Is Wal-Mart good for America or the world?
Wal-Mart’s pioneering use of technology and its market power has transformed the way goods are manufactured and distributed in the global economy; enabling you to have a profound impact on workers in the United States and around the world.
The late Wal-Mart founder Sam Walton was known for his aversion to technology. According to his 1992 memoir, Made in America, he wrote: “To tell the truth, I never saw computers [as he called the company’s Information Technology (IT) systems] as something more than necessary above the head. A computer is not and will never be a substitute for going out into their stores and learning what’s going on. “
Walton’s distrust of computers is corroborated by his handpicked successor, David Glass. According to Anthony Bianco’s book, Wal-Mart: The Bentonville Thug (2007), Glass watched his boss compare a computer-generated invoice to his own handwritten ledger. In addition, I would also provide a copy of the computer generated invoice. Bianco surmised that Glass chose to go “full throttle” into its IT systems (based at the David Glass Technology Center) at or around the time of his boss’s death.
Under the inspiration of David Glass, Wal-Mart became a technology leader. “The company was an early adopter of barcode scanning and ultimately set the gold standard for supply chain efficiency thanks to highly integrated point-of-sale systems, satellite-reported inventories, and even RFID tracking.” (Techdirt.com, Lindquist, 2007). As a special note,
RFID uses low-power radio transmitters to read data stored on tags, at distances ranging from 1 inch to 100 feet. Labels are used in place of barcodes and can contain much more data, allowing manufacturers, suppliers, and retailers to track and manage assets more efficiently (Vijayan & Brewin, TexasInstruments.com, 2003, paragraph 2) .
With the acclaimed supercomputer housed at the David Glass Technology Center ranking second in the world after the Pentagon supercomputer, Wal-Mart is able to transform the way products are made. For example, the company developed web-based software (Retail Link) that enables Wal-Mart and its suppliers to monitor the movement of their respective inventories from shelves (including distribution centers) to cash registers. In this way, Wal-Mart can keep inventory low that helps reduce operating costs. Thus, Wal-Mart can pass the savings, in part, to consumers in the form of lower prices. In turn, suppliers are forced (correct choice of word) to agree to a lower wholesale price (Wal-Mart may purchase merchandise in large volumes that dwarf demand from other retailers – competitive advantage) (Valenti, Go.com , 2002).
To compensate for the lower wholesale price, Wal-Mart’s suppliers gain (sometimes with Wal-Mart’s help) efficiencies by making their products more profitable to produce and by reducing their employees’ wages.
The reduction of the salary of the employees of Wal-Mart and its suppliers, to support the reduction of their respective prices to the consumer, generates a negative impact on workers in the United States. The reduction in wages is accompanied by an absence of medical care and a poor quality of life for American employees. The recourse for US employees is non-existent due to Wal-Mart’s successful ability to prevent unionization (courtesy of our US government) and the ability of its suppliers to relocate (outsource) manufacturing of its products to foreign countries.
The snowball effect (noted in the previous paragraph) also negatively impacts workers around the world. For example, foreign suppliers compete to meet Wal-Mart’s fanatical demand for low prices for its products. Thus, in some countries (instigated by their governments), employees are reduced to contract bondage (including child labor) without government protection or recourse through collective bargaining. In fact, Professor Musuraca (2007) pointed out that union leaders are marked to death in Colombia and unions are non-existent in China.
Wal-Mart’s pioneering use of technology also transformed the way goods are distributed in the global economy. For example, “they have such an efficient system for products to enter without having to stay in the warehouse (Go.com, 2002, paragraph 15),” said Arun Jain, professor and president of marketing at the University’s School of Management. from Buffalo. . Similarly, the transformation of how goods are distributed has the same negative impact on workers in the United States and around the world.
Consequently, Wal-Mart’s pioneering use of technology helps establish its market power while continuing to seek “the low price.” For example, Wal-Mart retains the top spot on the Fortune 500 list and, as Professor Musuraca (2007) taught, Wal-Mart is a microcosm of the American economy. I add to Professor Musuraca’s point by stating: “Wal-Mart is a microcosm of the world economy accompanied by all its warts (the negative impact on workers everywhere).”
In conclusion, I showed how David Glass overruled the late Sam Walton’s reluctance (after disappearing from the picture) to see the importance of investing in ‘computers’ by establishing the David Glass Technology Center.
David Glass’s vision and implementation of Wal-Mart’s pioneering use of technology help secure its market power, which in turn transformed the way goods are manufactured and distributed in the global economy. In addition, I elaborated on the impact of Wal-Mart (through its technology and power) on workers in the United States and around the world. Did David Glass prove the late Sam Walton, whom Wal-Mart reveres as an oracle or a prophet … hell, like the Moses (if not King Solomon) of Bentonville, wrong?