Analysis Of Competitive Environment 56738

ANALYSIS OF COMPETITIVE ENVIRONMENT: GENERAL ENVIRONMENT: There are some factors, come from external environment, which influence Wal-Mart’s internal activities. If any new technology comes, Wal-Mart tries to utilize it for their efficiency in the organization as early as possible. They always try to use advanced technology in their activities. Usually Wal-Mart is not much aware about their external environment (mostly during the present CEO) for which they are facing some problems. They always try to improve their internal performance, customer service but not considering the external environment. BUSINESS ENVIRONMENT: Industry Structure and Competitive Position: Wal-Mart is a chain store and chain store industry is very much competitive in maximum advanced countries mostly in U.S.A. Thousands of chain stores are growing in the market and each of them are trying to achieve their goal by providing competitive facilities. Some old and new large chain shopping males are J.C. Penny, Super Kmart Store, Super Target Store, Costco etc. Wal-Mart is competing with all the competitors in the super store industry. Wal-Mart is standing on the top in this competition. Considering all the factors of super market Wal-Mart is in the highest position. The considering factors are customer satisfaction, location, Brand image, Business strategy, Management etc. KEY SUCCESS FACTORS: Wal-Mart is the number one super store in the world for its provided customer satisfaction. Not only the customer satisfaction, there are many other factors those have ed for being successful. Those key success factors are being given below:

 Wal-Mart always use latest and high technology that to provide customer service. For instance using intranet among suppliers, management and employee from different locations.

 Providing online customer service such as taking orders, money receipt and taking information through online.

 Providing customer service in a very low price compared to the other competitors.

 Taking innovative ideas: according to the culture of Wal-Mart, any stakeholders of the organization can express their new ideas about the activities of the organization and the authority considers those for implementation. For example from the labor, employees, vendors, consumers.

 They follow Just in Time (JIT) method for inventory control. It reduces the costs of organization.



Store Layout of Wal-Mart is very well decorated and very good. The furniture and the products are decorated (displayed) in a way so that consumers can see all the products and they can move in the store very comfortably.

 They are covering a large rural area in product distribution.  They have a very renowned brand image.  Product line is very wide. (about 30,000+)  They have long term motivating mission.  They have a strong organizational culture (values, rules, beliefs)  Rural area coverage. So large distribution area. The current strategy is less likely to satisfy all the stakeholders and there is a possibility to be some conflicts among them in near future. Dissatisfied Stakeholders:  Wal-Mart has established some strong standards for the vendors those must be followed by them and Wal-Mart monitors their implementation. All suppliers are not happy with this control on them.  According to the current strategy, organizational growth is not going along with the expectation. So the stockholders are little bit worried about it.

 Management team, employee and the labors may not feel comfort in this workplace where there are claim for labor wage and female discrimination. Wal-Mart may face following Potential Conflicts in the organization for above dissatisfactions:  Sufficient inputs (supply coming) may be hampered from vendors.  Conflict may arise between authority and vendors.  Less productivity may occur because of dissatisfying employee.  Stock price may down because of low organizational growth. For above conflicts Wal-Mart may face many other problems like sales down, customers’ dissatisfaction, affecting brand image and low profit making.

DISCUSSION OF MAJOR CRITICAL ISSUES: Internal Factor Analysis Summery (IFAS): STRENGTH

Issues

WEAKNESSES

Importance (On 10)

Issues

Importance (On 10)

 Wide geographical distribution--------10

 Insufficient ments----------------09

 Better customer service capability-----09

They are failed to handle critical issues--08

 Purchasing goods in lower price-------08

 R&D is not much strong-------------------08

 Using high technology------------------08

 Taking many new unskilled labors-------08

 Strong historical background-----------08

 New CEO and management team--------07

 Inspiring Mission------------------------07

 Can’t be continuing current success-----06

 Organizational culture is very good---07  Large capital------------------------------07  Wide product line------------------------07  Strong brand image----------------------10  Better supply chain management------07

External Factors Analysis: (EFAS) OPPPORTUNITIES

THREATS

Issues

Issues

Importance (On 10)  Lower rice products---------------------10

Importance (On 10)

 Sales is increasing at deceasing rate-----10

forward

 Some claims are coming from labors----09

linkage----------------------------------------08

 6000 law sues affecting brand image----09

 Online services,-------------------------06

 Government Barriers----------------------08

 Working with Branded Companies----06

 Big competitors like Costco--------------08



Integrated

backward

and

 Cost has been increased for labor.-------08  Not Conscious ----------------------------07  Centralized distribution system---------07  Non Immigrant labors --------------------06

Wal-Mart’s Strengths, Weaknesses, Opportunities and Threats: Strengths:  Wide geographical distribution

Weaknesses:  Insufficient ments-

 Better customer service capability

They are failed to handle critical issues

 Purchasing goods in lower price

 R&D is not much strong

 Using high technology

 Taking many new unskilled labors

 Strong historical background Opportunities:  Lower rice products

Threats:



Integrated

linkage

backward

and

forward

 Sales is increasing at deceasing rate  Some claims are coming from labors  6000 law sues affecting brand image  Government Barriers  Big competitors like Costco  Cost has been increased for labor

Major issues or Problems:  R&D is not much strong  Insufficient ments Big competitors like Costco  Taking many new unskilled labors  6000 law sues affecting brand image (labor and female discrimination factor) AVAILABLE ALTERNATIVE STRATEGIES: Increasing Advertising: More advertising should be given in different media (television, news paper, internet, public awareness etc). The advertising should cover some massage about strengths and opportunities of Wal-Mart. The purpose of advertising should be how to make threats in to opportunities by providing attractive massage. Foe example Sum’s Club should be focused to increase its sales. Recruitment: As Wal-Mart took many unskilled labors, they need to be trained properly to get efficient works for them. The training should be on the job and off the job as well. On the other hand skilled, experienced, knowledgeable labors should be taken during recruiting. Decentralized Distribution system: The authority should decentralize the distribution system for not only to sale products but also to promote the employee and labors for effective works. Moderating the existing strategy: As the competition has increased (costco, K-mart), offensive strategy should be taken. And in the offensive strategy management should focus on both pro-active and re-active approaches. In pro-active approach company should look on all internal and regular activities (relation with vendors, management system, handling critical issues, labor factors, and all marketing tasks), whether all the tasks, authorities and responsibilities are being performed perfectly or not. In re-active approach company should take care on the external environments and the unexpected events so that they can handle those successfully.