om final project walmart
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WAL-MARTTHE WORLD BIGGEST RETAILER
SUSTAINING CORE COMPETENCE AND COMPETITIVE ADVANTAGE
Presented byPolawat and Mostafa
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COMPANY ( )REVENUES in $ millions
Exxon Mobile , .444 851 0
-Wal Mart Stores , .405 607 0
Chevron , .263 159 0
ConocoPhillips , .230 764 0
General Electric , .183 204 0
2009 Global Fortune
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RATAIL INDUSTRY STURCTURE
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PROCUREMENT
costsed Relationship with suppliers
DISTRIBUTION
-Reduce inventory cost-Efficient distribution (Cross-Docking)
Organizational Culture:Low cost business model, Sundown rule, 10 feetattitude
InformationTechnologySystem
Satellite, Radio Frequency Identification Scanned(RFID), Electronic Data Interchange (EDI)
MARKETING
AND SALES
-A fewpromotion
CORE COMPETENCE & COMPETITIVE ADVANTAGE
CORECOMPETENCE
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-Capabilities to
reduce costacross thevalue chain-
-Organization
Culture
SUPPORTACTIV
ITIES
PRIMARYACTIV
ITIES
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OUTSOURCING FOR LOWER COST:
Wal-Mart pressures manufacturers tooutsourcing jobs
More than 70% of Wal-Mart merchandise has aChinese component
Wal-Mart is the global leader of outsourcing
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Wal-Mart is facing stiffer competition everywhere. Indiscounting retailing area, many of its competitors
Kmart Sears and JC pennyare being revitalized bynew management. In warehouse clubs, its Sams clubsran a poor second to Costco.
Wal-Mart attracts criticism of environmentalists, anti-globalization activists, womens and childrens rightsadvocates, small business representatives and agrowing number of legislators of varying political hues.
How can Wal-Mart sustain its competitive advantageand core competence in the US and the world market?
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Revenue
Profit
Marketing Powerover suppliers
MarketingPower overlabor
MarketingPower overcustomers
Outsourcing
Investment inGreenTechnology
Investment inprocessimprovement
CSR Issue
Unit Cost
Low Price
Brand Image
Sales
Consumption
ResourceDepreciation
CapitalProductivity
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BRAND IMAGE
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Operations
Strategy
The Operation's
Strategic Objectives
The Operation's
Competitive Role and
Position
Design
Planning and
COntrol
Improvement
Operation
Strategy
Operation
Manageme
nt
InputResources
OutputProducts and
Services
Customers
WAL-MART GOING GREEN
To build a moreenvironmentally andsocially responsibleglobal supply chain
-To be supplied by 100% renewable energy-To create zero waste-To sell products that sustain resources andenvironment
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Operation Planning and Controlling 1. Increase fuel efficiencyin Wal-Marts truck fleet by 25 percent over three years and
doubling it within 10 years
2. Reduce greenhouse gasesby 20 percent in 7 years
3. Reduce energy use at storesby 30 percent in 7 years
4. Cut solid waste from U.S. stores and Sams Clubs by 25 percent in three years.
5. Buying diesel-electric and refrigerated trucks with a power unit that could keep cargo coldwithout the engine running, saving nearly $75 million in fuel costs and eliminating anestimated 400,000 tons of CO2 pollution in one year alone
6. Making a five-year verbal commitment to buy onlyorganically grown cotton from farmers,and to buy alternate crops those farmers need to grow between cotton harvests.
7. Promising by 2011 to onlycarry seafood certified wild by the Marine StewardshipCouncil, a group dedicated to preventing the depletion of ocean life from overfishing.
8. Buying (and selling) 12 weeks' worth ofRestrictions on Hazardous Substances (RoHS)
-compliant computersfrom Toshiba
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IN THE WORLD MARKET
Wal-Marts low price strategy was not successfulin German and Korean Markets because of :
-Differences in consumption behavior -High cost to invest in IT system -Differences in Organization Culture
Wal-Mart should use focused-market strategy inthe world market.
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