Walmart's Strategies, SWOT Analysis, and Corporate Governance Plan

This report provides a comprehensive analysis of Walmart's business strategies, competitive positioning, and stakeholder engagement. It begins by examining the impact of Walmart's vision, mission, and stakeholders on its overall success, followed by a Porter’s Five Forces analysis to assess its competitive environment. A SWOT analysis identifies Walmart's strengths, weaknesses, opportunities, and threats, with strategies proposed to maximize strengths and opportunities while mitigating weaknesses and threats. The report also outlines strategies to enhance competitiveness and profitability, including cost leadership, differentiation, and focus strategies. A detailed communication plan is presented for engaging with employees, customers, suppliers, and the government. Furthermore, the report delves into Walmart's corporate governance mechanisms, leadership effectiveness, and the relationship between its strategy and organizational structure. It concludes by highlighting Walmart's efforts as a responsible corporate citizen and offering recommendations for improving leadership and addressing business administration issues. Desklib provides past papers and solved assignments for students.

Running Head: WALMART 0
walmart

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Contents
Introduction................................................................................................................................1
Impact of Vision, mission and stakeholders on Walmart overall success.................................3
Porter’s Five Forces of Competitive Position Analysis.............................................................3
SWOT Analysis of Wesfarmers.................................................................................................4
Strength-.................................................................................................................................4
Weaknesses-...........................................................................................................................4
Opportunities-.........................................................................................................................4
Threats-...................................................................................................................................5
Strategies to maximise strength and opportunities.....................................................................5
Strategies to overcome threats and weaknesses.....................................................................5
Strategies to Maximise Competitiveness and Profitability........................................................5
Communication plan for various stakeholders...........................................................................6
For employees........................................................................................................................6
For customers.........................................................................................................................6
For suppliers...........................................................................................................................6
For government......................................................................................................................7
Corporate governance mechanism of Walmart..........................................................................7
1. Auditing...........................................................................................................................7
2. Board of directors............................................................................................................7
Effectiveness of leadership in Walmart.....................................................................................7
Recommendation for improving leadership...........................................................................7
Relationship between strategy and organisation structure.........................................................8
Techniques to solve issues in business administration..............................................................8
Efforts made by Walmart to be a responsible corporate citizen................................................8
Conclusion................................................................................................................................10
References................................................................................................................................11

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Introduction
Walmart which was incorporated in 1969 is World's biggest retail and wholesale store
(Walmart, 2018). It has basically three segments namely Walmart U.S., Walmart
International, Sam's Club (Reuters, 2018). Current CEO of Walmart is Doug McMillion. It
has to face various challenges due to its large size (Snyder, 2015). It will analysis Walmart
vision and mission that how these helps Walmart to bring success in business, further the
report will analyze the strength, weaknesses, opportunities, threats of Walmart and the way in
which Walmart can capitalize their strength and opportunities as well as overcome
weaknesses and threats. It also provides strategies for Walmart which they can use for
increasing their competitiveness and profitability. It further highlights the communication
plan by which Walmart can effectively communicate with all their stakeholders. In the later
section of the report, the corporate governance mechanism that is used by Walmart to control
managerial actions has been discussed. It showcases the way in which leadership is effective
in Walmart. Efforts made by Walmart to be ethical corporate citizen have been described
along with the relationships between organizational structure and strategies made by
Walmart.

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Impact of Vision, mission, and stakeholders on Walmart overall success
The vision of Walmart is to put emphasis on low prices, improving quality, providing
growth opportunities to its employees. The vision statement of Walmart helps it in
achieving overall growth, due to its lower prices Walmart is attracting a lot of customers
which in turn helps in company's overall success (Ferguson, 2017).
The mission of Walmart is to help people in saving their money. The mission slogan of
Walmart is saving more and live better. By giving this slogan, it is in the hearts of people
which result in the overall success of Walmart (Ferguson, 2017).
It is seen in the article that Walmart is only able to satisfy 50% of its stakeholders but by
improving this condition it can create more success in the market (Meyer, 2017).
Porter’s Five Forces of Competitive Position Analysis
It includes the threat of new entrants, bargaining power of suppliers, bargaining power of
buyers, threat of substitute products, rivalry among existing competitors (CGMA, 2018).
• The threat of new entrants to Walmart - New firms are entering the market with
innovative strategy this forces Walmart to cut down its prices, to cut down its
costs and providing innovative services. As Walmart is a leader in the market, it
has to keep himself in the growth pace (Greenspan, 2017).
• Bargaining power of buyers- Buyers demand are increasing day by day. They
want the good quality product at lower prices, it puts pressure on Walmart to put
innovative strategy so that it can sustain in the competitive environment.
• Bargaining power of suppliers- As Walmart also deals in food so it has to buy its
several raw materials from suppliers which in turn decrease the margins of
Walmart which it was earning in the market. Some powerful suppliers negotiate
with their prices which in turn affect the overall profitability of Walmart
(Greenspan, 2017).
• The threat of substitute product- Threats of substitute product occurs when
another industry is offering the similar product of same kind (Wilkinson, 2013).
There are so many firms who are competing in an industrial environment, it has
strong external forces from many firms which are retail firms, different variety of
retail firms (Greenspan, 2017).

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• Rivalry among the existing competitors- Wesfarmers is facing rivalry from other
competitors in food industries which hampering its customers demand and overall
growth.
SWOT Analysis of Wesfarmers
SWOT analysis includes strength (financial and technological strength), weaknesses
(old or inflexible technology, skill shortage), opportunities (technological innovation, new
social trends), threats (new competitors, brand-damaging factors) (Alan Sarsby, 2016). So to
know it's good and bad points, organization accordingly see the opportunities which are
available in the environment.
Strength-
• It has large supply chain all over the world.
• As Walmart is the largest retailer in the world, due to which it has largest market
power to its competitors.
• It has innovative technologies which can be used for growth purpose.
• Wesfarmers has a huge market which is diversified.
• By applying best practices it can achieve the huge profit (Jurevicius, 2018).
Weaknesses-
• As Walmart is market leader it always has to investigate whenever it takes the wrong
decision.
• The profit margin of Walmart is low as it uses low price strategy to get more
customers.
• Except for its size of business, it does not have to differentiate strategy by which
customers can differentiate it from another firm (Smithson, 2017).
Opportunities-
• It can do the expansion in various developing due to its easy access to the countries.
• Walmart can easily enter into the new sector because of its reputation.
• It can earn more by doing partnership in the local market.

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• Expansion of quality and more goods will help Walmart to gain more profit
(Gravette, 2018).
Threats-
• As it market and global retailer, there are various political problems it has to face.
• Amazon is the biggest threat to Walmart as it is expanding its business toward e-
commerce (Howland, 2016).
Strategies to maximize strength and opportunities
Walmart can capitalize its strength and opportunities in a number of ways-
• By giving more and more opportunities to shareholders in which they can spend.
• By opening such market segment in which demand is greater.
• By improving its HR practices, it can overall improve firm’s performance.
• By providing high efficiency to supply chain, it can move to foreign countries
(Smithson, 2017).
• Entry into market segment can easily increase the market reputation of Walmart.
Strategies to overcome threats and weaknesses
Threats can be in the number of ways such as the entrance of new competitors in the market,
Changes in customer needs, changes in government policies. Walmart can overcome its
threats and weakness by -
• Providing innovative products at lower price.
• By doing proper financial planning.
• Investment in research to effectively compete with its competitors.
• Use such advertising policies which result in lower cost and increment in market
share.
• By increasing its online marketing it can overcome its threat from Amazon.
Strategies to Maximise Competitiveness and Profitability
Low price strategy- For increasing the competitive advantage of Walmart, it should adopt
low price strategy. By putting its prices low it can increase its share in the market and attract
a large number of customers. Through using this strategy, Walmart can cut down its
competitors by providing products at low prices. For keeping its prices low, Walmart can do

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mass production because when producing in bulk overall cost become low which in turn
company can sell products at low prices as well as can increase the revenue (Way, 2018).
Differentiation strategy- Product differentiation strategy is used by companies to
differentiate their product from another firm's product when two firms are offering similar
kind of product (Williams, 2018). Walmart can use this strategy by lowering the prices of the
product because it is said that customers always price sensitive.
Control cost- by using this strategy Walmart can increase its profit margin because when
companies operate at low cost they are in the better situation to recover when prices decline
(business Plan Hut, 2009).
Focus strategy- Walmart can use focus strategy on the products which are not served by any
of the firms which are presently doing business. By using this strategy, the firm can increase
its competitive advantage as well as profit by offering that product which no firm is offering
in the market (business Plan Hut, 2009).
Communication plan for various stakeholders
For employees -
• Create a website so that employees get information regarding many things.
• Conduct general meeting on a regular basis so that problems can be solved (Schiff,
2018).
For customers-
• Provide e-mail id or phone number so that it becomes easy for consumers to ask
queries.
• Ensure that there will be a person to solve all the queries raised by customers
(Edmunds, 2018).
For suppliers-
• Conduct regular meeting with your suppliers so to get knowledge regarding new
trends going on in the market.
• Convey developmental plans for the long run to suppliers (Aromäki, 2011).
For government-
• Companies can communicate in legal terms with the government.

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• Either by sending letters or articles they can communicate effectively.
Corporate governance mechanism of Walmart
Corporate governance mechanism is the guidelines, policies used by the firm to attain its
objectives and which helps the organization in fulfilling the requirements of shareholders
(Chew and Gillan, 2009). The corporate governance mechanism used by Walmart is-
• Auditing- It helps Walmart in checking its financial transactions. It helps Walmart in
ensuring whether its transactions are in accordance with the national transaction or not
or it helps in collecting information regarding shareholders.
• Board of directors- Board of director helps Walmart to take care of stakeholder's
interest, the board of directors is responsible for managing the performances of
business. They also help the business to fill the gap between owners of the company
and various other stakeholders.
The effectiveness of leadership in Walmart
Leaders in organizations are those who motive their employees to work hard in order
to achieve organizational objectives (ILunga, 2015). Walmart through its leader make efforts
to communicate openly which helps in the transparency of information, as one-way
communication is not effective sometimes in taking right decisions (Burnison, 2012). The
policy of open and free communication helps Walmart in solving many problems as well as
achieving objectives. By forming such plot in which shareholders are given due concern for
their interest, leadership in Walmart is fruitful for the overall organization.
Recommendation for improving leadership
Proper training should be given time to time so that changes can bring to their notice
and they can work accordingly in order to improve the performance of Walmart. If the time
to time training will be given to leaders they will know how to lead their team according to
the current scenario.
The relationship between strategy and organization structure
Strategies are practical plans for achieving organizational goals whereas organization
structure is the hierarchy of companies or layout of a company. The main strategy adopted by
Walmart is cost leadership strategy where it offers a product at lower price, this brings
customer satisfaction in an effective way. The organization structure of Walmart is hierarchy
and functional based organizational structure. Hierarchy based organisational structure is

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such in which all the decision are made by top level and further actions are taken by middle-
level management and lower level, on the other hand, functional organisation structure is
such in which companies have different department for performing functions such as
Walmart has department for human resource and information technology (Lombardo, 2017).
Walmart makes the strategy for different departments accordingly so that Walmart can
achieve its objectives.
Techniques to solve issues in business administration
The first method supermarket firm can use is a logistic system by which dairy
products are handle till they are not used by final consumers, warehousing facilities can also
use to take care of perishable items and warehouses near shipping area is convenient to make
goods available to final consumers (Leonard, 2018). Besides this computerized system is
used by supermarkets in which all the details related to the stock received, the stock which is
sold, even how much space is available on the shelf can be scanned.
Efforts made by Walmart to be a responsible corporate citizen
Walmart ensures that their product is sourced in an ethical manner, for this they
started an ethical sourcing program to bring transparency (Walmart, 2017).
• It provides education to its employees regarding business ethics (Walmart, 2017).
• It provides reporting system very confidentially.
• Walmart has made various laws which ensure fair business practices.
• Walmart announced various principles regarding ethics and a better environment in
which they strictly banned the child labor in their organization and started various
practices for environmental protection (Rosenbloom, 2008).
• Sometimes such ethical practices result in increased cost of Walmart.
For example- When Walmart conduct training programs it increases the cost of Walmart as
well as ethical programs conducted by Wesfarmers increase the cost of Walmart.

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Conclusion
From the above analysis, it can be concluded that Walmart was successful in creating
such environment which was according to its vision as well as the mission of providing the
fair return to its shareholders was also achieved with due care. Although Walmart is leading
firm in the world in spite of this, it has to face challenges like threats of the new entrant,
bargaining power of buyers and suppliers, substitute of product which are available in the
market. Further, it was discussed that a large number of stores is the strength of Wesfarmers
on the other hand Amazon is the threat to Walmart but Walmart can overcome its threat by
providing an innovative approach to its customers. To overcome competition in a market,
Walmart adopted strategies of low cost and product differentiation in which it was successful.
Communication plans for various stakeholders have explained above. It shows that Walmart
is able to communicate with employees, customers, suppliers, the government in a better
way. The leadership of Walmart is effective in achieving success. It is using ethical practices
in their operations but it increases their operational cost.

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grocery-dominance-it-isnt-amazon/429209/

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minimize-loss-41526.html

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