Wal-Mart: Strategic Management

An in depth analysis of Wal-Mart and

its global strategic management and electronic distribution
Analysis for Business Policy: Strategic Management.
Instructor: Dr. M. Reitzel, DeVry University, February 2007, Austin, TX.
Members of the Team:
Marcus Bedford
Jon Cable
Wayne Oulicky
Constince Sanchez

Table of Contents:
Executive Summary..2
Problem Statement ...2
Situational Description and Strategic Analyses ...3
Strategic Analysis
Overview & History...3
External Environment.6
Internal Environment..6
Intellectual Assets.......9
Strategic Formulation
Business Level Strategy.9
Corporate Level Strategy...12
International Strategy14
Digital Business Strategy..15
Strategic Implementation
Strategic Control plus Governance15
Organizational Design19
Leadership......20
Innovation......22
Opportunities plus New Ventures......22
Proposed Alternative Solutions....23
Recommendations.....23
Summary.......24
Bibliography.25

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Executive Summary
Though out the years since their inception in the 1960s, Wal-Mart has grown at an
alarming rate. Although in the early years Wal-Mart was thought to be unsuccessful, it has since
proven to be a retailer of the future. It is the largest retailer in the world. It has the highest gross
profits of any company in the world as well as the highest net profits. Wal-Mart has also topped
the Fortune 500 4 times. According to Wal-Mart - Out in Fronti it has the following Corporate
strategies:

Broadening Our Appeal to All of Our Customers

Becoming an Even Better Place to Work
Improving Business Operations and Efficiency
Driving Growth in Our International Business
Making Unique Contributions to Communities

Because the public view of Wal-Mart is some what tarnished, they are making an effort both
corporate and globally to address the image issues that they have. Many communities have
refused or at least petitioned to have Wal-Marts banned. Wal-Mart has tried to gain public interest
by lining itself with politicians to achieve its overall goals.
While the goals that Wal-Mart has currently for its corporate strategy may lead them to
their overall achievement, Team Wal-Mart does not believe that it will lead Wal-Mart into
continued success. Wal-Mart has addressed all the issues listed above. However, our team thinks
their success, although driven by these goals, contains major problems that arise while putting
these goals into action. Some of the recommendations that we have developed are more at the
local store level, where some of the goals need to be implemented globally. The public image
needs to be addressed, the treatment of their employees both with regards to their pay scale as
well as the traumatic treatment that is displayed in the view of the media. Corporate hunger for
additional market gain has clouded their judgment when it comes to hiring to retain vs. hiring to
fill head count. Wal-Mart also needs to address its views on how to navigate, infiltrate and
dominate the global discount retail industry.
Wal-Mart needs to address the issues that they currently have with the public, their
employees and themselves. Although many work for Wal-Mart it is not the best place to work if
you are a single mother, student or minority. Wal-Mart also needs to implement changes on how
it treats and work with physically disabled people.

Problem Statement
The best way to describe the problems that Wal-Mart is facing is the lack of being able to or just
not implementing their once believed motto that customers are always right. Although
customers are not always right, associates at Wal-Mart should treated people, customers and the
public with respect and admiration. The associates at Wal-Mart once had a great company behind
them that believed that without them, they would not be where they are today. Wal-Mart needs to
regain that perspective in order to propel itself into the future of success. Their corporate tactics
of making money and reducing costs incurred by employee benefits needs to be readdressed and
realigned with the views of Sam Walton.

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Situational Description and Strategic Analyses

Through continual research and readings Team Wal-Mart has gained a better understanding and
perspective of Americas fascination with Wal-Mart. Despite the constant barrage of negative
press relating to its handling of labor issues, employee benefits, vendor practices and customer
service, the retailer is able to thrive. Wal-Martfacts.com brings an enlightening perspective on
Wal-Mart views and how they and the public perceive its pitfalls. First, we are going to examine
the history of the company. Where did Sam Walton get the idea to come up with a retail store like
Wal-Mart? Did he actually expect to be as large of the retailer as it is now? Our team wanted to
better understand where Wal-Mart is with its corporate level strategy, business level strategy,
strategic formulation and it own views on its implementation. W We will further explore some
alternative solutions and make recommendations as to where the public views the company in
regards to the topics of discussion, and where our teams views, and its perceptions of where they
are today in how well it is or is not implementing their own strategies. We will also make
recommendations and explain how and why those recommendations were derived and how they
should be implemented, as well as how Wal-Mart should take action to address those needs.
Throughout the entire document you will gain insight into the tactics that Wal-Mart has used to
achieve its goals. By reflecting on ideas and principles of where they were, where they want to be
and how they perceive their path to gaining the success to achieve its goals a better understanding
will emerge. Although our ideas may have some of the same fundamental principles, we view
Wal-Marts path to achieve its goal in a much different light.

Strategic Analysis
Overview and History

In 1962 Sam Walton opens his first Wal-Mart in Rogers, Arkansas. His low price
approach to retail soon became a model that all Wal-Mart stores would follow. "Sell brand
merchandise at low prices."ii Interesting enough, 1962 was the same birth year for Kmart, Target
and Wal-Mart. Sam Walton, founder of Wal-Mart wanted to take advantage of the opportunity
and establish a discount retail company. In the beginning the stores were started in the small
towns in the south. During that time period it was considered as the least successful retailer,
however it has outgrown most of its competition. Sams mission was to have an everyday low
price discount retail store. Five years into founding Wal-Mart, Sam felt that he needed to expand
before his competitors out ran him. During the 1970s, the retail industry became highly
competitive, but at the same time the economy became weak due to inflation Sears was the
leading retailer in the nation, during the 1970s, however, the recession of 1974-1975 and inflation
affected Sears adversely. Sears targeted middle class families and expanded its overhead. WalMart's strategy was to compete with its rivals and lower overhead expenses. Compared with

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Sears, who consisted of more than 6,000 distribution centers, Wal-Mart had only 2,500
comparable units.iii Although Wal-Mart was under financed, it managed to have 30 stores in the
8 years. In order to sell the merchandise at a low rate, Wal-Marts purchasing cost must also be at
a low rate. However, suppliers and vendors were not willing to supply merchandise at the rate
Wal-Mart was asking. As result of this he built warehouses so that merchandise can be bought in
bulk at a cheaper price because of the large volumes. At the same time Wal-Mart needed to
expand, but did not have enough capital. Sam decided to go public to raise capital. Over all, while
his competitors were under the impression that Wal-Marts business model will not be successful,
Sam has taken the advantage of the time and strategically placed his business to grow. Sam was
also able to convince his establish an internal culture in order have everybody on the same boat.
This resulted in everyday low prices. He did not have any sophisticated systems, which resulted
in less overhead cost.
Currently, Sams vision has become a global company employing more than 1.8 million
associates worldwide and nearly 6500 stores and clubs spanning across 14 countries. "The secret
of successful retailing is to give your customers what they want," Sam wrote in his
autobiography. "And really, if you think about it from the point of view of the customer, you
want everything: a wide assortment of good quality merchandise; the lowest possible prices;
guaranteed satisfaction with what you buy; friendly, knowledgeable service; convenient hours;
free parking; a pleasant shopping experience (www.walmartfacts.com).
In the 1980s, Wal-marts growth, among retailers, placed them in the top sellers in
America. Company sales in 1980 were an all time high; those figures were dwarfed in 1989 by a
record 26 billion in sales (www.walmartfacts.com). At the end of the 80s, the company had
almost 1400 stores in existence. Wal-Mart Stores, Inc. branched out into warehouse clubs with
the first SAMS Club in 1983. The first Supercenter, featuring a complete grocery department
along with the 36 departments of general merchandise, opened in 1988. Wal-Mart had become a
textbook example of managing rapid growth without losing sight of a companys basic values. In
Wal-Marts case, the basic value was, and is, customer service.iv (www.walmartfacts.com)

Timeline
1960s and 70's
1962 Wal-Mart opened the first store In Rogers, Ark.
1970 Wal-Mart opens first distribution center and home office in Bentonville, Ark.
1970 Wal-Mart traded stocks as a publicly held company

1971 Wal-Mart in five states: Arkansas, Kansas, Louisiana, Missouri and Oklahoma.
1972 Wal-Mart approved and listed on the New York Stock Exchange.
1973 Wal-Mart in Tennessee.
1974 Wal-Mart stores now in Kentucky and Mississippi, Texas is ninth state of Wal-Mart.
1977 Wal-Mart entered Illinois. 11th state: Alabama.
1980s
1981 Wal-Mart opened at Georgia and South Carolina

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1982 Wal-Mart opened at Florida and Nebraska.

1983 First SAM'S CLUB opened in Midwest City, OK People Greeter implemented at all store.
Wal-Mart enters Indiana, Iowa, New Mexico and North Carolina.
1984 David Glass named company president. Wal-Mart enters Virginia
1985 Wal-Mart has 882 stores with sales of $8.4 billion and 104,000 Associates.
Company adds stores in Wisconsin and Colorado.
1986 Wal-Mart enters Minnesota.
1988 David Glass named chief executive officer of Wal-Mart Stores, Inc.

1988 First Super center opened in Washington, Mo.

16 Wal-Mart distribution centers in operation.
1989 Wal-Mart is now in 26 states with the addition of Michigan, West Virginia and Wyoming.
1990s
1990 Wal-Mart becomes nation's No. 1 retailer.
McLane Company of Temple, Texas acquired
Wal-Mart enters California, Nevada, North Dakota, Pennsylvania, South Dakota and Utah.
1991 Wal-Mart enters Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire,
New Jersey and New York.
"Sam's American Choice" brand products introduced.
International market entered for first time with the opening of a unit Mexico City.
1992 Sam Walton passes away April 5.
S. Robson Walton named chairman of the board April 7.

Wal-Mart has entered 45 states with the addition of Idaho, Montana and Oregon.
Wal-Mart enters Puerto Rico.
1993 Wal-Mart enters Alaska, Hawaii, Rhode Island and Washington.
1994 Wal-Mart enters Canada by the acquisition of Woolco, and takes over 123
former Woolco stores across Canada. It opens 96 stores in Mexico. Three value
clubs open in Hong Kong.
1995 Wal-Mart enters its 50th state - Vermont - and builds three units in Argentina and five in
Brazil.
1996 Wal-Mart enters China
1997 Wal-Mart replaces Woolworth on the Dow Jones Industrial Average
2000s
2000 Wal-Mart ranked 5th by FORTUNE magazine in its Global Most Admired All-Stars list.
H. Lee Scott named president and CEO of Wal-Mart Stores, Inc.

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Wal-Mart ranked #1 Corporate Citizen in America in the 2000

Cone/Roper Report, an annual national survey on philanthropy and corporate citizenship.
2001 Wal-Mart has the biggest single day sales in history: $1.25 billion on the day after
Thanksgiving.
2005 Wal-Mart Stores, Inc. closed out the year with $312.4 billion in sales, while expanding to
more than 6,200 facilities around the world, including 3,800 stores in the United States, along
with 3,800 international units. Around the globe, we now have a strong presence in Argentina,
Brazil, Canada, China, Costa Rica, El Salvador, Germany, Guatemala, Honduras, Japan, Mexico,
Nicaragua, Puerto Rico, South Korea, and the United Kingdom. Wal-Mart employs more than 1.6
million associates worldwide. There are more than 138 million customers who visit our Wal-Mart
stores each week all over the world.v

External Environment
Wal-Mart already provides products categorized as negative category trips within their
super stores. Consumer habits are not likely to change in this area unless they can change buyers
habits which will account for more trips into their retail centers. Wal-Marts growth is partially
dependant upon its manufactures and their ability to package and brand items to meet Wal-Marts
every day low price model. This means being able to market more recognizable brand names into
Wal-Marts retail system, which could attract higher income shoppers. They have an estimated
83% of total U.S. household penetration. Competing retailers in specialty areas include - dollar
stores, automotive retailers, convenience/gas, home improvement stores, club stores and toy
stores. All of these outlets are in greater competition for Wal-Mart trips.vi The Wal-Mart Stores
segment is the largest segment of Wal-Mart's business, accounting for 67.3% sales during the
fiscal year ended January 31, 2005 (fiscal 2005). The segment consists of three different retail
formats, all of which operate in the United States. The Company's SAM'S CLUB segment
consists of membership warehouse clubs that operate in the United States, and accounts for 13%
of fiscal 2005 sales. The international segment consists of retail operations in eight countries and
Puerto Rico, and generated 19.7% of Wal-Mart's fiscal 2005 sales. In addition, the Company
owns an unconsolidated minority interest of approximately 37% of The Seiyu, Ltd., a retailer in
Japan.vii

Internal Environment
Economic Environment:

1980s & early 1990s- eras of economic uncertainty for retailers, many retailers negatively
affected.
Increased competitive pressures, sluggish consumer spending, slower than anticipated
economic growth.
At the beginning of the year 2000, the US had experienced one of the longest periods of
economic expansion in its history.
Wal-Mart responded to changes in the marketplace by selling goods at price levels below
regular retail prices. Wal-Mart even though was considered as the industry leader carried
much of the same merchandise, offered prices that were pennies apart and operated stores that
look almost exactly alike.

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Technological Environment:
To keep with the pace of technology revolution, Wal-Mart had an inventory control
system that was recognized as the most sophisticated as retailing. They incorporated a high speed
computer system that linked almost all stores to the headquarters and the companys distribution
centre. Most important for management, it helped detect sales trends quickly and speeded up
market reaction time substantially. At the beginning of 2000, Wal-Mart set up a separate
company with website with plans to go public.
Social Environment:
Wal-Mart had launched several programs to highlight popular social causes-Buy
American, 1985. The theme was bring it home to USA and its purpose was to communicate
Wal-Marts support for American manufacturing. In the program, the firms exerted substantial
influence to encourage to manufacturers to produce goods in the United States rather than import
them from other countries. Vendors were encouraged to initiate the process by contacting the
company directly with proposals to sell goods that were made in the United States. Also, WalMart was one of the first retailers to embrace the concept of green marketing. The program
offered shoppers the option of purchasing products that were better for the environment in three
respects: manufacturing, use, and disposal.
Management
The greatest strength for Wal-Mart from its start in 1969 to this day has been the vision
and dedication of the top level management CEOs David Glass and current CEO H. Lee Scott
and no one can deny Sam Walton the founder for his great vision that he made become crystal
clear. From the founding to this day Wal-Marts top level management has been striving to come
up with greater ways to bring Wal-Mart at level it is today and keep it at tops of all retailers and
companies world wide. Wal-Marts greatest strength after its management is its size which
management has helped it to grow with increasing sales and net income since 1993. The way they
have implemented their strategic strengths in the industry is first by coming up with multiple
store fronts to reach all markets and segments of people.
They have created a careful strategic planning on where and when to open new stores.
This geographic expansion strategy has focused on opening outward into new geographical areas.
Wal-Mart expands into adjoining geographic areas, saturating each area with stores before
moving into new territories. This type of strategy created synergy by doing this by clustering new
stores in a relatively small area, Wal-Mart could spread advertising expenses for breaking into
new markets across all area stores, and a tactic the company used it used to keeps its advertising
cost at 1% of sales compared to 2-3% for competitors. Wal-Mart although not the first but the
best at everyday low prices having 8-27% below those of such leading supermarkets this in turn
has been Wal-Marts winning strategy against competitors in find all ways to cut cost and create
synergy through the cost cutting there for keeping prices way lower than that of its competitors
therefore being the most popular amongst consumers when it comes to low price retailing.
Wal-Mart cut cost on many different levels but its most effective strategy it has found it
with its suppliers. Its relationships with its suppliers are its main competitive advantage by having
procurement management spend a lot of time with vendors and understanding there cost structure.
Thus they made the negotiation process transparent, doing all it could to cut down cost and quote
Wal-Mart an attractively low price. Some 200 vendors have established offices in Bentonville to

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work closely with Wal-Mart on a continuing basis where they are encouraged to voice any
problems in their relationship with Wal-Mart and to become involved in Wal-Marts future plans.
Most vendors view Wal-Marts single bottom line price and its expectation of close coordination
as a win-win proposition not only because of benefits of cutting out funny-money costs but
because they learn collaborative efforts and mutual data-sharing which often had tremendous
benefits in the rest of there operations.
In executing Sam Waltons strategic vision of become the largest low price discount
retailer in the world they also increased shareholders wealth every year almost five times more
now in earnings per share than in 1993. Wal-Mart has been the leader in its industry and growth
rate of more than 32 countries because it has had many strengths but with all strengths there are
weaknesses and although I did not see much I did see that Sams club was not at the top of its
game as all there rest of the other store fronts. Costco the main competition to Sams clubs is over
performing Sams club with fewer stores and is the nations biggest retailer of the fine wines
(600million).
As for opportunities and threats there are many opportunities and threats for Wal-Mart.
One is to clean up its recent public image and try to fight or settle the 6000 lawsuits it is facing
right now. The law suites range from anti-trust and consumer issues to tort claims. A couple of
lawsuits have potentially serious consequences like the alleging the company discriminates
against women, which has potential to turn into the largest sex-bias class action ever.viii WalMart also has the threats of having management put out brushfires instead of trying to grow and
operate the business. All the threats Wal-Mart can use as opportunities to show the public that it
is not a sex-bias company and exuberate what Sam Walton had which was care for the
community and all of his employees.

Porters Five Forces framework

Potential entrants - Wal-Mart does not have to worry about threat to new entrants because
of high barriers of entry for companies aspiring to come into the retail industry.

Bargaining power of buyers - Buyers do not have to bargain with Wal-Mart for low
prices and higher quality or more services because Wal-Mart has already established the
low prices, higher quality, and more services philosophy. Wal-Mart has many pricing
philosophies including Every Day Low Price, Rollback, and Special Buy to ensure
that their customers get the lowest price possible. Also Wal-Mart does allow customers to
match prices from its rivals by showing coupons from its rivals and will honor that price
if its lower than theirs

Bargaining power of suppliers - Wal-Mart hand picks its suppliers and has a good and
long standing relationship in order to maintain their pricing philosophies, every day low
prices, roll back, & special buy, Wal-Marts suppliers also know that they supply have to
be good quality products. Wal-Mart will not sell something that is not to their
satisfaction. Also suppliers are put into a tight spot where they have to play by the rules
set up by Wal-Mart or loose their contracts they are forced to redesign everything from
packaging to even sometimes telling them what it will pay for their goods.

Threat of substitute products and services - The ability of Wal-Mart to offer the cheapest
products that meet both quality and its price standards ensures that it will not incur the

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threat off substitute products from its rivals cause they are able to meet the customers
product satisfaction. Wal-Mart has an excellent customer service. Everything possible is
done to ensure that shopping at Wal-Mart will be a friendly experience. Wal-mart was
founded on 4 basic beliefs that all Wal-mart employees must adhere to which are,
respect for the individual, excellence in the workplace, customer service and always
having the lowest prices. Wal-Mart takes these 4 Basic Beliefs very seriously.

The intensity of rivalry among competitors in an industry - Due to Wal-Marts size,

domination in its industry there is no intensity of rivalry among Wal-Mart and its
competitors in the retail industry because Wal-Mart excels in this sector and the others
like Kmart seem to be struggling to stay afloat, Target is not even half the size of WalMart so they dont seem to be having that big of threat by their rivals. No competitor can
beat Wal-Marts every day low price so that gives Wal-Mart a distinct advantage over
their rivals.

Intellectual Assets
Wal-Mart has not developed any real intellectual assets on its own. It has however
incorporated other companys assets to gain strategic success in the retailing industry. What this
means is that Wal-Mart has taken and implemented RFID technology to a level that no other
retailer at the time has done. They took internal IT departments and implemented it in every store
location around the world, linked the information to their warehouses and made the network a
real-time network. This is discussed later. Their real Intellectual Assets are those of other
organizations all collaborated to one to propel Wal-Mart into history as the largest, fastest
growing and dominating retailer that it is today.

Strategic Formulation
Business Level Strategies
Wal-Marts competitive advantage in the world of retailing is greatly attributed
to their strategic focus on value chain activities. Efficient and innovative use of inbound and
outbound logistics and mastery of complex management operations with large economies of scale
have made it difficult for many retailers to imitate the value Wal-Mart has supplied to the world
of discount retailing. From establishing their own logistics operations, complete with their own
fleet of trucks and a private satellite system to successful management of complex cross-docking
strategies at over 19 wholly owned distribution centers, their efficient utilization of value chain
activities has made its mark in the world of low cost global retailing.
Wal-Mart realized very early on that the typical models of value chains in discount retailing
involving cost control, efficiency in distribution and purchasing and low overhead-facilities was
not going to be enough to compete for a valuable market share. They needed a strategy that
would move products from location to location quickly, efficiently and often without ever taking
it into inventory first. The logistics technique of cross docking offered such an advantage and has
since been a central feature in Wal-Marts value chain activities. Instead of wasting time in
warehouse inventory, cross docking is the practice of reducing handling costs by receiving new
merchandise, selecting, repacking and distributing it across one loading dock to another as
quickly as possible. Although efficient in use, cross-docking is extremely difficult to manage and
operate effectively. For this reason Wal-Marts ability to implement and manage cross-docking

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strategies provides a central advantage to their logistics operations reducing the cost of sales by 2
to 3 percent compared to its competitors. Since merchandise comes and goes from their
warehouses so quickly they needed an effective inventory control system. Radio Frequency
Identification (RFID) offered the ability for Wal-Mart to digitally monitor its shipments to-andfrom its warehouses and efficiently manages its supply chain without hindering the effective use
of its cross-docking strategies.
Wal-Marts Information Systems (IS) strategy is a central force in bringing all operations and
logistics of its value chain together. Their IS strategy consists of three basic principles:
Centralized IS for operations all over the world, common systems and platforms across the entire
organization, and be merchants first and technologists second. Wal-Mart was the earliest
adopters of supply chain software in the retail industry. Today their application infrastructure
allows a scan to automatically signal replenishment of stock, trigger a payment and adjusts
inventory level. Therefore, suppliers know what is selling with up to the minute statistics.
Through application and maintenance of this technology, a connection was made beyond that at
the store level, by analyzing that data as a mission critical requirement they are able to corner the
supply-in-demand equation and set them apart from their competition.
One of Wal-Marts pitfalls in its value chain is in its customer service. They have taken a step in
the right direction by implementing interactive online tools, clearly defined their return policies,
notification of product recalls, and encouraged of feedback from its customers. Leveraging buyer
knowledge through advanced customer relationship management (CRM) automation allows WalMart to build stronger customer profiles. This allows Wal-Mart to meet customers demands by
keeping shelves stocked while maintaining its low price credo.
(A full outline of Wal-Marts Value Chain)

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Competitive Advantages & Sustainability

Through its efficient use of cost reducing value chain activities and large economies of
scale Wal-Marts competitive advantage offers them a significant position in overall low cost
leadership by providing a strong industry-wide low cost position. With aggressive construction
of sole-owned efficient warehouse facilities, knowledge gained through experience of cost
reduction and overhead control in its value chain, Wal-Mart is the model of low-cost leadership
industry wide. Their inability to combine advantages by implementing a unique diversification
strategy on top of their already successful low cost model has inhibited them from broadening
their product offerings and increasing their market share. By offering one-stop shopping of
groceries, electronics, lawn and garden, clothing, optical/vision care, pharmaceuticals and now
health and medical facilities, Wal-Mart can assure its customers a convenient shopping
experience at low prices guaranteed. By combining the differentiation of its diverse products and
services Wal-Mart challenges all of its competitors. Grocery chains, optical shops and
pharmacies must now all fell the impact of market share when a new Wal-Mart comes to town.

The Role of IS in Wal-Marts Business Level Strategy

Information Systems have played a key role in Wal-Mart's management of its business level
strategies. By developing new systems that increase performance and reporting they utilize the
benefits of leveraging their human capital. By utilizing buyer knowledge information systems
allow Wal-Mart to build customer profiles from which they can determine how best to stock their
stores. This type of well-defined CRM business process has helped propelled Wal-Mart to its
leadership position. By positioning their IT professionals in central roles in Wal-Marts
organization it is able to develop internal systems that are more inline with the companys vision.

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In any development effort, our [IS] people are expected to get out and do the function
before they do the system specification, design or change analysis. The key there is to do
the function, not just observe it. So we actually insert them into the business roles. As a
result, they come back with a lot more empathy and a whole lot better understanding and
vision of where we need to go and how we need to proceed.
We've learned some hard lessons in our stores, clubs and distribution centers when we
developed something and people didn't use it, and they chose to find other ways to get the
job done. We are working hard to develop systems that are easy to use. That puts an
awesome responsibility on that developer to get out and understand the business. That's
one of our key things: We're merchants first, technologists second.
Wal-Mart CIO Kevin Turner

Corporate Level Strategy

Wal-Marts operations range in scope and are comprised primarily in three retailing
subsidiaries: Wal-Mart Stores Division U.S., Sams club and Wal-Mart international. Each of
their divisions is broken down into three types of shopping experiences for their customers:
Discount Stores ranging in size from 9k to over 200k square feet, Neighborhood markets
comprised like the typically supermarket and Sams clubs offering sales of bulk items to it
members. Although Wal-Mart international consists of 2,700 stores in 14 countries outside the
United States 67.2% of its fiscal sales in 2006 were comprised of its large U.S. division. WalMarts marketing has changed very little since its inception concentrating on two main principles
Low prices save you money and Always low prices, always. Shared values at Wal-Mart seem
to be, expand and overtake any and all other competition, no matter the costs. Make more money
- at whatever costs even if affects public image and the public perspective of the organization.
Management at the store and distribution levels are forced by upper management to push
restraints and massive growth restrictions on internal employees.

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Social Capital
As executives of Wal-Mart push to make a cheaper, more flexible workforce by capping wages,
utilizing more part time workers and scheduling more night and weekend shifts, they are
attempting to better serve there customers by deploying workers more effectively during peak
shopping hours. Through programs like: Office of Diversity, Corporate Compliance,
Realignment of job Classifications & pay structures, and the implementation of the career
preference system; Wal-Mart attempts to solve the publics views and concerns with its social
capital.
Office of Diversity
The goal of this department is to implement programs that develop pools of qualified diverse
candidates. In essence to make sure that the percentage of qualified minorities and women they
promote is equal to the percentage who apply. (Financial compensation based upon the
measurement of success in each region is used to reward office-level management reach the
underline goals of this program.)
Corporate Compliance
The goal of this department is overseeing compliance of obligations of associates in terms of pay,
working hours and time for breaks. The department is utilizing new technology as its main focus
to automate its obligations and place checks and balances on its managers and employees.

Job Classification & Pay Structure

Wal-Mart employed an outside consulting firm Hay Group to evaluate each of its positions
based upon several criteria: knowledge, problem solving and accountability. They offered a fresh
unbiased approach to ensure fair market value for each of its positions and they cross-referenced
each positions pay scale against the competitive pay of similar retailers.
Career Preference System
Employees are encouraged to participate in a career preference system. All participants, if
qualified can specify responsibilities and geographic criteria and be notified automatically if
current opportunities are available nation-wide. This effort is to enhance its job posting system
and ensure eligible associates have equal opportunity to know about and apply for open
management positions.
Wal-Marts Life Cycle
Wal-Mart has continued to grow at an extraordinary rate compared to the rest of the retail
industry. The increase was considered moderate at first, but with the exception of the slow rise in
the mid-nineties, their growth has propelled them into an intense international and domestic
market. With a high value on low-cost leadership, intense market growth, and some concern of
increasing competition, Wal-Mart has reached the maturity stage of its life cycle. This forces
them to build upon their existing values and vision statement to overcome public scrutiny and
competition. Successful new ventures into international markets such as Mexico, Canada, and

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South America as well as further expansion into India, China and Europe has been a increasingly
important part of continuing to maintain their market position without experiencing another
downturn like that of the mid-nineties.

International Strategy
Considering Wal-Marts current domestic position provides very little growth in its
mature life cycle stage, significant growth in sales and profits seemed only possible in
international markets. With an already saturated domestic market, consisting of only a small 4%
of the worlds population, emerging international markets with increasing technology cultural
homogenization and lowered trade barriers offered huge platform advantages for growth in
discount retailing internationally. Although international expansion came with a fair amount of
risks their one-size-fits-all mentality posed increasing pressure for adaptation in its international
markets. Some of these risks are: customer loyalty, local adaptation, and preferences to market
demands. Wal-Mart determined their expansion strategy had to consist of a series of corporate
buyouts, takeovers, or joint ventures (JV) in order to gain successful entry into many of its
international markets. With pressure to keep the strategic position of overall cost leadership
coupled with strong local adaptation to customer demands it sent Wal-Mart into a Transnational
Strategy. In this stage Wal-Mart must try to reduce costs and adapt to its new local markets. By
approaching international markets with sole-owned subsidiaries and buyout approach they
eliminated their competition and gained huge advantages in its targeted markets.

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Digital Business Strategies www.walmart.com

Walmart.com is passionate about combining that best of two great worlds technology
and dominating retailing to give customers a great online shopping experience. By expanding
services to include in store pickup and no hassle returns at any location, Wal-Mart sustains a
competitive advantage in its approach by offering on-site service to aid its Internet sales.
Although Wal-Mart has the ability to offer a competitive advantage on the web the threat of
substitutes within their low-cost strategy emerge as customers have access to an abundance of
new low-cost alternatives in this digital environment. In order to compete in the digital
marketplace Wal-Mart has adjusted many of its services to make it easier to search for particular
products and get all the information needed to make an educated decision based upon: price,
brand name, and availability. In order to make sure that transaction activities are monitored
customers are notified of arrival dates and offered several shipping options to choose from or the
option to pick the product up at any store location. The online customer service will allow
customers to answer questions regarding: how to create an account, fulfill an order, track order,
advise on shopping tips and even email suppliers for availability updates. This digital experience
allows any customer within shipping range to purchase merchandise from walmart.com.

Strategic Implementation
Strategic Control
Wal-Mart is a company that in essence appears to operate within the realm of the
traditional approach to strategic controls. By this I mean the management formulates strategies,
sets goals, implements those strategies, and measures them against their predetermined goals. The
feedback received comes in many forms, but the most utilized resource is the numbers generated
by each store and the forwarded to corporate headquarters through its vast digital network. In an
excerpt from case study conducted by the Tuck School of Business at Dartmouth, Each store
constituted an investment center and was evaluated on its profits relative to its inventory
investments. Store-level data on sales, expenses, and profit and loss were collected, analyzed, and
transmitted electronically on a real-time basis. The data could be analyzed by region, district,
store, department within a store, or even at the level of an item within a department.ix It is this
system that Wal-Mart basis some of its decisions on almost a daily basis as to whether or not they
should adjust their strategies. This would imply that to a certain extent Wal-Mart operates with a
contemporary approach because each of the four characteristics are realized and acted upon
almost on a daily basis.
It wasnt always this simple, back before the implementation of computers Wal-Mart used ledgers
to track this data. The principle of tracking previous years data or forecasting as it is called now
was something that Sam Walton instilled in his store managers. Sam Walton would instill
responsibility within his department managers and hold them accountable. This approach was not
without reward. By allowing his associates and managers to be creative, those same principles or
best practices were emulated into other stores. It was this kind of thinking that lead to new
strategies and innovations for Wal-Mart. This creative process which was started by Sam Walton
was a driving force in the creation of Wal-Marts culture. In light of what Sam Waltons original
strategy and where Wal-Mart is today there is a gap that exists between the company and its
associates. The controls that are now being implemented do not align with the original concepts
as outlined by Sam. Areas such as employee turnover create gaps in learning which can cause
inadequate response times when it comes to customers and the stores they service. Much of the
turnover can be attributed to poor wages, less than adequate health benefits and working

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conditions that have come under fire in recent years. All of these items signal trouble when it
comes to promoting a first class environment. If the associates dont feel like they are being taken
care of then that directly effect the company and it customers.
Attaining Behavioral Control
Years ago, Sam Walton challenged all Wal-Mart associates to practice what he called
"aggressive hospitality." He said "Let's be the most friendly - offer a smile of welcome and
assistance to all who do us a favor by entering our stores. Give better service - over and beyond
what our customers expect. Why not? You wonderful, caring associates can do it and do it better
than any other retailing company in the world . . . exceed your customers' expectations. If you do,
they'll come back over and over again." (http://www.hrdm.net/en/wal-mart.htm). This statement
outlines the basic principles that Sam Walton wanted to instill within the organization as a whole.
Getting his employees to adopt this philosophy wasnt hard because one of the first things Mr.
Walton did was breakdown a traditional barrier of employer and employee. Walton learned long
ago through his own employment at J.C. Penny that making the employee apart of the company
and creating responsibility was through their designation as associates. This approach provided a
sense of ownership in everything they did. It also laid the framework for his customer service
principles and Wal-Marts success. Everything centered on delivering the lowest possible price
and providing the best possible customer service. This formula worked for Wal-Mart and as an
incentive, but not without a little pressure Walton implemented a profit sharing plan in 1971.
The current profit sharing plan work like this. "Every associate that has worked for the company
for at least one year and who works at least 1,000 hours a year is eligible to have about six
percent of their wages put into their personal plan. When they leave the company, they take
whatever is in their plan - in cash or Wal-Mart stock. (Michael Clark) This plan has worked
well for the associates who stayed beginning in the early stages of the program but it is not in line
with what the companys strategy is today. Wal-Marts goal to dominate the Retail Market does
not come without a cost. The continued drive to drive prices lower impacts far more than just the
associates working for them. There are external costs to the tax payers for the low wages that
Wal-Mart pays to its employees. A May 2004 study released by the University of California,
Berkeley entitled The Hidden Public Costs of Law-wage Jobs in California identifies low pay
in retail as a serious cost to the public. Interviews with one of the studys authors identified WalMart as costing Californias taxpayers $86.0 million annually as a result of under-paying its
Employees.x Wal-Marts current plan is to reduce full time employees down to forty prevent of
its overall work force. With a common practice of considering employees who work over twentyeight hours a week as full time, there is considerable amount of gain to be made by the company
for taking this kind of measure, but there is greater loss associated with it as well in terms of loss
of experienced employees. It is issues such as these that have slowly eroded the culture that once
dominated Wal-Marts internal landscape. There was a philosophy that Sam Walton started called
The Sundown Rule, we respect our customers, Associates and suppliers and strive to treat them
as we ourselves want to be treated. In building and nurturing these relationships, as well as
serving the communities where we live, we've helped build a better business-one committed to
excellence. Only a portion of this statement truly reflects the operating environment that is WalMart today. Capturing this philosophy in whole, not in part is what could help to recapture the
culture that some have said was cult like

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Corporate Governance
The qualifications for members of the board of directors are as follows. The board will have a
majority of directors who meet the criteria for independence required by the New York Stock
Exchange. Nominees for director will be selected on the basis of outstanding achievement in their
personal careers; broad experience; wisdom; integrity; ability to make independent, analytical
inquiries; understanding of the business environment; and willingness to devote adequate time to
Board duties. Directors will be shareholders, holders of options granted under the Companys
stock option plan, or will elect to receive compensation in the form of stock units under the
Director Compensation Plan.
The responsibility of the directors is to exercise their business judgment, and to act in what they
reasonably believe to be in the best interests of the company, its shareholders, and to perform
their duties of care and loyalty. In discharging that obligation, directors should be entitled to rely
on the honesty and integrity of the companys senior executives and its outside advisors and
auditors, to the fullest extent permitted by law. Directors are expected to serve on Board
committees. The Board will meet at least four times per year and will hold additional meetings
when needed to address issues of special concern or urgency.
The Board will have at all times an Audit Committee, Compensation, Nominating and
Governance Committee, an Executive Committee, a Stock Option Committee and a Strategic
Planning and Finance Committee. Each committee will have their individual charter. The charters
will set forth the purposes, goals and responsibilities of the committees as well as qualifications
for committee membership, procedures for committee member appointment and removal,
committee structure and operations and committee reporting to the Board.
Directors have full and free access to officers and other associates of the Company and the
Companys outside advisors. At least once per year management will report to the Board
regarding management development and succession, including diversity initiatives and progress
and long-term strategic planning. Inclusion of the CEO and other executives on the Board
provides the Board with information and insight about the Company. Other executives may attend
Board meetings or committee meetings at the invitation of the Chairperson of the Board or the
CEO to provide information and insight to the Board.
The form and amount of compensation of the director will be determined by the following
committees: Compensation, Nominating and Governance Committee in accordance with the
policies and principles set forth in its charter and applicable legal and regulatory guidelines. Each
new director must participate in the Companys Orientation Program, which should be conducted
within two months after a director is first elected to the Board. This orientation will include
familiarizing new directors with the Companys strategic plans, its significant financial,
accounting and risk management issues, its compliance programs, its Statement of Ethics, its
principal officers, and its internal and independent auditors. The Compensation, Nominating and
Governance Committee will conduct an annual review of the CEOs performance, as set forth in
its charter. The Board will review the Compensation, Nominating and Governance Committees
report in order to ensure that the CEO is providing the best leadership for the Company in the
long- and short-term.
The Compensation, Nominating and Governance Committee should make an annual report to the
Board on succession planning. The entire Board will work with the Compensation, Nominating
and Governance Committee to nominate and evaluate potential successors to the CEO. The CEO

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should at all times make available his or her recommendations and evaluations of potential
successors, along with a review of any development plans recommended for such individuals.

Committee Charters - AUDIT COMMITTEE

(1) Assist the Board in monitoring:
(a) The integrity of the financial reporting process, systems of internal controls
and financial statements and reports of the Company,
(b) The performance of the Companys internal audit function, and
(c) The compliance by the Company with legal and regulatory requirements;
(2) Be directly responsible for the appointment, compensation and oversight of the
Companys independent auditor employed by the Company for the purpose of
preparing or issuing an audit report or related work (the Outside Auditor).
COMPENSATION, NOMINATING AND GOVERNANCE COMMITTEE
(1) Discharge the Board's responsibilities relating to the compensation of the Company's
directors, executive officers and associates;
(2) Assist the Board in the implementation of sound corporate governance principles and
practices.
EXECUTIVE COMMITTEE
The Executive Committee is appointed by the Board to exercise the powers and duties of
the Board between Board meetings and while the Board is not in session, and implement the
policy decisions of the Board.
STOCK OPTION COMMITTEE
The Stock Option Committee (the Committee) is appointed by the Board of Directors
(the Board) of Wal-Mart Stores, Inc. (the Company) to administer certain of the Companys
equity-based compensation plans with respect to equity-based compensation awards granted to
associates who are not directors or officers subject to the provisions of subsection 16(a) of the
Securities Exchange Act of 1934, as amended.
STRATEGIC PLANNING AND FINANCE COMMITTEE
The Strategic Planning and Finance Committee (the Committee) is appointed by the
Board to review and analyze financial matters and assist the Board in long-range strategic
planning.

Organizational Design

Wal-Mart Stores - Super Centers

Neighborhood Markets
SAM'S Clubs
Wal-Mart International Walmart.com Wal-Mart Pharmacy
Wal-Mart Optical
The Tire & Lube Express Division
Alaska Bush Shopper
Wal-Mart Used Fixture Auctions

- 18 -

Each division may contain(s) all or some of these departments

Aviation & Travel; CMI & Benefits; Corporate Affairs; Finance; Independent Doctors of
Optometry; Information Systems Division; Legal; Merchandising & Product Development;
Operations; Pharmacy; Realty; Replenishment

Wal-Marts Matrix Organizational Structure:

Designing the
Organization

Determining a
Direction

Nurturing a
Culture dedicated
to excellence and
ethical behavior

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Leadership: Current Strategy

In January of 2007 Wal-Mart announced its Out in Front campaign. The plan outlines
transformations that are taking place within the company as apart of their current strategy. Each
of the areas addressed within the context of the plan are areas that Wal-Mart has struggled with or
come under fire for not addressing. The plan consists of five pillars and is modeled after Sam
Waltons advice of staying out in front. Three of the five pillars outlined within this strategic
plan address current, high profile issues that exist within the internal and external environment of
Wal-Mart. The three areas of most importance center on their appeal the customers, a better place
to work, and the improvement of business operating efficiencies. Each of these areas have been
the core focus of external entities looking to attack the company. Wal-Mart seems to be trying to
address those areas, and display an attitude of listening and caring.

Broadening Our Appeal to All of Our Customers

More in-depth market research is helping us understand our customers better. We are
communicating more directly with them through new ads on television and new signage in our
stores. And our Store of the Community approach helps us better serve the specific needs of
our customers. We are demonstrating this in our merchandise mix and in our store designs. WalMart stores are becoming an even truer reflection of the communities we serve. (Wal-Mart Out
in Front)

Becoming an Even Better Place to Work

People want Wal-Mart jobs. Theres no better example of this than our Evergreen Park Store in
Chicago, where 25,000 people applied for just 325 jobs. People want Wal-Mart jobs because we
pay competitive wages and associates have the opportunity to advance. More than three-fourths
of our store managers started as hourly associates. We also offer health benefits that are
affordable and accessible and provide financial security from catastrophic medical expenses.
Every associate - both full-time and part-time -- can become eligible for health care that costs $23
per month. And for a cost of just 50 cents more per day, their children can get coverage too.xi

Improving Business Operations and Efficiency

Our goal is to have the right product, in the right place, right when our customers need it. So
were shortening the time it takes for merchandise to go from our suppliers to our customers. We
are eliminating inventory on shelves that are out of the reach of customers. And we are making
sure our aisles are clear of clutter. These inventory improvements -- combined with the
outstanding work of our logistics team -- mean a better customer experience in our stores.xii

Driving Growth in Our International Business

Today Wal-Mart operates in 14 countries, up from 11 last year. Of the nearly 600 stores we plan
to open this year, more than a third of them will be international. We are also interested in new
markets opening up, like India. With each store we open, our company has the opportunity to
learn and grow. Just as important, we offer working men and women everywhere the opportunity
to improve their quality of life.xiii

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Making Unique Contributions to Communities

We donated more than $245 million to charity in 2005, with the majority targeted locally. Were
increasing the number of in-store health clinics, which bring affordable and accessible health care
to working families and a high number of the uninsured. Were also becoming more
environmentally friendly by selling organic products, minimizing waste and conserving energy.
Corporations can be more efficient and more environmentally friendly at the same time. And we
are proving that at Wal-Mart.xiv
IMPLEMENTING THE VISION
When Sam Walton began the company he envisioned a company that would take care of the
customers by offering them whatever they wanted. He also understood that service to these
customers was paramount and to take care of the customers you also need to take care of the
associates. The early stages of his customer service principles helped to grow the company far
beyond even his own expectations. Waltons vision for growing the company further grew out of
his basic principles, and what he called his ten rules for building a business. Each of these rules
defined a specific area. If addressed properly and in the manner that he envisioned the sky was
the limit.
The first rule was committing to your business. This was Waltons way of telling associates that
if you approach your job with passion, the attitude would become contagious throughout the
organization. This approach apparently worked because the company reaped considerable gains
in the early nineties. Another aspect that he preached reverently was sharing the profits with the
associates. Walton understood that none of the successes experienced by the company would
have been possible without the hard work of his associates. Sharing that success was part of
recognizing those efforts. Of the ten rules Sam instilled, these two were his most important and
had considerable weight on what the culture was about when Sam Walton was alive. Rules five
and seven represent the missing elements of what is currently occurring within Wal-Mart. Lack of
appreciation for associates and lack of communication.xv
Rule 5
Appreciate everything your associates do for the business.
A paycheck and a stock option will buy one kind of loyalty. But all of us like to be told how
much somebody appreciates what we do for them. We like to hear it often, and especially when
we have done something we're really proud of. Nothing else can quite substitute for a few wellchosen, well-timed, sincere words of praise. They're absolutely free -- and worth a fortune.xvi
Rule 7
Listen to everyone in your company.
And figure out ways to get them talking. The folks on the front lines -- the ones who actually talk
to the customer -- are the only ones who really know what's going on out there. You'd better find
out what they know. This really is what total quality is all about. To push responsibility down in
your organization, and to force good ideas to bubble up within it, you must listen to what your
associates are trying to tell you.xvii

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Developing a Learning Organization

Wal-Mart has always tried to instill and maintain a learning environment. From the very
moment that an employee begins working at Wal-Mart they are put through customer service
training, on the job training and ongoing formal training of job responsibilities. In the beginning,
customer service and the ten foot rule were the driving forces to the associates indoctrination
into the Wal-Mart culture.xviii Walton believed in associates at every level having the opportunity
to make suggestions, some of which were adopted and spread throughout the company stores.
This exemplified his desire to empower employees at all levels to have and impact on the
organization.
In addition to these opportunities, Wal-Mart offers reimbursement to employees for
books, classes and tests for successful completion of their GEDxix. In addition to this resource,
the company offers a service called My Education Connection. Through this resource, Wal-Mart
has created partnerships with selected online education providers. Some of these providers are
with accredited national institutions and universities with special pricing passed on to
associates.xx
Wal-Mart is active in recruiting through the college ranks as part of their ongoing diversification
programs. The utilization of internships is another asset that Wal-Mart implements to further
strengthen their ranks and bring in talent.

Managing Innovation
Wal-Marts continuing process of evolving its distribution channels is a testament to their
innovation in this field. Their adoption of RFID (Radio Frequency Identification) technology is
meant to further strengthen their ability to get products to their consumers. This technology will
allow Wal-Mart to begin tracking shipments the moment items leave the manufacture, into their
distribution channel, onto the store, and off the shelf to the consumer. The overall impact has not
been fully realized as of yet but the long-term aspect is that it will save the company millions in
operational costs. In addition to this step towards innovation, Wal-Marts commitment towards
the environment and the impact it has on it is another innovation process that is in the early stages
of implementation. The approach is this concept is realized through their Sustainable Value
Networksxxi, where everything from renewable energy, waste reduction and sustainable products
are all areas that are being monitored and radically changed to benefit the company, environment
and the consumer.

Opportunities and New Ventures

Some of the opportunities that Wal-Mart has passed are due to the lacking of them no panning
out. They tried a joint venture in Germany and China however it has failed. The failure is more
due to Wal-Mart inability to cater to the interests and ideals of the environment that is going into.
Through further research and cultural understanding, two things that Wal-Mart does not
implement well, they would be able to expand and enter into the global market in these countries
well. To become a global player in the global market, Wal-Mart has to gain access into China and
Japan. In order to be considered in all other Asian countries, having a foot-hold, not necessary a
strong-hold, in Japan and China is detrimental.

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Proposed Alternate Solutions

For the company to recapture some of the lost enthusiasm it is currently experiencing both
internally and externally, Wal-Mart needs to refocus on the core concepts that got them there. The
most important of these is their focus on "associates". Rekindling the bond that was once
prevalent when Sam was alive is instrumental to reviving overall appeal. If the associates see
interest being taken in them, that in turn will transfer over to their customers.
Aggressive pursuit, refinement and implementation of their Sustainability 360 program is
instrumental to their long-term success as a company and could well define them as an industry
leader when it comes to doing whats right for the environment. Gaining the trust of consumers in
regards to their public image when it comes to energy, waste and the environment can have a
dramatic impact on their ability to capture new customers who shop there just on the basis that its
a company dedicated to doing right when it comes to being an environmentally friendly
corporation.
Another idea to further Wal-Marts ambitions in becoming a global market is to better understand
their environment. To better understand their environment, they would need to gain access to new
markets through joint ventures as they are currently doing in India. While they explore new
markets, they should allow for the growth at a rate that they are not used to. To expand into a
culture that does not have the same ideals as you, you need to have patience and communication
with the local environment to fully understand the culture in which they may not be accustom too.
For the recommendation of how to better their public image here, Wal-Mart would need to make
some radical changes. The corporate memo that went public about how they would change their
work force from a 80/20 (full-time/ part-time workers) to a 60/40 all to reduce costs of employee
benefits, drop coverage for associates that have spouses or force them to part-time, would require
some very radical transformations. One-way of transformation is to take a poll of the associates,
with an 100% none judgmental approach. Allow it to be in complete confidence without
ramifications to the employee based upon their responses, and take their ideas into consideration.
Allow those that need certain shifts to work them, allow those that need health care the
opportunity for coverage and take the difference in corporate tax expenses. The government
offers grants for this reason if the company looks for the right opportunities.

Recommendations
Setup a program under the human resources department to monitor strategic controls concerning
the social problems arising from associates at the store level to ensure that employee concerns are
heard and addressed appropriately at the corporate level.
Considering the amount of lawsuits Wal-Mart has faced in the past concerning unjust treatment
their employees, unfair opportunity and benefit packages, Wal-Mart should not only address the
concerns of their store level employees but also monitor the resolutions to ensure that these
concerns are addressed. In order to ensure these concerns are accurately portrayed employees
should feel comfortable and have open opportunities to submit complaints directly to Human
Resource at the corporate level rather then filtered through local management. Considering WalMarts has a strong IS department where employees are required to work in the job
responsibilities before developing software, they should employ IS staff to job positions in
locations where the most amount of concerns are present. The IS staff will not focus on the
nature of each individual concern rather identify a common variable between the complaints and

- 23 -

develop an open system that will encourage those employees to voice their concerns directly to
HR without fear of repercussion. By developing applications that will track and monitor the over
all satisfaction of the store level employees they can maintain a value database of information in
order to poll overwhelming concerns that may seem repetitious or alarming. By employing
systems that will monitor and archive employee complaints Wal-Mart management at the
corporate level should be able to get a broader picture of concerns arising in local markets in its
past and present.
Monitor and poll international markets identifying discount trends and customer preference in
new and unknown markets before approaching new ventures or corporate buyouts.
Wal-Marts future sustaining its desired growth pattern is undoubtedly in its international
markets. However, Wal-Mart has continuously entered markets where there presence was either
undesired or customer preferences were not fully understood. Its seems that Wal-Marts current
strategy is to gain local presence in communities is by buying up land acquiring building
contracts and then address the concerns of the local community in the development stages as they
arise. Wal-Mart should approach new markets with great opportunity but also with a very good
understanding of the local culture and market. By placing marketing management in strategic
research rolls to poll and request feedback from the local communities before entering into a
particular local market they may find a better understanding of the needs of their clients. Once
they provide acquire feedback and analysis the concerns of the community at hand they may find
greater opportunity to assist and serve the market. This approach will not only offer them
understanding of the market but also prevent an undesired backlash once the project has already
begun.

Summary
Throughout the entire exploration of the organization, Wal-Mart, we have gained a better
understanding of the organizations strategies and the turmoil that is plaguing. Primarily the
issues discovered within Wal-Mart are in its inability to gain access to global markets, regain its
public image as the Most Admired Company in America, and steadily increase its market share.
Wal-Mart has long since been the largest retailer in the world, however without increased growth,
further expansion in other locations besides Americas, it will become very stagnant. With further
consideration into the recommendation made by Team Wal-Mart, they may be able to gain
access, increase profitability, increase global market share and delve into more global markets
with joint ventures. Having a better understanding of what is holding you back may finally
position them to the stature of global domination that they desire.
Their history further provides information into how the success of their past needs to be rekindled
to better gain success into their future. By regaining their once admired, Sam Waltons dream,
they may be able to reach the projection of what they see themselves becoming in the future and
allow the organization to successfully reach the global growth they seek. Better understanding of
their external and internal environment will draw further focus on change and expansion in both
existing and new markets. Comprehension of their need to further develop their intellectual assets
globally will allow for Wal-Mart to expand internationally at a rate that they have here in the
states. Reformation of their business strategies at the corporate level will allow for their
associates to feel like the community that Sam once held so strongly has been regained. Having a
better connection with where your employees fit into the larger scheme of the corporate strategy
will enable the organization to better its public image by changing the overall treatment by
enriching their employees and offering further development and adjustments to local

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management. If you have a positive and nurturing work environment that encourages and
promotes employee cohesiveness within, then the rest will fall into place. With the right strategies
Wal-Mart can be the organization with global dominance their stockholders desire with the vision
Sam Walton once dreamed.

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