Page 158 - DCOM506_DMGT502_STRATEGIC_MANAGEMENT

Strategic Management

Notes Wal-Mart has chalked out an aggressive expansion plan to accelerate its growth in the
near future. At the fiscal year ending 2007-08, Wal-Mart achieved a revenue target of $500
billion.
Questions
1. What problems do you think would have been faced by Wal-Mart initially to offer
products at cheapest prices?
2. After analysing the above case, do you think every company should aim at cost
leadership?

Source: www.icmrindia.org

8.4 Business Tactics

Tactics should work with a firm’s strategy and they are the set of requirements need for the plan
to take place. A tactic is a device used by the firm for meeting your goals set by your strategy.
Strategy and tactics should always be relative to one another because the tactics are the set of
actions needed to fulfill your strategy.
1. Tactics are the tools used to achieve goals.
2. Tactics include things like advertising and marketing.

3. Tactics are the steps taken to achieve goals.

Brand Management

One tactic that almost every firm employs is strategic brand management. Firms must find a
way to communicate their products and corporate philosophy to potential customers. Over
time, a business can establish a reputation that gives its brand name an advantage over the lesser
known competitors.
Brand management includes good advertising and public relations to present an image of that
is consistent with the mission and vision of the company. A company may also conduct research
or poll the general public to learn about how it is perceived and what changes are necessary.

Diversification and Specialisation

Two different business strategies that deal with the scope of a company are diversification and
specialisation. A business can diversify by simply expanding its products and services, such as
adding a new division, or through merging or acquiring another business.

Specialisation is the opposite of diversification. It refers to narrowing a business’s products to
focus on a more specific type of product. By focusing limited resources on a smaller product line,
a business may hope to improve the quality of its remaining products, or simply divest itself of
an unprofitable product.

Research and Development

Some firms use investments into research and development as a major tactic to get ahead of
competitors. This is particularly true in the manufacturing field, where new product technologies
can save money and produce products that will excite consumers. Smaller businesses may lack
the money or in-house talent to invest directly in research and development, but for larger
companies the ability to innovate can be the difference between success and failure.

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