Yes, Walmart IS a technology company

I recently wrote something that mentioned various technology companies, and I initially included Walmart in the list.

Initially.

The post cataloged the companies that former coworkers were now working, and I wrote it knowing that one of my former coworkers was a Walmart. Well, you don’t know what you think you know. It turns out that this former coworker is no longer at Walmart (as I write this, she is at Comcast), but I had THIS entire post written up about Walmart as a technology company. So I’m going to go ahead and post it anyway.

Technology for better living

While many of us don’t think of Walmart as a tech company, in truth it is a tech company, and technology innovations play a key part in Walmart’s corporate dominance in its markets over many other players.

I was first exposed to Walmart’s technology orientation many years ago, even before Walmarts began opening in earnest in Southern California. At the time I was working for a consumer goods company, and Walmart was one of my company’s customers. Obviously Walmart was a big customer, and big customers have the power to tell their suppliers what to do.

Today’s acronym is EDI

And Walmart wanted the consumer goods company to do EDI.

EDI stands for “Electronic Data Interchange,” and it offers a computerized method for two business entities to communicate business data between each other. Thus, Walmart was asking my employer to transmit data relating to our shipments of product to various Walmart stores, and Walmart incorporated this data into its internal inventory systems.

EDI has progressed a long way since I worked for that consumer goods company (the graphic above does NOT illustrate the flow that my former employer was using), but the basics remain the same.

Electronic data interchange (EDI) is a standard format for exchanging business documents. These documents are exchanged between suppliers and retailers. EDI is made up of two components: translation and communication. During the translation process, the business data is changed into a standardized EDI format.

Once the business document is translated into a standardized EDI format it is communicated (electronically sent) to the intended recipient. Just like with translation, there are various methods of EDI communications available. The method that is used by Walmart and their suppliers is AS2.

Not AS3, not AS1. AS2. Walmart is Walmart.

But not just EDI

And as you may guess, Walmart uses a number of other technologies to keep its mammoth business running. Such as blockchain.

How do you know your food is safe to eat?

This isn’t a question many of us often ask ourselves. But lately, food safety has been in the public eye: 2018 has already seen a large outbreak of E. coli in romaine lettuce and Salmonella in a number of products from eggs to breakfast cereal….

Today, Walmart and Sam’s Club sent a letter to suppliers of fresh, leafy greens asking them to trace their products all the way back to the farm using blockchain technology. Suppliers are expected to have all these systems in place by this time next year.

Again, Walmart is Walmart, and it wanted the suppliers to comply. And the suppliers had some work to do to come into compliance.

The basic requirement for those in far-flung rural areas includes a mobile device with geolocation features, so that other information such as date of harvest and size of the crop can be associated with specific coordinates. In cases where a farm might not be covered by wireless access, the information can be uploaded when there is coverage.

And yes, agriculture has moved far away from the family farm and is now accurately described by the term “agribusiness,” but I’m sure these agribusinesses weren’t thrilled about requiring the capture of geolocation, date, and harvest size data as a mandatory step in harvesting. And if there are any family farms left, they REALLY weren’t thrilled. (Not that small family farms are doing business with Walmart, but these requirements are going to flow down to smaller food sellers also.)

So yes, these data capture and blockchain requirements are onerous from the suppliers’ perspective. But think of Walmart’s perspective for the moment. If Walmart can convince its customers that its foods won’t make them sick, and if Walmart’s competitors can’t do this, then Walmart has a clear competitive advantage.

The retailer was motivated to focus its first “substantive, not symbolic” declaration as a result of several highly publicized E. coli outbreaks in the United States… — including five deaths — that were related to tainted romaine lettuce, according to Frank Yiannis, vice president of food safety and health for Walmart.

And not just Walmart

And these and other modern technologies are necessary for Walmart or any multi-billion dollar firm, or even much smaller firms. As I said, eventually consumers will demand blockchain or similar food tracing from all grocery stores.

Yes, even Dollar General is embracing technology, but as far as I can tell it is concentrating on consumer-facing technology and hasn’t adopted blockchain yet. But I could be wrong.

These days, long after my former consumer goods employer went out of business, you’re not going to run your business on a Lotus 1-2-3 spreadsheet, even if Lotus IS integrated.