The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions
In 2006, Norway's Ministry of Finance announced it would exclude Wal-Mart Stores Inc. from its government pension fund, citing the company's "serious/systematic violations of human rights and labor rights." Norway's fund, one of the largest sovereign pension funds, owned more than 6 million Wal-Mart shares at the time, as well as 8 million shares of Wal-Mart de Mexico, all of which it divested. This case teaches students about the complex issues raised by socially responsible investing, such as the merits of taking an activist approach, the responsibility of corporations for actions of its suppliers, and the difficulties of obtaining cost-efficient information.
Swot Analysis of "The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions" written by Andrew Ang includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Wal Mart facing as an external strategic factors. Some of the topics covered in The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions case study are - Strategic Management Strategies, Financial management and Global Business.
Some of the macro environment factors that can be used to understand the The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions casestudy better are - – increasing government debt because of Covid-19 spendings, technology disruption, there is increasing trade war between United States & China, central banks are concerned over increasing inflation, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , increasing energy prices,
challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Wal Mart, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Wal Mart operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions can be done for the following purposes –
1. Strategic planning using facts provided in The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions case study
2. Improving business portfolio management of Wal Mart
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Wal Mart
Strengths The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Wal Mart in The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions Harvard Business Review case study are -
Highly skilled collaborators
– Wal Mart has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Global Business field
– Wal Mart is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Wal Mart in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Wal Mart digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Wal Mart has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Diverse revenue streams
– Wal Mart is present in almost all the verticals within the industry. This has provided firm in The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Training and development
– Wal Mart has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Low bargaining power of suppliers
– Suppliers of Wal Mart in the sector have low bargaining power. The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Wal Mart to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Wal Mart is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Global Business industry
– The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions firm has clearly differentiated products in the market place. This has enabled Wal Mart to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Wal Mart to invest into research and development (R&D) and innovation.
Organizational Resilience of Wal Mart
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Wal Mart does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Learning organization
- Wal Mart is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Wal Mart is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Wal Mart is one of the leading recruiters in the industry. Managers in the The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Weaknesses The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions are -
Aligning sales with marketing
– It come across in the case study The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions can leverage the sales team experience to cultivate customer relationships as Wal Mart is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Wal Mart 's lucrative customers.
No frontier risks strategy
– After analyzing the HBR case study The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions, it seems that company is thinking about the frontier risks that can impact Global Business strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Need for greater diversity
– Wal Mart has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Products dominated business model
– Even though Wal Mart has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions should strive to include more intangible value offerings along with its core products and services.
Skills based hiring
– The stress on hiring functional specialists at Wal Mart has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions, in the dynamic environment Wal Mart has struggled to respond to the nimble upstart competition. Wal Mart has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions, is just above the industry average. Wal Mart needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Lack of clear differentiation of Wal Mart products
– To increase the profitability and margins on the products, Wal Mart needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions, it seems that the employees of Wal Mart don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Workers concerns about automation
– As automation is fast increasing in the segment, Wal Mart needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Opportunities The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions are -
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Wal Mart can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Wal Mart can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Loyalty marketing
– Wal Mart has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Better consumer reach
– The expansion of the 5G network will help Wal Mart to increase its market reach. Wal Mart will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Wal Mart can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Wal Mart can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Wal Mart can use these opportunities to build new business models that can help the communities that Wal Mart operates in. Secondly it can use opportunities from government spending in Global Business sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Wal Mart can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Wal Mart can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Wal Mart can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Wal Mart in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Wal Mart has opened avenues for new revenue streams for the organization in the industry. This can help Wal Mart to build a more holistic ecosystem as suggested in the The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions case study. Wal Mart can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Wal Mart can develop new processes and procedures in Global Business industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Building a culture of innovation
– managers at Wal Mart can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Global Business segment.
Threats The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions are -
Regulatory challenges
– Wal Mart needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Global Business industry regulations.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Increasing wage structure of Wal Mart
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Wal Mart.
Environmental challenges
– Wal Mart needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Wal Mart can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Consumer confidence and its impact on Wal Mart demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Stagnating economy with rate increase
– Wal Mart can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Shortening product life cycle
– it is one of the major threat that Wal Mart is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Wal Mart needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Wal Mart.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Wal Mart in the Global Business sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Wal Mart in the Global Business industry. The Global Business industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Wal Mart can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Wal Mart with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc., Assignment Questions is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Wal Mart needs to make to build a sustainable competitive advantage.
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