Wall-Mart Strategic Planning

Topics: Wal-Mart, Target Corporation, Sam Walton Pages: 12 (4131 words) Published: April 15, 2011
Wal-Mart Strategic Development and future
Becoming Wal-Mart- The Past:
Wal-mart was founded by sam Walton in 1962. The idea behind was to bring discount shopping stores to rural America. It grew rapidly with huge popularity. Today it has 3708 Wal-mart U. S. Units, 569 U.S. Sam’s Club and 4112 International units. It toppled GE and became No.1 in Fortune 500 Company list with annual revenue of 405 Billion USD and employs about 2 million associates. It has presence in multiple sectors across retail industry like grocery, Auto, Pharmacy, Jewelry, Clothes, electronics, books etc. Let’s consider strategies in place and changes during last 25 years of Wal-mart. Mission: We save people Money so they can live better. Deliver Quality products at lowest possible price. Values and Culture:

In my opinion Wal-mart’s values are keys to its sustainable success. Here are some key values and words about company culture. * Respect to individual.
* Open door. Listen to customers and associates.
* Give best service to customer.
* 10-Foot Rule – greet and ask for help to customer within 10 foot of distance. * Sundown Rule – Combine efforts to answer to any requests or resolve any complain by end of business day. * Leaders are also servants.

Many of these values helped Wal-mart developing two important feedback loop for any organization, which drive for constant improvement, are Internal and external Feedback. Strategy:
Let’s analyze five elements of strategy diamond to understand how placed Wal-mart itself in this industry and became global player. Areas:
Wal-mart has decided to compete in retail segment keeping in mind to be one stop place for customers. Wal-mart made rural area as their business places. This in long run helped them to lock out competitors, helped Wal-mart to use as entry barrier. Customers can get almost everything they want from one place saves time and money both. It decided to have its own distribution network. Use of technology was and is a big helping factor for Wal-mart. It employed computer system back during 1970s and still reaping benefits of having excessive amount of data available. Wal-mart pushed retailed industry to have universal bar-codes. With bar code tracking of products became easy. Data derived from these technologies was used to plan stores, products to be sold, inventory management etc. In turn, it helped Wal-mart developing thin, effective supply chain and as a result ensured lowest prices for consumers. Recently, Wal-mart implemented RFID technology in some of its stores. The outcome of experience over 8 months was reduction of out-of-stock merchandises by 16%. This technology helped in serving customers better and saved cost. Vehicles:

Wal-mart developed all its stores as organic development meaning it developed by its own in USA. However, this has changed since Wal-mart decided to go International during 1990s. They widely used Joint-Ventures and acquisitions as their vehicles. By choosing these vehicles that they have shortened learning curve to understand local trends, needs. However, this road has been with lots of obstacles for Wal-mart and they have closed operations in Germany in year 2006.

Key differentiators of Wal-mart from other stores are as below * One stop shops by offering wide range of products.
* Lowest possible cost every possible day.
* IT system for inventory handling and logistics management. * Better Customer Handling and response.
* Designed Sam’s club for small retailers who buys in bulk. Staging:
Wal-mart has been smart in planning and entering into new market places. It has delayed international market for long to focus and capture home market first. Later on it moved huge untapped international market which is source of Wal-mart’s further growth. Here also it expanded country by country and leveraged learnings. Recently, it decided move to international markets starting with closet...

References: Mason A. Carpenterand Wm.Gerand Sanders (2007), Strategic Management A dynamic Perspective concepts and cases, 2nd edition,New Jersey:Pearson Education,P.605-614.
Walmart Annual Report (2010),[Online],Available http://walmartstores.com/sites/annualreport/2010/
Walmart Sustainability, [Online],Available http://walmartstores.com/Sustainability/
Walmart File (1999), [Online],Available http://news.bbc.co.uk/2/hi/business/325922.stm
Beth Lewallan, Walmart and the bar code, [Online],Available http://www.pbs.org/wgbh/pages/frontline/shows/walmart/secrets/barcode.html
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