Wal Mart Is A Competitive Tool For Its Business

One of Walmart’s most recent applications of information technology is the use of radio frequency identification or RFID. These tags can be used for all sorts of applications, but in the retail industry this they are used to track packages or individual products from the factory all the way to the sell. The tag itself emits a small radio signal that a server picks up and uses to identify the tag. These tags are placed on the product or package after assembly at the factory. The RFID servers tells the computers when the product has been shipped out. Warehouses do the same thing to determine then the package is entered and when it leaves for the store. At the store, computers use the tags to make inventory easier for clerks and are usually taken off once the package is sold. In some cases the RFID label is sometimes used to see exactly where the package is in route while shipping, provided they have the proper equipment. Information technology has been instrumental in the success at Walmart throughout its history.

Wal-Mart was once the world’s top retailer that used technology to reinvent global supply chains. However, the world has now caught up with the leader and is forcing stores to focus more on their customers. Wal-Mart is no longer the leader and it now faces a crossroads in the technology field (Wailgum, T. 2007).

In comparison with K-Mart, Wal-Mart has better ability in responding sudden demand and marketplace changes or uncertainties, which supported by their effective distribution strategy and inventory management. Moreover, Hi-tech information technology, such as VMI and REMIX also offer real time information all supply chain participant. (Johnson 2006). However responsiveness and efficiency could not be obtained at the same time. To gain responsiveness, Wal-Mart inventory is raised and the growth of it faster than sales growth which cause increase in the cost. More inventories means higher holding costs.

Wal-Mart Stores Inc. is American multinational retail corporation that operates a chain of discount department stores and a warehouse stores. The company is headquartered in Bentonville, Arkansas and was founded by Sam Walton.

Wal-mart has seen itself become a retail giant over the past decades. They have an enormous amount of control over both consumers and suppliers. Brands literally sacrifice profit margins to have shelf space within their stores. With the addition of grocery brands as well, Wal-mart has positioned itself as a “one-stop” destination for all consumer’s needs. However, there are various internal and external factors that affect the four functions of Management positively or negatively. Organizations need to pay close attention to these factors because it can enhance the company’s success when used appropriately. Currently several factors are top of mind for management. They need to be concerned with in this era are globalization, new technologies, innovation, diversity, and ethics. Wal-mart is a big player in the nation and global market and must stay reactive to these internal and external factors to stay on top. Wal-mart is addressing each of these issues directly.

Wal-Mart is one of the biggest retailer of its time who was known for being the major private sector employer worldwide. It has become an enormous company by identifying the market gap regarding customer services. They have tried to fulfill this gap through their market research of both small and large towns. As quoted in the case study Wal-Mart’s focus was on building up an efficient supply chain management system as it claims “Supply chain management is moving the right items to the right customer at the right time by the most efficient means.”

With the benefit of hindsight, it is apparent that in the knowledge era, creating and leveraging knowledge is the business of business. By all available measures, the stock market is already providing handsome rewards to companies that successfully leverage their knowledge--a phenomenon that will almost surely grow in significance as knowledge-based organizations increase in size and number. A number of firms are anticipating this and looking to knowledge management to enhance, measure, and manage the knowledge of their employees and organizations more effectively.

In the digital era, innovation is the only way to success. Innovation in business means doing something different in a better and smatter way that will make a difference regarding quality, value or productivity by use of technology. Information technology has been the main thing that has been used in propelling the business to the next stage of innovation. Wal-Mart, the world largest retailer, was facing inventory management in all its branches leading to low- sales. From its inception, Wal-Mart has relied on the supply chain in contributing to its success. The company used fewer links in the supply chain as part of its innovation that will enhance its success in 1980. Before 2014, the company had engaged in previous attempts of incorporating technology in its activities since 2003. However, the technology was abandoned in 2009 as it did not solve any problem for the company. However, the same technology was incorporated into the business in 2014 which ensured that there were transparency and efficiency in supply chain leading to enormous success in the company.

Walmart uses a number of bridging techniques in order to advance its position against firms that provide resources. Essentially, these strategies shape dependency relations in an environment by means of – (1) negotiations; (2) selectively exchanging various forms of resources by way of contracts and interlocking directorates; (3) pooling resources with other firms as in - joint ventures and strategic alliances; and (4) merging with other firms, or totally absorbing other entities (Salazar, 2012).

Surprisingly, Wal-Mart Stores Inc. has continued to grow exponentially without any real threat to their business due to their extensive supply chain model and management. Innovation was their special ingredient in disrupting the retail industry by creating more effective and efficient ways of managing their supply chain and inventory. In fact, the most interesting aspect of the strategy was not merely adding, but actually removing associations in the supply chain which in effect, caused numerous advantages for Wal-Mart; less expenses, more simplified system of flow which produces fewer errors from looming.

Wal-Mart is an organization that has been extremely successful in achieving its goals of becoming top retail store in the world. Managers for this organization must plan, organize, lead, and control each component of this organization in order to secure its success. There are factors, internal and external, that can impact these four functions within an organization. Management 's responsibility is to take these factors into consideration to ensure that business will be successful. These factors are its strengths, weaknesses, opportunities, threats (SWOT). (Bateman-Snell, 2009)

The US based Wal-Mart ranked first in the global Fortune 500 list in the financial year 2001-02 earning revenues of $219.81 billion. Wal-Mart is one of the largest retailing companies in the world. The company has grown larger then than its competitors, such as Target, Sears, K-Mart, and many more. Now, Wal-Mart operate more than 3,500 discount stores, Sam’s Clubs and supercenters in the US and more than 1,170 stores in all major countries across the world. So, one has to wonder, how do Wal-Mart’s supply chain works and how is it managed.

The supply chain is a concept resulting from multiple independent entities that affect each other. This paper will discuss about Wal-Mart supply chain it will provide the six component, problems and approaches to solve the problems. Wal-Mart is one of the major retail in the world (Walmart 2011). Wal-Mart is continuously developing its business by developing its services and product portfolio. The supply chain of Wal-Mart is also effective to enhance its effectiveness within the industry (Hoppenstedt & Rathkolb 2005).

Pankaj Ghemawat (2007) introduced the triple A strategy to help better analyze the competitive advantage of a firm outside the home country. As shown in figure 2, the framework focus on the adoption of local responsiveness, aggregation of economies of scale and arbitrage of absolute economies under the globalization of markets. He argued that company must allocate one or more factors as to compete globally. Walmart is achieving the three competitive advantages simultaneously. As discussed above of the Walmart China, the company is taking the local responsiveness as through CSR event. Secondly, Walmart also realized economies of scale by selling bulks of commodities right off pallets, through its

(1A) it’s quite simple how Wal-Mart became a world leader in supply chain management. Wal-Mart’s main focus was to develop cost structures that would allow them to provide low costs friendly everyday prices for all of its customers. They accomplished this by eventually cutting off all middle man distributors. Although this is what ultimately Wal-Mart above the rest of the competition it didn’t work right away in Wal-Mart’s earlier years. Just like any large or small business Wal-Mart went through both its share of trials and tribulations. When Wal-Mart first developed the RFID technology, the company began to greater strides towards become a world