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Walmart Using Information Systems to be Market Leader

- Bidisha Sarma
Manas Ranjan Tripathy
Unni Krishnan S

Walmart- Overview
Founded by Sam Walton
Started business in 1945
Walmart Store started in 1962
HQ at Bentonville, Arkansas
Largest Retailer in the World (Forbes)
Vision:
To provide quality products at an everyday low price
and with extended Customer servicealways

Walmart- Overview
Stores- 11000+
Customers- 245 Million
Presence- 27 Countries
Revenue- $473 Billion
Employees- 2.2 Million

Walmart's Key to Success


Offer Products at Lowest Prices using Information Systems to
Reduce Costs
Offer Optimal Customer Experience

Walmarts Use of Info. Systems


Advanced Product Tagging and Identification
Revolutionary Supply Chain Management System
Data Collection And Analysis using own Satellite Network
Walmart.com

Timeline
1972-Programs and Control Systems implemented for Accounts, Data Processing
and Management Systems
1973-System Updated for Complete Vendor System
1974-Inventory Control using IBM Systems
1977-Company-wide Network integrating different stores of the company for
data transfer was started
-Cross Docking System started for Unloading Trucks
-System for Payroll Recording
1978-Marking of items for Identification and Inspection started
1981-New Purchase Order System and Point of Sales Scanning System started
1983-Uniform Barcode System implemented for Scanning

Timeline
1984- Merchandise Management System assisted by Texlon
1984-87-Satellite Network for receiving and sending data from all stores
simultaneously
1987-Universal Barcode System implemented for Inventory Control and Distribution
System
1988-EDI Deployment
1990-93-Data Warehouse System and Retail Link System Implemented($2 Billion in
1990 and $2.8 Billion invested in 1993)
1996-Retail Link and EDI made available through Internet
2004-One Hour Digital Photo Online Service Launched
-RFID System Deployed

Product Tagging and Identification


Barcode (Old):
First to use of Barcodes for Tagging Products
Helped in Faster Billing
Reduced Labor costs needed for Manual Tagging
Improved Inventory Management
RFID Tags (New):
Radio Frequency Identification is the wireless use of electronic identification to transfer data
Easier to use and more storage capacity
Does not need direct line of sight to work
Helps track inventory without need for manual scanning
Optimal Inventory Management

Supply Chain Management


Retail Link
A Network which helps suppliers in-Keeping Track of Inventory Requirements
-Checking and issuing quotations
Based on these quotations Walmart issues order
using EDI (Electronic Data Interchange)
GPS
GPS helps keep track of shipment

Supply Chain Management


Hub Spoke Architecture (Effectively implemented using IS)
Goods are ordered directly from Suppliers through Retail Link
Stored at a massive warehouse, i.e., distribution center (hub).
Goods are dispatched to the individual stores (spoke).
Cross Docking is used to reduce storing requirements (Goods are directly
transferred from inbound truck to outbound truck)

Supply Chain Management


VOF(Voice based Order Filling)
System guides employees using voice commands
System eliminates mispicks and labelling costs
POS(Point of Sale)
Improve pricing accuracy by integrating bar-code
scanners and credit card authorization ability
RFID and Bar Codes help keep track of items sold
Manage inventory by automatically updating
inventory status
Data is directly sent to HQ through satellite system

Data Collection and Analysis


Satellite System
Helps in keeping track of Sales at all stores
Helps in Inventory Management
Helps in taking decisions based on Sales Figures

Data Collection and Analysis


MPP (Massively Parallel Processing)
Used to track movement of goods and stock levels
Used to analyze Sales Data and create Forecasts
CPFR(Collaborative Planning, Forecasting and Replenishment)
Walmart collaborated with key suppliers in real time to forecast product wise
demand
System reduces inventory costs and helps ensure availability of products

Walmart.com
Walmarts own dedicated e-commerce site having a wide range of
products

Walmart.com
Core Services:
Purchasing Items Online
Enabling Services:
Servers
Internet
Banking Servers
Enhancing Services
Comparison of products
Tracking Facility
Cash on Delivery

Conclusions
Using IS Walmart has been able to
Reduce Manpower Requirements
Save Time
Build a Strong Base of Suppliers linked by Retail Link
Achieve Rapid Replenishment of Inventory
Guarantee Lowest Prices
Use only 10% of floor space as Inventory area, compared to 25% average for the
industry
Lower distribution costs compared to competitors
As long as Walmart keeps using IS effectively it should be able to retain its title as,
The Worlds Largest Retailer

References
http://www.thefreelibrary.com/Economies+of+IT+systems+at+Wal-Mart--an+histor
ical+perspective.a0166778592
Walmart Stores, Inc. Getting Started with EDI Implementation Guideline
Document version: 1.0, Published November 2011
http://www.forbes.com/sites/paularosenblum/2014/05/22/walmart-could-solve-itsinventory-problem-and-improve-earnings
/
http://jimmyalyea.blogspot.in/2012/02/analyzing-wal-marts-distribution-and.html
http://walmartprojectis.blogspot.in
http://www.usanfranonline.com/resources/supply-chain-management/walmart-keys
-to-successful-supply-chain-management/#.
VDzEOPmUcYE
http://www.forbes.com/