Walmart Business Strategy: SWOT, PESTEL, and VRIO Analysis Report

This report provides a comprehensive analysis of Walmart's business strategy, focusing on the importance of its vision, mission, and values. It employs analytical tools like PESTEL and SWOT to assess the external and internal environments, identifying strengths, weaknesses, opportunities, and threats. VRIO analysis is used to determine Walmart's sustainable competitive advantages. The report also explores the implications of competing in international markets, diversification strategies, and ethical considerations. Furthermore, it discusses the planned execution of strategies and the utilization of ROI and cost-benefit analysis in strategic planning. The analysis reveals that Walmart's strong financial performance and brand image are key strengths, while weaknesses in HR policies and e-commerce growth need improvement. The report concludes that Walmart has a sustainable competitive advantage but faces challenges in international markets and requires effective stakeholder management and change management strategies. Desklib offers this and many more solved assignments for students.

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Executive Summary
The report has thrown light on analysing the importance of vision, mission along with the
value statement of the business appropriately. All three elements play a significant role in the
organizational strategy process in which values guide how the different organizations will
reach the ultimate goal or vision effectively. It can be analyzed that without defined and
strong values, the vision or mission is not possible as it will require proper guidance that will
be effective in managing the overall system. From the mission, vision and values, it can be
identified that the mission of the organization is to save people money as they can live better
which will be beneficial in managing the overall effectiveness. The marketing mix of
Walmart involved the low pricing strategy as it is the way for them to gain competitiveness.
From the mission, vision and values of the company, it can be identified that the primary
motive of Walmart is to become the best retailer in the market and striving for excellence.
With the usage of PESTEL and SWOT analysis, both external and internal environment
analysis have been done which helped in the development of strategies. With the employment
of VRIN analysis, the sustainable competitive advantage has been demonstrated
appropriately. Furthermore, with the implementation of financial analysis, the overall
stability of the business has been identified. From the SWOT and PESTEL analysis, it has
been identified that Walmart has been able to gain strong financial performance and due to
the same, it has increased brand image of the organization appropriately.
However, the threats and weaknesses are required to be solved by improving the HR policies
and proper growth in the e-commerce market. On the other hand, PESTEL analysis has
helped in identifying that the political condition is stable and the environmental factors are in
favour of the company to become more competitive. The technological advancements have

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helped the company in decreasing unemployment and it helps the company in becoming
more environmentally friendly in selling the different products.
From the VRIO analysis, it has been identified that the firm is sustainably competitive
advantage. Furthermore, there are different cons faced by the company in competing in
international markets which is inclusive of lack of time and no proper communication which
affected the diversification aspects. The company has utilized the direct entry strategies in
different parts of the world which assisted them in managing the relationship in an
appropriate manner. With the help of the corporate diversification strategy, Walmart has been
successful in providing the customers with all the customers in one stop shop.
The participation of the different stakeholders and managing the various changes are the
different aspects which have been proved to be beneficial in managing the strategic planning
appropriately. From the cost benefit analysis and return on investment aspects, it has been
analyzed that the company has been able to appraise the desirability of policy that has been
proposed. With the help of ROI, it has been helpful in strategic planning.

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Table of Contents
Task 2.........................................................................................................................................3
2. Discussion of Vision, Mission and Values Statement.......................................................3
3. Justification of Analytical Tools Used in Development of Strategy..................................3
4. Detailed SWOT Analysis...................................................................................................5
5. Plan for Maintaining Competitive Advantage...................................................................6
VRIO Analysis of Walmart................................................................................................6
6. Implications of Competing in International Markets.........................................................9
7. Diversification Strategy Considered in Business Strategy...............................................10
8. One Ethical Consideration of Strategy.............................................................................11
9. Planned Execution of Strategy.........................................................................................12
10. Utilization of ROI and Cost Benefit Analysis as Part of Business Strategy..................13
11. Conclusion......................................................................................................................14
References................................................................................................................................15

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Task 2
2. Discussion of Vision, Mission and Values Statement
The corporate mission statement of Walmart is “saving the money of people so they
can live better”. The statement helps in reflecting the ideals of the founder named Sam
Walton. The strategic decisions taken by Walmart is to provide the customers with easy
access to more to Walmart which is evident in more than 1000000 products available in
online stores and make the business more innovative (Aguinis, Edwards & Bradley, 2017).
On the other hand, the vision of Walmart is to become the best retailer in the USA in
the hearts and minds of customers and employees. The main reason for the change in the
perception of the company reflects the strategic changes in the competitive landscape and
overall condition of the retail industry as well (Bergh et al., 2016). Lastly, the value
statement of Walmart is to strive for excellence, good services provided to customers and
respect is the other vital criteria which should be considered to improve the scenario
effectively.
From the mission, vision and value statement of the Walmart company, it can be
identified that all these play a vital role in the management strategy process. By utilising the
environmentally friendly methods and components, the proper combination of economic,
political, social and environmental factors can be taken into aspect which will provide a brief
overview of managing the activities appropriately.
3. Justification of Analytical Tools Used in Development of Strategy
The three tools which have been used in the development of the strategy is inclusive
of the following means:

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 PESTEL Analysis- It is defined as the tool which may affect the company as it is
described as the method for providing the competitive advantage. The analysis is
required to be completed first as it will be helpful for the management to harness
information effectively (Bromiley et al., 2015). SWOT Analysis- It is defined as the systematic procedure for adequately identifying
the critical factors of success which is inclusive of both internal and external aspects.
SWOT has been identified as the chief instrument which will be tackling complicated
strategic conditions as it is helpful and straightforward in minimising data which will
aid in strategic management (Eskerod & Jepsen, 2016). Porter’s Five Forces Model- Porter has rationalized the fact that to manage the
organization strategically and the management needs to start with analyzing the
overall competition. Based on the respective analysis, the managers can examine the
different aspects which should be planned strategically and administered by the
organizational element to sustain the competitive edge in the marketplace (Ginter,
Duncan & Swayne, 2018).
SWOT Analysis of Walmart

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PESTEL Analysis of Walmart
Porter’s Five Forces Model of Walmart
Strengths
Strong financial performance
Brand Image
International Presence
Weaknesses
Issues related to HR
Negative brand image
Weak growth in e-commerce
Opportunities
HR policies can be helpful in improving
the overall practices
Expanding in emerging new Asian
markets
Threats
There is intense competition from the
rival brands
Stronger dollar can affect the lower
profits for international division
SWOT
High Stability in Politics
Huge political support for globalizationPolitical
Stability in major economies
Decreased unemploymentEconomic
Healthy lifestyle brand
urban MigrationSocial
Automation of business has increased
Business Analytics or Big DataTechnological
Business trend related to sustainability
Environment friendly productsLegal
Regulations relating to food safety
Tax law reformEnvironmental

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4. Detailed SWOT Analysis
Strengths- The company has core competence which is involvement of the use of
information technology as it will be supporting the international logistics system. The global
organizational size of Walmart has provided the business with deep pockets to fund growth
and expansion. Additionally, the global supply chain offers business resilience from the
market specific risks inclusive of disruption in local supply chains (Grant, 2016).
Weaknesses- Walmart has experienced numerous lawsuits which are concerning the
treatment of the employees inclusive of discrimination, unequal wages and unpaid overtime.
There is a massive turnover among the employees at Walmart as there is lack of motivation.
Lastly, some of the products sold by them are of an inferior quality which has reflected the
brand in a poor manner (Hanson et al., 2016).
Opportunities- It has the chance to offer more western goods to the developing
countries which have disposable income, and it will be providing value for money. Walmart
has the overall opportunity to expand the online store and presence which is inclusive of
High level of aggressiveness of retail firms
Large variety of retail firms
Competitive rivalry or competition
Diversity of Consumers
Large population of customers
Bargaining power of buyers
Large population of consumers
Tough competition among Suppliers
Bargaining power of suppliers
Low Variety of substitutes
Higher cost of the different substitutes
Threat of substitutes or substitution
Moderate cost of Capital
Low cost of doing business
Threat of new entrants

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emerging economies which are considered in how to perform online shopping (Hazen et al.,
2018).
Threats- As Walmart is number one due to which it is the target of many other
competitors in the market locally as well as globally. As is the number one retailer, there are
various political problems in the countries wherein the company is operating (Hazır, 2015).
5. Plan for Maintaining Competitive Advantage
VRIO Analysis of Walmart
Resources Value Rare Imitation Organization Competitive
Advantage
Copyrights,
Trademarks
and Property
Rights
Yes, it is
valuable to
the
competition
Yes No In the present
scenario, the
company has
not been able
to utilize the
IPR to the full
extent as it is
possible
Strong
Competitive
Advantage
Supply Chain
Management
Yes Yes Yes, it can
be
imitated
by the
other
competitor
present in
Yes Providing a
strong
competitive
advantage

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the market
Human
Resource
Management
Yes Yes Yes No Sustainable
Competitive
Advantage
Strategy
Related to
pricing
Yes Yes Yes No Sustainable
Competitive
Advantage
Process of
Procurement
Yes Yes Yes No Sustainable
Competitive
Advantage
Technology
and Innovation
Yes Yes Yes No Sustainable
Competitive
Advantage
The expertise
of marketing
within
Walmart
Yes, the
different
firms are
competing
which is
based on the
strategy
related to
differentiati
on in the
competitive
market
No, as
different
other
companies
are a
competitor
and they
know the
decent
marketing
know how
The
policies
related to
pricing are
matched
with the
different
competitor
in the
market
Yes, the
respective firm
is leveraging
the in-house
expertise
Temporary
Competitive
Advantage

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From the VRIO analysis of Walmart, it can be identified that there is inclusion of
different kinds of elements such as structure of the organization, marketing and other
activities which are related to one another and it will be helpful in managing the overall
effectiveness of the firm appropriately (Hitt, Ireland & Hoskisson, 2016). Through the VRIO
analysis, the company has been able to understand the global competitiveness which can be
gained by Walmart in comparison of the other competitors, and it will be assisting in
successfully conducting the business. The VRIO analysis of Walmart is resource-oriented
analysis with the use of detailed which are provided in Walmart Inc in the case study. The
resource-based analysis is based on the overall assumption in which the strategic resources
can provide Walmart can provide with an opportunity to build sustainable competitive
advantage over the rivals in the market.
6. Implications of Competing in International Markets
There are different implications of competing in the international markets which is as
follows:
Pros
The growth of the business is one of the advantages which will help direct all the
resources, and it will help expand the work (Hitt & Duane Ireland, 2017).
Diversification of the risk is essential which is the other advantage in which the
business may be saved which will help in removing the drastic changes effectively
(Jarzabkowski & Kaplan, 2015).
Cons

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There is a lack of time in analyzing the defining the risks of the international trade
which can affect the overall marginalization of the risks (Lasserre, 2017).
There can be the inclusion of no communication effectively with the business
partners wherein it has been seen that there are different kinds of instability in the
profitability.
Strategic Options
There are different strategic options which are considered in the entry to the foreign
markets which are as follows:
 Direct Exporting- It is selling directly in the market and consumers in the other
country without using another person or organization into consideration (Laudon &
Laudon, 2016). Licensing- It is the sophisticated arrangement wherein one firm provides the
opportunity to use their products and services to the other firm. It is one of the useful
strategies if the purchaser of the license has a relatively large market share in the
competitive market (Meyer, Neck & Meeks, 2017). Franchising- It works well when the firms have repeated business model such as the
food restaurants or organizations which can be transferred easily to the other country. Partnering- It is necessary when the entry in the foreign markets and some parts of
the world it may be required. Partnering can take in various forms from pure
marketing and sophisticated strategic alliance (Meyer, Neck & Meeks, 2017). Joint Ventures- It is the aspect which is inclusive of the creation of independently
managing the organization, and it is 1+1=3, and the two companies agree to share the
profits, and they can share the losses equally (Taticchi et al., 2015).