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Wal-Mart's Planning Levels

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Essay title: Wal-Mart's Planning Levels

Wal-Mart as a company employs several different levels of planning to ensure the completion of the many goals is put into motion each year. After the upper management members have attended the massive planning meetings that Wal-Mart holds in order to put projects in motion, they will relay the messages to the next layer of management. It is this level of management, better known as middle management, which we will concentrate on for this paper as they are the ones who will implement the tactical phase of any plan. An example of this would be the method that Wal-Mart devised to guarantee diversity in the management ranks. After “being sued for allegedly not paying employees for overtime, for alleged gender bias” Wal-Mart decided to start a plan of action to ensure diversity (, 2004). In this plan managers were required to hire the same percentage of minority managers as the percentage that applied for the job (, 2004). If these numbers were not met, the bonuses of all managers involved were to be cut significantly. After receiving this message from upper management, it was up to the middle management team to pass it on to the operational managers and check on them to guarantee that changes were being made that would allow the company to reach the goal. By using this tactical level of management, the mid-tier managers were able to direct the lower managers and make a positive step towards accomplishing the objective that was put in front of them.

SWOTT Analysis (Strengths)

Low prices, management strategies, and diversity are just some of Wal-Mart’s strengths. Wal-Mart is known for being one of the largest retailers that’s able to provide a wide range of quality products at a low price. Competitors such as K-Mart are unable to compete with Wal-Mart due to the lack of name brand products. K-Mart is able to provide non-name brand products at a reduced price, but cannot maintain the low prices of the name brand products Wal-Mart provides (Hayden, P., Lee, S., McMahon, K., & Pereria, M., 2002).

SWOTT Analysis (Weaknesses)

As a huge organization, Wal-Mart has a weakness in opening an expansion in Germany. The weaknesses in an organization need more development in order to become successful. As Wal-Mart continues to grow and expand into different countries, the diverse management now has to plan for the different regulations for each country. It is found that the Wal-Mart chain in Germany may have been a huge risk that this organization was willing to take. Germany has labor costs that are unaffordable, which forces consumer shops to close earlier than usual (Fernie & Arnold 2002, p95). The high cost of employees is the cause of closing early evenings, which will result in a lower profit margin for Wal-Mart.

Fernie & Arnold stated, “Under German law, an ‘every day low price’ (EDLP) item must be sold at the same reduced level for two months to be classified as EDLP” (2002, p96). This would be reasonable for any organization to gain more sales and consumers, but it also comes with consequences. German consumers are drawn to shopping centers with low priced products. As each competitor lowered their prices, Wal-Mart continued to lower their own prices. “Wal-Mart has…fallen foul of the regulatory authorities and was fined $308,000 for selling goods below cost” (Fernie & Arnold 2002, p97). Wal-Mart may have gained many German consumers because of their continued low prices, but the consequences have cost them millions of dollars in the long run. The management planning for Wal-Mart is on track in making more money, but the consequences have to be reviewed again because losing

money is not the idea.

SWOTT Analysis (Opportunities)

Based in a case study, Wal-Mart has an opportunity to continue their growth internationally and continue employment opportunities. Currently, Wal-Mart has stores in numerous locations around the world. According to, “the company employs 1.6 million associates worldwide through more than 3,600 facilities in the United States and more than 1,570 units in Mexico, Puerto Rico, Canada, Argentina, Brazil, China, Korea, Germany and the United Kingdom. More than 138 million customers per week visit Wal-Mart stores worldwide”. However, expanding into smaller rural areas and smaller countries pose a challenge due to the economic impact that is might have on smaller businesses.

SWOTT Analysis (Threats)

According to USA TODAY, Wal-Mart, which is the world’s largest private employer with over 1.3 million employees, is still susceptible to threats that today’s society imposes. Stephanie Armour, a journalist of USA TODAY writes, “At the pinnacle of

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