Wal-MartInformationTechnology Strategic Plan
Descriptionof the company
Wal-Martis the largest retailer in the United States and the world. Over thedecades, the company has evolved into the largest discountdepartmental store in the United States. The main aim and focus ofthe organization, is to make a difference in its customers’ livesby helping them “save money and live better”. The company wasincorporated in 1969 and become a public company in 1972 when itsshares started trading in the New York Stock Exchange. By late 1970s,the retailer had opened 276 stores in major cities in eleven states.In the 1980s, Wal-Mart adopted a new business strategy where itstarted general merchandise and supermarket in its stores. In the1990s, it became the largest retailer in the United States. In thelast two decades, Wal-Mart has focused on improving customer shoppingexperience by adopting emerging revolutionary technologies (Roberts &Berg, 2013). Wal-Mart was rated the world largest company in 2013 byFortune Global 500. The company has over ten thousand stores intwenty seven countries around the world serving over two hundredmillion customers every week. Additionally, the retailer employs over2.2 million people directly in different parts of the world. In 2013,Wal-Mart net sales were 274.5 billion dollars, where internationalsales contributed almost a half of the newt sales. However, Wal-Martoperations and profitability are faced by intense competition fromboth large scale and small scale retailers. Although at infancystages, Wal-Mart has ventured into the online and mobile applicationsmarket with an aim of enhancing customer experience and meetingemerging needs of their customers (Massengill, 2014).
Currentsituation of the company
Electronicradio frequency is one of the most influential technologies in theretail industry. The technology is used to track the movement ofunits in the supply chain. Wal-Mart was the first retailer to use thetechnology in 2004. The financial power of the retailer enables it toaccess the recent technologies which many retailers are not able toafford. In the late 1980s and early 1990s, Wal-Mart was performingrelatively poorly compared to other retailers such as K-Mart.However, due to the role of revolutionary technologies such as theelectronic radio frequency identification and point of sale system,the company became a trend setter in the 21stcentury retail market. In the last few years, Wal-Mart has investedheavily in modernizing its information systems. Enhancing customerservice in the increasingly competitive market has motivated thismodernization (Reynolds, 2015).
However,there are some technology challenges that face or are likely to faceWal-Mart. Modern technologies such as internet and mobile phoneseliminate space and time barrier in the business environment. In themodern business environment, the location of the retail store is nolonger a strategic issue or a disadvantage. In the past, where aretail store was located relative to the flow of customers had adirect influence on the success of the retailer. Therefore, Wal-Martand other retailers were very concerned with where they locate theirretail outlets. In the digital age, Wal-Mart need to refocus itsbusiness and adopt technologies that is market based rather thanlocation based. For example, online shopping is replacing thetraditional shopping model in which Wal-Mart are depended on. Thiswould require technologies that change the method of selling adoptedby the retailer. Online shopping increases customer convenienceallowing them to safe time. However, this will lead to radicalchanges in the operations of the retailer. On the other hand, it willenable Wal-Mart compete more favorably with other online retailers,such as Amazon, who are diversifying the commodities they offer tomeet emerging market demands. However, the organizational inertia ofthe mega retailer is a major challenge to creating an online Wal-Martmarket place. Additionally, Wal-Mart is not very visible in theonline social media. Increased visibility in the online social mediaand mobile phone applications will transform Wal-Mart into ahigh-tech retailer, which is able to capture the emerging onlinemarket (Roberts & Berg, 2013).
Anotherarea of Wal-Mart operations that emerging technology may have apositive impact is human resources management. Due to its massivesize, managing the human resources at Wal-Mart is not an easy task.However, emerging technologies can effectively handle some of thehuman resources challenges facing Wal-Mart. In the modern businessenvironment, employee recruitment and selection has become relativelyeasy due to technology. This will increase the pool of potentialemployees available for Wal-Mart. Some of these technologies willreplace some of the employees in the organization. In the long run,technology will significantly reduce the operating cost at Wal-Mart.Reduced operation costs will enable the company offer competitiveprices (Roberts & Berg, 2013).
Almostall Wal-Mart personnel and contracted personnel will have a role toplay in the implementation of the strategic plan. This is because itaffects all aspects of Wal-Mart operations. The most important roleis the role of the executive. The executive includes the chairman,Greg Penner, and president and chief executive officer Doug McMillon(Massengill, 2014). The executive has to endorse the strategic plan. The executive has the overall responsibility. Another role that has asignificant impact on the implementation of the strategic plan is themanagers. Managers include head of departments and store managers.These managers are responsible for the implementation of thestrategic plan in their departments or the over ten thousand storesaround the world. The users of the specific technologies will alsohave a direct impact on its implementation. For example,implementation of point of sale technology will require the input ofthe point of sale employee. A critical role in any information andcommunication system is the role of IT support. Informationtechnology experts have a huge role in the implementation andmanagement of an information system. However, Wal-Mart may decide tohire an information technology consultant firm to implement thestrategic plan. Thus, the role of external providers will beessential in the implementation process.
Sizeof its operations is the most significant strength at Wal-Mart.Wal-Mart is the largest retailer in the world. Its unmatchedeconomies of scale and influence on the market put Wal-Mart above itscompetitors and suppliers. Additionally, it is one of the largestprivate employers in the world, employing over two millionindividuals. Wal-Mart annual revenues are more than the revenues ofmore than four of its closest competitors in the world. Additionally,it is among the most valuable brands in the world. The size ofWal-Mart is associated with economies of scale, increased efficiencyin the use of resources, reduced business risks and enhanced power inthe market. Additionally, the economies of scale allow Wal-Mart toaccess the most advanced information and communication technologies(Matusitz & Reyers, 2010).
Despitethe economies of scale enjoyed by Wal-Mart, it has several internalweaknesses that are a constant threat to its market dominance. Due toits focus on mass sales and assisting their clients to save, theprofits margins at Wal-Mart are relatively thin. The huge Wal-Martrevenues are therefore dependent on sale volume. Additionally, thebusiness model of Wal-Mart is easy to copy and has been replicatedworldwide (Matusitz & Reyers, 2010).
Wal-Marthas several external opportunities and threats. Venturing into newand emerging markets present numerous opportunities. This includesgeographical and online expansion. Another important opportunity inthe operations of Wal-Mart is improving its human resourcespractices. Due to the size of Wal-Mart workforce, there are severalstaffing problems. Dealing with these challenges can have a hugeimpact on the future prospects of the company. The use of technologycan effectively deal with some of these challenges. Improving thequality standards is also an important opportunities. Better qualitystandards will translate into better abilities of Wal-Mart to meetthe needs and interests of the stakeholders. Wal-Mart is also facedwith some threats in the external environment. Wal-Mart operationsare affected by changes in market conditions and consumers behaviors.Therefore, the biggest threats facing Wal-Mart are intensecompetition and changes in lifestyles. These threats are directlyrelated to technology. For example, Wal-Mart is faced by intensecompetition by online sellers and marketers. Changing in lifestyles,especially the role of internet and technology in influence consumerbehaviors is an important threat to Wal-Mart operations. However, thechanges in lifestyle present an opportunity in venturing intoemerging markets (Hicks et al, 2012).
Informationtechnology strategic plan
Thefirst goal of the information strategic plan would be improvinginformation technology governance and IT management processes (Iyamu,2015). Wal-Mart has a robust information and communication technologysystem. However, an improvement in the governance of IT systems andfacilities will have a positive impact on the company’s operations.This outcome of these objectives will be improvement in servicesdelivery, ensure continuous evaluation, revitalizing the informationand communication technologies to enable Wal-Mart venture intoemerging markets and building capacities at different levels.Improving it governance will also introduce process based andstandard based operations as well as form the basis fororganizational culture change (Pham, 2014).
Thesecond objective of the information technology strategic plan is toimprove accountability, openness and transparency in the managementof Wal-Mart resources and business processes. This will includeensuring that the process owners have the required tools andinformation at all time. This includes applications that are alignedto their roles and responsibilities as well as implementation offunctional upgrade of the existing systems. Holistic approach toquality information technology tools and information has an impact onaccountability and transparency. Operational excellent in all thebusiness functions at Wal-Mart will be supported by best fittechnology solution, a performance driven culture, solutions thatpromote smart working rather that harder working, and leadershipbased on available information and knowledge (Pham, 2014).
Thethird objective of the information strategic plan would bestabilizing the information technology infrastructures,decentralization of processes through enhanced connectivity, andenhancing sustainability of Wal-Mart business processes. Due to thesize of Wal-Mart, a “digital superhighway” will have a hugeimpact on its business operations. Unified and stable information andcommunication system will be an essential aspect of this “digitalsuperhighway”. Additionally, a data center with enhancedcapabilities, and a system that focuses on better service delivery byeliminating single point failures will support decentralization ofprocesses. Due to the demand for environmental sustainability in themodern world, implementation of options that are environmentallyfriendly such as process outsourcing is an essential informationtechnology objective (Iyamu, 2015).
Thefourth objective is development of a platform that supports theoverall goals of the organization. Wal-Mart vision is to assist itscustomers to save money and live better. The information system needsto reflect this vision (Iyamu, 2015). For example, an easy to accesswebsite and self service systems will greatly influence its abilitiesto help its customers to live better lives. Additionally, sinceWal-Mart has international presence, addressing the informationtechnology needs of every niche in Wal-Mart market is essential.
Thefifth and most important goal is providing flexible and expandedaccessibility of information by customers. Wal-Mart operations aredependent on the volume of sale. The use of technology to reach awide range of potential consumers is an essential aspect of Wal-Martstrategic plan. Wal-Mart need to be able to compete using moderntechnology based platforms such as the social media and mobileapplications. This will play an important role in developing a moreexpansive strategic plan for online sales and online marketing.
Impactsof strategic plan on the organization
Themodern business environment is powered by technology. As mentionedearlier, the competitive of Wal-Mart in the modern businessenvironment is largely influenced by its ability to adopt emergingtechnologies. The information technology strategic plan will havedirect impacts on the performance of Wal-Mart. The plan will enhancethe role of information technology in processing transactions and theenable the mega retailer to interact effectively and efficiently withits customers, suppliers and employees. The foundation of informationtechnology is the flow of information. Thus, the most importantimpact of the information technology strategic plan is enhanced flowof information. The strategic plan will enhance the management ofinternal and external, objective and subjective information. Thecentralized and decentralized data centers will have a huge influenceon the decision making processes. Technology will also promote theflow of information in all direction (Iyamu, 2015).
Thestrategic plan wills also impacts on transaction processing atWal-Mart. This is the point of contact between the businessorganization and its customers or suppliers. Over the years, Wal-Marthas used technology to simplify its transaction processes. A robustsystem enhances customer experience and quality of services. Forexample, an online sales platform would be depended in accurate andsecure capturing of transaction information. Additionally, thecaptured information will have an important role in inventory andsupply chain management. The strategic plan will also impactpositively on the decision making process. The system will act as adecision support and enhance decentralization of decisions. Aflexible and interactive information system enables faster decisionmaking through timeless and borderless communication. This will alsoenhance workgroup support, where the over ten thousand stores will beinterlinked. The system will also enhance data management and supportthe various management functions such as controlling, planning,organizing and staffing (Iyamu, 2015).
Hicks,M. J., Keil, S. R., & Spector, L. C. (2012). “Mom-and-Pops orBig Box Stores: Some Evidence of WalMart Impact on Retail Trade”.EconomicDevelopment Quarterly,26(4): 311-320.
Iyamu,T. (2015). Strategicinformation technology governance and organizational politics inmodern business.Hershey, PA: Business Science Reference.
Massengill,R. (2014). Wal-Martwars: moral populism in the twenty-first century.New York: New York Univ. Press.
Matusitz,J., & Reyers, A. (2010). “A Behemoth in India: Walmart andGlobalization”. SouthAsia Research,30(3), 233-252.
Pham,T. et al. (2014). FromBusiness Strategy to Information Technology Roadmap: A PracticalGuide for Executives and Board Members.CRC Press, ISBN 146658503X.
Reynolds,G. (2015). InformationTechnology for Managers.Boston, MA. Cengage Learning.
Roberts,B. & Berg, N. (2013). Wal-Mart:key insights and practical lessons from the world`s largest retailer.Philadelphia, PA: Kogan Page,