BUS FPX3022 Assessment 3: SCM Case Analysis: Information Technology

Information is a vital input in supply chain management because it is the foundation of all supply chain decisions and processes. Information in the supply chain allows business managers and leaders to plan and coordinate supply chain activities. Information is also critical in strategy formation, supporting the corporate goals of the business. Information, most importantly, allows businesses to understand their consumers and clients while also ensuring that the firm can share pertinent data about the volume of supplies that the company must maintain in its inventory to fulfill customer demands (Hugos, 2018). For retail organizations like Walmart, information is essential in maintaining its retail responsiveness across all segments of its operations. Not only does it help Walmart to ensure that the right product is available at the right time, but it also secures that customers are provided with a satisfying retail experience (Chopra, 2018). 

Walmart’s Information Management System as a Competitive Advantage

Information system, according to Walmart, is a critical aspect of the company’s retail activities including supply chain management. According to the company, “given the number of individual transactions we have each year, it is crucial that we maintain uninterrupted operation of our business-critical information system” (Walmart Inc., 2022, p. 19). Supply chain coordination is made more efficient when firms have a reliable and competitive information management system (IMS) that links all the critical areas of the supply chain (Hugos, 2018). For Walmart, the company’s information system is a competitive advantage because it is made up of different programs linked together that help coordinate the firm’s segments and also enable business managers to monitor business operations, retail transactions – both physical and online, human resource management, facility management, and logistics. Walmart’s My Productivity program is used by supply chain managers from different areas of the business – warehouse, distribution, and retail – that makes it easier for the company to collect retail information (Ibbotson, 2016). Through this, demand levels are easily monitored and inventory levels are also made transparent among managers, thus making retail fulfillment efficient and faster. 

Another physical manifestation of the company’s IMS is seen in Walmart’s warehouse and distribution facilities which are transformed digitally to efficiently respond to consumer demands from Walmart’s eCommerce channels (Guggina, 2022). Because Walmart is committed to positioning its omnichannel retail capabilities to strengthen the company’s position in the market, IMS has helped transformed Walmart fulfillment centers by streamlining inventory management and order fulfillment processes. 

Role of Technology in Walmart’s Transportation and Warehousing Network

Walmart uses information technology (IT) and IMS tools to modernize the warehouse and transportation strategies and methods of the company. First, on transportation, Walmart invests in programs and technologies that aid Walmart’s fleet in creating a transportation system “equipped with an intuitive, interactive tablet device” that streamlines “driver workflow” (Donahue, 2022). This technology is made possible through Walmart’s partnership with Platform Science and this move enhances fleet visibility. This IMS strategy in Walmart’s transportation is aligned with the company’s last-mile goal that targets quick fulfillment for customer satisfaction (Donahue, 2022). Communication between the distribution fleet and retail stores is also improved by Walmart’s Platform Science. This IMS program provides driver location which then leads to store preparedness for supply unloading. IMS applications for warehouse activities can be seen in the Symbotic automation technology that is designed specifically to improve processes of sorting, storing, retrieval, and packing of supplies that will be distributed among Walmart retail stores (Metzger, 2021). This technology is also adopted by Walmart to improve accuracy levels in warehouse activities and freight handling across every single regional distribution facility. 

IMS and Supply Chain Coordination

Supply chain coordination regards the process of linking various entities and different units within an organization which is all concerned with specific supply chain activities and responsibilities (Chopra, 2018). One component of supply chain coordination is the relationship with suppliers or vendors. Among Walmart’s physical stores, the company enhances its data-sharing process with vendors to leverage the just-in-time (JIT) principle in the firm’s supply chain activities. Vendors are provided access to Walmart’s inventory levels through cloud computing technologies embedded in the retail giant’s supply chain management technology (Leonard, 2021). Through JIT, vendors and suppliers are notified when the company’s inventory levels are low, prompting the dispatch of goods to Walmart warehouse facilities (Banker, 2021).

Apart from Walmart’s continuous effort in improving the process of managing supplies from vendors, the company is also aiming to integrate suppliers in their eCommerce retail activities as a way for the business to enhance customers’ shopping experience. To do this, Walmart’s Platform Partner program is created and deployed to provide eCommerce suppliers and vendors accessibility to customer demand information so that they can devise the appropriate marketing and advertising initiatives, campaigns, and promotions (Lehrfeld, 2022). This strategy grants suppliers and vendors direct access to customer demand data which is necessary in knowing consumer segments and strategies for specific niches and groups. 

The success of the company’s omnichannel retail activities is made possible and enhanced by Walmart’s IT programs and IMS capabilities that are deeply embedded in the firm’s inventory management strategies. When the company decided to further its eCommerce activities, it has become crucial for Walmart to ensure that its warehouse hubs and distribution facilities are coordinated with the retail stores to create a highly responsive fulfillment capability for in-store and online purchases (Ibbotson, 2016). IMS tools and programs make it possible for Walmart to fulfill eCommerce orders in the most accurate and fastest way possible by decentralizing customer information. Through this, customer orders are fulfilled by the facility that has the item ordered in proximity to the delivery address of the customer. This strategy leads to customer satisfaction by reducing lead and lag times (Hugos, 2018).

Another area of supply chain coordination is internal alignment among the individual units that fulfill unique supply chain functions (Chopra, 2018). Walmart depends on various IT tools and programs in maintaining operational coordination among its warehouse facilities, regional distribution hubs, and retail stores (Blanchard, 2010). One of the most important benefits that Walmart achieves from its IT and IMS investments is the creation of precise supply chain coordination characterized by dynamic supplier and vendor relationships on the upstream side of the supply chain and responsive and transparent fulfillment on the downstream side of the supply chain (Hugos, 2018). 

IMS for Order Monitoring and Inventory Management

Purchasing orders (supplies) and inventory management are product-centric activities in the supply chain. As a retailer, Walmart contracts with a multitude of manufacturers who furnish a large array of goods and merchandise sold among Walmart stores. Monitoring orders and managing inventory can be a great challenge for large retail firms like Walmart, thus requiring the firm to have a system that efficiently generates accurate information concerning inventory levels at a given time (Chopra, 2018). Automated warehouse systems aided by a myriad of devices such as RFIDs, barcodes, and robotics are all deployed by the company across its warehouse facilities to assist in accurate inventory-level data collection (Kay, 2022). RFIDs are highly useful tools for product movement monitoring and inventory management because it helps the organization to track which products have been received, stocked, retrieved, and dispatched from the warehouse facility (Blanchard, 2010). Along with modern warehouse technologies, RFIDs are proven vital in Walmart’s product and inventory management among its warehouses and retail stores. 

Conclusion: Significance of Information Management

Information management helps Walmart in leveraging its IT capabilities for improved supply chain management practices and strategies. Information management is a competitive advantage of any company that aims to transform the business into a customer-centric environment (Chopra, 2018). With the use of modern technologies, the process of collecting valuable information from various areas of the supply chain becomes easier, more efficient, and more reliable. Information management also allows managers to coordinate strategies that ensure the alignment of operational goals for the realization of the business’s strategic targets. Managing information is more important than the movement of goods and products because it is the foundation of all supply chain activities and decisions (Alicke et al., 2022). 

Information technology has long been part of Walmart’s supply chain activities. Information management system aids Walmart to improve its warehouse strategies and activities which are closely intertwined with distribution and inventory management (Hugos, 2018). When every function of the supply chain is smoothly coordinated, the timely dispatch of goods among Walmart stores is maintained and supply levels can be secured. Consumer needs are always fulfilled. Waiting times for online orders can also be fulfilled according to what the company promised its consumers. Therefore it can be summarized that without an effective and competitive method or structure of managing supply chain information, Walmart will not become a global retail leader. Given the size of Walmart’s retail operations, the strategical management of business and supply chain information has supported the company’s critical supply chain activities including demand forecasting, inventory management, and distribution schedules. 

References

Alicke, N., Dumitrescu, E. & Protopappa-Sieke, M. (2022, Mar 18). Transforming supply chains: Do you have the skills to accelerate your capabilities? McKinsey & Company. https://www.mckinsey.com/capabilities/operations/our-insights/transforming-supply-chains-do-you-have-the-skills-to-accelerate-your-capabilities 

Banker, S. (2021, Apr 23). Walmart’s Massive Investment in A Supply Chain Transformation. Forbes. https://www.forbes.com/sites/stevebanker/2021/04/23/walmarts-massive-investment-in-a-supply-chain-transformation/ 

Blanchard, D. (2010). Supply chain management best practices: Best practices. John Wiley & Sons, Incorporated. ProQuest eBook Central

Chopra, S. (2018). Supply Chain Management: Strategy, Planning, and Operation (7th Edition). Pearson Education (US). https://capella.vitalsource.com/books/9780134732459 

Donahue, S. (2022, Jun 20). Walmart Uses Innovative Onboard Technology To Go the Extra Mile for Drivers. Walmart Newsroom. https://corporate.walmart.com/newsroom/2022/06/20/walmart-uses-innovative-onboard-technology-to-go-the-extra-mile-for-drivers 

Guggina, D. (2022, Jun 3). A New Era of Fulfillment: Introducing Walmart’s Next Generation Fulfillment Centers. Walmart Newsroom. https://corporate.walmart.com/newsroom/2022/06/03/a-new-era-of-fulfillment-introducing-walmarts-next-generation-fulfillment-centers 

Hugos, M. H. (2018). Essentials of supply chain management. John Wiley & Sons, Incorporated. ProQuest eBook Central

Ibbotson, M. (2016, Jun 2). How Real-Time Data is Putting Success at Our Fingertips. Walmart Newsroom. https://corporate.walmart.com/newsroom/innovation/20160602/how-real-time-data-is-putting-success-at-our-fingertips 

Kay, M. (2022, Feb 9). Walmart To Use RFID To Improve ‘Store Level’ Inventory Accuracy In Home Goods, Consumer Electronics. Forbes. https://www.forbes.com/sites/marshallkay/2022/02/09/walmart-to-use-rfid-to-improve-store-level-inventory-accuracy-in-home-goods-consumer-electronics/?sh=12cf7a0e5540 

Lehrfeld, R. (2022, Mar 30). Walmart Connect: Building Meaningful Shopping Experiences Between Suppliers & Our Customers. Walmart Newsroom. https://corporate.walmart.com/newsroom/2022/03/30/walmart-connect-building-meaningful-shopping-experiences-between-suppliers-our-customers 

Leonard, M. (2021, Jun 18). Patent Pending: Walmart’s idea for just-in-time, FourKites’ plan for predictive visibility. Supply Chain Dive. https://www.supplychaindive.com/news/patent-walmart-fourkites-just-in-time-inventory-visibility-technology-data/602031/ 

Metzger, J. (2021, Jul 14). Chain Reaction: We’re Partnering with Symbotic to Bring High-Tech Automation to Our Supply Chain. Walmart Newsroom. https://corporate.walmart.com/newsroom/2021/07/14/chain-reaction-were-partnering-with-symbotic-to-bring-high-tech-automation-to-our-supply-chain Walmart Inc. (2022, Jan 31). Form 10-K. https://d18rn0p25nwr6d.cloudfront.net/CIK-0000104169/c68fb8be-2602-4f2a-aee0-261b4f04b970.pdf