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IT Management Course Innovation Project
- 1. Wal-Mart: A New Age Shopping ExperienceSoeb ContractorAnthony FitzpatrickApril MerscherJoseph NachinsonAdrienne TallaromÌý
- 2. Seems Familiar?Lines are Killer!Source: Maritz poll, July 15 2008
- 3. Wal-MartAlways in the forefront of adopting new technologyCustomer focused organizationLong lines at the checkout lane is a problem for the customersWal-Mart already requires suppliers to place RFID tags on shipmentsWal-Mart - RFID reduced Out-of-Stocks by 30 percent for products selling between 0.1 and 15 units a day
- 4. RFID:Better alternative to traditional barcodes for identification Uses radio waves for identificationCan be read from several meters away and beyond the line of sight of the readerCost of RFID tags reducing every year and now available for 3¢
- 5. GPS Tracking on cartsAbility to develop patterns of customer movement inside the storeBetter position displays according to movementTrack purchases off displays and promotionsSell data to market research companiesIdentifies cart at kiosk for check out process
- 6. Kiosks:Pulls out cart specific purchase informationHas payment options and ability to swipe credit cardPrinting of receipt and couponsAllows speedy checkout.
- 7. Competitive EnvironmentBuild Awareness with customer baseAdvertising Media, Billboards, Public Transit, etcIn store: Flyers, Banners, Greeters, Coupons, etcEconomies of scale – 1st Mover AdvantageNo 3rd party or partner companies in operating its business, easier to integrateFull Vertical IntegrationSignificant expertise in implementing and using IT systemsCompetitors lack resources & expertise to respond accordingly…..Wal-Mart remains innovative leader
- 8. Cost/Benefit Analysis CostsInitial System Cost RFID readersStand alone for carts Standard for kiosk GPS for cartsAntenna Middleware Consulting/IntegrationRecurring Costs RFID tagsSystem Maintenance Data Storage / Sorting BenefitsAn increase in sales of 2% due to reduced out-of-stock items30% reduction in inventory due to lower safety stockReduction in theft Approx. 40 employee reduction per store Market ResearchDecrease in wait time for customers increase sales by 3%
- 9. Definition of Scenarios Best Case – All Walmart stores would implement this technology – 4,300 total stores Worst Case – Project would not proceed past the initial implementation – Assumed to be about 10% of the Walmart Supercenters, total of 274 stores Likely Case – Only Walmart Supercenters would implement this technology – 2737 Walmart Supercenters
- 11. Organizational ImplementationPlan of Attack and Time LineRisksTechnology – 3rd Party Right?Competitors – How long before we are copied?Customers and Suppliers – Will they buy into the technology?Costs – Will they decrease?Inventory – Does this provide better tracking?Employees – Will they buy in?Executives – Is there an ROI?1 yr½ yr½ yr1 yr1-2 yrs
- 12. Organizational ImplementationRisk MitigationTechnology – Well rounded selection teamCompetitors – Confidentiality and long term contractsCustomers and Suppliers – Market positively and show valueCosts – Research before and track afterInventory – Track both waysEmployees – TRAIN! TRAIN! TRAIN! INFORM!Executives – Analysis of ROI, show updates during implementationRisk MitigationTime, Costs, Wait (Queue) time decreasesContingency PlanScrap ProjectRevert to previous system – ensure employees still know traditional check out procedures
Editor's Notes
- #12: Tags (100,000/store) Readers: Stand Alone (1,000/store) Readers: Standard (20/store) GPS on Cart (1,000)Antenna (1,020) Middle Ware(1/store)