Our U.S. trucks log millions of miles every year, delivering products to our more than 4,800 locations across the country. So when it comes to sustainability and fleet efficiency, the goal is simple: deliver more while driving fewer miles. This goal is the driving principle behind our commitment to double fleet efficiency by 2015 (compared to 2005). We’re already 80% of the way there. Since 2007, we’ve delivered 658 million more cases while driving 298 million fewer miles.
But the key to continued improvement is through technology. We need to use the most efficient equipment available – and we need to pursue and test the technologies of tomorrow. That’s why we’ve been working with our suppliers to pilot new and emerging technologies for about 20 years. These tests have included a number of prototypes: hybrid assist, wheel-end hybrid assist, full propulsion hybrid, natural gas (LNG and CNG) and waste grease.
In Canada, our Supercube trailer pilot has just entered its second test phase after proving that it can ship up to 40% more merchandise than conventional tractor-trailer combinations, reducing costs by 24% and greenhouse gas emissions by 14%.
The latest example of this is our new Walmart Advanced Vehicle Experience concept truck, which is the result of collaboration between many vendor partners, including Peterbilt, Great Dane Trailers and Capstone Turbine. The truck combines aerodynamic, mictroturbine-hybrid powertrain, electrification, and advanced control systems all in one vehicle.
Like the concept cars you see at auto shows, this prototype will evolve before it’s ready for the road. But it’s exciting to think about how any one of the new features might become an industry standard in the future. The important thing is that we find incremental improvements while also challenging ourselves to look at fleet efficiency in new and different ways.
At Walmart’s Lab 415-C, we look for disruptive,
innovative technology that has the potential to change the way people shop. But
not just change that part of their lives – make it better.
From augmented reality to robotics, our team discovers
and tests emerging technology that powers the shopping experience our customers
want. In fact, we’re even named after an early innovation in Walmart’s
Walton’s 415-C airplane, which he used to scout real estate
from the sky (a business-growth tactic that was unheard of in the 1950s).
How do we bring these innovations to our customers and
associates? It starts with research. You wouldn’t buy a car without researching
its capabilities, safety and reliability, right? We research between 700-750
technologies a year and make sure we know the technology’s maturity, use cases,
comparisons and how it can improve shopping for customers. We look at
everything from technology that helps associates run stores more efficiently to
capabilities in the internet of
things (connected devices that communicate without human
interaction, such as a smart thermostat).
But what good is research if it isn’t shared with others?
That’s where our showcasing team comes in. More than 5,000 people come through Lab
415-C each year. Our showcasing team helps plan discussions, brainstorms and
events within Walmart and the greater entrepreneurial and academic community to
accelerate how we find innovative technology.
Testing technologies for how they’ll work within Walmart
is another aspect of Lab 415-C’s capabilities. We’ve tested technologies internationally,
at local stores and within our lab at Walmart’s headquarters in Bentonville,
Arkansas. Failing fast is key, so we don’t see failure as a roadblock; we see
it as a way to finesse the solution to fit Walmart’s needs.
An important way we find solutions that fit our
customers’ needs is by sourcing innovations from technology suppliers. This October,
we are doing that in a big way through our Technology
Innovation Open Call, an event where our leaders will meet with companies
creating the latest technology for retail, logistics, big data, security and
Our open call event is a great opportunity for companies
to pitch their innovations to the largest retailer in the world. I can’t wait
to see what ideas and inventions we’ll discover! Together we will transform the
deadline for potential selection in the Technology Innovation Open Call is July
22, 2016, or the first 250 submissions. For details and an application, click here.
VP – eCommerce Operations and Fulfillment, Walmart
April 18, 2016
About a year ago, Walmart assembled a team from all over the
company to focus on ways we could continue improving the online shopping
experience. The feedback we received was tremendously helpful, but there was a
surprise. An overwhelming majority of customers took it upon themselves to
elaborate on an unsolicited topic: The size of our boxes.
Over and over again, our customers expressed a desire for us
to reduce our packaging. That’s what they were talking about, so we immediately
shifted our focus to follow their
lead. And that shift has created the potential for huge results.
In the world of e-commerce,
several factors have to be taken into account when reducing packaging. Because
these items are being shipped great distances and handled multiple times, we
must ensure the proper amount of cushion and protection. Ultimately, it’s about
the product arriving at its destination undisturbed.
Through data analysis and extensive testing of potential solutions,
we’ve developed a way to improve cardboard box utilization by more than 30%,
without sacrificing product protection. If scaled over our entire e-commerce
operation in the U.S., this effort has the potential to reduce cardboard box
consumption by 7.2 million cubic feet annual, roughly enough to fill 82
Olympic-size swimming pools. It also translates into the ability to pack more products
into the tractor-trailers we put on the road.
We took everything from order trends and history, to the
size of boxes used at our fulfillment centers, into account. We developed
several new box sizes and put them to the test – first with a couple of hundred
orders, then with 10,000 orders. Then we piloted the program across an entire
fulfillment center and, ultimately, concluded we could maximize efficiency by
expanding our assortment of box sizes from 12 to 27.
Soon, we’ll implement the program at a second e-commerce
fulfillment center and, eventually, across the organization. But the key to
success will be our ability to customize the program to the needs and orders of
every facility. In fact, this program will have to be continuously monitored
and adjusted to meet changing needs. What is achievable at one facility with an
assortment of 27 boxes may require an assortment of 40 boxes at another. And
we’re up to that challenge.
The bottom line is, we recognized an opportunity by
listening to our customers, and we acted on it. Great things happen when you
take time to listen.
Editor’s Note: With
this post, we follow up with two associates who previously shared their stories on video.
Proximity brought Nicholas Qualman to Walmart, but his
personal drive has since taken him far.
In 1998, the then 16-year-old was working for a fast-food
chain located in the parking lot of the Walmart store in his hometown of
Marinette, Wisconsin. He was tired of making burgers and wanted to work the
counter, but with no positions open, he had to look elsewhere for a new
He applied at Walmart and was hired as a cashier, and he
hasn’t stopped moving since.
By the time he was featured in this 2011 video, he’d earned
10 promotions. After that, he lost count.
“I’ve had many careers within the same company,” he said, reciting
every title he has held, which comes to about 16.
His ambition has taken him from cashier to department
manager to a role leading education for other associates and many – many – points
in between. In the summer of 2015, he began helping to support the rollout and
day-to-day operations of online
grocery, which includes store
pickup and home
delivery – a job that he says is his favorite thus far.
“It’s a completely new way of us serving the customer,” he
said. “I equate it with being the supercenter of this generation. It’s a game
changer for stores and for our customers.”
As Nick moved up in the company, he also moved around. “One
of the great things is you get to experience different people and the company
in different geographies,” he said.
He transferred from Northeast Wisconsin to Minneapolis for
college, then worked in Sacramento; San Diego; Los Angeles; Princeton, New
Jersey; Boston; and Scottsdale, Arizona. He now calls San Bruno, California,
Like Brother, Like
Nick’s drive can only be matched by that of his sister,
Jessica Crow. It took her only five years to do what he did in 17 years, Nick
said with pride and a bit of brotherly frustration.
“We’re kind of in competition,” he said, “and I’ve got to
tell you, I’m struggling to keep ahead. She’s told me several times she wants
Jessica joined the military after college and served in Iraq
and Afghanistan. When she returned to the States, she toured the country with
the Pentagon to share her experiences.
Despite what she’d gained in the military, finding a
satisfying job in the private sector was difficult, Nick said. She worked in
logistics but didn’t feel happy or challenged. That’s when Nick offered to share
her resume within Walmart. But, he told her he wouldn’t push it: Getting hired
was up to her.
It wasn’t long before Jessica was offered the position of
developmental store manager. She made it to store manager in three months and moved
to a new store after a year and half. A few promotions later, she is now a
divisional manager – also surpassing the story she shared in this 2013 video.
After talking about his sister, Nick was quick to point out,
“My story isn’t unique – it’s one of many, many stories of Walmart associates.
Not everyone has had a chance to tell their story.”
Nick doesn’t want his story to end here. He achieved his
last goal of joining the e-commerce team, and now he’s setting his sights on Walmart
International, the one area he says he hasn’t yet touched. For now, Nick
sees himself sticking with online
grocery for the next five years or more – if he can keep his sister at bay.
“I’m just worried about my job,” he joked.
The following conversation with Walmart CEO Doug
McMillon is excerpted from our 2016 Annual Report, which was released today.
Read the report.
now living in a new period of retail disruption, largely driven by rapid
technological advances, and that change is likely to accelerate even further. What
does the future look like for Walmart?
work starts and ends with the customer. Technology has changed customer
expectations. Customers used to compare us with the store down the street; now
they compare us with the best online shopping experience. And beyond retail, they
compare us with every business they interact with in their lives. They compare
our pickup experience to the speed and friendliness of the best drive-through.
They compare our checkout process to the ease of paying with an app.
Customers should be able to shop on
their own terms – in a great store or club, with a quick pickup stop on the way
home from work, or with items reliably arriving at the front door. And
customers want to have some money left over to put toward their priorities: an
experience together as a family, a special gift every once in a while, or
savings for a rainy day.
Retail is not just about putting items
on a shelf anymore. It’s about fighting for our customers, cutting out the
hassles and advocating for them on price, too. We’re moving beyond just selling
products to being the brand customers rely on to make their lives simpler and
more meaningful as they save money.
mentioned “seamless shopping” before. What does that mean, and how will Walmart
A: It starts with unparalleled assets
that only Walmart has – our 2.3 million people; more than 11,500 retail locations;
e-commerce websites and apps; and a dynamic, optimized supply chain. But it
also requires new capabilities and fresh thinking.
This includes new digital tools for
customers and frontline associates, as well as back-end software and platform
work that benefits the entire enterprise. The use of data, algorithms, advanced
forecasting capabilities – and more – is of extreme strategic significance.
We will put these pieces together in a
way no one else can.
Ultimately, customers don’t care about
what channel they’re shopping in, or about how we deliver them a product or
service. They simply know they’re shopping with Walmart.
Q: What is
Walmart already doing to make progress against this seamless shopping strategy?
help our associates succeed and better serve our customers, we’ve made big
changes – including investing approximately $2.7 billion over two years in
higher wages, education and training to make Walmart U.S. a better place to work
and shop. We’re already seeing positive results: our fourth quarter of fiscal
2016 marked six consecutive quarters of positive comps and five straight
quarters of positive traffic at Walmart U.S. Everything we’re doing in
omnichannel depends on customers having great interactions with us in our
We're also accelerating e-commerce and
technology advances globally. We expanded Online Grocery shopping to new
markets, ramped up in-store and in-club pickup, fully acquired the Chinese online
retailer Yihaodian, and began to add new mobile services such as Walmart Pay.
We developed a technology platform that we can scale across the business. We
improved our fulfillment capabilities with new centers that are helping us get
orders to customers’ doors faster and more efficiently.
clear what these strategic investments mean for customers. How will they affect
associates and the communities where Walmart operates?
A: As we work to win with our customers, we will also create a great place to
work. We will create tremendous opportunities for people from all walks of
life, with all kinds of skill sets and education levels. We’re striving to
create a true meritocracy. No matter where you start from or what your unique
and special characteristics are, you can fulfill your potential here. We
believe in opportunity and that hard work, dedication and talent should be
We will also use our size, mindset and
policies and help make the world a better place. We create opportunity
throughout our global supply chain – on farms and in factories, by buying more
from women-owned businesses, by hiring veterans and by strengthening the retail
We work to be more sustainable, both
in our own operations and in our supply chain. We have three big goals:
creating zero waste, running on 100 percent renewable energy and selling products
that sustain people and the environment. And we give back to the communities we
serve – supporting American manufacturing, preparing for and responding to
natural disasters and fighting hunger.
does this growth plan mean for investors?
A: We will win with a differentiated, disruptive strategyand a foundation
of operational excellence. As we do, we believe shareholders will benefit by
receiving above-average returns.
Although this will be another year of foundational
investments, we believe we will soon be growing faster than the retail market.
We are a growth company; we just happen to be a large one.
The road ahead will not always be
easy, but by being customer focused, hungry, fast and accountable, we will win
and have a good time doing it.