WAL-MART. COM: A Case Study in Managing Technical Transitions Managing Technical Transitions Prof. Michael Lawless February 24, 2001 Prepared by: Andrew Bender Ann Howell Amy Lavin David TorgersonFounded in 1962 by Sam Walton, Wal-Mart followed an amazing pattern of success and growth, eclipsing all other U. S. department store retailers by the early 1990’s. In early spring 2001, Wal-Mart enjoyed a huge market capitalization of over $230 B, which was down from highs of nearly $300 B in early 2000.
Over the last year, however, Wal-Mart had suffered a number of failures in its Internet-based operations, as it tried feverishly, along with many other traditionally “bricks-and-mortar” companies, to make a transition to the Internet. As much of the commotion in the markets relative to the Internet subsided due to a slowing economy and a number of high-profile “dot-com” failures, Wal-Mart continued to experiment with it’s Internet presence and corporate strategy. In this paper, we discuss Wal-Mart and its technical transition to the Internet. First, we examine the company from a value chain and core competency perspective, to gain insight on what value the company brings to the table, both in its traditional and Internet operations. We give a synopsis of Wal-Mart’s recent and current online philosophies, and then turn to Wal-Mart’s strategy as it relates to the transition. Finally, we provide an analysis of Wal-Mart’s prospects and recommendations for the future.
The Essay on Unfair Business Ethics for the Employees of Wal-Mart
Wal-Mart is a superstore that has facilities all over the world. Wal-Mart is known as the friendly neighbor superstore. But until recently Wal-Mart has found it's self not so friendly and is battling in unfair labor practices.An employee working for the Wal-Mart in New York has accused the world's top retailer of unfair labor practices. The suit, which seeks class action status, was filed in a New ...
Sources of Value Wal-Mart had always invested heavily in infrastructure. They were among the first to use point-of-sale Uniform Product Codes (UPC) scanning, and intra-store radio frequency (RF) transmission of product UPC and pricing information between central store inventory systems and personnel with scanners on the store shelves. However, their most valuable infrastructure investments were made at a significantly higher level. A satellite system connecting all stores was initially installed in 1983, and grew into a complex communication network that included all stores, headquarters, and distribution centers, as well suppliers. This system facilitated a modified just-in-time process of inventory control, a feat virtually unheard of in general merchandise retailing.
Put simply, as each store sells an item, a message is automatically sent to the supplier of that item, who then knows to include a replacement in the next shipment (usually that day) to the nearest distribution hub. This degree of connectivity allows rapid response to inventory needs, and reduces dramatically the amount of inventory required. A second area of major investment was in distribution technology. Wal-Mart established a network of innovative hubs which used “cross-docking” to minimize distribution center inventory and to facilitate the need-based inventory delivery system enabled by the satellite network. In this model, as shipments arrive at the warehouse, merchandise is moved directly to the trucks carrying the outbound shipments to specific.
