London School of Commerce

Strategic Information Management

ASSIGNMENT SUBBMITTED BY

Priyank Mehta
Roll No: L0243KMKM1010 BA 4

SUBMITTED TO

David Acquaye

Contents:
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Introduction Mission Statement of Walmart Pest Analysis of Walmart Porters Five Forces Analysis Swot Analysis of Walmart Level of Management in Walmart Strategies of Walmart Referencing

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Introduction

In recent years a number of significant changes in the world took place. Their commitment to the countrys state of strict control economies has shifted their policies and harsh economic reforms initiated to facilitate trade. At least some of the world market will reach terms and Conditions. Among other things, new tools like the Internet have quickly become the opening of a new time of international trade relations. The challenge of a society, the formation of a strategy in the 21st century global economy, participate in the interesting discussion and to compete globally with the aim and objective. The world biggest stores chain at current is the Walmart store, will be extremely exciting group to study. The company was founded in 1962 as a store in Rogers, Arkansas, by Sam Walton. Since then the company has grown at an unprecedented pace and was listed in New York stock exchange in 1972.The major products lines consist of house wares, customer electronic, sports good, grass and garden stuff, fitness, house fashion, paint and bath product and grocery. In 2009, Walmart generates U.S. $ 258 billion in the United States from grocery business. In 15 countries Walmart owns 8500 stores along with 55 different names. Walmart is much more than the biggest retailer in in the world. It is an financial strength, a artistic experience and a lightning rod for argument .It all happened with a simple beliefs from founder Sam Walton. Offer customers prices lesser than they find elsewhere. The basic approach Walmart has formed and driven the company culture escalation. Now that the Walmart is so big, it has an supreme power to outline global labour market and changes the operation of entire industry.

Mission Statement of Walmart

Mission statement indicates why the industry has been in business and how to carry out its activities. What they represent. That really sets the, what will they do for their consumers, shareholders, supplier, staff and community. Sam Walton, founder of Walmart decided to carry out higher sales volumes in order to maintain selling prices below than its competitors by reducing their profit margins. As a large retail empire has almost 8500 stores in 15 countries providing the largest in the world in terms of revenues.

Walmart Stores Mission Statement is

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"To help people save money so they can live better."

Walmart mission is to offer products and service for their consumers at cheap cost, With their new knowledge they attempt to have products range from foodstuff ,clothing, music etc. Walmart is dedicated to development of their selfs to be better. They strive to be the finest and give best value for money and promise to their consumers. Walmart staff are a great advantage to their enterprise and should not be without them, they include a big impact on what their business was what it is, and what it will be. They moreover considered it significant to give kindly to those less lucky than others, which is why Walmart offers hundred of dollars a year for various organization. A large variety of high-quality products the lowest achievable price assured satisfaction with what you buy, informed service, suitable hours for free parking, a enjoyable shopping experience. Way back during 90's as Stated by Sam Walton was turn out to a $ 125 billion by 2000, but idea of Sam for their store is actually capture in the first announcement above. The second announcement is a SMART goal and Objectives Since 2008, Walmart has identified three major issues are important in today's society and the world in its statement, the broad mission of "helping people save money so they can live better."

The three most important issues are: Healthcare Energy effectiveness Source of ethics. Making excellence fitness care more accessible and affordable. Dipping power cost for our consumers. Ethically and environmentally responsible supply worldwide, including China.

That these problems have objectives they want to achieve are:

Pest Analysis of Walmart

Political factor
Political factors are the set of laws, guideline, constraint and order made by government. Companies doing business in particular country must follow the term and condition of that country. Local governments look after public sector business under their authority as they were the stand of their power (political) and a resource of personal profit as well as economic profits. Working in a globalized atmosphere with companies around the world (Walmart now operates in 15 countries in world). The Government support retail sellers for flexible, and low paid jobs based local employment opportunities to a high efficient, high payment jobs. Also to gather the insist from residents category such as student, working people and senior nation. Walmart understand that transaction has a great impact on jobs and people factors, being an inherently local and labour-intensive sector. The key components of 4 Priyank Mehta L0243KMKM1010

Walmart which offers economical prices than its competitor include firm infrastructure like frugal culture, no regional offices and enjoyable atmosphere to work. Walmart make sure that they know all the term and condition of that particular country in which they are doing business and make sure that they follow it.

Economical factors

Economical factors refer the the economy of the country. Despite of general weakness in all over the world economy. Walmart had 11 percent growth amounting 6.5 billion. Walmart economical condition is very stable for last decades and its economic figure is going very well. Walmart not only think of company economy but also thinks for the country economy in which they are doing business. Walmart checks the economy of the country before doing business in that country. The main economical factors which are important to know are satiability of economy and buying power of the people. Change in economy blow price of product and services which they offer to consumers, for doing business in third world country this factor is very important because in worst economic condition demand may go down.

Social Factor

Walmart evaluate social factors before starting business in a particular country. Social factors include ethnic groups, relationship, lifestyle, religion, age distribution, charity etc. Social values also plays an important role. Walmart stores attracts lowincome customer segment. Another important factor that contributes to the social factor is Frugality. Walmart ensures that the product and services they present should be appreciated and accepted by the consumers. Walmart dont provide the product and services they know that will cause complains in consumers. Walmart make good relationship with their consumers and engage in public activities, that help in making good relationship with customers.

Technological Factors
Technology is now the big part of society. Technology is making improve quality and decrease time to promote the product and services. Walmart was very fast to accept new technology and implement to their operation. Walmart use the technology 5 Priyank Mehta L0243KMKM1010

to make best use of operational effectiveness. Walmart also manage much of its personal logistics through a central hub-and-spoke system of warehouse and distribution centers. Consumers shop a Walmart get best value for their money. By introducing reasonable natural product, fair deal, coffee, light bulbs with the reach of millions of consumer ,who buys in Walmart , It believe that it can play great role in defending our atmosphere and our global natural resources. Walmart use latests cash register. It use the best security system. As the technology changes very fast Walmart bring up to date their technology to what is happening and adjust to it.

Porters Five Forces Analysis

Threat of substitute products and services
The threat in grocery market, off licenses shop, food chains and clothing because of Walmart better quality products and services at significantly low prices.

Threat of entry of new competitors

The threat of entry in food, grocery retail industry to new competitor is very low because of its huge investment capital and to built such a big brand name. Many brand have already captured the market.

Intensity of competitive rivalry

The intensity of competitive rivalry in the retail industry is extremely high. Walmart faces very tough competition with its other competitors.

Bargaining power of buyers

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The bargaining power of buyers is quite high. Brand changeover is very often when the quality of the product is better and the price difference is very low.

Consumers are always attracted to low price and with online accessibility of products and easy price comparison.

Bargaining power of suppliers

The bargaining power of suppliers is low. The suppliers are leaning towards food and grocery retailer, is make supermarkets position very strong as the supplier has fear to loss business and make walmart strengthened in order to get the cheapest price.

Swot Analysis of Walmart

Strength
Brand Name Walmart has a brand name that is known for low pricing & bargain pricing Low budget- It is a store where people usually visit when they set out to buy certain things due to low budget & wish to get the same in cheap pricing. Vast network Due to it very wide network all across the country, it is accessible to everyone. Lucrative offers - Because of Walmart big size they can get heavy discounts from suppliers and so pass these savings on to the customers that are not available to other organizations One stop store It is one stop store where you get everything from eatables to electrical goods & from safety shoes to cosmetic and hence able to cater the need of every individual. 7 Priyank Mehta L0243KMKM1010

Weaknesses
Unfair practices Due to the litigation from its employees of accusing unfair practices specially from it female workers has given a bad name to its reputation Low Quality customer may be concerned of the quality of product because of its low price. Chinese Market- The goods that are being supplied from china have many cases of health & safety hazards and that has again given a bad name . Difficulty in management Management can be little difficult with big organization with wide network .

Opportunities
Low Income- In recessionary times, people are looking to save money & and would prefer to buy cheap goods & Walmart is a good choice for that time. Bad Market Scenario- Due to economy slowdown, many business houses are closing down and this can helpWalmart to increase it customer base. Low prices As Walmart buys in bulk hence get goods in very cheap rate from it suppliers. Thus they can transfer to it customers as heavy discount of sale in order to encourage them to shop at Walmart

Threats
Competitors Some of the competitors gives heavy discount to its customer making it difficult for Walmart to fight with because their profit margins are quite low as compare to them. Rely on consumer spending -Another major threat is that, Walmart has to depends on the consumer spending. As the income decrease, the sale automatically goes down. As reduction in income will led to curtail the spending. Opposition from local vendor - Local retailers may not like the arrival of Walmart and hence they has to face lot of opposition. Lack in ethics 8 Priyank Mehta L0243KMKM1010

Level of Management in Walmart

There are three levels of management in Walmart

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Top level management Middle level management Supervisory level management

TOP LEVEL MANAGEMENT

It refers to all those who occupy top functional position in an organization and are entrusted with the responsibility of planning and executing broad policy decisions. Top level management generally perform the following functions in Walmart. setting out general objectives and policies of the business laying down guidelines for the developmental heads, polices as to production, marketing, finance, personnel, public relations organizing the business into various sections & departments for the efficient accomplishment of the enterprise goal. They use Executive support system or Decision support system.

MIDDLE LEVEL OF MANAGEMENT

Includes the departmental heads such as production manager, marketing manager, finance manager & personnel manager etc. Middle management works with the frame work of goals and policies decided by the top management. But it is mainly concerned with realizing short term than long term goal of an organization. Middle Level Management use Management Information system.

It have an advantages of system frame work. Capturing and handling data Communicating the information to the decision makers. Repetitive use of the same information Sorting out confecting information Customer retention

SUPERVISORY LEVEL OF MANAGEMENT

Supervisory Management constitutes the lowest range of management ladders. The main job of manager at this level is to supervise the operative
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staff. These managers are generally designated as superintendents, supervisors, foreman, clerk in charge & son on. Lower level management functions involves: assignment of jobs keeping a watch on workers performance sending reports and statements to supervisor maintaining close and personnel contact with workers and evaluation of their work planning of day to day work

Successful executives do not act on guess work. They get accurate information about the market conditions . the marketing research enables the manufacturer to know the latest trends prevailing in market and they alter the plans and strategies. Marketing research is a systematic gathering recording and analyzing of data about marketing problems to facilitate decision making. Research can be done by collecting the primary and secondary data depend upon the purpose of enquiry.

Strategies of Walmart
Walmart retail competitive advantage in the world is highly recognized by their strategic techniques. Walmart logistics management operations (inbound and outbound) had made very difficult to its competitors in retailing industry. Having their own trucks and private satellite system to run successful management operations , their effective and efficient utilizations of resources made its mark in cheap cost in retailing. Walmart know that its price control, effective distribution, purchasing was not sufficient to compete from its competitors. They need some strategy to move their goods from one place to place as fast as possible, efficiently and effectively .The strategy technique of cross docking has been implemented by Walmart and it is very useful to them. And it has been the main feature of Walmart value chain. They reduce their inventory by cross docking. It reduces the handling cost of goods. Although its very difficult to manage cross docking strategy .It overall reduce the cost by 2 to 3 percent as compared to its competitors. As the goods come and go from Walmart warehouses very fast they need efficient and 11 Priyank Mehta L0243KMKM1010

effective stock control system. RFID (Radio frequency Identification) made is very easy to have a look at their stock, it offer to monitor the shipments from one place to other and efficiently and effectively manages its supply chain. Walmart was the first retailer to adopt retail chain software. They introduce the system which automatically indicate the supplier about the quantity of the products and it indicates when to deliver, it is directly linked the with the check out point. Walmart IS Strategy have 3 basic principles. Centralized IS for all over the world Same systems and platforms across the whole company Be merchant first and technologists second

Referencing :

http://www.apicsterragrande.org/Wal-Mart%20Sustainability.pdf http://money.howstuffworks.com/wal-mart.htm http://www.essays24.com/print/Wallmart-Toyota-Analysis/56647.html http://www.prenhall.com/divisions/bp/app/alter/student/useful/ch1walm art.html http://www.scribd.com/doc/11796980/Information-Systems-at-WalmartInc http://www.slideshare.net/Terry34/powerpoint-presentation-4408047 http://www.scribd.com/doc/11796980/Information-Systems-at-WalmartInc http://www.apicsterragrande.org/Wal-Mart%20Sustainability.pdf http://www.walmart.com/ http://www.slideshare.net/jaspalbhatia/business-strategy-retail-walmart
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http://allman.rhon.itam.mx/~oromero/Wal_Mart_CaseStudy.pdf http://mike-pereira.com/subpage/docs/Wal-Mart.htm

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