Information System
Today, the 21st century is characterized by an information edge, and many organizations that cling to outdated business practices are left behind. It is observed that companies are now emphasizing information systems as a key tool for gathering relevant data to facilitate decision-making. Those companies prioritizing this approach are among the top Fortune 500 companies, including Walmart Supermarket.
According to Hemmatfar et al. (2010), the comprehensive changes in business background, the emergence of computers, and the internet have transformed information into an integration agent and an enabler of new competitiveness in today’s global marketplace. By contributing to an organization’s strategic goals and boosting its performance and productivity, a strategic information system (IS) helps an organization gain a competitive advantage (Hemmatfar et al., 2010).
Information systems use technology, people, and processes to gather, store, process, retrieve, and distribute information. The primary objective of an information system is to meet the needs of an organization, its employees, and its customers by providing relevant and timely information (Bourgeois, 2014). There are five components of an information system: combinations of hardware, software, networks, databases, and human resources, which people build and use to support organizational needs. Financial systems, operational systems, and strategic systems are the three main categories of IS that have been established and widely used (Hemmatfar et al., 2010).
Hardware
Hardware refers to an information system’s tangible, physical components (Bourgeois, 2014). It includes all physical devices that can be seen and touched. Computer hardware comprises the central processing unit (CPU), motherboard, memory, hard drive, monitor, input/output devices such as printers and headsets, and other components. The CPU is the computer’s brain, responsible for processing and executing instructions and performing calculations. Memory is a place for storing data and instructions that the CPU can access quickly.
The motherboard connects all the components and allows them to communicate with each other. The hard drive is the primary storage device that stores the operating system, software applications, and user data. The monitor displays the computer’s output and allows users to interact with the keyboard, touchpad, or mouse.
Software
Software is a collection of commands that informs hardware what to perform. (Bourgeois, 2014). Software cannot be touched since it is not physical. It consists of instructions or code written in a specific programming language and executed by a computer processor (Bourgeois, 2014).
There are many different types of software, but the two basic types are operating-system software, which enables hardware usage, and application software, which performs different beneficial tasks (Bourgeois, 2014). Microsoft Windows and Google’s Android are examples of operating systems used on personal computers and mobile phones. Regarding application software, Microsoft Excel is a prime example widely used for various purposes such as data analysis, financial modeling, and project management. (Bourgeois, 2014).
Network
A network comprises interconnected devices such as computers, servers, printers, and other devices that share resources, exchange data, and communicate (Bourgeois, 2014). A network can be wired or wireless and classified based on size and geographical area. For example, a network in a home or office is called a Local Area Network (LAN), while a network that covers a large area, such as different cities and counties, is called a Wide Area Network (WAN). A Metropolitan Area Network (MAN) connects devices in a single city (Bourgeois, 2014). The primary function of a network is to enable and facilitate communication and data exchange between devices for sharing files and folders, accessing the internet, and using network-enabled applications.
Database
A database is a structured data collection organized to enable efficient data storage, retrieval, and management. It is designed to store a large amount of data in a structured format that can be accessed, managed, and updated efficiently and quickly. As Bourgeois (2014) explains, while individual data units may not hold much significance, they can become a valuable asset for enterprises when combined, classified, and arranged systematically within a database. In a database, data is organized into tables with rows and columns.
Human Resource
Human resources refers to the people who work for and manage the organization’s workforce. It is a department responsible for managing employee relations, recruitment, training, and benefit administration. The primary purpose is to ensure the company has the right people with the right skills and abilities to achieve its goals (Bergstrom, 2012).
Walmart’s Use of Information Systems
Walmart’s investment in information systems has created a competitive advantage for the company. According to Garcia (2020), Walmart has become one of the largest retail companies in the world, and this success can be attributed in part to its use of information systems. Specifically, Walmart implemented the Global Donation Management System (GDMS) software from Global Governance Digital Solutions for their Information and Decision Support Systems, which allows them to give back to people and communities. Additionally, Walmart developed and implemented bar-code technology and checkout scanners, which have helped them track the distribution of products and ensure they are placed in the correct locations.
One of Walmart’s key strengths is its use of AI and machine learning to optimize its supply chain operations. The company has developed a sophisticated system for real-time tracking of inventory levels, enabling it to manage its logistics and supply chain operations more effectively (Garcia, 2020). This system allows Walmart to minimize the inventory it needs to hold at any given time while ensuring it always has enough stock to meet customer demand. Besides, the company’s irrigation system is cloud-based, allowing it to monitor data movement, track in real-time, and control watering instructions (Walmart, 2018, p. 87).
Another strength of Walmart’s information systems strategy is its use of business intelligence tools, such as Tableau, to analyze data from various sources. These tools allow the company to identify trends and patterns in customer behavior, which helps it make more informed decisions about pricing, product placement, and other key factors that impact its bottom line.
Walmart has also invested heavily in customer-facing applications and e-commerce, bringing the company ahead of its competitors, such as its mobile app and website (Garcia,2020). These tools allow customers to shop online, view product information, and manage their accounts from anywhere. As per Mohammed Kemal’s 2019 report, Walmart leveraged its internal cloud network to gain a significant online shopping market share. Additionally, Walmart strives to outperform Amazon’s utilization of cloud-based big data that fuels digital sales.
As with any other company in the digital age, Walmart’s information systems are threatened. A potential cyberattack could compromise customers’ data and impact the company’s reputation. Another potential challenge is the increasing competition in the e-commerce space. Companies like Amazon continue expanding their reach and capabilities, which could make it harder for Walmart to maintain its position as a leader in online retail. To stay competitive, Walmart must continue to innovate and invest in new technologies and its approach to cybersecurity.
References
Bourgeois, D. (2014). Chapter 1: What Is an Information System? Opentextbook.site; Published through the Open Textbook Challenge by the Saylor Academy. Web.
Garcia, G. J. (2020). Information Systems Utilization of an Organization: The Case of Walmart Inc. ResearchGate. Web.
Hemmatfar, M., Salehi, M., & Bayat, M. (2010). Competitive Advantages and Strategic Information Systems. International Journal of Business and Management, 5(7). Web.
Kemal, M. (2019). Beneficial uses of Cloud Computing Service and Deployment Models. ResearchGate. Web.
Walmart. (2018). 2018 GLOBAL RESPONSIBILITY REPORT. Web.