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Executive summary

Strategic decisions refer to the divisions concerned with the entire environment in which an organization operates; the Company's resources, people who constitute the venture, and the interface between the two (Calton, 2015). The strategic decisions may be characterized by the possession of new resources and the reallocations of resources and harmonizing resource capacities with their threats and opportunities. Strategic decisions are complex and have to consider various aspects, including the organization's internal and external environmental elements (Freeman et al., 2011). This essay provides the internal and external environmental factors of Walmart Limited a discussion of how these factors impact the Enterprise strategic decisions add its capacities to remain competitive.

Background of a company

Walmart is one of the giant Enterprises leading in retail and wholesale. The Company was started by Samson Walton, who was focused on awfully excellent customer services and ensuring that customers get value for every coin they spend in the business. Walmart opened its first store in the year 1968 in the outskirts of Arkansas in Sikeston. In the year 1969, the Company was incorporated. By the Year 1970, the Company had already opened more than 38 stores operating with more than 1500 employees and would make sales exceeding 44.2 million dollars (Hong, 2011). Company in the same year started to trade its stock publicly, and it was soon listed on the New York Stock Exchange.

Internal factors affecting the business

Factors which impact Walmart's strategic decision-making include the internal relationships with the company workforce, the human resources, labor-management, the Company plans, and policies, not forgetting its corporate image. Its formal structure plays a crucial role in motivating the employees towards a common Purpose and developing a unified vision and mission statement (Hong, 2011). The Company's internal environment is characterized by smoothened communication through the utilization of emerging technologies. We cannot understate the company culture of focusing on excellence and enhancing the customer utility, coupled with an endeavor to create an enabling environment that enables the company employees to give their best (Neebe, 2020) As the Company hires the most talented employees, the workforce can influence the firm's strategic decision making; the Company developed an innovative and creative environment coupled with enhancing efficiency in operations. The Company's organizational structure is flexible enough to maneuver in the rapidly changing business environment, especially in the technological evolution and changes in the customer demands, enabling the Company to make rapid changes whenever needed (UniqueWritersBay, 2014). The business's role of financial and physical assets is critical in giving it a competitive advantage over the competitors as it can maximize any emerging opportunities and invest in strategies that call for massive capital, unlike the small Enterprises. The company management guarantees that its internal environmental factors, including the employees, the business assets, and management decisions, align with the business Vision and make positive contributions to the Company's strategies.

Another internal environmental factor influencing Walmart's strategic decision-making can be attributed to the corporate structure (Neebe, 2020). It should be understood that Walmart Company was structured into three major business units that is Sam’s Club, Wal-Mart Stores USA as well as Walmart international. Although Walmart is a public corporation, most of its stock is still under Walton family members, which means their family members, are highly involved in top-level alongside corporate and decision-making, among other critical functions.

Company’s external environmental factors

Call external factors which impact the business's strategic decision-making in Cloud competition changes in customer perceptions and trends. Many operators and new entrants into the business pose a significant threat to Walmart Limited. Walmart's limited competition faces increasing competition, primarily due to the emergence of the online trading changes in technology, which gave both large and small rival firms significant capacity to compete against the business (Calton, 2015). The actions of rival giant companies in the industry such as Costco, McDonald's, Apple, and other small retail businesses who painted to lower their selling prices but more customers are a significant threat to the business. There are rapid changes in the customer purchasing trends and perceptions of the (Greenspan, 2019). They are increasingly demanding higher quality services and products at subsidized prices, which they expect the firm to deliver promptly. These demands are a massive blow to the company profits; they adversely impact the business cost reduction strategy, as the cost of offering the services may outweigh the gains to be derived from the same.

Other than the competition for market share, technology plays a critical role as an external factor influencing Walmart's business. Worth knowing is that the internet and e-commerce impact the overall performance of Walmart (Greenspan, 2019). Walmart launched its online stores asthe strategic business decision, which will enable it to remain connected with a wider base of clients and esteemed customers. Just like Walmart employees did when it adopted new technologies for its business, many of its customers as of today have also changed their demand, particularly in the manner they buy goods and services. Technology is one of the external factors, more so the-commerce has opened a new way of connection between the sellers and buyers.

Primary challenges for Walmart

The main challenge confronting Walmart is that the competitors say the Company has to always keep an eye on what these rival businesses are doing and react accordingly. Some of the competitive firms are willing to take higher risks, including operating at an insignificant profit, to increase their market shares which is a significant threat to Walmart Limited. Some rival businesses go beyond standard business trends to provide services such as home delivery at no cost to attract more customers (Freeman et al., 2011). It is common for rival firms to offer sales discounts. Walmart Ltd has always engaged in extensive research incoming with unique services and products, giving it a competitive notch against the rival businesses whose strategic moves are constantly changing.

Recommendations for handling the issue

It would be essential for the business to invest in research and development heavily and in the installation of new technologies coupled with training of the employees to equip them with the skills that can increase their efficiency and lower the operating cost of the business. Through mechanization, the Company can reduce its overall operational cost and profit margin even when selling at lower prices, giving it a competitive advantage over the rival businesses and increasing the Company's market share cc The Company should determine to invest in the developing economy such as in Africa, where the business can tap new opportunities and enjoy decreased production costs due to an adequate supply of low-cost labor.

Reference list

Bocanegra Gastelum, C., 2019. Walmart: competitive crossroads in the chinese retail market. México y la Cuenca del Pacífico, 8(22), pp.89-120.

Calton, J., 2015. A Decentred Stakeholder Network Path to Creating Mutual Value: Is Walmart Showing the Way?. Journal of Corporate Citizenship, 2015(59), pp.82-91.

Greenspan, R., 2019. Walmart Inc. Five Forces Analysis (Porter’s Model), Recommendations - Panmore Institute. [online] Panmore Institute.

Available at: <http://panmore.com/walmart-five-forces-analysis-porters-model-case-study.>

H, H., 2020. Walmart: A Comprehensive Business Analysis for the US Market. [online] ToughNickel. Available at: <https://toughnickel.com/industries/Walmart-A-Comprehensive-Business-Analysis-for-the-US-Market>

Hong, X. 2011. 2. Outsourcing in China: Walmart and Chinese Manufacturers. In: Chan, A. ed. Walmart in China. Ithaca, NY: Cornell University Press, pp. 34-53. https://doi.org/10.7591/9780801462672-004

Neebe, K., 2020. Sustainability at Walmart: Success over the Long Haul. Journal of Applied Corporate Finance, 32(2), pp.64-71.

Rowland, C., 2019. Walmart PESTEL/PESTLE Analysis & Recommendations - Panmore Institute. [online] Panmore Institute.

Available at: http://panmore.com/walmart-pestel-analysis-recommendations-case-study.

Smithson, N., 2019. Walmart SWOT Analysis & Recommendations - Panmore Institute. [online] Panmore Institute.

Available at: http://panmore.com/walmart-swot-analysis-recommendations-case-study.

UniqueWritersBay ., 2014. Walmart External and Internal Environmental Analysis | UniqueWritersBay. [online] uniquewritersbay.com.

Available at: https://uniquewritersbay.com/walmart-external-and-internal-environmental-analysis/.

Freeman, R.B., Nakamura, A.O., Nakamura, L.I., Prud’homme, M. and Pyman, A. (2011). Wal-Mart innovation and productivity: a viewpoint. Canadian Journal of Economics/Revue canadienne d’économique, 44(2), pp.486–508.

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