Essay on Best Buys

4490 Words 18 Pages
Best Buy Corporation - S. Bensen, A. El Haddi, K. Fitzsimmons, A. Hussein, H. Marotske -- UST EMBA

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“Best Buy Corporation: Strategic Management Analysis” S. Bensen, A. El Haddi, K. Fitzsimmons, A. Hussein, H. Marotske Strategic Management University of St Thomas, College of Business Executive MBA program, Cohort 62

Abstract
Best Buy’s news coverage of the last few years has been consistently negative. The company’s performance and reputation suffered greatly. Its Earnings per Share fell by more than 200% in 2012 alone. These negative events were the result of governance problems, a changing market landscape (cloud computing, music streaming, online purchasing, online gaming, etc.) and a significant leadership turnover in a
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As of this writing, sales are flat around 50 Billion dollars and its growth is declining from an average CAGR of 7%. Its earnings per share have declined by more than 200% in the last year. Additional performance data is shown in the appendix). In 2012, Best Buy pulled out of the UKi, removed the founder and chairman of the boardii, closed many stores, reshuffled management and is trying to deal with its own governance issuesiii. In addition, BB is facing a significant market paradigm shift towards online e-commerceiv, mobility, cloud computing, internet taxationv, music and video streaming. In section 2 we discuss the value streams, followed by a SWOT, a TOWS and we finally propose several strategies to address Best Buy’s stagnation issues.

Best Buy Corporation - S. Bensen, A. El Haddi, K. Fitzsimmons, A. Hussein, H. Marotske -- UST EMBA

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Figure 1: Best Buy brands.

2. BEST BUY VALUE STREAMS
Organizations can pursue one of the following value streams: Operational Excellence (OE), Customer Intimacy (CI) or Product Leadership (PL). They must master at least one value stream in order to succeed in the market place.
2.1 Value streams defined

Organizations that pursue OE lead in overhead cost minimization and convenience maximization by designing and deploying processes and systems that drive efficiency whether in production or in delivery of goods or services. Companies whose objective is

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