A Case Study

Presenters

TV, Shreeharsha; M,Dev; S,Mritunjay;

S,Upendra; S,Ramendra

Wal-Mart and Mattel: Supply

Chain Management Best Practices

TVS, New Delhi

Walmart is a Multinational Retail chain.Walmart has an envious supply chain

management that changed the way business is done.

Mattel Inc. encountered a new experience when dealing with Walmart.

This case talks about the Best practices by Walmart in IT integrations to ensure efficiency and effectiveness of Supply chain.

The case also presents Mattel’s Learnings and Drawigs from doing business with Walmart.

Scenario

11/25/2013

TVS, New Delhi

Company Founded by Sam Walton in 1962 and Incorporated in 1969.

Opened its First distribution center in Bentonville, Arkansas in 1970.

Walmart Corporation goes Public in 1972.By 1987 there were 1,198 stores with sales

of $15.9 billion and 200,000 associates.Walmart Entered South America in 1995 and

Europe in 1999.Till date Walmart remains a family-owned

business.

Walmart Through Time

11/25/2013

TVS, New Delhi

The company is the world's second largest public corporation.

Walmart is Headquartered in Bentonville, Arkansas, United States

With over two million employees, and is the largest retailer in the world.

Walmart has a reported Revenue of US$ 469.162 billion for the FY 2013.

S. Robson Walton is the Chairman and Mike Duke is the designated CEO.

Walmart the Corporation

11/25/2013

TVS, New Delhi

Supply chain and Inventory management are key aspects of retailing.

Walmart being the largest retailer in the world needed the best strategic systems in place.

Efficiency in Information Systems for inventory management and supply chain was required.

Planning and Information Sharing was needed for effective functioning of collaborations.

Inventory & Supply Chain

11/25/2013

TVS, New Delhi

Walmart Invested early and heavily in building IT infrastructure.

RFID and µChips replaced bar codes and security tags.

Online operations were started by retailing on their website.

Collaborative Planning, Forecasting and Replenishment techniques were used to develop the Just In Time(JIT) Inventory program.

JIT inventory program meant less storage , less excess and less wastage.

Best Foot Forward

11/25/2013

TVS, New Delhi

Walmart introduced Data Sharing for the first time.Data sharing with Suppliers was thought to be

risky by conventional Supply Chain systems but Walmart saw a reward in this.

Buy-ins increased as data sharing was perceived as a collaborative action that helped everyone.

Information about Sales, Geography, Sale Rate and Customer reaction gave a technical edge to selling.

The CPFR program allowed partners and suppliers to study the state of Inventory and Plan better.

Hat Trick

11/25/2013

TVS, New Delhi

Working with Walmart, Mattel has Experienced and Understood the fruits of IT integration and Information sharing.

Mattel Plans to Implement Walmart’s model of Information sharing , JIT inventory increasing and Manufacturing efficiency.

Mattel’s wants to execute this IT infra implementation in phases.

While Inhouse supply chain optimization is half way there, the reminder would be understanding and processing customer data.

Mattel's Cup of IT

11/25/2013

TVS, New Delhi

Mattel could start by investing in creating an ERP solution.

Implementing ERP would give an Integrated IT solution to efficient managing of information and inhouse operations.

Developing Web based CRM and PRM solutions will make interaction easy .

Implementing JIT inventory would decrease Inventory related overheads.

Creating Sharepoints with Dealers, Suppliers and Customers will help reduce transaction lag.

Recommendations

11/25/2013

TVS, New Delhi

By investing early in IT, Walmart has gained a significant technological edge over its competitors.

Rewards of Information sharing has proved to be worth the risk.

JIT inventory, CPFR program and other Technological investments have proved to reduce business turn around cost and increase profits and overall turn over.

Mattel like many other companies chose to follow Walmart’s lead and invest in IT infrastructure to boost its operations and Supply chain management.

The decision to invest in IT needs to be carefully backed by sufficient research and understanding of the requirements and proposed solutions to prove fruitful.

Conclusion

11/25/2013

TVS, New Delhi

1. Do you agree that Wal-Mart is “the best supply chain operator of all time”? Why or why not?

2. What has Mattel learned from Wal-Mart? How well are they applying it to their own business? Explain your evaluation.

3. What can other businesses learn from the experiences of Wal-Mart and Mattel that could improve their supply chain performance? Use an example to illustrate your answer.

Q&A

11/25/2013