Walmart Case Study

                                                                Walmart Case

1. Walmart manages a supply chain effectively by employing continuous innovations and improvements. When having supply chains include multiple firms, it increases difficulties for Walmart to manage its supply chain since supply chain members are tend to disagree about their goals, roles, or rewards, and therefore results in conflict. Walmart overcomes such conflict by contract negotiations, use of advanced technology, tight inventory control, and etc.

Walmart manages its supply chain primarily by making advantage of its position as one of the largest retailers in the world, which enables it to have more control and power in preparing the contracts. Manufacturers and distributors who want to do business with Walmart, will have to do things in the Wal-Mart way. In addition to using its power in the supply chain, Walmart employs advanced technology for better inventory management and distribution. For example, Walmart’s partnership with P&G allows them to share the information together and better track the shipments. This partnership helps both companies lower costs and therefore saves money, which create values for them . However, the conflict is possibly to arise if  Walmart fails to carefully examine the needs of different parties. For example,  a supplier desires to sell as much as possible but Walmart wants it to just meet sales forecasts level.  Moreover, the distribution of benefits can rise conflict as well. If Walmart receives most benefits of selling merchandise but the vendor receives much little than Walmart’s benefits to reach its desired profit level, the vendor will be unsatisfied.

2. Overall, Walmart has been able to efficiently use the advanced technology to continuously improve its supply chain. As mentioned in the case, CRFE systems, UPC bar codes, EDI, cross-docking and etc, which all contribute to its effective supply chain. To achieve higher levels of product availability, Walmart  uses UPC and EDI to record the data to suppliers to ensure timely replenishments to its distribution center. Its hub-and-spoke distribution network successfully delivers goods to distribution centers first and then to thousands of stores, which helps Walmart realize great product availability in short time.