Running head: EXTERNAL AND INTERNAL ENVIRONMENTS OVERVIEW
External and Internal Environments Overview
Lashuna Boatman
BUS 499
11/16/2020
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EXTERNAL AND INTERNAL ENVIRONMENTSOVERVIEW
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External and Internal Environments Overview
Walmart's external and internal environment involves factors that are responsible for the
company's success. As the leading company in the retail industry, Walmart has progressively
endured the adverse effects of threats in the political, social-cultural, economic, legal, ecological,
and technological phases of its commerce (Ghosh, Ostry & Qureshi, 2017, p.124). Nevertheless,
the success of the company requires a progressive evaluation of the retail industry environment.
The factors also tend to change from time to time; hence, imposing challenges to the company. Out
of the changes, Walmart may get opportunities or threats. However, for Walmart to protect itself
from the risks, it must exploit all the opportunities.
Demographic Segment
The demographic segment is genetic and observable features of a population, including
sex, density, race, geographic region, income, levels, and age growth. The demographic segments
in Walmart Company are analyzed globally since the company operates globally (Ghosh, Ostry &
Qureshi, 2017, p.130). The company uses its riches of sales and inventory data in carrying out the
segmentation based on the demographics; this allows the company to do marketing to a specific
age, income brackets, and ethnicity. The stores of the company were, geared toward the lowincome customer segment; the headquarters, on the other hand, were reflective of Walmart's trend
to be mean as they were, accommodated in a warehouse-style building with simple décor.
Through this classification analysis, Walmart's company will be able to understand its
customers and improve the services rendered to them. It will also locate the customers' divisions,
match their expectations, and meet their demands.
EXTERNAL AND INTERNAL ENVIRONMENTSOVERVIEW
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Sociocultural Segment
The socio-cultural factors influence the values, beliefs, and lifestyles of society. The best
example is the higher percentage of females in the workforce, a bigger worry for healthy lifestyles,
greater worry for the atmosphere, and an upsurge in the provisional labor. Therefore, the company
should keenly evaluate the social, cultural factors in all the countries they are operating to ensure
that all the consumers accept the products they offer. The evaluation will enable the company to
stop delivering products that will bring complaints from their customers. Nevertheless, the
company's primary cultural trend is the constant growth of the rural communities (Martínez,
Galván & Alam, 2017, p.67). The increasing population of people in rural places has made
Walmart continue expanding its stores and accommodate current customers' current products and
services. The company is trying to maintain a good relationship with members of the society.
However, there are a few groups and individuals in society who have a problem with the company.
Walmart Company also participates in communal social activities to create a good relationship
between them, the community, and the customers.
In finding out the level of competitive rivalry in the retail industry, the primary
consideration is market saturation (Martínez, Galván & Alam, 2017, p.69). The fact remains that
the retail market is highly saturated. As a result, Walmart's company faces tough competition,
which requires tactics and strategies to build its strengths. However, other forces like the
negotiating power of buyers, negotiating power of dealers, and extortions of alternatives. The most
significant forces are economic contention and the risk of new competitors.
Economical Competition
EXTERNAL AND INTERNAL ENVIRONMENTSOVERVIEW
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The strength of competition is tough in the retail business. This is because there numerous
organizations of diverse capacities that are contending in this business setting. However, Walmart
should consider the following exterior elements because they are vital in competitive rivalry's
strategic management. The first external factor that needs to be considered is the vast number of
firms in the retail market. The other factor is the availability of different types of retail firms and,
lastly, the high aggressiveness of the retail firms (Martínez, Galván & Alam, 2017, p.77).
Therefore, the company faces the potent forces of these external factors that define the level of
competition in the retail environment. The company experiences a challenge in creating a
competitive advantage because of competitors' diverse approaches from different firms in the
industry. The regular competition is also created by high firm aggressiveness. Therefore for
Walmart's company to remain competitive, it must put more effort as well. For the company to stay
in its position as the highest international retailer, it must maintain growing.
The threat of New Entrants
The company must address the high level of threats imposed by the new entrants. New
retail firms enter the industry despite the presence of giant retailers like Walmart. The new retailers
join the industry and become more competitive because of their location, convenience, and other
factors that make them more favorable. The threat of new entrants is also affected by external
factors like moderate capital costs, low costs of doing business, and the moderate to high brand
development price. Although it is expensive to develop the new entrant's brand, some new firms
can create new brands that challenge Walmart Inc (Petrakis, 2020, p.46). On the other hand, the
cost of establishing a retail firm is low to moderate. Therefore it makes it easy for new firms to
compete favorably with Walmart.
EXTERNAL AND INTERNAL ENVIRONMENTSOVERVIEW
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External Factors affecting Walmart Company
The company's threats are connected to the retail market conditions and the constant
changes that take place in the customer perception concerning the goods they purchase. These
elements alert the company to make some tactical economic alterations (Petrakis, 2020, p.54). The
external threats that Walmart is facing are; online retailers of various sizes, aggressive competition,
and healthy lifestyle trends.
External Factors Affecting the Opportunities of Walmart Inc
The opportunities of the company are essentially about growth and improving business
performances. The opportunities of Walmart are connected to the international economic situation.
Additionally, the company's human resource provides issues that offer the company opportunities
to improve (Martínez, Galván & Alam, 2017, p.85). The company's Opportunities are;
enhancement of the quality standards, expansion in the developing countries, and development in
the human resource performances to create effectiveness in the labor market.
Strengths of Walmart
The strengths of the company are linked to the size of the firm. This competitive strength
allows the company to endure the threats despite its low-cost retailer and weaknesses (Martínez,
Galván & Alam, 2017, p.83). The company's strengths that will enable it to exploit the
international enlargement opportunities are; high efficiency of the supply chain, the international
business size, and the internal supply series. The company obtains funds from its international
firms to fund its development and enlargement. The business's supply chain has great effectiveness
because of its high tech in controlling and monitoring goods from the stores to the retail shops
globally.
EXTERNAL AND INTERNAL ENVIRONMENTSOVERVIEW
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Recommendations
According to the evaluation, it is clear that the company is supposed to prioritize its
strengths to utilize the opportunities in the international market. The company's secondary
priorities should be its threats and weaknesses (Ramadani, Memili, Palalić & Chang, 2020, p.234).
To improve its performance, it should improve its human resource management standards and
product quality standards. Besides, the company should develop progressively to utilize economic
opportunities in developing countries. Walmart should support and strengthen its aggressive
international development globally through its global supply chain and the high-efficiency supply
chain. Finally, for the company to prepare the business for long-term expansion, it must
implement strategic changes based on its threats and weakness.
EXTERNAL AND INTERNAL ENVIRONMENTSOVERVIEW
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References
Ghosh, A. R., Ostry, J. D., & Qureshi, M. S. (2017). Managing the tide: How do emerging markets
respond to capital flows?.
Martínez, A. B., Galván, R. S., & Alam, S. (2017). Financial Analysis of Retail Business
Organization: A Case of Wal-Mart Stores, Inc. Nile Journal of Business and Economics,
3(5), 67-89. Retrieved from;
http://journal.nileuniversity.edu.ng/index.php/NileJBE/article/view/105.
Petrakis, P. E. (2020). The evolution of the Greek economy: Past challenges and future approaches.
Springer Nature.
Ramadani, V., Memili, E., Palalić, R., & Chang, E. P. (2020). Entrepreneurial Family Businesses.
Springer Texts in Business and Economics.
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Week 3 Strategic Management and Strategic Competitiveness Assignment
Lashuna Boatman
Strayer University
BUS 499 Business Administration Capstone
Professor Brian Grizzell
10/26/2020
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Week 3 Strategic Management and Strategic Competitiveness Assignment
The task in context involves strategic management and strategic competitive analysis
carried out on a public company. The chosen public corporation is Walmart Inc. one of the largest
corporations within the retail industry. With that regard, an analysis is to be carried out to
determine how globalization alongside the change in technology has impacted Walmart Inc. in the
past years. Additionally, the industrial organization model and the resource-based model gets
deployed to help figure out how Walmart Inc. would deploy such approaches and realize revenue
margins above its current average revenue. Another examination will be ascertaining how the
corporation's mission statement and vision statement have contributed to the overall success
experienced at Walmart. Then the last section takes a look at how different groups of stakeholders
linked to Walmart have also influenced the company's success witnessed today.
Globalization
The ability of many corporations to be able to operate in geographical regions away from
their motherland can be attributed to the concept of globalization. Globalization is defined as the
existence of a scenario where countries and their respective corporations progressively become
inter-reliant on one another (Hitt et al., 1). The interdependence becomes evident through a
number of factors as presented by the impact globalization has had on Walmart Inc. The movement
of assets required to facilitate the provision of goods and services is evidence of how globalization
has impacted Walmart. In the process of expanding its territory and global market share Walmart
has been able to open up a number of retail shops in other continents like Asia and even some parts
of Africa. It is because of globalization, that the retail company is able to invest resources
harnessed in the United States to another country in a different country. Besides intercontinental
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flow of capital knowledge and skills are also able to be transferred across borders, and competition
at a global level. That is the reason why Walmart is able to move out of the USA and set up a store
in India for instance and compete with Indian retail companies without sparking any legal
concerns. As a result, Walmart has enjoyed an increased revenue base from its stores situated in
different parts of the world.
Technology
Walmart has enjoyed for some time the title as one of the largest retail companies in
America. However, just like any other corporation, they have been at risk of being threatened by
technological developments.
The category of the technological invention that has impacted
Walmart's operation is the disruptive technological inventions. Disruptive technological inventions
are characterized by their tendency of rendering irrelevant prevailing technology by coming up
with new approaches that result in newer opportunities (Hitt et al., 1). Disruptive technology has
impacted Walmart in a number of ways, and in order for the retail company to maintain their
position, they have had to adopt technologies that disrupt existing markets and keep them ahead of
the curve. For instance, as a way of keeping up with the growing online shopping method,
Walmart had to create more value with their operations by developing a technology called
Alphabot. The development has hastened the online shopping procedures by improving procedures
for picking products, packing, and faster deliveries to customers shopping at Walmart (Thomas, 2).
This approach as result creates a new market for Walmart while devaluing the existing online
shopping approaches used by other retail companies.
Industrial Organization Model
Just like any other company, Walmart Inc.'s objective among other targets is to increase
revenue. In order to determine how much extra revenue above its normal average revue can be
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attained, it requires the adoption of an industrial organization model. The specific model
appropriate to enable this simulation is the industrial organization model focusing on returns that
are above average. Based on this model it is assumed that companies’ profitability tends to be more
influenced more by factors from outside the company more than internal factors like management
decisions (Hitt et al., 1). Therefore, Walmart can attain above-average returns by making decisions
intended to capitalize on external factors. Some of the external factors make up the opportunities
they can exploit and increase revenue. Walmart can increase its revenue to heights above its
current average revenue by developing strategic plans based on some of the external influences.
For instance, the company receives monthly payments of over $100 million paid by its customers
using banking billing methods like credit cards and debit cards among other methods (Marcilla, 3).
In the process, charges are incurred while processing payments. If the corporation adopts a banking
method of its own, it would be making extra revenue off the processing charges.
Resource-Based Model
Unlike the industrial organization model, the resource-based model deploys organization's
internal capability as a way of increasing a firm's profits. The best-recommended approach is
coming up with a strategic plan built on an integration of the organization's strengths. The strengths
include all human capital and physical capital. With the resource-based model, Walmart Inc. can
improve its profits through the development of a strategic plan that uses its large revenue base of
over $400billions by integrating it with an approach where it sells a wider range of products
(Marcilla, 3). The best approach is then evaluated and all the organization's capital, human capital,
and physical capital is deployed. As result, the increased sales will definitely result in higher
revenue.
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Vision
A corporation's vision is stated in its vision statement. Whereby, the vision statement is a
declaration of what the company wants to be in the future. A company's vision guides the
company's actions and as a result, impacts the overall success level of the corporation. In the case
of Walmart, their vision statement talks about being dedicated to the service that regardless of how
their customers shop, they must still save money at the end (Walmart, 4). Taking an assessment of
the company's overall success, it is evident the vision statement is their guide. They are able to
command a larger customer base due to the approach of selling their products at a relatively
cheaper price.
Mission
A corporation's mission acts as the specifier as it explains exactly which sector the
corporation intends to offer its product or service. All that is given in a mission statement which is
normally built on a vision statement. For instance, through Walmart's mission statement, it
becomes clear that they are inclined towards selling products at the retail level and the cheaper
prices (Walmart, 4). Based on the company's mission statement their mission is ensuring that
people live better through saving their money. How that has impacted the company's success is
profound since the company has established itself as a giant retail company that sells its prices at a
cheaper price. The company thrives on the pricing strategy, which is its secret to success, an
approach that gives them an edge.
Stakeholders
Stakeholders can be attributed as the individuals and entities that contribute to the bringing
up of a corporation and also keep it up and running. Stakeholders are individuals and entities
within an organization that can be affected by the organization’s decision and their decisions can
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also affect the organization's well-being. They are grouped into product-market shareholders,
capital market shareholders, and organizational stakeholders. Under the product market, they
include; main customers and suppliers of raw materials or commodities. Capital market
stakeholders are the bankrollers of the business, they include; banks and company shareholders. In
addition, organizational stakeholders are made up of employees and managers within the
organization (Hitt et al., 1). In the case of Walmart, capital stakeholders are those initial investors
in the company and those who own shares of the company on the stock exchange. Organizational
stakeholders are its managers and employees. Customers and their suppliers make up the product
market stakeholders' category. With regard to the company's success, stakeholders play a key role,
especially the suppliers. Walmart relies on the supply of products from local suppliers for them to
be able to adapt their pricing strategy. Their employees also accept minimum wage based on a
part-time basis which allows the corporation to sell its product prices at relatively lower prices.
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Sources
1. Hitt, Ireland, & Hoskisson. 2020. Strategic management: Concepts and Cases:
Competitiveness and globalization (13th ed.). Mason, OH: South-Western Cengage
Learning
2. Thomas, Lauren. 2020. Walmart Just Unveiled a New Technology that Could Help Defend
its Position as America’s Largest Grocer, CNBC. Retrieved
https://www.cnbc.com/2020/01/08/walmart-unveils-a-new-technology-for-its-grocerybusiness-alphabot.html
3. Thomas, Lauren. 2020. Walmart Just Unveiled a New Technology that Could Help Defend
its Position as America’s Largest Grocer, CNBC. Retrieved
https://www.cnbc.com/2020/01/08/walmart-unveils-a-new-technology-for-its-grocerybusiness-alphabot.html
4. Walmart, 2020. Walmart’s.com History and Mission. Retrieved:
https://www.walmart.com/help/article/walmart-com-s-history-and-mission/
a62ce500758c4746a211d00d7c2acfcd
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Business Strategic Analysis
Lashuna Boatman
Strayer University
BUS 499
Professor Brian Grizzell
11/30/2020
2
Business Strategic Analysis
Introduction
Walmart is an American multinational retail corporation. Sam Walton founded the
organization in 1962, and currently, it operates a chain of hypermarkets that have made it the
largest global company with a revenue of USD 514.405 billion. Its main focus is to touch people’s
lives by offering quality products at much affordable or lower prices. The organization enjoys the
broad support of loyal consumers that have been enhanced by effective strategies, which has made
it be on top of the game within the industry. Through its corporate-level strategy, the organization
has managed to diverse its operation into other counties worldwide but across the industries lime
Insurance, Banking and fiancé, Hospitality, among other sectors. Through its pricing strategy, it
has managed to achieve long-term success.
Business-Level Strategies for The Corporation
Business-level strategy assists organizations in achieving a competitive advantage within
the industry. According to Walmart corporation's case, for the long term success, the organization
has made an appropriate individual business strategy and choices that have enabled it to get to
where it is today (Altaf, & Khalil, 2016). For its business-level strategy, Walmart uses both cost
leadership and differentiation as its main strategy. It has diversified its product base in which it
provides its customers with a wide variety of products and services. Additionally, the products are
also of similar or better quality than those of the competitors ("Business level and corporate level
strategies – Walmart Inc | UniqueWritersBay blog," 2017). Through that, Walmart can gain longterm success since it can gain the loyalty of various types of customers through a wide variety of
products. Most consumers also have a high preference for low prices in which they prefer to spend
less on a quality product. The organization will still experience high sales revenue due to
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affordable prices or low prices of its products, which are about lower than those of its competitors
within the retail store industries.
Cost leadership and differentiation represent a business level strategy that is very
significant for the long-term success of the firm because it can attract more consumers while at the
same time increasing its sales as a result of the new traffic. For example, its main competitor is
Target. Despite both companies having large retail stores and various products, they have different
business strategies that give Walmart a more competitive advantage (Altaf, & Khalil, 2016).
Walmart focuses on low prices with a strong slogan, which states that "Saving People Money." On
the other side, their main competitor, Target, focuses on giving its customers the best service
through a shopping experience. They also focus on high-end consumers with an average income of
about $64,000. Walmart focuses on a wider range of consumers right from low-income earners to
people with high-end income.
Based on personal judgement, the low-cost leadership approach is a very good strategy for
the organization since it ensures consumers are constantly attracted to the products. It is not easy to
find a company or business organization that offers such high-quality standard products like
Walmart at a low price within the store retail industry. Through that strategy, Walmart gets a
competitive advantage over other firms. Consumers will consider themselves lucky by purchasing
their products since they will have nothing to lose; rather, they will be gaining through quality
products at low prices. Another key factor why the low-cost leadership approach is a good strategy
is that the organization can create entry barriers for competitors. Through that, the organization
will be much stiff or strong for any new entrants to survive, thereby enabling it to keep competition
at bay.
Corporate-Level Strategies for The Corporation
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The organization, Walmart corporation, has several corporate-level strategies that have
made it successful by giving it a competitive advantage. Based on that, its main corporate-level
strategy involves a single business strategy and public affairs strategy. According to the public
affairs strategy, the firm had been successful over the years. It will still experience such constant
improvement since Walmart can expand its operation to the new markets through that. For
instance, they have managed to open new branches in various countries or nations across the globe
(Altaf & Khalil, 2016). Currently, Walmart branches are found in major countries all over
America, Europe, and even Asia. Through the strategy, the organization has also managed to
venture into new markets by operating across the industries ("Business level and corporate level
strategies – Walmart Inc | UniqueWritersBay blog," 2017). For instance, Walmart is currently
doing various operations like insurance, giving soft loans, and not within the retail industry.
Through this strategy, the organization has also managed to create good social relations or partner
with other prominent individuals like politicians and professionals who have helped them achieve
their goals by offering financial support.
Based on personal opinion, single business strategy and public affairs strategy are
appropriate or good choices that have been made by the organization, Walmart Inc. That is based
on various reasons; for instance, through the public affairs approach, the organization has managed
to focus on customer satisfaction, whereby it has managed to improve its activities that aim to
enhance customer service activities. Additionally, they have also managed to create a good public
image by engaging or getting involved in community or social activities through that approach.
People or consumers are currently becoming more aware of business organizations that emphasize
creating a good environment within the community by offering various support. They tend to get
attracted to such brands since they show concern for society's welfare at large. Through social
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activities, people have to gain more interest in Walmart's products since through that, they get to
feel that they do positively contribute indirectly to community development. The organization's
chances of being sued by environmentalists and activists who champion environmental
preservation and human rights are minimal. Through the organizational corporate-level strategy, it
has managed to focus on various productive factors or activities that will ensure long term success.
Competitive Environment
According to the competitive organizational environment within the discount retail
industry, Target is the main competitor of the organization, Walmart. It also has a good market
share and enjoys the support of loyal consumers to their brand. That is because Target has also
adopted almost the same corporate and business level strategy as that of Walmart, which makes
them two major organizations that control the discount retail industry. Target is the second
discount retailer in the United States; they have an almost similar business-level strategy. Both of
them majorly focus on offering quality products to their consumers. That has made them realize an
increased number of loyal customers to their brand. However, ty differ in cost leadership in which
Walmart tend to offer a bit lower price than those of Target. Based on that, Walmart gets a
competitive advantage over its closest competitor, Target. However, Target has also managed to
lower its prices but indirectly lower its production cost, which has also indirectly affected its
growth strategy.
Another key difference can be seen through their corporate-level strategies. Whereas
Walmart has depended on using the public affairs approach for its competitive advantage, Target is
banking on the shopping experience. They give their clients the best service by treating them like
guests. That does not match Walmart’s public affairs strategy, which has enabled it to gain a good
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public image within the community and expand across various industries and beyond country
borders into other markets.
According to personal opinion, in the long term, Walmart has more opportunity of being
successful than its closest competitor, Target corporation. That is because of the features that relate
to the public affairs approach, enhancing the effective growth process. Currently, a good number of
consumers do become loyal to company products based on their reasons. For instance, many
consumers will feel obligated to promote Walmart due to its role in promoting community through
social activities and environmental safety in which they will also benefit from.
Whether The Choice In Business-Level And Corporate-Level Strategies Template [Docx]
Would Differ In Slow-Cycle And Fast-Cycle Markets
A slow cycle market is a kind of market whereby resources get shielded while a company
maintains a monopoly over the market so that competitive pressure cannot penetrate. On the other
side, the fast cycle market refers to markets whereby the organization's competitive adage is not
shielded from imitation (Capocchi, 2019). Imitations do happen very quickly, and competitive
advantage is not sustainable in such markets, fast-cycle markets. According to the case of the
chosen company for the study, Walmart, it will still be more likely to succeed in a slow cycle
market to its customer loyalty and barriers to entry. However, the case will be different in a fastcycle market whereby the company, Walmart, will be forced to enact various changes to its
strategy to maintain its competitive advantage and realize long-term success.
There are various levels and types of business strategies in which the levels include
corporate, business units, and departmental. Based on that, the corporate level majorly emphasizes
growth, stability, and retrenchment strategies. However, business-level strategies involve concepts
like Porter's generic strategies. The last one includes the department level. It includes strategies that
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coordinate various operations that aim to design, manufacture, deliver, and support a product or
service.
Conclusion
Generally, Walmart is one of the leading multinational retail corporations in the United
States and globally. Having been founded in 1962, the organization has managed to retain a steady
growth over the years. Currently, it is ranked the largest company in terms of revenue. Walmart
has managed to experience a big success due to its effective business and corporate strategies that
have managed them to reach many consumers. For instance, through its business and corporatelevel strategies, it found a way of offering quality products at lower prices but still maintains its
profit margin due to product differentiation. It has also managed to lure a large number of
customers through public affairs approach.
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Reference
Altaf, M., & Khalil, M. (2016). Strategic information system: a source of competitive advantage.
In Information and Knowledge Management (Vol. 6, No. 9, pp. 24-34).
Business level and corporate level strategies – Walmart Inc | UniqueWritersBay blog. (2017,
January 11). Professional Assignment Help - UniqueWritersBay.
https://uniquewritersbay.com/blog/business-level-corporate-level-strategies-walmart-inc/
Capocchi, A. (2019). Time in Entrepreneurship. In Economic Value and Revenue Management
Systems (pp. 21-39). Palgrave Macmillan, Cham.
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