attracts a sequence of lawsuits and accusations, the company has committed more labor law violations compared to its competitors. In the future, Wal-Mart must commit to give more focus on how to resolve its legal issues. It must be cognizant of all its practices which trigger litigations and work towards addressing them appropriately. 5% from the previous year. According to the financial figures of the fiscal years 2015, 2016 and 2017, the cost structure margins and are far below the bar. There is a need for the retailer to hold a tight grip on its cost and capital structure. The analysis of Wal-Mart’s leverage and ratings reveals that the company’s capital structure is a mix of equity and debt.
Based on the company’s 2017 financial year, the retailer’s both short and long-term debt is $56. The management strategy adopted by Wal-Mart was developed by Sam Walton and ever since it has remained in use to the present. Nonetheless, the current growth of the retailer has prompted it to add more management layers to increase efficiency and profitability. While the Wal-Mart has expanded its management layers, the senior executives has strived to maintain the unique culture of the company in terms of the way and channel through which it runs its operations. Given the retail industry is becoming highly dynamic, Wal-Mart must keep abreast with the emerging management models to increase its competitive edge in the industry. Wal-Mart’s Applied Decision Methods There are essential applied quantitative techniques which are necessary for business decision-making.
The information systems of the Wal-Mart is highly hierarchal, formal and structured which comprises of Senior Business Analyst, Analyst, Senior Manager, Manager, and other subordinate levels below them (Foster, Haltiwanger &Krizan, 2006). The firm’s data center, which is known as Jane data center was constructed in 1989 and was primarily composed of four types of data: store opening data, distribution opening data, model calculations data and deviations data. The main drive behind Wal-Mart’s adoption of these types of data was to facilitate sales production tracking, inventory management and reducing the costs of its supply chain. The company has experienced a significant shift in the management of its supply chain as a result of embracing appropriate information technology. Wal-Mart was behind the launch of the bar code technology which is now increasing efficiency in the day-to-day operations in the retail sector.
Essentially, Wal-Mart’s deficiency arises from its application for the leases accounting without complying with the section that requires disclosures and procedures assessments. In most of Wal-Mart’s annual reporting, it has been found that it hardly conform to its global accounting policies. In more often than once, Wal-Mart has been engaging in correcting some errors associated with store lease expenses across the stores of its subsidiaries. Conclusion The highly evolving retail sector has significantly changed the operating conditions and forced the player to keep abreast with the changes. Wal-Mart’s future competitive edge will entirely depend on how it responds to the dynamics in the retail industry. H. Van. “Putting a Smiley Face on the Dragon: Wal-Mart as Catalyst to U.
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