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Target AnalysisGroup 3
Organizational Life Cycle
• Target has followed the typical organizational life cycle
• First actual store opened in 1962 in Minnesota• Became a publicly traded company in 1970 and began
to follow a more bureaucratic leadership format• By the mid-1980s, Target had over 100 stores and was
seeing over sales of over $1 billion a year. • They then began to follow a more divisional structure,
as they were maturing and becoming one of the largest discount retailers in the country
Organizational Life Cycle
• As Target grew into a major corporation, with over 5000 stores by the 1990s, it was important for them to keep control over themselves and stay organized
• Thanks to leadership having a large amount of communication and well-organized coordination, Target is now the second largest discount retailer in the U.S., behind Wal-Mart
Organizational Chart
• Target has adopted a typical organizational chart
• Like most large corporations, Target has a hierarchal organization chart
• This is a top-down organized corporation with the CEO/Chairman overseeing multiple Vice Presidents who oversee other executives
Company Situational Analysis
• As the 2nd largest retailer in the U.S., Target is in a strong position
• They have been hurt by the economy over the past decade and have had to close a limited amount of stores
• Their main competitors are Wal-Mart and other retailers such as Sears
• Targets main strengths include their brand recognition and upscale discounted product offerings
• Their weaknesses include competitors such as Wal-Mart offering similar products at cheaper prices
Company Culture
• Team Effort• Employees are valued
– Turnover rates low• Supportive of Employees• Rules are strictly followed, fairly• Great opportunity for advancement• Constantly growing
Strategic Changes
• Recently expanded to Canada• New clothing lines
– Famous designers• Online Shopping
– Delivered right to the customer’s door• Changing their industry
Objectives of Strategies
• Competitive Scope– Multinational
• Strategic Intent– Constantly growing– Trying to provide a higher quality shopping
experience• Market Share Objective
– Opening more stores– Reaching a wider range of customers
Objectives of Strategies Cntd.
• Competitive Position– Maintaining but growing at a manageable pace
• Strategic Posture– Not overly aggressive risk takers, but are taking
some to continue growth• Competitive Strategy
– Separate themselves from other companies in their industry
– They are gaining a good reputation
Age distribution
• Average age of shopper 40• 57% of customers are college graduates
Geographic Distribution
• 1,778 storefronts
Income Distribution
• Average income of shopper is 64k
Managerial Factors
• Corporate Responsibility
• Environmental Assessment
• Growth in new market
Competitive Factors
• Product Strength
• Customer Loyalty
• Company Innovation
Financial Factors
• Return on Equity
• Ability to Compete on Prices
• Market Share
Technical Factors
• Technology Used in Products
• Manufacturing Skills
• Production Effectiveness and Delivery Schedules
Blue Ocean Strategy
• How Target has made a Blue Ocean
• Core Principals
Great by Choice
• 10X Leadership
• 20 Mile March