Exercise 1: Read the Walmart case and answer the following questions.

1. Consider the markets Walmart chose to focus on, relative to other discount retailers, such Target, Sears Holding, and Dollar Tree. How are Walmart's markets different from those of its competitors? Does Walmart's choice of market focus contribute to its competitive advantage? If so, how?

2. What is Walmart's unique value or value proposition? Why do customers choose Walmart? Does Walmart really deliver lower prices?

3. How does Walmart deliver its unique value better than competitors? What resources does it have, and what capabilities has it developed that help it deliver its unique value?

4. Are the functional strategies of areas such as human resource management, information technology, sales and marketing, store operations, procurement and logistics, information technology, aligned to support Walmart's overall strategy for delivering unique value? Do the functions contribute more to Walmart's success than others?

5. Why don't other discount retailing competitors seem to be able to imitate Walmart's strategy? What, if anything, prevents imitation?

6. How is Target's strategy different from Walmart's in terms of the markets it focuses on, unique value it tries to offer, resources, and capabilities it has developed, and the ways it has tried to prevent imitation? Has Target's strategy also been successful?

7. What factors might make it difficult to maintain a competitive edge? What has made it difficult for Walmart to compete with Target and in international markets?