Pros And Cons Of Best Buy

According to Peter McManners (2016), corporate strategy provides direction and coordination to allow all parts of the corporation to work towards shared aims and objectives. Corporate strategies should be monitored periodically to ensure that an organization progresses to achieve the objectives and goals of the organization. Also, functional strategies are organizational plans that are used in conjunctions with corporate’s business strategies in marketing, research and development and human resources to guarantee success with the changes of external and internal factors. With intention of sustainment during different stages, Best Buy restructured to cut cost to accommodate changes to meet the needs of internal and external factors in 2012.

Business uses three types of stability strategies: no-change, profit, and pause/proceed-with-caution. No-change business will decide to do nothing and continue with current strategy because of low threats, opportunities, strengths and weaknesses. Profit is where profits are low and the business takes measure such as cutting costs, lay-offs, and raise prices temporally which Best Buy did in 2012. As stated by Hautala (2012), Best Buy Inc. laid off 600 Geek Squad employees and 1,800 store workers as a new strategy after Best Buy fell 15 cents, or 0.7%. The pros for this approach is good only if temporary and con is it can worsen the company’s position in the market. Best Buy did not use the pause/proceed-with-caution which is when business pause to test before moving ahead in expansion until conditions changes in the environment which is temporary because of their shares that dropped as a result of their lay-off and closing of stores they proceeded with the retrenchment strategy. Retrenchment strategies are the reduction of size and personnel through: turnaround, sell-out/divestment, bankruptcy, and liquidation which is the approach that Best Buy chose to increase

Internally, Best Buy were able to improve their customer service through their Reward Zone Silver loyalty program now called My Best Buy; however, they lost money and had to close 50 stores to improve their performance and laid office senior managers. Their long-term goal was to open Best Buy Mobile stores to improve profits and to become more competitive with this approach. Thus far, they have managed to make a profit over the years. Externally, Best Buy under their restructure are faced with external factors such as technology, competition, and demographics. Once they downsized and open mobile stores and strategically placed them demographically, they were able to meet the competition of areas where store like Radio Shack had left. However, the cons side is they are still faced with online buying from other