Competitive Strategy of Walmart-Free-Samples-Myassignmenthelp.com

Question: Discuss about any two examples of Organisations that are widely regarded as excellent in their Industry. Answer: Competitive Strategy Walmart, a retailer company, has set itself apart with numerous outlets across several countries globally. Stankevi?i?t?, Grunda Bartkus, (2012) reports that Walmart is one of the largest retail firms with the highest sales within its geographical span, a formidable inventory turnover and equally high operating profits compared to other discount retailers. Walmart remains the best retail company due to its ability to deliver convenience for their consumers by bringing products as close as possible to the consumer. The company finds its strengths in its management of supply chains which have enabled the company to gain competitive advantage and attain leadership in the retail market. Business Model Innovation The business model involves the company operations which involve its partnerships with the consumers and other stakeholders such as the vendors, distributors and partners. The business model therefore involves the activities by the organization to achieve their objectives in the market (Ghemawat, 2003). Walmart is a good example of an innovative business model. The traditional discount business model for the company was based on low cost inventory from Chinese suppliers, highly advanced IT systems that controlled the supply chain and distributions alongside the use of float as a means of covering the operational costs. According to Iacovone, Javorcik, Keller Trybout, (2009), the payments for supplies were done on a float basis where the suppliers were paid after 90 days while the goods reached the consumer markets in 7 days or less. However, the company has also used innovative strategies in its business model on the demand side of the business. Some of the aspects of the innovative business model strategies have involved differentiating its service provision on the consumer access aspect. Furthermore, the global reach has led to increased optimizing of products through assortments that cater for the consumer needs at the local level. CAGE Framework The CAGE framework is an appreciation of the challenge of distance in marketing and expansion of businesses. The CAGE stands for the cultural, administrative, geographic and economic factors that come into play when expanding into new regions and countries where the market environment contrast the local markets (Ghemawat, 2007). The four major factors usually vary across the regions in which a company works which forms the distance between the organization and its market. Cultural distance for Walmart involves the differences between the cultures of the various regions in which it retails its products. Roberts Berg, (2012) suggests that the four main markets for Walmart bear some consistency in their culture that lightens the burden of customizing marketing and operational activities for the business environments. The Administrative trade distance among the main markets, Canada, Mexico, United States and the United Kingdom is not too diverse for the company to approach the markets. Javorcik, Keller Trybout, (2008) points out that the North American Free Trade Agreement joins some of the profitable markets which makes investment and business environments fairly similar in terms of policies governing trade. Geographical distance among the various global markets is alleviated through the use of efficient freight capabilities, communication processes that enable the company to go around constraints on geographical distance. Economic distance is the fourth dimension which involves the cost of labor, productivity and GDP which are determinants of the purchasing power of consumers. The differences bear implications on the most preferable products among the various expansion territories. Coca Cola Coca-Cola is the largest soft drink brand and is the bestselling company for sodas, waters, flavored and enhanced waters, juices and other non-alcoholic beverages. Incorporated in 1919, the company has seen tremendous growth and has achieved in terms of its global reach and consumer targeting such that the company now retails to virtually all kinds of consumers. Taylor, (2000) points out that the company strategies have surpassed its competitors such as Nestle, Pepsi Co and other companies in the beverage industry. The business model innovation and the CAGE frameworks best explain the operations and success of the company in its market. Business Model Innovation Coca Cola has gained competitive advantage through its business model that is highly dependent on innovation and is flexible for emerging market changes. The strategies by Coca Cola have involved the establishment of new products and modification of the existing ones to derive innovative products that target consumers preferences. Apart from optimization of product quality and price, the company has also focused on the consumer and trends in taste and beverage preferences as a means of deriving new business ventures. According to Polk, (2009) big data has played a significant role in the transformation of Coca Colas business model. Some of the major roles of big data to company management have included increased insights into consumer needs thereby changing management methods and structures, increased inspection of products and consumer reactions to their quality and pricing, availability of marketing and sales information as well as enhanced consumer service. The transformation from traditional supply and marketing driven approaches has led to increased market targeting and overall reach for the company. CAGE Framework The CAGE framework implies the effects of the four main factors that determine distance in multinational ventures, that is, the cultural, administrative, geographical and economic differences. Although the Coca Cola Company is an organization which has stayed in the market longer than other companies, cultures among the various global markets still matter in determining sales and the manner in which the company conducts business (Ruman Verbeke, 2004). At country level there is a great difference in religions, ethnic networks which are a challenge to the manner in which Coca Cola is able to approach the market. In addition, the administrative distance is also a challenge since the global scale of Coca Colas business goes across different regions that do not share considerable trading blocs amidst political hostilities which affect the companys supply chain. Some of the strategies by Coca Cola have involved use of universal marketing slogans that are redefined among the different coun tries (Polk, 2009). Differences in business systems and purchasing power form the economic distance which the company has attempted to narrow through different pricing strategies. References Ghemawat, P. 2003. The forgotten strategy. Harvard Business Online. Ghemawat, P. 2007. Redefining global strategy: Crossing borders in a world where differences still matter. Harvard Business Press. Iacovone, L., Javorcik, B., Keller, W., Tybout, J. 2009. Walmart in Mexico: The impact of FDI on innovation and industry productivity. University of Colorado. Javorcik, B., Keller, W., Tybout, J. 2008. Openness and Industrial Response in a Wal?Mart World: A Case Study of Mexican Soaps, Detergents and Surfactant Producers. The World Economy, 31(12), 1558-1580. Polk, X. L. 2009. COCA-COLA: LONG TERM INNOVATION (A CASE STUDY). Consortium Journal of Hospitality Tourism, 13(2). Roberts, B., Berg, N. 2012. Walmart: Key Insights and Practical Lessons from the World's Largest Retailer. Kogan Page Publishers. Rugman, A. M., Verbeke, A. 2004. A perspective on regional and global strategies of multinational enterprises. Journal of international business studies, 35(1), 3-18. Stankevi?i?t?, E., Grunda, R., Bartkus, E. V. 2012. Pursuing a cost leadership strategy and business sustainability objectives: Walmart case study. Economics and Management, 17(3), 1200-1206. Taylor, M. 2000. Cultural variance as a challenge to global public relations: A case study of the Coca-Cola scare in Europe. Public Relations Review, 26(3), 277-293.