Case Study (one question : Walmart How IT and IS may be used to help the company

Question

Case Study (one question : Walmart

How IT and IS may be used to help the company operate and achieve its objectives.

Walmart

With the advent of science and technology, technological innovations have become a pre-requisite to achieve operational and strategic excellence. Organizations by using state-of-the-art systems, are striving for their best to achieve sustainable and long-term competitive advantage. It has become sine qua non to use modern tools for the effective achievement of goals and objectives. Its importance can also be observed from the increased spending on Research & Development in order to pace up with the todays dynamic business environment.

Wal-Mart, founded by Sam Walton in 1962, is the world's largest retailer that employs about 2.1 million associates worldwide, in more than 8,400 stores, including 8, discount stores, 3,100 combination discount and grocery stores. Wal-Mart is serving its customers and members more than 200 million times per week at more than 8,613 retail units under 55 different banners in 15 countries. Wal-Mart has ranked first among retailers in Fortune Magazine's 2010 Most Admired Companies survey with fiscal year 2010 sales of $405 billion. Sam Walton's belief was to build an empire by providing value to its customers and empowering employees, also known as associates. The way the Wal-Mart operates is so fascinating and impressive that Jack Welch, CEO of General Electric once said: "Many of our management teams spent time there observing the speed, the bias for action, the utter customer fixation that drives Wal-Mart."

The use of high-tech Information technology has always been an essential ingredient for Wal-Mart's growth. Since its inception, it has used the IT systems well enough for the Inventory, administrative, customers and suppliers management.

Wal-Mart's investment in technology started with the computerized accounting systems and since then the continuous adoption of latest technologies has made Wal-Mart a market leader in the whole retail industry.

Wal-Mart developed a well-equipped computerized Point of Sale (POS) system capable of identifying each unit sold, creation of accurate sales receipt and storing all the information item-by-item for sales analysis and inventory reordering purposes. It helped company to avoid overstocking of merchandize through effective information usage and also assisted them in investing in only those merchandize that were profitable. It has also helped them figure out best selling products and prospective products that customers want. Analysts say that it is Wal-Mart's Point of Sale system that has helped them achieve the world's largest market share and revenues in retail industry.

Wal-Mart, in 2004, was the first in retail industry to adopt electronic radio frequency identification (RFID) tags for inventory distribution management. RFID technology, which is still being used, helps them keep track of inventory movement across its supply chain. Wal-Mart was trailing K-Mart in 1980's but with the adoption of latest technologies, it has now become the trend setter in retail industry all over the world.

Wal-Mart is currently working on a project to make best out of wireless technology. In near future, they have plans to develop a remote system that would allow customers to just walk into their store and use their own devices (Phones or PDA's) to get whatever they want. i.e. they might go online to their website, while at the store, and find things for themselves or just compare the products' prices etc.

Customer service, best shopping environment and experience, one-stop shopping, best value products, customer convenience of online shopping, good customer relations are the blessings that Wal-Mart provides using cutting-edge technology. Latest wireless system at their stores, online web-retailing, vast width and hierarchy of product items, and stores at multiple remote sites are the benefits customers of Wal-Mart cherish.

Wal-Mart is considered to be a trend setter in retail industry and it's all due to its inclination towards achieving impossible through modern technology. For example, Wal-Mart once tried to develop three experimental stores in McKinney, Aurora and Las Vegas that were equipped with latest technologies or concepts like wind turbines, photovoltaic solar panels, bio-fuel-capable boilers and water-cooled refrigerators. Irrespective of the criticism it had on environmental issues, Wal-Mart's initiative was considered to be a positive step towards change and innovation and it provided them with an opportunity to become the biggest seller of organic milk and the biggest buyer of organic cotton in the world, as well as reducing packaging and energy costs. It has been quoted in 2006's annual report of Wal-Mart that in order to compete against upscale and appealing store, such as 'Target', they have launched a new Supercenter concept in Plano, Texas. The new store had wood floors, wider aisles, a sushi bar, a coffee shop with free Wi-Fi Internet access, and more expensive beers, wines and other electronics goods.

By using advance forecasting techniques and integrating different technologies, Wal-Mart is planning to deploy simulation software that would help them simulate business events that are yet to happen.

Wal-Mart has got a strategic plan of introducing a concept of self-service. Self-service technology, aimed at eliminating paper and paper forms, will be provided to their associates, prospective associates, customers and members. It was said by Kevin Turner, CEO of Wal-Mart's subsidiary corporation, in his interview with 'CIO' personnel that "having an associate portal and devices on our sales floors will let customers and members get product information, and let us do computer-assisted selling".

For evaluating new technologies, they are always plugged into research and development labs of their key suppliers like Cisco, IBM, NCR, AT&T or HP in order to get current with latest technologies and drive the future for themselves.

Wal-Mart has been outstanding in its investments in Information technology from all prospects. IT systems at Wal-Mart allow them to reduce transactional as well as operational costs at their distribution centers and it has also helped them to support Wal-Mart's long-term strategy of owning the distribution centers and maintaining long-term relationships with their suppliers. Also, improvement in productivity due to IT systems is dramatic at Wal-Mart. It has helped them offer products at such a nominal cost that a small town merchant is unable to provide and this is remarkable achievement of Wal-Mart. It has become a sustainable competitive advantage for them over their competitors and a reason of their growth and profitability. We are aware of a fact that every benefit is accompanied with some problem but Wal-Mart has successfully defied its weaknesses and have used its strength well to take advantage from the prospective opportunities and avoiding possible threats.

Explanation / Answer

The finest example for existing business communication model is Walmart.
Walmarts communication model includes communicating with stakeholders on the issue of reduced sales from E-Commerce depart as well as improving The E-Commerce service inside the organisation by taking the communication as a serious task.

Walmart is a retail giant in the industry operating across the seas and creating a big furtune out of it. Its the worlds largest and the most influencing retailer.

Some terms that followed to build its empire are as follows.

Efficient Supply Chain
?Walmart's supply chain is one of the world's most efficient supply chain, Walmart uses very less break in between from the warehouse to their store reducing the costs and enhancing the overall profit.
By having an effective supply chain Walmart has successfully developed it advantage over its competitors and in providing different materials to the different places at a very standard time.
Sometimes it would be less than official for the company to have a supply chain dependent organisation because the whole system is depending on the supply chain if a part breaks down then there is a little delay in doing the business.

Strategic partnership
?Strategic partnership is one of main reasons of Walmart's success , Walmart find the best price supplier and ask them if they can fullfil the demand then a long term partnership program is offer which reduces the prices.
Strategic partnerships also provides a solid base walmart. By having different strategic partnerships Walmart at successfully integrated itself into market and merge into the competitors as well.
Sometimes is strategic partnerships also create a problem for the organisation as the partners start to show different characteristics rather than implementing the strategies with the Walmart.

Intuitive inventory storage
?Walmart uses very intuitive way of storing the inventory, It keep its inventory in truck and then later the inventory is loaded to the semi truck without moving them to the warehouse , this broadly increases the efficiency of the transportation and time.
Dependency on the too much Technology and totally depending on the intuitive storage system sometimes leads to failure as they can be technological as well as mechanical error.

Using latest technology
?Walmart uses state of the art sorting and transporting technologies to ensure the required quality and speed it requires and to obtain high profits and and super efficient system.
Technology based environment is always in fear of getting hacked, being misused and being operated by some other person rather than the companies official employees. Depending on too much Technology Kelly Walmart failure in terms of the technological errors.

Walmart used the terms listed above to build an environment for the low cost industry. It focused on the largest group of middle class people and the idea was to provide low cost product with great quality. Walmart provided the best supply and management system which cut down the costs thus customers were getting the products in best price with higher quality.

Walmart's strategy kept evolving according to the time and needsthus Walmart's low cost strategy is very well suited for the industry.

Improving the Walmart current situation in Walmart has to apply their strategies to the different part of the world. Walmart should focus on the developing countries like India and China as well as smaller developing countries like Bangladesh. Buy directly focusing on these countries Walmart can widely increase the level of sales as well as can be easily getting resources at a better price in these a specific locations. As Bangladesh is considered as manufacturing hub for many of the international brands , walmart and easily upgrade themselves and implement these strategies to overcome the specific problem of increased budget for the specific location. As the labour charges are also very low in the developing countries, walmart in widely increase their effectiveness in terms of the retail marketing.

By keeping an eye on the overall sales as well as the human resource information system, walmart can widely increase their efficiency as well as productivity towards the specific region in which they are doing business. Measurement of the inventory as well as Rises of the customer regarding the product types and also be very beneficial for the organisation to keep a record of the performance for Walmart. This understanding of the situation would definitely increase the level of productivity of the organisation. High number of measurement techniques should be used to frequently measure and regulate the data as well as its progress for advancing Walmart in to the society . By using different metrics for Quality Management Walmart can widely increase the level of service provision to the customer.

Implementation of digital platforms is very essential for walmart to improve their overall level of effectiveness over the internet and other digital mediums. By creating specific strategy for implementation of the better marketing aspect on the Digital Network and widely increased companies reach to the customers. By increasing the reach the customer company can easily grow in different markets as well as it can easily go Global as well.

By using above strategies Walmart in easily increase the level of implementation as well as advancement in the society. Strategy for definitely help Walmart to maintain and advantage over its competitors and to provide better service and get larger revenues from the market.

Company has implemented multiple database management systems for better communication inside your organisation for provision of inter connectivity in different departments. My connecting the different department communicate information flows from one department to another department in a horizontal way and provides efficient support as well as feedback.
Sudden changes in the supply chain as well as requirement of inventory is also done by the business communication from the bottom most store of Walmart to the top most authorities. By having a communication channel in different departments of the company Walmart has successfully manage to integrate itself into the organisational structure.
By implementation of HRIS walmart has successfully built a new system for efficiently communicating within the human resource information. This is specific system has increased the capability of Walmart to communicate with their overall employees and human resources inside the organisation to create a better working environment. By promoting you open communication between stakeholders and employees of the organisation Walmart has successfully managed to interconnect the department and provide better fluency of communication between two channels of the organisation. By arranging the sender, mediator, receiver system into the organisation Walmart has successfully manage to implement a new system which is totally based on electronics to provide send message to the receiver and take the feedback or an instant time.

Walmart supply chain is one of the finest examples of implementation of communication model. Walmart supply chain uses a digital communication structure from bottom to up. Sending out information from their inventory to the stores and stores to the inventory Walmart successfully manages the overall number of product in their inventory system. Buy automatic be communicated process from their inventory to the suppliers as well as getting supplies Walmart has successfully managing the overall process of communication inside the organisation.

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