Integration of Business Functions

This essay explores the integration of business functions, focusing on strategic planning, leadership, and the impact of external factors on Walmart's operations. It discusses the organization's background, leadership style, and analyzes the external environment using STEEP and Porter's five forces analysis. Additionally, it examines Walmart's SWOT analysis and the role of stakeholders in shaping the company's strategic direction.

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INTEGRATION OF BUSINESS FUNCTIONS
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Introduction
As discussed by Barros, Hernangómez and Martin-Cruz (2016), strategic planning can
be defined as a management based activity that is implemented in order to set the priorities,
strengthen the levels of operations, ensuring that the employees and the other stakeholders are
able to contribute towards effective achievement of the goals. The organizations need to
adjust the directions of their strategies with the help of the strategic plans that are developed
and implemented in various processes (Daspit et al. 2017). The direction of the organization
can be changed with respect to the variations that have taken place in the exterior
environment. The fundamental decisions and the actions that have been implemented by the
organizations have an impact on the strategic planning process.
The essay will be built on the study of the strategic direction that has been set by a
major organization like Walmart. The variations that have taken place in the organizational
operations will be discussed in the essay in detail. The external macro environment factors
that have an influence on Walmart will be examined with the help of STEEP analysis. The
industry of the operations of Walmart will be discussed by implementing Porter’s five forces
analysis tool. The essay will also provide detailed picture based on the stakeholders and the
leadership process that has been followed in the organization. The journey of Walmart and
the effect of changes in exterior environment on the company will be discussed in the essay
as well (Nickels, McHugh and McHugh 2012).
About the organization
Walmart Inc. is an international retail based company that has its operations in the
US. The company mainly operates a huge chain of discount based department stores,
hypermarkets and the grocery stores. The headquarters of the organization are located in
Bentonville, Arkansas. Walmart had been founded in the year 1962 by Sam Walton. Sam’s

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clubs retail based storerooms are owned and operated by Walmart. The organization currently
operates more than 11,000 stores in around 27 countries in the world (Walmart.com 2019).
The different countries in which Walmart currently operates include, US, Canada, the UK,
Chile, South Africa. Walmart has gained a leadership position in the retail business of the US
based on amounts of revenues that have been earned (Walmart.com 2019).
The comparable sales of Walmart have grown by around 4.5% in second quarter of
the year 2018. This can be considered to be the strongest growth of the organization that has
been depicted in the last ten years. The e-commerce based sales of Walmart has also grown
by around 40% from 33% that was experienced in the year 2017 (Nickels, McHugh and
McHugh 2012). Electronic sales of Walmart are considered to be the strongest in the
operations of the company within the last four years (Demir, Wennberg and McKelvie 2017).
The digital sales that are performed by Walmart have gained high levels of importance in the
last few years. Walmart has started developing its digital goals in order to face the rivalry that
is delivered by a major online retail organization like Amazon. The improvement of customer
satisfaction is also considered to be a key aspect that has an influence on the successful
operations of Walmart (Bogomolova et al. 2015) (Refer to Figure 1).

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Figure 1 – Growth of Walmart
Source – (Businessinsider.com 2019)
Leadership in Walmart
The founder and CEO of Walmart Sam Walton had surrounded himself with the types
of people who are able to provide big ideas and not afraid of taking the risks. The
implementation of the ideas in practical areas is also possible with the help of the vision that
has been developed by the leader. The CEO of Walmart Sam Walton had been able to
maintain the operations of his organization with the help of appropriate implementation of
transformational leadership in diverse aspects of its operations. Transformational leadership
based activities have always been at the core of the effective processes of Walmart in the
retail business (Durand, Grant and Madsen 2017).

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Sam Walton was a visionary leader and had intended at evolving the processes of
Walmart with the help of transformation leadership based processes. The managers of the
organization pay regular visits to the stores in order to make sure that the business operations
are effectively developed. The leaders in Walmart were not afraid of taking risks and taking
tough decisions that can affect the organization in a positive manner. This is able to provide
major growth chances to the company in order to maintain a supportable place in the highly
competitive retail industry (Dyer et al. 2015).
The development of a leadership pipeline has also been a major aim of the company
in order to maintain its operations and to increase the profitability levels. Transactional
leadership based policies based policies have also been applied by Walmart in order to
execute the strategies that had been formed by the organization. The company provides
promotions to the employees with respect to the performances that have been depicted in the
previous years (Engert, Rauter and Baumgartner 2016). The CEOs or leaders of Walmart
namely, Rosalind Brewer, Robson Walton, Gregory Penner, Marc Lore, Mike Duke have
shown similar leadership styles in order to implement the effective strategies (Nickels,
McHugh and McHugh 2012).
The relationships that have been formed by Walmart with the suppliers are mostly
built on the methods by which the products can be offered to the customers at lowest prices.
The implementation of charismatic leadership and visionary leadership qualities have been
able to influence the methods by which Walmart is able to maintain its position in the retail
industry. The development of different leadership styles is considered to be highly significant
for the methods by which various organizational aspects can be maintained in an active way
(Ethiraj, Gambardella and Helfat 2018).
STEEP analysis of Walmart

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Social factors – The perceptions and favourites of consumers of Walmart have an
influence on the revenues and sales of the organization. The major opportunities are provided
by Walmart due to the trends based on healthy lifestyle and stages of cultural variety as well.
The company can aim at growing the variety of products that are presented to the customers
in order to increase the revenue levels. The different cultural preferences are able to play a
key part in the appropriate growth of product portfolio of Walmart (Evans, Murray and
Schmalensee 2016).
Technological factors – The technological trends have to be taken into attention by
Walmart on order to improve the operating processes of the organization. The competitive
landscape that has been developed in the retail industry is influenced in a huge way by the
technological disruptions that have taken place in different countries (Balaji and Roy 2017).
The levels of business automation had increased in the last few years and organizations have
started depending on the proper analysis of big data. The usage of mobile device among the
consumers is able to affect the technological environment. Walmart needs to aim at boosting
the online presence in order to improve the stages of revenues (Frynas and Mellahi 2015).
Economic factors – Vast economic changes have taken place in the retail industry of
different countries further leading to the proper implementation of changes in different
processes. The unemployment levels have started decreasing in the US and has been able to
deliver major levels of development opportunities to Walmart. The organization aims at
exploiting the opportunities that are offered by the external economic environment of the US
(Gaur and Kesavan 2015).
Environmental factors – Ecological factors are considered to be significant for
Walmart for the purpose of maintaining the operations in the retail industry. The principle of
proper environmental conservation is considered to be quite popular in the modern business

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environment. The trends based on business sustainability have led to the growth of the
product portfolio of the organization based on environmental friendliness and major
technological innovations (Goswami and Ha-Brookshire 2016).
Political factors – The variations that have taken place in the political situation within
the last ten years are based on development of operations of Walmart. The stability levels of
the political conditions can have an impact on the profitability levels of Walmart.
Globalization has been supported in a huge way by the political variations that have taken
place in the retail industry. The increase in wage rates have a main influence on the methods
by which Walmart can continue its operations (Hill, Jones and Schilling 2014).
The macro environmental changes have a main influence on the ways by which
Walmart has constantly changes its direction and strategies. External changes have also been
able to provide main prospects of growth to the company.
Porter’s five forces analysis of Walmart
Competitive rivalry – The competitive conflict levels are high in retail industry as
different organizations are constantly competing with each other in order to gain a larger
share in the market. The large organizations are able to upsurge the stages of competition that
are faced by Walmart. The variety of the retail firms and the levels of aggressiveness are also
high based on the impact that they have on increasing the levels of competitive rivalry.
Competitive advantages gained by Walmart is based on the diverse methods that have been
applied by the company (Meyer, Neck and Meeks 2017).
Bargaining power of the buyers – The population of the consumers in the retail
business is high and this is able to reduce the power that they have on the prices of products.
Rise in the stages of globalization has been able to reduce the power that individual

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consumers have on the product ranges and prices. The diversity stages of the consumers of
Walmart have also increased in the last few years further reducing their power (Michael,
Storey and Thomas 2017).
Bargaining power of the suppliers – The suppliers in retail business have low power
due to the development of efficient supply chains by the organizations like Walmart. The
population of the suppliers in retail industry is high and company is able to put pressure on
them built on the prices of raw materials. The influence of suppliers on the large retailers like
Walmart is low (Morschett, Schramm-Klein and Zentes 2015).
Threats of the substitutes – Threats built on the availability of substitute products in
the retail industry are low. This is considered to be a moderate force that has low impact of
the processes of a huge company like Walmart. The cost based on the substitute products of
the ones offered by Walmart is considered to be quite high based on the point of view of the
customers. The customers are not able to move away from the products easily from the
products of Walmart (Pantano and Vannucci 2019).
Threats of the new entrants – Walmart has started facing threats from the entry of
new organizations in the retail industry. The new organizations are able to enter the retail
industry easily in spite of the presence of giants like Walmart. The high costs of brand
development can however have an impact on the decisions that are taken by the organizations
to enter the highly competitive retail industry (Dobbs 2014).
The industrial forces and their impact on the operations of Walmart have been
changing constantly for the last few years. The levels of competition have increased in a huge
way further affecting the processes of Walmart (Forbes.com 2019).

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SWOT analysis of Walmart
Strengths – The global size of Walmart and its presence in different countries is
considered to be a key strength of the company. The levels of efficiency of the supply chain
of Walmart is high which is considered to be helpful for the organization to maintain its
expansion based operations (Pantano et al. 2017).
Weaknesses – The weaknesses of Walmart have been able to impose key stages of
challenges to the ability of the firm to withstand different threats that are provided by its
competitors. The low prices of products are considered to be a key aspect that has reduced the
profit margins. Walmart also has some major levels of competitive disadvantages in
comparison to the different high end sellers that are present in the US retail industry (Sakas,
Vlachos and Nasiopoulos 2014).
Opportunities – The expansion based opportunities have been provided to Walmart
along with proper improvement of the business operations as well. The opportunities are
mainly based on the global situation of the economy that has been developed. The
organization can also bring major improvements in the quality based standards in order to
compete against the speciality retailer stores that are present in different parts of the country
(Shockley and Turner 2015).
Threats - The perceptions of consumers and variations that have taken place in the
retail market condition have a main influence on the operations of Walmart. The choice of
consumers has started shifting more towards the healthier food options in comparison to the
situation that had prevailed earlier. The levels of aggressive competition have increased
recently resulting in the requirement for the development of high stages of differentiation by
the company in order to maintain the successful processes (Sakas, Vlachos and Nasiopoulos
2014).

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The variations that have taken place in the external environment and the retail
industry have a major influence on the internal factors and condition of Walmart.
Stakeholders of Walmart
The strategic direction of Walmart is influenced in a huge way by the stakeholders of
the organization. The different stakeholder groups are able to affect the business operations of
the organization in a direct or indirect way. The pressure is thereby exerted on the
organization so that it is able to push the interest stages of the company. Walmart has gained
large number of stakeholders due to the huge size of the organization and its effective
presence in different countries. The various stakeholder groups of the organization are, the
investors, the customers, the employees and the suppliers (Hill, Jones and Schilling 2014).
The stakeholder group of investors have been offered with the highest stages of
priority by Walmart. All the groups of stakeholders have been considered by Walmart in
order to develop the decision-making process. The investors of Walmart are mainly interested
in the profits that are made by the company (Forbes.com 2019). The costs based on
operations of Walmart have been reduced with the help of reduction in wages. The customers
are another major stakeholder group of Walmart. The changes that are constantly taking place
in the choice of consumers have main influence on the products that are provided by Walmart
in the stores (Forbes.com 2019).
The popularity that has been increased by the firm is based on its low prices.
Employees are the third major stakeholder group of Walmart who have been able to affect the
services that are provided by the organization to its consumers all over the world. The wage
levels of the employees are a major concern for them due to the reduction in wages that have
been made by Walmart in the last few years (Forbes.com 2019). The suppliers are the fourth
group of stakeholders of Walmart who are able to provide the products that are sold in

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different stores of the organization. The suppliers are benefitted with the increase in prices of
the products that are offered by Walmart to its customers (Morschett, Schramm-Klein and
Zentes 2015).
Discussion based on the systems and structure of Walmart
The organizational structure that has been developed and followed by Walmart over
the years has a major impact on the business related activities of the organization. The
operations of e-commerce platform of the organization are also based on the development of
an effective organizational structure. The different approaches that have been applied by the
firm are affected in a vast way by the variations that have taken place in the organizational
structure of Walmart (Pantano and Vannucci 2019).
A hierarchical and functional organizational structure has been followed by Walmart
since the start of its operations. Over the years, this structure has proved to be extremely
effective for the processes of the organization in the retail business of the US. Vertical lines
based on authority have been developed in Walmart in order to maintain the operations in a
profitable way. The lack of organizational flexibility is considered to be a key aspect that has
been able to affect the processes of Walmart (Goswami and Ha-Brookshire 2016).
The organizational culture developed in Walmart is mainly based on four major
components that include, the services provided to the customers, the respect that people have
for different individuals, striving for high levels of excellence and taking the actions based on
integrity. The contribution that is provided by each of the employees have been recognized
by the company in an order to maintain the performance stages of the teams, the organization
and the individual workers as well (Frynas and Mellahi 2015). The structure and
organizational culture of Walmart has been able to play a key part in the success that has
been gained by the organization in the last ten years. However, the lack of proper systems in

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the organization for addressing the issues faced by the employees have been able to influence
its profitability levels that are gained in different countries (Frynas and Mellahi 2015).
Role played by the business functions in Walmart
The variations that have taken place in the external retail environment of Walmart has
been able to influence the methods by which the company has made changes in the business
functions and operations. The competition that is faced by the company is considered to be a
key aspect that is able to impact the frequent fluctuations that have been made in the
strategies of the company. The major opponents of Walmart in the business mainly include,
Kmart, Costco, Target. The organization has to implement changes in its operations on a
continuous basis in order to maintain a competitive position (Durand, Grant and Madsen
2017).
Conclusion
The essay can be settled by asserting that Walmart has been able to maintain its
successful operations in the retail business for the last ten years with the help of effective
resources and approaches that have been applied. The organization has become highly
successful in its operations with the help of continuous development of its processes.
However, the employee wage related issues need to be solved by Walmart in order to uphold
the leadership position that has been gained in the market.

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