Corporate strategy is a continuous process of establishing a business’s value, setting goals for profits and growth, and training employees to achieve them. It is different from business strategy in that it is concerned with cost leadership, differentiation, and focus approaches rather than just competing in a market. Product, personnel, and organizational structure are integral to any corporation and, thus, shape and influence a company’s corporate strategy. For instance, Walmart’s product life cycle, human resource management, and organizational structure have a tremendous impact on the company’s corporate strategy of cost leadership.
Walmart has a long history of inadequate human resource management. However, the company has been on its path to redeeming past injustices directed toward its employees. According to Kumari and Tewari (2018), Walmart “focuses on employees’ career development by providing competitive wages and comprehensive benefits like medical coverage, vacations, holiday pay, etc.” (p. 34). Motivation and proper personnel reimbursement are critical for long-term corporate sustainment and growth.
Regarding product life cycle, Walmart enjoys high diversity of manufactured goods distributed at low costs (Kumari & Tewari, 2018). This strategy secures prolonged growth and maturity phases, increasing competitive potential. In addition, Walmart has considerably optimized operational costs and efficiency, which has increased product supply and presence (Kumari & Tewari, 2018). This has been achieved through years of networking and technological advancements in supply chain management.
In addition, Walmart’s organizational structure combines hierarchical and functional elements. This kind of hybrid organization of management process facilitates the manufacture of a unique product at a relatively low cost (Kumari & Tewari, 2018). The company exhibits a classic hierarchical chain with more essential links at the top-management level. According to this structure, organizational directives are passed from the top management to regular employees. Conversely, Walmart utilizes function-based structuring to sort the employees according to their skills and experience, which implies the presence of functional management.
In conclusion, Walmart’s corporate strategy rests on its organizational structure, product life cycle, and human resource management. Walmart maintains its status as one of the largest retailers worldwide, with some of the lowest prices in the market. The company aims to produce a wide range of unique and cost-efficient goods for specific audiences. Due to low costs, high product diversity, improved employee treatment, and a hybrid organizational structure, Walmart sustain high revenue and competitive advantage, which proves its cost leadership strategy effective.
Reference
Kumari, E., & Tewari, V. (2018). Strategic management of Walmart. Research Journal of Social Sciences, 11(1), 32-36.