Mighty Wal-Mart


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Mighty Wal-Mart

  1. 1. Mighty Wal-Mart
  2. 2. Wal-Mart <ul><li>8th largest trade partner of China. </li></ul><ul><li>1.8 Million employees </li></ul><ul><li>$315 Bilhões (receita) </li></ul><ul><li>1945: Walton ’s five and dime </li></ul><ul><li>No promotions (ELP) </li></ul><ul><li>Profit: >$11 Bilhões </li></ul>
  3. 3. Innovations <ul><li>Intense adoption of IT </li></ul><ul><li>Cross-docking </li></ul><ul><li>RFID </li></ul><ul><li>Everyday low prices policy </li></ul>
  4. 5. Controversy <ul><li>Lowered world inflation by 0.5%? </li></ul><ul><li>Use of foreign labor </li></ul><ul><li>Low wages </li></ul><ul><li>Health benefits </li></ul>
  5. 6. Controversy: Wal-Mart is accused of lowering costs at the expense of its employees, but that is probably an exaggeration.
  6. 7. Controversy: Wal-Mart is also accused of employing alien foreigners, but that is probably also an exaggeration.
  7. 8. Controversy Of course, Wal-Mart’s headquarters deny any wrongdoings
  8. 9. <ul><li>Wal-Mart asked all its suppliers to advance RFID standards </li></ul><ul><li>the HP implementation </li></ul>
  9. 10. Industry’s Largest Supply Chain <ul><li>#1 in material spend – $40B </li></ul><ul><ul><li>Memory – #1 </li></ul></ul><ul><ul><li>Microprocessors (Intel & AMD) – #1 </li></ul></ul><ul><ul><li>Windows software (Microsoft) – #1 </li></ul></ul><ul><ul><li>Hard disk drives – #1 </li></ul></ul><ul><ul><li>Laser engines – #1 </li></ul></ul><ul><ul><li>Optical disk drives – #1 </li></ul></ul><ul><ul><li>Chipsets (Intel) – #1 </li></ul></ul><ul><ul><li>LCD panels and many more – #1 </li></ul></ul><ul><li>#1 in contract manufacturing/ ODM – spend ($5B) </li></ul><ul><li>#1 in electronics industry logistics procurement – $1.7B </li></ul><ul><li>1M service support parts per month </li></ul><ul><li>Every day HP delivers: </li></ul><ul><li>1.3 Million Inkjet cartridges </li></ul><ul><li>110,000 Printers </li></ul><ul><li>75,000 Personal systems </li></ul><ul><li>3,500 Servers </li></ul><ul><li>1B customers - 178 countries </li></ul><ul><li>21,000 patents </li></ul><ul><li>675 new products in FY03 </li></ul><ul><li>142,000 employees </li></ul>
  10. 11. The Supply Chain Business Case <ul><li>Retaining your Customer </li></ul><ul><ul><li>Tagging goods that your Customer asks you to tag </li></ul></ul><ul><li>Improving Supply Chain Efficiency </li></ul><ul><ul><li>Do things at less cost by reducing labor involved </li></ul></ul><ul><ul><li>Increase Supply Chain velocity by taking less time to do the same work </li></ul></ul><ul><ul><li>Do things better by increasing first pass accuracy </li></ul></ul><ul><ul><li>Lessen Supply Chain risk by increased in transit accountability </li></ul></ul><ul><li>Improved Data Collection </li></ul><ul><ul><li>RFID reduces effort & cost to identify item </li></ul></ul><ul><ul><li>Which can make identification viable where it wasn’t before </li></ul></ul><ul><ul><li>And this can improve overall Supply Chain visibility </li></ul></ul><ul><ul><li>Which should reduce second guessing of events </li></ul></ul>
  11. 12. Futian, Shenzen Mentor Media Scanners & Cameras
  12. 13. Retail IPG RFID Plan In transit Regional Distribution Walmart Walmart, Sam’s Club and Neighborhood Market Stores Product Completion Center Base Manufacturing Malaysia Flextronics Shanghai Calcomp Shenzhen Mentor Media Bangkok Venture Hong Kong Canon Tokyo Canon Canon China AiO & Personal Printers AiO & Personal Printers Scanners& Cameras AIO Toner Toner/ Personal Laserjet Personal LJ Memphis Flex Memphis Menlo Virginia Sonoco Walmart DC3 De-Soto, Texas Walmart DC1 Sanger, Texas Walmart DC2 Cleburn, Texas FGI Direct FGI Direct FGI Direct IDS Air Various Guadalajara Jabill InkJet Supplies Guadalajara Flex Tag Site Supply Site Delivery Site
  13. 14. HP RFID Geographic Scope RFID impacts businesses, operations and Customers in all Regions. Therefore program scope is global and pan HP in nature Commercial sites Retail sites 28 sites now RFID capable 10 more in progress
  14. 15. First site to go live in volume in August 2004 We are also working with our large Retailers to synchronize pilot efforts The Memphis Pilot Tagging pallets & cases with EPC Class 1 915Mhz tags Began shipping tagged cases and pallets with full system integration to WalMart April 2004
  15. 16. Refining Existing Processes – Integrating with RFID He is scanning every printer engine to capture the serial number And he is applying a barcode label by hand
  16. 17. Refining Existing Processes – Integrating with RFID RFID capable printer Integrated RFID tag Integrated RFID tag
  17. 18. Refining Existing Processes – Prior to RFID <ul><li>Forklift selects full pallet for shipment, picks the pallet from storage, then takes it to a shipping dock </li></ul><ul><li>Tells warehouse staff that pallet is ready </li></ul><ul><li>Warehouse staff then scan pallet contents </li></ul><ul><li>WMS system confirms pallet to order and prints shipping label </li></ul><ul><li>Operator retrieves address labels and apply to pallets </li></ul><ul><li>They then call forklift to load truck </li></ul><ul><li>Creates “idle” time between processes </li></ul>
  18. 19. Refining Existing Processes – With RFID <ul><li>Forklift selects full pallet for shipment, picks the pallet from storage </li></ul><ul><li>Forklift approaches ship preparation tunnel, photoeye triggers process </li></ul><ul><li>Antenna reads pallet tag and case tags on the pallet </li></ul><ul><li>System identifies pallet and prints shipping label and tag </li></ul><ul><li>Label ready by the time that forklift reaches end of tunnel </li></ul><ul><li>Pallet taken directly to outbound staging </li></ul><ul><li>Idle time eliminated completely </li></ul>
  19. 20. Refining Existing Processes – With RFID <ul><li>Before RFID: </li></ul><ul><li>Operator bar code scans part number and serial numbers on each individual box </li></ul><ul><li>WMS system verifies product and quantity </li></ul><ul><li>Pallet is then shrink wrapped </li></ul><ul><li>With RFID: </li></ul><ul><li>Pallet rotates on shrink wrap machine while antennas read case EPC’s from each box </li></ul><ul><li>WMS verifies product and quantity </li></ul><ul><li>Results: </li></ul><ul><li>Eliminates manual scan step </li></ul><ul><li>Reduces cycle time incorporating scanning with wrapping operation </li></ul>
  20. 21. Receives components and raw material, manufactures printers then ships finished goods to Latin America Region Starting at manufacturing, will then “walk” down the process chain to Shipping Sao Paolo Printer Plant Tags carry quality & control data thru the process with the unit as it is built as well as EPC Code
  21. 22. Component Verification <ul><li>Every item that goes into the box is scanned by hand </li></ul><ul><li>Usually under a scanner positioned over the work station </li></ul><ul><li>If every item was tagged then the items would simply be put in the box </li></ul><ul><li>With an automatic verification of all contents against SKU prior to pack out </li></ul><ul><li>A classic example of speeding up the line </li></ul>
  22. 23. He is scanning one product barcode to ensure the right product is picked Correct pick will be verified on his on board screen If items were tagged then no scan would be necessary. Product would be verified as forklift approaches pallet and failing a warning of incorrect product, driver spends all of his time and effort in moving the product on to the next process Everything stops for this process
  23. 24. Mixed Pallets <ul><li>Less than full pallet quantity </li></ul><ul><li>One or more products </li></ul><ul><li>Can only be barcode scanned by un-stacking pallet </li></ul><ul><li>RFID wouldn’t require this </li></ul>
  24. 25. Outbound Staging Pallet staged for loading – pallet label / tag visible Barcode scanned to confirm staging location
  25. 26. Pallet staged for loading Barcode scanned to confirm which dock door pallet went out of
  26. 27. Reader would be positioned at dock door Reader suspended above temporary staging lane
  27. 28. It Couldn’t Be Done Before RFID <ul><li>Proof Of Delivery is an essential part of trading between the shipper and the Customer </li></ul><ul><li>Today that process lives or dies at just one point in the process – the Receiving Dock </li></ul><ul><li>If this goes wrong, then an expensive and time consuming reconciliation process is launched </li></ul><ul><li>Our research shows that it needn’t have about 80% of the time </li></ul><ul><li>It also impacts supplier / Customer relationships </li></ul><ul><li>RFID can help us avoid much of this pain </li></ul>
  28. 29. Tracking Item Movement Previously restricted to Receiving Dock Delivery can now be “proved” at many points in the process