Strategic Analysis; Tools and Techniques – Essay 1, Essays (university) for Strategic Management

Executive Summary

This paper provides a strategic analysis of Wal-Mart International. Wal-Mart international is one of the biggest retail chain stores in the world. The company has been growing from strength to strength and now boasts of global leadership among retail chains.
Strategic management implies long term planning and doing everything in an organization with a long-term picture or vision. As defined by Mitzberg et al (1998), strategic planning consists in making long or midterm decisions with the aim of delivering a competitive edge to an organization. Strategic planning is not possible without strategic analysis. Through application of strategic tools, one deploys mechanisms of understanding the organization and the environment within which it operates (Yergin & Stanislaw, 2002).
Analysis of the business environment is the primordial function of strategic management (Sadler & Craig, 2003). In this paper, Porters Five Forces and PESTEL model are employed towards understanding the market and the macro environment within which Wal-Mart Operates.
From the market analysis anchored on the five forces model, it is clear that competition is the biggest headache for Wal-Mart International. The company operates in an environment characterized by high competition. Due to stiff competition, it has had to withdraw from some international markets like South Korea and Germany.
The strategies employed by an organization can be based on models and plans or on internal capacity of the organization. Models notwithstanding, the resource based view of strategy holds that organizational resources are the most critical factor in determining a competitive edge (Wernerfelt, 1984). This implies that organizational competencies and capabilities matter a lot when it comes to defining a competitive edge. A SWOT analysis done on Wal-Mart reveals that it has many strengths and hence competencies.
The company has an international presence, a strong work force and employs modern information technology platforms to remain ahead of competition. In terms of revenue, the organization is one of the highest revenue earners in the world. In the last year alone, the organization had a 15.4 billion (US dollars) as net revenue. The SWOT matrix on Wal-Mart reveals that it has enough strengths as well as opportunities that put it is a strong competitive position. The opportunities further offer a huge potential for growth.
Based on identified characteristics of the organization and the business environment within which it operates, managers adopt given strategies. Tools like the BCG matrix, the GE matrix or the grand strategy matrix are helpful when identifying the kind of strategies to adopt for a company (Ulwick, 2000). The grand strategy matrix was used in identifying the kind of strategies Wal-Mart can employ going into the future.
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