Strategy and Innovation
WEEK 3: What is Strategy?
Strategy in a company since it describes the methodology to accomplish objectives. In simpler terms, a strategy entails a plan designed to consolidate resources to provide the desired output. Some of the components of a plan comprise procedures, purposes, and expected outcomes. Sempels & Hoffmann (2013, p.123) argue that a strategy entails positioning for sustainable competitive advantage, planning which services and products to offer, and assigning resources to achieve a competitive position, the firm is aiming. Nilsson, Olve & Parment (2011, p.78) give that the sole aim of the strategy is to achieve long-term and sustainable performance. The concentration of a strategy is on enhancing value by meeting the needs of the clients than any other rival. Articulation of a strategy comes to getting an option from a set of alternatives. The product of an effective strategy is the attainment of a competitive advantage in the industry by offering products in a unique way. A strategy engulfs all levels of a firm. This includes employees and the executives. Proper coordination between the employees and the managers ensures that there is a practical approach. This is because the management sees that the workers are dedicated to the strategy. Employees, on the other hand, ensures that the goals of the strategy are achieved.
Walmart has been able to sustain its competitive edge in the market using the concept of strategy. Before Walmart immerses itself in formulating a plan, it first caries an extensive market research. The importance of carrying out the research is to spot and analyze the behavior of the consumers in the market. Analyzing the needs and expectations of the clients is important in strategy formulation since it provides the basis of the strategy (Sempels & Hoffmann 2013, p.127). Since the company offers a variety of products ranging from food commodities to machinery, it has to carry out a diverse study of the customers’ preferences and choices. Apparently, the company faces an aggressive rivalry from companies such as Ildi, Tesco, and Aldi. Therefore, coming up with an ineffective strategy would mean that the firm would succumb to the rivalry of the respective companies. However, the firm has not been active in strategy formulation. This is because there have been constant complaints from consumers. Thus, Walmart’s management need to advance a plan to notice gaps in service provision. The gaps can be said to be behind the retrogressive sales returns. Therefore, observing the gaps and dealing with them effectively will be one strategy to increase sales and profits. One of the relevance of the e-learning activity to be implemented by Walmart is to analyze the factors that account for the growth. The other relevance is that strategy expansion needs research on the phenomenon. Additionally, Walmart should get that the strategy development methodology should take into consideration the place of the employees since most strategies fail due to the failure of not involving the employees.
The importance of employee involvement in plan preparation has been given by Ulwick (2005, p.119), who argued that it encourages knowledge diversification. In simpler terms, employees with various knowledge and skills come to one table to design one effective strategy. This combination of ideas ensures that the accomplishment of the goals of the company is smooth and efficient. Moreover, the involvement of workers, mostly curbs employee resistance. At Walmart, the place of the employees in strategy formulation has been overlooked for years. This has seen retarded profit growth. However, the Walmart’s management embracing the position of employees in plan preparation can reverse this trend. One strategy that Walmart can embrace is repackaging of its products. This approach will improve uniqueness. The other strategy is to reshuffle sales representatives in the stores. In addition, the firm should consider lowering the prices of its products to those of rivals. This strategy will make clients purchase from the company. Ulwick (2005, p.121) argues that conducive purchasing atmosphere makes consumers get attracted to buy particular products or services.
WEEK 4: Business Model Innovation
Innovation remains a frustrating quest in many firms, despite enormous investments in money and time by management. Most innovation endeavors habitually fail, and those that succeed get a rough time sustaining their achievement. Innovation deals with coming up with a new product or improving the appearance of the surviving one. Innovations are pertinent mostly when a form is experiencing a period of declining sales and profits. In such case, the management of a firm designs the best approach to use to the reverse the trend. Innovation primarily entails product and service development. It is usually crucial for a company to plan how to meet the needs of the customers in the future. Thus, a company restructures itself in the endeavor to improve the products and services to meet those expectations. Slack & Parent (2006, p.165) argue that some of the pertinences of innovation include reducing the cost of products in the market and improve the quality and appearance of the products. Innovation can enhance the reduction of prices by inventing new operating methodologies that correlatively decrease the cost of production. Simerson (2011, p.112) argued that giving the consumers the low price makes them purchase more of a product. This process ends up making the company getting more sales. In the end, the company will gain a competitive position in the wider market. On the contrary, high priced products make consumers buy fewer quantities of products. The retrogressive repercussion of this behavior is that a company makes lower sales as well as profits than those who charge less.