Grand Strategy Matrix for Barnes & Noble

The Action Compass
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The Action Compass
The convenience of new technology has rendered companies that traditionally operated brick and mortar outlets into struggles. Purchasing trends are leaning heavily towards e-commerce. Companies are beginning to make their online presence as sound as possible to limit the physical access that customers are avoiding. Book sales are among the most affected industries, going by the present trends. A company such as Amazon keeps employing its e-commerce efficiency to limit the viability of brick and mortar outlets such as Barnes & Noble Booksellers. Business insiders must ask the strategic changes that an entity such as Barnes & Noble, which is mildly oriented on e-commerce, can overturn trends. This paper analyses the Barnes & Noble case as presented in the publication “Barnes & Noble, Inc.: Maintaining a competitive edge in an ever-changing industry” by Hall and Gupta (2010). The case is employed to develop grand strategies using the company's BCG and the great strategy (GSM) matrix analyses and to define the changes that Barnes & Noble could make to turn around its competitive struggles. The case highlights the need for a revised strategic path with product development and market penetration remaining the primary grand strategies for Barnes & Noble to pursue in the wake of increased competition, dwindling core business in book sales, and growth in e-commerce.
Case Summary
Barnes & Noble is among the oldest bookselling outlets poised to be eliminated following industry changes. Starting in 1917, the company has operated extensively in the US market, leading the market share until comprehensive e-commerce strategies. As an organization that prides itself on book sales, its core business must be kept active and beyond the reach of competition. Barnes & Noble, however, finds it challenging to manage that fete with more negative trends emerging in the industry. Primary among the negative trends in the changing preferences of the readers. People are not reading books as much as they did before the advent of the internet. The case indicates a decrease in publishers’ net dollar sales from 3.4% in 2009 to 2.9% in 2010. The decline implies reductions in the profitability indices for Barnes & Noble. The other challenge that Barnes & Noble is facing is competition. In book sales, companies understand the swiftness by which markets change. To Barnes & Noble, the advancements in technology have limited their growth as sales in e-commerce expand. In 2008, 41% of product sales online were for books. While it is performing mildly, Barnes & Noble is still the second bookseller in online outlets. The company is offering to expand its operations through audio, Wi-Fi, and membership services.
Grand Strategy Matrix
A grand strategy matrix is a tool for formulating feasible strategies for organizations that intend to revive their competitiveness. Corporations can develop new techniques to steer their competitive advantage using the GSM. The GSM matrix bears four quadrants, each showcasing some of the most attractive or least attractive strategic options that Barnes & Noble could take t...