Business Operations of Walmart: Strategies, SWOT and RBV Analysis

This paper provides an analysis of the business operations of Walmart, including its mission, vision, and values, strategies, industry environment, Porter’s Five Forces, SWOT and RBV analysis. It also identifies major issues and provides recommendations for improvement.

Running head: MANAGEMENT
Management
Name of the Student
Name of the University
Author Note

1MANAGEMENT
Executive Summary:
The paper is focused in the elaboration of the business operations of one of the largest global
organization named as Walmart. The paper provides a brief overview of the company and
along with that, the paper provides an important discussion regarding the mission, vision and
values of the company. Other than this, the paper also provides some of the crucial strategies
of the company such as the application of the low prices and the establishment of the strong
store presences. Apart from this, the paper includes an important analysis regarding the
business environment of the company with the Porter’s Five Forces analysis and along with
that, it also describes the strengths and weakness of the company such as the strong brand
reputation and skilled workforce and their incapability in managing the human resources in
the company. With a precise focus on the identified challenges, the paper produces a series of
strategies for the management of these challenges such as the improvement of the copyrights
policy and the marketing and promotional activities.

2MANAGEMENT
Table of Contents
Introduction:...............................................................................................................................3
Project Part A:............................................................................................................................3
Background of the company:.................................................................................................3
Mission, Vision and Values of the company:........................................................................4
Strategies:...............................................................................................................................5
Project Part B:............................................................................................................................6
Industry Environment:...........................................................................................................6
Porter’s Five Forces:..............................................................................................................7
SWOT Analysis:....................................................................................................................8
RBV Analysis:.......................................................................................................................9
Project Part C:..........................................................................................................................10
Major Issues Identified:........................................................................................................10
Strategic Change:.................................................................................................................11
Recommendations:...............................................................................................................11
Summarization and Conclusion:..........................................................................................12
References:...............................................................................................................................13

3MANAGEMENT
Introduction:
The paper evaluates the business activities of one of the reputed retail chain of the
world named as Walmart. The paper delivers an important analysis regarding the history of
the company along with the mission, vision and the values of the company. In addition to
this, the paper provides an important discussion regarding increasing level of completion that
it is facing in the global world of business. Apart from this, the paper provides an internal
analysis of the selected company. Along with that, the paper summarizes the issues that the
company is currently facing in the effective management of the business operations. With a
precise look back at the identified issues, the paper presents some crucial recommendations
for the company to manage the impact of the identified issues in an efficient manner.
Project Part A:
Background of the company:
Walmart is a renowned multinational retail company operating in the global retail
industry. The selected organization was found in the year 1962 by a renowned American
businessman, Sam Walton (Walmart.com. 2019). The mentioned company is observed to
have its headquarter in Bentonville, Arkansas. The organization is seen to have the expertise
of serving the customers across the globe by providing excellent quality electronics, home
furniture, clothing, footwear, jewellery, toys, health and beauty products, sporting accessories
and fitness goods along with the grocery products. Apart from this, the company has notable
amount of good reputation of serving he customers with the services such as the
Walmart.com, Walmart Pay and Walmart MoneyCard. Majority of the business researchers
are seen to term the divisions of the company such as the Walmart US, Walmart
International, Sam’s Club, Global eCommerce as one of the main factor responsible for the
significant improvement in the functionality of the company (Walmart.com. 2019). Walton

4MANAGEMENT
Family is the current parent organization of the mentioned company. Along with that, the
service excellence of 2.2 million employees of the company and excellent leadership of the
management team of the company which includes Greg Penner, the chairman of the company
and Doug McMillon, the president and chief executive of the company are seen to be the
main factors responsible for the success of the company (Walmart.com. 2019). The company
is able to generate 514.4 billion US dollars in the year 2019 as revenue along with 21.96
billion US dollars as operating income (Walmart.com. 2019).
Mission, Vision and Values of the company:
Considering the mission statement of the company, it is understandable that the
company is determined in making sure that they provide the luxury to the customers in
purchasing whatever they need without any sort of concern regarding the pricing of the
products. In a nut shell, the main mission of the company was to make sure that the
customers of the organizations be able to save their money and purchase the products of the
company at the same time.
With a precise look back at the vision statement of the company, it is evident that the
company has the aim of becoming the perfect and best suited destination for their customers
for saving their earned money and purchase the products of the company (Walmart.com.
2019). Apart from this the company has the vision of becoming one of the best retailer in the
hearts and minds of the customers which precisely highlights the urge of the company in
influencing the purchase intention of the customers of the organization.
Considering the values of the company, the senior management focuses in being one
of the most innovative and agile organization in meeting the varying demands of the
customers. The company continuously wants to promote high performances, fairness and is

5MANAGEMENT
focused in listening to the varying requirements of the customers while designing their
products and services.
Strategies:
With the vision and mission statement of the company, it is understandable that the
company is significantly efficient in applying the low pricing policy (Toporowski and
Lademann 2014). With the application of the low pricing, the company is able to develop a
cost leadership in the market which enables the company for the achievement of the much
required success in targeting the customers of low income groups. This plays a crucial role
for the company in gaining a large customer base for targeting with the products and services
of the company.
Apart from this, the strong presence of the company is seen to be one of the main
success factor for the selected organization (Head, Jing and Swenson 2014). The significantly
efficient store presence of the mentioned organization along with the online business
operations are observed to be crucial for the company reaching out to the customers with the
products and services in an efficient manner.
Both the mentioned strategies are observed to be tough for the other organizations to
imitate owing to the requirement of huge investment. Hence both the strategies provide
significant amount of competitive advantage to the chosen organization.

6MANAGEMENT
Project Part B:
Industry Environment:
(Information: Global retail market size from 2011 to 2021 (in billion U.S. dollars))
(Information Courtesy: Statista.com 2019)
Considering the statistics of the global retail industry, it is evident that the market size
of the global retail market is expanding in a significant manner. In the year 2011, the retail
sales is observed to be 18800 billion US dollars which in the year 2014, reached to 22400
billion US dollars (Statista.com 2019). The continuation of the market growth of the
mentioned industry is pretty visible even in the year 2018 with 28200 billion US dollars
(Statista.com 2019).

7MANAGEMENT
(Information: Forecast for global retail sales growth from 2008 to 2018)
(Information Courtesy: Statista.com 2019)
Other than this, the percentile growth of the retail industry is observed to increases as
well and that is pretty visible with the statistics. In the year 2015, the global retail industry
experienced a growth of 2.9% and in the year 2018, it increased to 3.4% (Statista.com 2019).
Hence, it is evident that Walmart have the possibility to ride on the growth of the
mentioned industry and conduct a profitable business.
Porter’s Five Forces:
Considering the competitive rivalry aspect, Tesco with a generation of revenue of £
63911 million in the year 2019 (Tescoplc.com 2019), Woolworths with a generation of
56.726 billion Australian dollars in the year 2018 (Woolworths.com.au. 2019) and Coles

8MANAGEMENT
Group with a generation of 39.388 billion Australian dollars in the same year, are providing
an intense level of competition to Walmart (Colesgroup.com.au. 2019).
Considering the bargaining power of the buyers, it is observed that all the mentioned
organizations are applying the low pricing strategy in an efficient manner and along with that,
the product diversification of the companies are meeting the diverse requirements of the
customers in an effective manner. Hence the bargaining power of the buyers is high.
As majority of the organizations operating in the global retail industry, are able to
accurately apply the low pricing strategy along with the product diversification, it places the
chosen company in situation where it will face high threat of being substituted by the other
market giants of the industry.
With a precise look back at the significant availability of the suppliers along with the
skills such as on time supply, supply of accurate amount and supply of the raw materials at
reasonable prices, the bargaining power if the suppliers is seen to be low (Hugos 2018).
Considering the significant market share of the mentioned market leaders along with
the requirement of bulk investment for the infrastructural development, the company has the
possibility to face moderate threat of new entries.
SWOT Analysis:
Strengths:
Strong brand reputation.
Strong presence in the global market along with efficient reach which is evident with
store presence of the company in 11368 different locations across the globe (Walmart.com.
2019).
Approximately 2.2 million skilled and experienced employees (Walmart.com. 2019).

9MANAGEMENT
Weakness:
Incapability in managing the unionization in the American workforce in an efficient
manner.
Opportunities:
Acquisition of the small market players can contribute to growth.
With the application of the low pricing strategy, the company has the possibility of
increasing their presences in the smaller towns.
The pricing strategy of the company will be significant increasing the ability of the
company in targeting the customers of low income groups.
Threats:
Tough competition in establishing the cost leadership and quality concerns of the
products of the company.
Many of the products and services of the company are in threat of being substituted or
copied by the competitor organizations.
RBV Analysis:
With a precise focus on the RBV analysis, the identification of the tangible and intangible
resources are as follows:

10MANAGEMENT
Tangible Resources:
The company is currently experiencing the optimum level of skills and competencies
of 2.2 million employees across the globe (Walmart.com. 2019).
The strong financial support from the part of the parent company Walton family
enables the company in conducting quality business (Walmart.com. 2019).
The store presence of the company with 11,368 stores across the globe helps the
company in reaching out to the customers in an efficient manner (Walmart.com. 2019).
Intangible Resources:
Strong brand reputation along with the goodwill of the company in the global retail
market.
The efficient customer management system of the company plays a significant role in
the success of the company.
Project Part C:
Major Issues Identified:
The major issue for the company is observed to be the inefficient management of the
human resources in the company which is pretty prominent with the increasing number of
cases of the labour strikes in one of their largest workforce in America (Eater.com 2019).
Other than this, the company is seen to have considerable amount of difficulty in protecting
the copyrights of their products. The other multinational companies are taking the advantage
of the fact with the development of the cheap products (Fan, Lau and Zhao 2015). Along with
that, the company is also facing considerable amount of issues in introducing the products at
competitive prices.

11MANAGEMENT
Strategic Change:
One of the major changes that the selected company is expected to undertake is the
effective management of their human resources. The service excellence and the reputation of
the company is seen to be largely dependent on the skills and competencies of the employees
of the company and under such situation, the company requires to manage their resources in
an efficient manner with the inclusion of the pay structures as per the industry standards.
Other than this, the company needs to improve their copyrights policy for protecting
the design of their products and services from getting copied by other companies at cheaper
rates. The company must formulate patents for the same as well (Brem, Nylund and Hitchen
2017).
Along with this, the company has the necessity of improving their marketing and
promotional activities for reaching out to the customers with the low priced products as that
has the potential to ease out the difficulty faced by the company in establishing the much
required cost leadership.
Recommendations:
The company is recommended to improve their copyrights policy along with the
patent formation.
The company is in need to improve their marketing and the promotional activities for
establishing the cost leadership in an efficient manner with the introduction of their low
priced products.
The company is expected to improve their human resources policy with the much
required improvement in the aspect of the wage and work time characteristics. The ability of
the company in providing industry standard compensation to their employees and work time

12MANAGEMENT
has great significance in motivating the employees company towards the necessary
performance improvements.
Summarization and Conclusion:
The company is one of the largest organization in the global retail industry. However,
the company is facing some significant issues in the management of their operations such as
establishment of the cost leadership, marketing and promotions, copyright management and
the human resource management. Having said that, the company has the capability to
improve their business operations with precious focus on the improvement of their ability to
effectively conduct the marketing and promotions of the products. Other than this, the
company must improve their copyright management policies and the process related to the
human resource management to get out of the situation for the further business improvement.

13MANAGEMENT
References:
Brem, A., Nylund, P.A. and Hitchen, E.L., 2017. Open innovation and intellectual property
rights: how do SMEs benefit from patents, industrial designs, trademarks and copyrights?.
Management Decision, 55(6), pp.1285-1306.
Colesgroup.com.au. 2019. Coles Group | A trusted retailer, delivering quality value and
service. [online] Available at: https://www.colesgroup.com.au/home/
Eater.com 2019. Grocery Store Workers Are at Their Breaking Point. [online] Available at:
https://www.eater.com/2019/6/5/18510971/stop-and-shop-walmart-grocery-store-employee-
protests-strike
Fan, S., Lau, R.Y. and Zhao, J.L., 2015. Demystifying big data analytics for business
intelligence through the lens of marketing mix. Big Data Research, 2(1), pp.28-32.
Head, K., Jing, R. and Swenson, D.L., 2014. From Beijing to Bentonville: Do multinational
retailers link markets?. Journal of Development Economics, 110, pp.79-92.
Hugos, M.H., 2018. Essentials of supply chain management. John Wiley & Sons.
Statista.com 2019. Forecast for global retail sales growth 2008-2018 | Statista. [online]
Available at: https://www.statista.com/statistics/232347/forecast-of-global-retail-sales-
growth/
Statista.com 2019. Global retail market size 2011-2021 | Statista. [online] Available at:
https://www.statista.com/statistics/914324/global-retail-market-size/
Tescoplc.com 2019. Home. [online] Available at: https://www.tescoplc.com/

14MANAGEMENT
Toporowski, W. and Lademann, R., 2014. The importance of assortment, pricing, and retail
site location for competition in food retailing–Results from marketing research. Marketing:
ZFP–Journal of Research and Management, 36(2), pp.131-140.
Walmart.com. 2019. Walmart.com | Save Money. Live Better.. [online] Available at:
https://www.walmart.com/
Woolworths.com.au. 2019. Woolworths Group. [online] Available at:
https://www.woolworths.com.au/