The main issue facing the management of Wal Mart was how to sustain their extraordinary growth. As the domestic market reaches saturation, a strategy for at home and for global expansion will be necessary.
Wal-Mart needs to identify and nurture the primary core competency that fueled their growth: fulfilling customer needs with a wide spectrum of products at "everyday low prices". This competency is the product of the aggregate of competencies across individual skill sets and organization boundaries: Wal-Mart is a leader in channel management, inventory control, distribution and customer service. This is a result of the company's ability to coordinate a complex information management and distributing …show more content…
Although diversification into the food retail industry only provides "razor thin" margins, the supermarket section serves as a draw to the higher margin merchandise departments. The two largest supercenters chains, Meijer and Fred Meyer, plan on staying regional. Wal-Mart has the infrastructure to exploit the concept nationwide.
Management should continuously benchmark operating results and best practices against those of their competitors. This includes not only Target and K-Mart, but the major supermarket chains as well.
Management must nurture their competitive advantages and convey their importance to the organization as a whole. The management and associates need to understand their responsibilities and what they need to contribute to maintain the system of best practices that translate into advantage.
To expand globally, Wal-Mart should enter into joint ventures or acquire foreign mass retailers already established in the market, as they did with Cifra S.A. in Mexico. By buying an established business, Wall-Mart would be relieved of some of the initial capital investments for land and buildings, as well as skirting the morass of zoning ordinances and regulations. Having an experienced local partner will also eliminate some of the problems associated with customer