Wal-Mart's IT Woes Sound Familiar

In this month’s cover article, CIO Magazine details how Wal-Mart lost its IT edge. The story is applicable to the federal government. The article catalogues how after years of being an IT leader (being among the first to adopt bar-code scanning, satellite communications, electronic data interchange, and a supply chain management system that automatically triggered orders to suppliers when stocks dropped) Wal-Mart’s legendary IT department has fallen on hard times, including some failures in the social networking realm. The IT problems have indirectly contributed to failed ventures in international markets and missed profit projections.

The failed ventures and lower profits may not be specifically applicable to government, but the reasons for Wal-Mart falling off its IT game may be. According to the article, Wal-Mart “has relied too much on centralized decision making” and “analysts say that Wal-Mart's reliance on homegrown IT systems -- and its conviction of their superiority -- needs to change.” Wal-Mart’s chief information officer, Rollin Ford, “must bring in best-of-breed commercial applications,” such as Business Intelligence and other IT tools to improve operations. “We cannot overestimate how much packaged software can help them right now,” says Paula Rosenblum, an analyst and managing partner with Retail Systems Research, according to the article.

Sound familiar? Also, what Wal-Mart is trying to do to recover its "IT mojo," as CIO calls it, holds some lessons for the federal government.

As an aside, it wouldn’t be too surprising if some government IT managers are now feeling redeemed after Wal-Mart was held up as a better relief provider than FEMA after Hurricane Katrina â€" mostly because of the company’s superior IT operations.