At Wal-Mart, business technology is a team effort--the retailer's far-reaching RFID project would be impossible to achieve if it weren't. This year, InformationWeek recognizes CIO Linda Dillman and her IT staff--some 2,400 strong--as our business-technology team of the year.
Wal-Mart Stores Inc.'s I.T. team is just a couple of weeks away from the first wave of suppliers participating in its ambitious radio-frequency identification project. When RFID-tagged pallets and cases begin moving en masse into three distribution centers in Texas, and data begins to flow from them into Wal-Mart's Web-based supplier-collaboration system, it will be the start of a revolution in supply-chain management.
Executive VP and CIO Linda Dillman and some 2,400 people who make up Wal-Mart's Information Systems Division can take credit for leading the charge that already has expanded far beyond the retailer's four walls. A couple of years ago, Wal-Mart was involved with MIT's Auto-ID Center doing field studies on RFID. It was perfect research work, but too fragmented an effort to drive industrywide adoption, Dillman says. "You couldn't try RFID in all the scenarios," she says. So Wal-Mart picked one approach--tagging cases and pallets--and issued an edict to have its top 100 suppliers focus on that for a January 2005 deployment, in the process driving commitment from some major, but hesitant, tech vendors. "That was critical to make the technology work," Dillman says.
Within Wal-Mart, a team of four RFID pioneers (later expanded to eight people) headed by Simon Langford, manager of global RFID strategy, did a lot of the heavy lifting. But both Dillman and Langford point out that the project was possible only because of the support of Wal-Mart's entire Information Systems Division. "There's no sense of pride to solve something yourself," says Dillman, a 12-year Wal-Mart veteran who joined the retailer when it acquired the Wholesale Club in Indianapolis, Ind., where she had been a senior systems analyst. "There is strength in numbers, in reaching out to others."
In the last year, collaboration in the division has fueled some 2,500 projects, from the RFID deployment to rolling out global financial systems that make it easier for stores to more quickly close their books each month, as well as adding features to point-of-sale systems that help Wal-Mart's approximately 1,360 discount stores, 76 Neighborhood Markets, 1,062 Supercenters, and 550 Sam's Clubs nationwide comply with local labor laws.
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The Information Systems Division team at Wal-Mart's headquarters deserves credit for the company's success, says CIO Linda Dillman (front center in the blue jacket, with Tony Puckett, VP of international systems, second from left; Randy Salley, VP of app development, third from left; Carol Mosely, VP of information systems, in front of Salley; Mark Porter, director of information security, two people to right of Dillman).
Photograph by Bob Stefko
Indeed, collaboration is critical for speed, efficiency, and innovation. The company has more than $250 billion in yearly revenue and a below-the-industry-average IT budget, relies on homegrown software to run its business, eschews outsourcing, and requires systems to be available for global use. "The [application] development isn't successful if the infrastructure team that builds the physical system isn't successful," says Dillman, 48, whose career at the retailer included manager, director, and VP positions in application development before she became VP of international systems. "The infrastructure team isn't successful if the operations team doesn't know how to measure the system. They all are measured in their success based on the final impact to the business." That shouldn't be a surprise, given that the Wal-Mart culture is to consider every employee a merchant first, and each one's goal is to serve the customer.
Dillman objects to being the star behind any of Wal-mart's IT productions, including the RFID drama. For one thing, the first push for using RFID in the supply chain came from Thomas Coughlin, now vice chairman of the board of directors, she says. The result of the combined efforts of many people within Wal-Mart is that retailers Best Buy, Target, and others, as well as the Department of Defense and the pharmaceutical industry, have begun RFID initiatives; the travel industry, health care, and other government agencies are interested in what RFID can do for them; and leading vendors are shipping in volume RFID tags and software that supports the technology.
But Dillman certainly has played an important role since March 2003, when she stepped on stage at the Retail Systems show in Chicago to unveil Wal-Mart's plan. She's been out in front collaborating with her competitors to make sure that the industry's efforts succeed, has been involved in helping to clear up confusion about RFID's costs and benefits, has worked with suppliers to overcome their initial skepticism, and helped drive the adoption of EPCglobal standards (see "Wal-Mart's Way," Sept. 27, p. 36).
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