Wal-Mart Essay Example | Topics and Well Written Essays - 4750 words

Wal-Mart - Essay ExamplePorters generic strategy provides a clear linkage between strategic management and strategic finance. Wal-Marts decisions had a clear linkage between strategic management and strategic finance. Even when entering a foreign country, a firm needs to assess which markets to enter, the timing and the scale of entry (Hill, p488).Whether the strategy is to maintain cost leadership or product differentiation, the ultimate strategy is to gain competitive advantage and enhance profitability. Wal-Mart focused on cost leadership and their low-cost model served them well within the US scarcely the same strategy did not help them in their international operations. In the US they had achieved organic growth but when they decided to expand their ventures overseas, they did not life beyond the low-cost model. According to Mintzberg (1987), a strategy must essentially have two characteristics it is made in advance of the action undertaken and it must be devised purposefull y and consciously. Wal-Mart did not follow this principle of strategic management.Wal-Mart did none of these and merely tried to replicate the business model that had brought them success in the US. Another consequential factor when entering another country is the choice of entry mode which must be based on long-term growth and profit potential. thither are four different modes of entries - exporting, contracts (licensing) joint ventures (JV) or wholly owned subsidiaries (WOS) and the choice depends upon the level of control required.