Organization’s Strategy and Structure

Considering the Wal-Mart Stores, Inc., it is worth recalling that it is an American company, the world’s largest retailer, which includes (2010) 8,838 stores in 15 countries (Walmart Corporate 2011). Among them – hypermarkets and supermarkets that sell food and industrial goods. Wal-Mart strategy includes such terms as the maximum range and minimum, tending to wholesale prices.

Discussing the strategy of Wal-Mart, is worth just mentioning the seven key components of success of Wal-Mart, which can be called P.O.C.K.E.T.S. – it is an acronym, the key ingredients for success are: (P) = Price, (O) = Operations, (C) = Culture, (K) = key products, (E) = expense control, (T) = Talent and (S) = Services. These are seven key components of the Wal-Mart success, stated by its strategy.

Considering Wal-Mart’s organizational structure it is seen that it consists of a divisional structure. Its divisional structure has three different categories, such as product structure, market structure, and geographic structure. Wal-Mart falls under market structure. There are 41 regions in which Wal-Mart is. Every region is manages by a Regional Vice President, whose office is situated in Bentonville, that is why he travels to the regions three weeks during the month. There is a very high concentration of managers and executives in the Home Office. All regional managers meet once a week with Bentonville-based corporate in order to discuss developments in the individual stores. Every region contains about 11 districts, at the same time every district contains about 6-8 stores (Houston, 2005). The head of each district is District Manager, who lives there. Each District Manager works in cooperation with Regional Personnel Managers. All stores of Wal-Mart have the similar job categories, job descriptions and management hierarchy.

At the bottom of the ladder, the primary level is taken by cashier, sales associate and stocker. The next level is taken by Department Manager; then Customer Service Manager, then Support Manager; then Assistant Managers; the next step is taken by Co-Manager, Store Manager. The Wal-Mart stores contain 40-50 different departments. It is worth mentioning that Wal-Mart structure fully supports its strategy which makes the work of this company successful and profitable (Houston, 2005).

In today’s economic situation, many executives are looking for reserves to improve the organizational structure. There is no doubt that a well-organized interaction between staff and departments can significantly improve business performance. Company’s structure and strategy play an important role in the success of the company. Organizational structure and strategy are closely connected and, depending on the chosen strategy the company should build an organizational structure. Properly set strategy and wisely selected structure help to avoid problems in work process of the company. Cooperation of these two elements allows the company to be successful, have fast decision making process, increase sales opportunities and innovation, improve communication between management and employees, and improve collaboration between its departments.

Brickley, J.A., Smith, C.W., Zimmerman, J.L. (2002). Designing organizations to create value: from structure to strategy. p. 201.
Houston, B. (2005, October 29). Wal-Mart structure. Wal-Mart Space.

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