Information Technology Impact on Business
In recent years, advances in information technology have made substantial improvements in many aspects of retail sector business, such as logistics, warehousing, and inventory. By examining highly successful businesses and exploring how they have improved their business using technology, it is possible to identify the impact of information technology on the retail sector overall.
One such business is Wal-Mart, whose state-of-the-art technology and business innovations have set the trend for others of its kind. Among the technologies Wal-Mart has used to improve its bottom line are radio frequency identification (RFID) technology and data warehousing. RFID is ôthe practice of putting radiant identification tags on cases and pallets of products;ö each tag would store an Electronic Product Code (EPC), a bar code successor used to track products entering Wal-MartÆs distribution centers and subsequently shipped to individual stores (Williams 2004). Wal-Mart uses RFID along with global positioning system (GPS) technology to provide ôend-to-end visibility of shipmentsö:
As a crate moves out of the shipping area past the ôfinalö RFID reader into a truck, it would continue to be tracked via GPS monitoring of the location of the truck, until it finally reaches a Wal-Mart distribution center where it would be ôreadö into Wal-MartÆs inventory management system (and internal distribution center mapping), and the supplier being informed of a successfully received shipment, in turn triggering billing and other accounting activities (Williams 2004).
Wal-MartÆs data warehousing capabilities are vast, probably making Wal-MartÆs the largest data warehouse in the world with its 423-terabyte system handling data from over 5,000 stores worldwide (Kaltenheuser 2005). WalmartÆs data warehousing operation is so efficient that it costs ôless than one percent of the $256.3 billion in revenu...