Strategic Management in a Globalized Economy

The major agenda of the report is to

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STRATEGIC MANAGEMENT IN A GLOBALIZED ECONOMY
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6/30/2019
Student name

STRATEGIC MANAGEMENT IN A GLOBALIZED ECONOMY 1
An agenda
The major agenda of the report is to compare and analyses two major companies that are Wal-
Mart and Nordstrom and their mission, key strength and weakness, pricing and positioning
strategy, and competitive strategy in order to understand the key importance of strategy
formulation and their relevance in the sustainability of the business in the global economy. Each
organizational activity would be assessed in the report.
Executive summary
Wal-Mart and Nordstrom, both the companies are found to be involved in offering best quality
products to the consumers including innovation in varieties and different pricing strategies. Wal-
Mart mission depicts that the company has been adapting the cost leadership strategy so that
customers can have more number of products at a single room with lower cost and increased
standard of living. The mission statement of Nordstrom reflects on the differentiation strategy of
the company. Wal-Mart has been able to differentiate itself from the key competitors through
lowest cost provided to the customers every single day. In order to sustain in the market,
Nordstrom has increased in stores through acquisition and has focused over a generation of sale
scenario. Therefore, it can be said that Wal-Mart is focused more on a product that is the
company is product oriented on the contrary; Nordstrom is largely focused on services that this is
a service-oriented company.

STRATEGIC MANAGEMENT IN A GLOBALIZED ECONOMY 2
Contents
An agenda........................................................................................................................................1
Executive summary.........................................................................................................................1
Introduction......................................................................................................................................3
Comparative Mission statement......................................................................................................3
Price points and positioning.............................................................................................................4
Generic competitive strategy...........................................................................................................5
Bricks and motors versus an online store........................................................................................6
Growth and sustainable strategies...................................................................................................6
SWOT analysis................................................................................................................................7
Conclusion.......................................................................................................................................8
References........................................................................................................................................9

STRATEGIC MANAGEMENT IN A GLOBALIZED ECONOMY 3
Introduction
Two potential retail stores in America that would be considered for the discussion in the report
are Wal-Mart and Nordstrom. Wal-Mart is one of the largest retailing stores serving various
nations across the globe with the key objective to reach out to the customer with retailing,
grocery, and consumer goods at the lowest cost possible; the company is serving twenty-eight
nations. On the other hand, Nordstrom is considered to be a fashion specialty retailer that is
involved in treating several accessories and clothing for men women and kids. Both the
companies are found to be involved in offering best quality products to the consumers including
innovation in varieties and different pricing strategies (Betton, 2017).
Comparative Mission statement
The mission of Wal-Mart is to provide high-quality products and make people live better while
saving them money that is to provide goods at lower prices. The mission of the company depicts
that the company has been adapting cost leadership strategy so that customers can have large
number of products at a single room with low cost and increase the standard of living
(corporate.walmart, 2019).
On the other hand, Nordstrom mission includes providing extraordinary services to the customer
and taking care of one customer at a particular time. The mission statement of Nordstrom reflect
on the differentiation strategy of the company and depicts that The company objective is to make
best services available to the customer for which the company work to words their employee
performance and providing training to the employees in order to achieve the mission effectively
(shop.nordstrom, 2019).

STRATEGIC MANAGEMENT IN A GLOBALIZED ECONOMY 4
Price points and positioning
Price point and positioning of Wal-Mart include the following of low price strategy and
implementing the practices according to the strategy, for this Wal-Mart has attract the customer
because of cost instead of promoting their products to greater extent and increase the cost to the
company which will eventually include in the price of the product (Chari & Feng, 2018). The
company has also work to words the economies of scale so as to increase the production and
decrease operating cost of the company which would eventually decrease the cost and price of
the product. This costing strategy has able to company to provide with a lower cost of the
product to the clients. Other activities that the company has implemented is the barcode reader
that has helped Wal-Mart in several ways like diminishing cost of later, cost of inventory stock
and therefore help the company to gain a cost advantage over other competitors. In order to

STRATEGIC MANAGEMENT IN A GLOBALIZED ECONOMY 5
support the low-cost strategy of the company, the company is providing low wages to the
employees, which may decrease the service quality of the company (Chu & Liu, 2017).
Considering Nordstrom the differentiation strategy of the company, introduce the activities
related to the premium value concentration. For this, the company has improved its inventory
management and the turnover of inventory to approximately 5.35. Moreover, the strategy of the
company is to target high-income group people while providing extraordinary services to the
customers and increase the premium value of the product. Therefore it can be said that Wal-Mart
is focused more of a product that is the company is product oriented on the contrary Nordstrom
is largely focused on services that this is a service oriented company (Aksoy, 2018).
Generic competitive strategy
As already discussed, the generic competitive strategy of Wal-Mart is cost leadership strategy
whereas Nordstrom has always focused over differentiation strategy. Wal-Mart mission is to
provide low-cost for the high-quality products for which the company has been serving to the
customer in more than 27 nations through thousand stores with the low-cost provider in all the
nations and strategies to cut down cost through its agile supply chain in the global market.
Considering the recent business activity or Wal-Mart it is providing loyalty programs for the
customer in order to enhance online sales and retail Customer due to increase competition in the
industry (Bruns, 2013).
For the implementation of different station strategy of Nordstrom, the company was able to offer
premium value to the customer through designer clothes and extraordinary offers in order to
enhance the customer experience and being personal attention to the customers at the stores.
Nordstrom has provided a stylist to the customer available online that will be helpful for the

STRATEGIC MANAGEMENT IN A GLOBALIZED ECONOMY 6
customer to select the product and in enhance the customer services while providing the field of
purchasing at stores through online portal as well (Doole & Lowe, 2008).
Bricks and motors versus an online store
Considering bricks and mortar versus online stores, both companies have been working forward
to a words differentiation strategy in order to increase the selection of the product and increase
the online sales so as to decrease the cost of the companies. However, the online store has
become a challenge for the company in the retail industry as people can easily compare the
prices of the products through different websites without going physically to any retail store. For
this Wal-Mart has provided loyalty program and offer a various discount to the customers
through the online store, as one of its major competitors is Amazon providing a large number of
products in lowest possible cost due to largest business conducted by the company globally. On
the other hand, Nordstrom has been able to provide extraordinary services but face several
barriers like the inability of the company to attract customers face-to-face and provide personal
attention to the customer through online mode (Jaworski, 2018).
Growth and sustainable strategies
Considering the growth and sustainable strategy Wal-Mart has been able to differentiate itself
from the key competitors through lowest cost provided to the customers every single day. Since
the company’s focus is to lower the cost of the product, the company has not very much in
involved in the environment and other related factors like globalization designing of the stores
and ethical sourcing. On the other hand, in order to sustain in the market Nordstrom has
increased in stores through acquisition and has focused over a generation of strength sale

STRATEGIC MANAGEMENT IN A GLOBALIZED ECONOMY 7
scenario. However, the key challenge faced by the company is to maintain the satisfaction of the
customer through customer services, it is need of the company to its price parity along with its
key customer in the retail industry (Robson & Zeriti, 2014).
SWOT analysis
The key strengths of Wal-Mart include cost leadership strategy and targeting middle and lower
income group people, which consist of the maximum percentage in most of the developing
nations. However, the key weaknesses observed are the inability of the company to satisfy the
customer through service and experience at the store. The major opportunity would be to
increase the product line to increase the product variety and technological innovation at the store
to improve operational efficiency. Increasing competition in the industry and lower switching
cost to the company are major threats to Wal-Mart (Ahlin, 2014).
Considering SWOT analysis of Nordstrom, the key strengths include high quality products and
extraordinary services to the company resulting in increased customer satisfaction. However, the
weakness is the inability of the company to target the middle and lower class customer segment.
The opportunity for the company would be expanding business by introducing new stores at
various locations and geographical diversification. Increasing competition in the industry and
change in customer taste and preferences are the greatest threat to Nordstrom due to dealing with
the company in fashion clothes and accessories (Hunt & Bicen, 2017).

STRATEGIC MANAGEMENT IN A GLOBALIZED ECONOMY 8
Conclusion
Wal-Mart is one of the largest retailing stores serving various nations across the globe.
Nordstrom is considered to be a fashion specialty retailer that is involved in treating several
accessories and clothing for men women and kids. The mission of Wal-Mart is to provide high-
quality products and make people live better while saving them money that is to provide goods at
lower prices. Nordstrom mission includes providing extraordinary services to the customer and
taking care of one customer at a particular time. The generic competitive strategy of Wal-Mart is
cost leadership strategy whereas Nordstrom has always focused over differentiation strategy.

STRATEGIC MANAGEMENT IN A GLOBALIZED ECONOMY 9
References
Ahlin, B. (2014). Entrepreneurs’ creativity and firm innovation: the moderating role of
entrepreneurial self-efficacy. Small Business Economics, 43(1), 101.
Aksoy, S. (2018). Applying Ansoff’S Growth Strategy Matrix To Innovation Classification.
International Journal of Innovation Management, 1850039.
Betton, P. (2017). Competitive Strategy: Creating and Sustaining Superior Performance. Macat
Library.
Bruns, P. (2013). Corporate Entrepreneurship: Innovation and Strategy in large organisations
(3rd ed.). london: Palgrave MacMillan.
Chari, S., & Feng, H. (2018). Research in marketing strategy. Journal of the Academy of
Marketing Science, 1-26.
Chu, C., & Liu, S. (2017). Hedonic Pricing Method, the Third Law of Demand, and Marketing
Strategy: An Abstract. In Academy of Marketing Science Annual Conference, 721.
corporate.walmart. (2019). about us. Retrieved from https://corporate.walmart.com/
Doole, L., & Lowe, R. (2008). International marketing strategy: analysis, development and
implementation. Cengage Learning EMEA.
Hunt, D., & Bicen, P. (2017). The FREE (Firm Resources and External Environment)
Framework as an Alternative to SWOT: An Abstract. In Academy of Marketing Science
Annual Conference, 49.
Jaworski, B. (2018). Commentary: advancing marketing strategy in the marketing discipline and
beyond. Journal of Marketing Management, 34(1), 63.
Robson, M., & Zeriti, A. (2014). Sustainable export marketing strategy fit and performance.
Journal of International Marketing, 44.
shop.nordstrom. (2019). about us. Retrieved from https://shop.nordstrom.com/c/about-us?
origin=footer&cm_sp=corp-_-corp_AboutUs-_-globalfooternav_aboutus

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