Target Analysis Group 3. Organizational Life Cycle Target has followed the typical organizational life cycle First actual store opened in 1962 in Minnesota.

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

Target vs. Competition

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