Walmart Stores Inc.

Management Control Systems Assignment Case study: A) Wal-Mart Stores, Inc. , Case 1-2, Page no. 31 B) Vershire Company, Case 4-1, Page no. 145 Case A) Wal-Mart Stores, Inc. Question 1. What is Wal-Mart’s strategy? What is the basis on which Wal-Mart builds its competitive advantage? Answer? Wal-Mart’s Strategy is a. Winning strategy of Wal-Mart is based on selling branded products at a low cost. b. Marketing strategy of Wal-Mart is “Everyday low prices” is to pull in customers everyday. c. Saturation strategy of Wal-Mart is for the store expansion. The standards was to be able to drive from a distribution centre to store within a day.
And a distribution centre was strategically planned so that it eventually serve 150-200 stores within a day’s drive. d. Bulk strategy of Wal-Mart is for purchasing branded products at bulk can help to drive hard bargain which help Wal-Mart to sell the products at low prices. These are the main basic policies which Wal-Mart follows to become world’s largest retailer. On the basis of selling branded products at low cost and everyday low prices at Wal-Mart store and also continuously following the above strartegies helps Wal-Mart builds its competitive advantage over other retail stores to pull in more customers everyday.
Question 2. How do Wal-Mart’s control systems help execute the firm’s strategy? Answer? The Wal-Mart’s control systems help execute the firm’s strategy is given below, •The Information Technology- The IT that powered Wal-Mart’s supply chain and logistics was the most powerful. Therefore it pursuads its suppliers to adapt latest supply chain technologies like RFID- which increases monitoring and management of the inventory. •Each distribution center 24 operated hours a day using laser-guided conveyer belts and cross-docking techniques that received goods on one side and simultaneously filling orders on other side. The Wal-Mart had largest privately owned satellite communication network in US and broadcasted television. •Each store constituted an investment centre and was evaluated on its profits relative to its inventory investments. •The data from “outstanding” performers among 5300 stores were used to improve operations in “problem” stores. •For the employees loyalty and dedication- the Wal-Mart offers Profit sharing for the employees who spends at least one year and who worked at least 1000 hours. Several policies that help Wal-Mart to execute the firm’s strategy such as- incentive bonuses, a discounted stock purchase plan, promotion from within, pay rises based on performance not on seniority basis, open door policy . •Wal-Mart had implemented a satellite network system that allowed information to be shared between companies wide network of stores, distribution centers and suppliers. By following these above mentioned control systems it help to execute the Wal-Mart’s strategy.