Although this article is from December of 2002 the content relates to what we have talked about in class over the past few weeks, and I found it to be very interesting. This article talks about Wal-Mart using a sophisticated IT system to track what customers purchased with their debit and credit cards. At the time, this IT system being used by Wal-Mart was highly advanced compared to other companies in the same business. “Wal-Mart’s aggressive adoption of information technology to improve logistics and back-office efficiency has also been a major driver of productivity.” The company takes the information received from the scanners each day to determine the quantity of sales, for that period of time, and what products need to be inventoried. Today this is something that is fairly common, and almost expected for large-scale companies to have, but Wal-Mart was a leader in this aspect of the IT world back in 2002. I found it very interesting that in the article it talks about how secret Wal-Mart top-management was with the information that they received from the scanners, and the importance of their IT systems not only for the company but for the government as well. When we think of information technology we don't think about the large scale impact that it could have. Federal officials used not only Wal-Mart's video cameras but their scanner system to see exactly when, where, and what was purchased by the 9/11 hijackers. This is something that seems so logical but that I have definitely overlooked when thinking about IT systems. The importance of Wal-Mart's systems are also seen in their attempt to restrict competitors to learning their success methods. "In October 1998, Wal-Mart filed a trade secrets lawsuit in Bentonville against Amazon.com, accusing it of pirating 15 employees, including chief information officer Richard Dalzell. The lawsuit was settled in April 1999, but the defections put Wal-Mart on guard against competitors recruiting employees with inside IT knowledge." Amazon's attempt to get the edge on Wal-Mart really only hurt them in the long run, but it shows how competitors are doing everything they can to get ahead, even using information technologies. Especially when sending the information received from the scanners everyday, Wal-Mart uses a secure private network when sending to their headquarters in Arkansas.
Back in 2002 Wal-Mart had the state of the art technology to track inventory, manage relationships with suppliers, and find trends that could help make better decisions about what products to stock, all of these things crucial for successful business operations. Today, information technology is even more important for Wal-Mart considering all of the foreign trading and production they are involved in. They have adapted over the past few years and grown with the times, updating their IT department and systems to keep up as well as get ahead in the economy.
I found this article to be very interesting and it relates directly to what we talked about in class in the beginning of the year. IT systems being used to influence operating activities and inventorying stock are very important to a smooth operating cycle and this is where Wal-Mart had the edge back in 2002, and other companies soon followed.
http://www.pressaction.com/news/weblog/full_article/hand12022002/
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I was not surprised after reading about this article. Wal-mart is based on efficiency and reducing costs so it can provide their customers with the low priced products. There IT system is very proactive in discovering and meeting the interests and needs of their customers. This provides them with a competitive advantage over other companies. Furthermore, their customer relations are very important in this economy. Many people are trying to cut costs and buying their groceries and other household products at a Wal-mart rather than a more expensive store. Therefore, this IT system helps not only Wal-mart but the customers it services as well.
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