Wal-Mart cutting 300 jobs in information systems unit

Dive Brief:

Wal-Mart is eliminating about 300 jobs at all levels of its Information Systems Division as it continues revamping and streamlining of its technology operations, according to a Talk Business and Politics report.
Some affected employees in the retailer’s Bentonville, AR headquarters reportedly were informed Tuesday that their jobs are being eliminated, and more cuts are expected to continue through the month. Affected employees can remain on the payroll for 60 days and apply for other open jobs in the company in the interim.
Job cuts also are occurring at Wal-Mart-owned Sam’s Club, with affected employees being informed this week, the report states.

Dive Insight:

These cuts come after two separate rounds of layoffs were announced by Wal-Mart in January, when 1,000 jobs were eliminated from the supply chain group at the retailer's Arkansas headquarters, and another 200 e-commerce positions were cut from the company's Silicon Valley office. It also comes barely a week after a trio of technology executives were elevated to new jobs in which they are being charged with driving the integration of online and in-store shopping experiences.

"As we said in January, to fuel our growth and our investments we have to manage our costs and our capital decisions with discipline," Wal-Mart spokesperson Randy Hargrove said in an email to Retail Dive. "This means we will continue to find ways to operate more efficiently and effectively, true to our cost-conscious heritage. In order to achieve this, from time to time you’ll see the company eliminate positions in an effort to stay lean and fast. In some areas, we’ll invest in new positions but in other cases, we’ll operate more efficiently and work to change our processes and become more digital to change the work itself."

Wal-Mart's $3.3 billion acquisition of Jet.com has driven the retail giant to essentially tackle a massive integration of technology that serves customers externally, while it is moving the opposite direction internally, separating customer-focused technology efforts from internal IT and information systems obligations. This seems be getting done with an eye toward freeing externally-focused tech teams and projects perhaps from certain corporate structure and resource limitations.

What does that mean for some ongoing IT projects and responsibilities? The report suggests many of the positions being cut are project management jobs, and that some jobs are being outsourced to a third-party vendor that Wal-Mart already works with in India — a notion which a Wal-Mart official quoted in the Talk Business and Politics report disputed.

Some retailers, such as Target, have been making an effort in recent years to keep technology expertise and projects in-house as much as possible — or at least when and where it makes sense — as they try to own the technology change that is required of them as e-commerce continues to chip away at brick-and-mortar operations. Layoffs suggest Wal-Mart is not doing the same thing, though perhaps the cuts will get the organization in a position where it can move in that direction. Regardless, it would not surprise us if this were not the end of job cuts and revamping moves as Wal-Mart continues to absorb Jet.