Paper Example on Business Model: Strategic Approach to Realizing Long-Term Value

Introduction

The business model is a very important aspect in an organization; it is based on finding the best methods for realizing the long-term value of the business while offering quality products and services. The business model is a business idea which is not just about strategizing on how the organization makes money and retain the brand name in the market but also creates a kind of incentives for the users. It also enables the company to engage in partnerships with other businesses. The business model is a straightforward framework for defining, understanding and designing the organization based on the market structure (Demil et al. 2015). For the time I have been working with Walmart, I realized the importance of having a business model that creates and captures the value of the business in the market. Walmart's business model provides a direct link to the internal and external environment of the business, strategies, value chain, and management. The mission of Walmart Inc, which is about providing quality products and services to the people to help them save money, has remained a successful business model since Sam Walton initiated the first Walmart stores. This business model has placed Walmart at the rank of American retailers with the highest annual revenue. It started as a small discount business in Rogers Ark1969, and it has expanded to various parts of the United States. Walmart has also opened different stores in many countries in the world based on the same business model. We are creating new job opportunities through innovations and delivering valuable products and services to the customers as well as different communities in the world Everyday Low Price (EDLP) has remained the best strategy and the cornerstone of this organization. This paper explores Walmart's business model.

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Walmart's Business Model

Sam Walton, the founder of Walmart Inc, developed a noble and a simple mission for bis business. He wanted to reduce the cost of living by providing affordable prices for the people who speed in his stores and for this reason he designed a big box retail set-up which is evident in all Walmart stores today (Schaltegger, Hansen, & Ludeke-Freund, 2016). Walton envisions a marketplace where customers could get all they need under one roof based on discount pricing. This business model has given Walmart stores, Sam's Club stores great opportunity to explore the market and define the big-box business model across the globe that many other organizations have applied. Walmart's business model illustrates the rationale of how the operations are organized to deliver, create, and capture the value of the business. Also, it is based on the nine-block decomposition of a business model:

Value Preposition

The value proposition for Walmart Inc is based on providing customers with EDLP. This strategy is the core factor has led t the success of the business and enable the business to face competition in the market. Everyday Low Price act as the main objective in Walmart's business model as well as the rest of the key factors of the business (Manning, 2017). Walmart's main goal is to provide goods and services at a low process to enable people to save money and live better lives. This value proposition shows that the clients do not have to wait for the products to reduce the price or have fair deals since prices are low in all seasons. Besides, the business is not just based on sells convenience; it focusses on offering a wide range of products and services where customers can choose from in a single store. It is possible to do all the shopping under one roof, for example, in every store client can get a variety of groceries and pharmacy services. Therefore, Walmart's clients can save money and time. Walmart is focused on bringing quality value to the customers at a competitive price.

Distribution Channel

In order to sustain its value preposition, Walmart provides a platform for communication between the customer and the business as well as linking the customers using its distribution channels. These channels are owned by the company, and it is the company managing all the moves in the distribution process, this brings higher margin as it corresponds to the clients through social media platform as well as other forms of communications which have low cost like the internet. The company aims at providing goods and services at any time and location. This channel of distribution has provided the company with an opportunity to competitive advantage and maintain its brand name across the market. Walmart comprises supercenter, neighborhood market, online shop (Walmart.com), pick up machines, discount centers, Sam's clubs, etc. all these categories provides simple and easy process od distribution.

Customer Relationship and Customer Segment

In Walmart, customer relationship has been established based on self-service; most of the operations are automated. Walmart has always worked hard to reach for the mass market with grate focus on mass customization. Walmart divides its customers into thee categories: clients with low income based on the brand (brand operations), wealthier clients who focus on business deals (price-sensitive) clients who like shopping at low prices and cannot afford to go much more (value- price customers) (BreaSolis, CasadesusMasanell, & GrifellTatje, 2015).

Key Activities

The principal activities that are used in implementing Walmart's business model include the purchase of goods, their delivery, and the total cost management. Some of the activities are aimed at creating brands that cover customer specifications in order to control products which have been developing lately. Also, our organization is based on providing a variety of products that meets the requirements of the customers and the environment. The essential activities are in inventory control, distribution, and logistics technologies. Walmart can move goods from place to place within the schedule and efficiently maintain low costs.

Key Resources

Based on market philosophy- sell more for less, Walmart Inc has successfully incorporated its model of business in all of its stores. Key resources of Walmart can be divided into two-three categories; physical resources which are owned by the company such as stores, human resource- this category compares of all employees, including experienced managers and delivery team. Lastly is the culture of the company, Walmart is a business corporation based on constant and restless efforts aimed at internal and external improvement of the business.

Key Partnership

In Walmart, the key partnership is based on a strong relationship of buyer-seller; in this case, suppliers are considered as close business partners. They also play an important role in the value chain. Walmart provides them valuable access to a large market. Through negotiation, Walmart can control price strategy with its suppliers.

Cost Structure

The cost structure is driven by the cost model because the company is focused on offering products and services at a owe price. Walmart has expanded to different markets giving it a chance to enjoy economies of scale and reducing the expenditure besides the technological interventions. The financial disciplines of Walmart are popular, and their abilities to share the operating cost with its suppliers is well known.

Revenue Stream

Revenue streams are generated from Walmart's customer segments- retail sales. This organization also generates its revenue by selling its products and brands. One big advantage which Walmart enjoys in the market is that we can sell goods and services before paying our suppliers.

Generally, Walmart's business model is driven by cost leadership business strategy (Stillman, 2015). Its commitment is experimental, and the suppliers have developed a close relationship with the company making them the leading Walmart's business partners. This kind of business model has been proven to the most valid one because it generates much income to the company; it acts as a role model for the company to strive. Many companies have tried to copy this business model; however, it has been hard for them to imitate because Walmart has continuously expanded, and I prove its operations since it started.

In an organization, the use of metaphors defines the way people think and search for the actual meaning. Therefore, they provide results of cognitive operations by which the business uses a word or a particular concept in a new context to bring a figurative point of view in a different and pleasurable way. Walmart's metaphors have helped the organization to evaluate and analyze complex management situations. From different perspectives, managing a business organization provides a key subject to analyze, the level of creativity helps incorporate different mental processes such as political views, cultural and structural. Metaphor is a business tool that is that can be utilized in various business practices to cope with complex business operations. Walmart uses its metaphors to help in facing some of the complex managerial situations. The main advantage of using, metaphors is that it is an approach that is simple and can be understood by all the stakeholders. Metaphors also provide identifying the weakness in the organization by providing a platform where the managerial team has a better observation of the ongoing business operations. The concepts of metaphors involve a general view of the business, which is contributed by all those who participate in the business. Walmart uses organizational metaphor to act as a general theory used in bringing minds of different participants into one platform to improve business operations; these include business partners and employees.

There are several organizational theories concepts and behavior that must be taken into consideration to define the failure or the success of the business and ways in which this concept is perceived and applied in business operations by the employees and the management team. Walmart considers business management and the employees as the main factors deriving the business and not just the products, and therefore, these are the people who can bring success or failure in the business (Casadesus-Masanell, & Heilbron, 2015). Motivation, communication, politics, and power are the major factors that lead to business success. Walmart has maintained its brand name in the market; it has established a completive platform that has enabled it to retain its position in the market. Walmart has significantly applied organizational theory in managerial practices in order to analyze and establish various business approaches that are relevant in handling complex situations (Stillman, 2015). This concept has helped in evaluating the level of business performance for both internal and external operations. It promotes the development of theoretical thinking for development and encourages growth in all department across all our stores.

Metaphor acts as the main structural form of human operations that is when organizing, engaging, and understanding business concepts (Defoe, 2013). Walmart's organizational metaphor is well defined, and it shows a way in which the organization is characterized by its operations. Walmart acts as a machine, culture, brain, or a political system. It has provided a platform where people encounter different experiences, develop new ideas which add quality to the business; this concept adds new concepts to the main metaphor. Walmart's metaphors are based on founders' perspectives. Walmart's workers are trained to treat customers as if they are part of the Walmart family. The organization aims to treat clients as their neighbors through the establishment of a neighborhood store. Customer's perspective that Walmart is...