Supply chain management: Wal-Mart invests in logistics

The other day, I wrote a column about the lessons supply chain professionals can learn from the recent volcano in Iceland.

A news announcement from Walmart Stores the other day got me thinking about what we can learn from the world’s largest retailer. The answer, by the way, is that investments in your supply chain count, even in a down economy. They might count even more in a down economy.

Walmart is, after all, the world’s largest retailer and the largest employer in the United States. That said, much of the news about Walmart lately has been negative. For awhile, retail analysts thought that affluent consumers who were holding their noses while looking for bargains in Walmart’s aisles had made a permanent shift. Turns out, that may not be the case. Walmart’s sales have disappointed of late as those more affluent shoppers return to Target and the blue collar worker who is Walmart’s bread and butter remains under stress thanks to higher gas prices and continued layoffs. Walmart is now looking to the overseas markets for its future growth.

But that doesn’t mean Walmart is tucking tail and running for the hills. In fact, Walmart, which has always prided itself on having the leanest and meanest supply chain in the business, continues to look at its warehouse and transportation operations to stay on top. Along with the usual commercials touting Walmart’s low prices, Walmart has been running television ads featuring truckers who talk about the role they play in helping consumers save money. Can you think of another retailer that uses its supply chain to attract customers?

But what really caught my eye was an announcement last week from Walmart about a new Lifelong Learning Program. In partnership with American Public University, an online university, Walmart will invest up to $50 million over the next three years to provide tuition assistance to associates who want to earn college credit. The point of the program, according to the New York Times (Walmart did not return our calls), is “to help employees get more education and to build a better work force.” Classes will be offered “in areas like retail management and logistics.”

What does it tell you when a company that uses its supply chain as a competitive advantage decides to invest up to $50 million during the worst economic downturn in the last 80 years to build a better work force and improve its logistics?