Introduction
‘Saving people money so they can have a better life.’ (S. Walton, founder of Wal-Mart) is both the company’s slogan and the essence of its corporate mission. Since 1990, the chain has been the leader of the american retail industry, their success is assimilated to the innovative corporate strategy of relying on both the firm’s capabilities and resources.
1) Position of the article in the strategy debate
Richard Lynch (2006) defines corporate strategy as the focus on the ‘organisation’s basic direction for the future: its’ purpose, ambitions, resources and how it interacts with the world in which it operates. The article’s position in the wider strategical discussion is in the firm’s strategy to obtain and sustain competitive …show more content…
Wal-Mart’s use of these capabilities to position itself in the business environment was revolutionary, for example achieving such high economy of scale reduced considerably the threat of potential new entry, especially when considering how costly it would be for competitors to copy their business model (Conner ,1991). Such strategy is related to the concept of ‘strategic capability’ which Lenz (1980) defines as a company’s capability of taking actions affecting its development in the long-term, whereas Stalk, Evans and Shulman (1992) strongly correlate capabilities with customers.
The article is also putting in light how Wal-Mart reached such competitive position with its efficient use of cross-docking and the ‘everyday low price’ strategy implementation which resulted in a successful implementation of low-cost strategy in the cost leadership framework. Therefore ensuring an increase in the firm’s market share and diminishing the threat of substitutes in the discount retailing industry.
2) Critical …show more content…
The case study highlights the CEO’s vision influence and the possible outcomes of this vision associated with the right processes, business units creating value, customer orientation, communication abilities and other strengths (consistency, agility, innovation, etc). Therefore the authors not only describe the change of attitude towards strategy in the 1990’s, developed a clear guideline for the theories’ application in organisational management but also gave strong arguments in favor of their vision of strategy with clever use of
‘Saving people money so they can have a better life.’ (S. Walton, founder of Wal-Mart) is both the company’s slogan and the essence of its corporate mission. Since 1990, the chain has been the leader of the american retail industry, their success is assimilated to the innovative corporate strategy of relying on both the firm’s capabilities and resources.
1) Position of the article in the strategy debate
Richard Lynch (2006) defines corporate strategy as the focus on the ‘organisation’s basic direction for the future: its’ purpose, ambitions, resources and how it interacts with the world in which it operates. The article’s position in the wider strategical discussion is in the firm’s strategy to obtain and sustain competitive …show more content…
Wal-Mart’s use of these capabilities to position itself in the business environment was revolutionary, for example achieving such high economy of scale reduced considerably the threat of potential new entry, especially when considering how costly it would be for competitors to copy their business model (Conner ,1991). Such strategy is related to the concept of ‘strategic capability’ which Lenz (1980) defines as a company’s capability of taking actions affecting its development in the long-term, whereas Stalk, Evans and Shulman (1992) strongly correlate capabilities with customers.
The article is also putting in light how Wal-Mart reached such competitive position with its efficient use of cross-docking and the ‘everyday low price’ strategy implementation which resulted in a successful implementation of low-cost strategy in the cost leadership framework. Therefore ensuring an increase in the firm’s market share and diminishing the threat of substitutes in the discount retailing industry.
2) Critical …show more content…
The case study highlights the CEO’s vision influence and the possible outcomes of this vision associated with the right processes, business units creating value, customer orientation, communication abilities and other strengths (consistency, agility, innovation, etc). Therefore the authors not only describe the change of attitude towards strategy in the 1990’s, developed a clear guideline for the theories’ application in organisational management but also gave strong arguments in favor of their vision of strategy with clever use of