Strategy Assignment Example | Topics and Well Written Essays - 1000 words

Strategy - Assignment Example 2) According to Wal-Mart, it needs substantial brands to form associations with it in order to attract affluent customers and also have a tendency of increasing peripheral business by selling other commodities. Therefore, forming associations with Levis’ allows it to attach a designer brand name with it that is accepted and received well in affluent customer’s segment. 3) Considering this case study, Wal-Mart has an edge over Levis’ in this corporate strategic alliance. This is so because Levis’ needs Wal-Mart for its business expansion as its own showrooms and other smaller retail networks have been proven incapable of attracting major customer base. Secondly, Levis’ has made considerable capital investment along with extensive business restructuring to suit Wal-Mart’s model. Therefore, Levis’ is dependent on Wal-Mart for cost-recovery and further business revival. Whereas Wal-Mart has a tendency of switching to other suppliers who wi ll offer better profit margins without incurring much liability. Therefore, Wal-Mart has a greater bargaining power as compared to Levis’. 4) Wal-Mart follows a broad target/ cost leadership generic strategy (Porter, 1980). It has multiple product lines that cater to every demographic segment. Furthermore, it has an extensive retail model with around 9000 stores worldwide. Such extensive network makes it a premium choice of suppliers due to which it has a greater bargaining power to persuade suppliers for providing their products at considerably low prices, as compared to other retail stores. 5) ‘Barriers to entry’ is an edge used by various leading market players to create obstacles for preventing new competitors from easily entering into market, industry or particular area (Sullivan & Sheffrin, 2003). Wal-Mart has developed a state of art automated system that is synched with its suppliers through point-of –sale mechanism. Therefore, the moment a product is bought, a supplier is notified which results into timely product delivery. As a result, customers prefer to stay with Wal-Mart since they know that their desired product will be available readily. This strong link with suppliers requires higher switching cost which is difficult to incur for its competition. As a result, their customers would also prefer Wal-Mart over them (Competing with information technology, n.d). 6) Value chain constitutes of following activities along with examples from Wal-Mart’s case study: Production- No self-production, acting as a retailer Production Management- Inventory management Quality Management- Extensive IT network and huge workforce Marketing & Sales- Sales teams dealing with suppliers General management- store management, venue management Marketing and sales management- Sales team heads dealing with suppliers in a particular industry Accounting and Finance- In-house finance department performing general accounting, forecasting etc. Res earch and development- Constant acquisition of market intelligence and tools to make IT its niche. Human Resource Management- Extensive handling of employees’ daily attendance, payroll, deployment etc (IMA, 1996). 7) Out of all the above mentioned activities, production management is the most important activity. Although Wal-Mart is a