Walmart Case Study Essay

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Question 1) Determine the Core Competences of Wal-Mart. Substantiate your answer.

In order to determine the core competences of Wal-Mart, I will first need to conduct an internal analysis of Wal-Mart before we could identify the core competences of the company. The internal analysis consist of a few components, first we will have to identify the resources available to the company, followed by the capabilities of the company. After which I will put the capabilities through a numbers of models to determine if they “fit the bill” to be considered as a core competency of Wal-Mart. I will start by first identifying the resources.

The resource available to any companies compromises of two component, the first being Tangible resources, …show more content…
An aspect of having such an economy of scale is the aggregation effect, commonly seen as with other business such as The Home Depot and Wells Fargo, whereby Wal-Mart stock as many different products as possible. This allows the company to grow its revenue over the fixed cost base. • Cost Efficiency - Wal-Mart has a stringent stand towards controllable expenses. One example of how stringent is that associates working on a hourly basis can be reprimanded or even to the extent of being terminated for taking unauthorized overtime. Wal-Mart also filters out any inefficiency in the business; one example would be reducing paper used through computerization.

I have identified the five capabilities above, before I can deduce that they are able to be classified under the core competences of the company, I will need to put them through a couple of test. First would be the “Four Criteria of Sustainable Advantages” model, followed by the “Value Chain Analysis”.
The first model consist of four components, they are: • Valuable capabilities – which help a firm neutralize threats or exploit opportunities • Rare capabilities – which are not possessed that few, if any, competitors possess • Costly-to-Imitate capabilities – that other firms cannot easily develop • Nonsubstitutable capabilities – that do not have strategic equivalent

By putting the capabilities stated above through the four
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