Inside Walmart’s Digital Transformation: 30 Tangible Steps on its Journey

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Seven months ago, when Walmart and Microsoft signed a massive 5-year deal to drive sweeping modernization and change across the world’s largest company, CIO Clay Johnson said his primary goal was to accelerate the digital transformation of a company with 2 million employees and daily revenue of about $137 million.

And this week, as Walmart released earnings results for Q4 and the full year, it disclosed a wide range of initiatives it has completed or that are underway as Walmart remakes every facet of its enormous global operations to enable intimate digital relationships with the tens of millions of people who shop at Walmart each week.

“We’re excited about the work we’re doing to reach customers in a more digitally connected way,” said Walmart CEO and president Doug McMillon in a press release.

New statements from CEO Doug McMillon provide insight into Walmart's digital transformation journey
Doug McMillon

“Our commitment to the customer is clear—we’ll be there when, where and how they want to shop and deliver new, convenient experiences that are uniquely Walmart.”

In July, when I had a phone conversation with CIO Johnson about the Microsoft megadeal, he offered this perspective: “If you think about Walmart’s transformations over time—for example, our development of the SuperCenters, our work in supply-chain improvements, and our work on distribution networks—it  makes perfect sense for us at this time to really accelerate our digital transformation.”

Johnson also noted that he and the entire company were “extremely excited” about embarking on that digital journey with Microsoft and its extensive capabilities in the cloud, with data, and operating at the highest scales imaginable.

So this week, in reviewing the massive amounts of information that came out about Walmart and its Q4 results, it was fascinating to explore both the scale and scope of its digital initiatives and how those efforts touch every part of the company in every corner of the globe.

I want to emphasize that while Walmart’s 5-year megadeal with Microsoft is deeply focused on digital advancement, technology upgrades, and delivering that new and essential customer experience that CEO McMillon described above, the long list of Walmart digital accomplishments I’m about to offer are not all offshoots of the Microsoft relationship.

But they do offer a remarkable roadmap of what digital transformation within the world’s largest company looks like and how truly sweeping such initiatives must be in order for companies to be able to “be there where, when and how” their customers want and expect them to be, as McMillon said.

So from material distributed publicly by Walmart with its earnings results, I’ve extracted about 30 separate steps the company has taken or will soon be taking on the road to digital—and I offer it here not only because it’s a compelling story but also in the hope it can give your company some ideas and perspectives for how to transform your company from what it is today into what it must become in the near future.

Walmart’s Digital Journey

  1. Walmart U.S. eCommerce continued to benefit from the expansion of grocery pickup and delivery and a broader assortment on Grocery pickup and delivery are now available in more than 2,100 and nearly 800 locations, respectively.
  2. Walmart U.S. eCommerce sales increased 40%. Net Promoter Score and the company’s Customer Value Index continue to improve.

    Proposed for fiscal 2020 ending Jan. 31, 2020:   
  3. Walmart U.S. eCommerce net sales growth will be about 35 percent
  4. Approximately 3,100 grocery pickup locations by year-end FY20
  5. Approximately 1,600 grocery delivery locations by year-end FY20
  6. Capital expenditures of approximately $11 billion will include a strong focus on store remodels, customer initiatives, eCommerce, technology and supply chain
  7. Walmart U.S. expects to open fewer than 10 stores, while Walmart International expects to open slightly more than 300 new stores, primarily in Mexico and China

    Additional highlights for fiscal year 2019
  8. Added about 1,000 grocery pickup locations, and reached nearly 800 grocery delivery locations
  9. Announced pilot with Udelv for custom autonomous cargo vans to deliver groceries
  10. Announced collaboration with Ford to test grocery delivery with self-driving cars
  11. Launched Spark Delivery test, a new last-mile grocery delivery service
  12. In-store innovations inclued autonomous shelf-scanning robots and floor cleaners and FAST unloaders
  13. Launched 17,000 virtual-reality training devices for employees
  14. Launched new digital scheduling system for store associates
  15. In all U.S. stores, launched service that allows customers to checkout from anywhere
  16. Launched new “endless aisle” feature allowing customers to order and pay for online items while inside a store
  17. in Walmart app, launched Item Finder and store maps chain-wide
  18. Launched new features for the Marketplace, including free two-day shipping on millions of new items and the ability to return marketplace items in stores
  19. Launched Jetblack in New York, a new conversational commerce platform
  20. Introduced 3D virtual shopping and “Buy the Room” feature for the Home category on
  21. Launched Walmart eBooks through partnership with Kobo
  22. Acquired virtual-reality studio Spatialand
  23. Announced partnership with Eko to create interactive storytelling for entertainment and retail
  24. Acquired ELOQUII, a digitally native brand focused on women’s fashion
  25. Launched Allswell, a digitally native vertical mattress brand
  26. Announced a high-tech distribution center that can move 40 percent more product than a traditional DC
  27. Announced a high-tech consolidation center that can receive, sort and ship freight and enable 3x more volume
  28. Acquired majority stake in Flipkart Group, India’s leading eCommerce business
  29. Launched online marketplace in Canada
  30. Launched first Walmart Rakuten Ichiba Store, the first Walmart eCommerce store in Japan
  31. Established joint venture with Rakuten for grocery delivery in Tokyo
  32. Announced agreement to acquire Cornershop for last-mile delivery capabilities in Mexico and Chile
  33. Walmart Mexico launched a secure digital payment option for mobile devices
  34. Walmart China established strategic partnership with Tencent, including use of WeChat Pay and Scan & Go
  35. Launched new depots in China for accelerated eCommerce fulfillment and delivery
  36. Converted four Sam’s Clubs to eCommerce fulfillment centers

The Walmart experience shows very clearly that digital transformation involves everything a company does, regardless of whether your company generates $137 million in revenue every day as Walmart does.

(Disclosure: At the time of this writing, Microsoft was a client of Evans Strategic Communications LLC.)

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