Strategic Management and Strategic Competitiveness, SWOT Analysis Example

Question 1

Market Leadership: According to Plunkett (2008), Sam’s club Corporation is one of the nation’s (U.S) largest members-only warehouse clubs. It is a subsidiary of Wal-Mart stores, Inc., with a U.S membership of more than 47 million. Additionally, it has above 500 stores in the U.S with over 100 international locations in various other countries that include Brazil, China, Puerto Rico, Mexico and Canada. Parker, defines globalization as a growing worldwide interconnection in every virtually sphere of activity (2005). This can result to integration of unity worldwide that others do not.

Having increased economic interconnection, there has been a deep-seated political change, where peripheral countries (poorer) have adapted to means that promote their dependency of activities whereas in the USA, which is a central economy country, of a located capital and technical expertise. A shift in power has taken place from the state and toward multinational corporations. It has also resulted to the rise and globalization of the ‘brand’. Large corporations can also operate across many, diverse countries – they have also manufactured, developed and marketed products that could be just as well sold in the U.S. Brands like Sony, Nike, Coca Cola, and a horde of others has become part of the fabric of vast numbers of people’s lives.

Delocalization: Researchers argue that, in the last few years or so, of the twentieth century, a new economy emerged around the world. Before many errands that involved face-to-face interaction now is conducted across great distances. There has been a significant delocalization in social and economic exchanges. Now more than ever, people have to involve themselves with distant systems. Retailing, for example, adopted latest technologies with less face-to-face interaction of people involved. When buying goods through the internet, the delivery driver is the only person you might communicate with directly.  When using the Internet we inhabit ‘spaces’ to communicate or to buy things (via sites) can allow us to develop a rather different sense of place and of the location to which we belong. Businesses are a classic example of this. They are structured around networks of management, production and circulation. Businesses that are flourishing have to swiftly respond to change – both in the market and in production. Quality information systems are essential in such globalization.

Risk: Apart from giving way for considerable possibility, employment of new technologies, this ‘short’ reach, brings with it particular risks. It is stated that the ‘techno-economic progress’ has led to gain in power, which is quickly being disadvantaged by harm arising from technological and economic change (risk). Hazards linked to industrial production, can spread quickly past the instant framework in which they are generated. Thus, risks become globalized.

Rise of multinational corporations and branding: There is growth in nature and power of multinational corporations that is, Sam’s Club Corporation. Such companies now account for an alternatively large per cent of world output and world trade (Parker 2005). Significantly, a quarter of world trade happens within multinational corporations. Therefore, this shows that Sam’s Club Corporation still has considerable economic and cultural power.

Impact of multinationals on local communities: They often look to hire on contract operations (production, service and sales) in countries, where they can exploit cheaper labour and resources. (Parker, 2005) elaborates this with additional wealth for locals through seeking out under-exploited markets; they are able to increase sales by trying to creating new desires among diverse target group in these local countries.

Getting Consumers to Buy: Due to globalization, and innovation techniques, a deal has been struck between Sam’s Club and with an approved small business administration business lender and superior financial group. This is a deal, where consumers were enabled to borrow loans of up to $25,000 and spend it at Sam’s Club. The Club was to subsidize some of the loan costs (Plunkett, 2008).

Question 2

According to Plunkett (2008), the Industrial Organisation Model deals with the industry structure or attractiveness of the external environment thus, it is largely determined by characteristics outside the firm. While the Resource-Based Model deals with obtaining valuable resources and capabilities, which are hard for rivals to imitate to determine above average returns for both.

Industrial Organization Model: One should study the external environment first then find an industry with high potential for above average returns. Secondly, identify an above average return strategy then develop assets and skills needed to satisfy this strategy. Use the firms’ strengths to implement and maintain the chosen policy in order to do better than rivals in the industry.

Resource-Based Model: One should first identify the firm’s resources; study its strengths and weaknesses too, relative to rivals. Then, identify the capabilities that give it an upper hand than its rivals. Lastly, determine how you can create competitive advantage, locate an attractive industry, select the best strategy that best exploits resources and maintain that strategy in order to outperform industry rival.

Question 3

A public declaration of a firm’s purpose is its mission statement. The reason as to why it is in existence is that it serves the consumers and gives them a competitive advantage. The first step is to transform the vision statement into a mission statement that explains its entire intentions and aims. Define precisely the mission, goals and objectives of the organization. Planners have to analyse the firm’s current, competitive position using tools such as SWOT Analysis. Managers then set specific objectives, then strategies for reaching these objectives are developed, which will differentiate the firm from its competitors. An action plan is then developed to achieve the goals and objectives as efficiently and effectively as possible. Resources to implement this should also be provided. Establishing responsibility and transparency for implementing the plan is very important. Performance measurement systems should be used in order to monitor and report progress.

Question 4

Stakeholders are a collection of individuals affected by a firm’s performance and who have claims on its wealth. In order to evaluate how each category of stakeholder affects the overall success of this corporation, the firm should maintain an adequate level to maintain the participation of key stakeholders (Parker, 2005). For instance, for Capital market, the stakeholders are Stock market/ investors/ debt suppliers/ banks and for Product Market stakeholders are primary customers, suppliers and organizational.

References

Plunkett, W. (2008). Plunkett’s Retail Industry Almanac 2009: Retail Industry Market. Houston, Texas U.S.A.

Louis E. B. & Kurtz, D. (2011). Contemporary Business (14^thed.). Rosewood Drive, Danvers: U.S.A.

Parker, B. (2005). Introduction to Globalization and Business: Relationships and Responsibilities. California: Thousand Oaks.