ENVIRONMENTAL SUSTAINABILITY AT WALMART
1. How is Walmart doing in terms of social and environmental
sustainability?
Walmart views “environmental sustainability as one of the most
important opportunities for both the future of our business, and
the future of our world.” Everyday low prices is the vision that
guides Walmart’s business model, and it is predicated on everyday
low costs. Its environmental vision is equally clear: “to be supplied 100 percent by renewable energy; to create zero waste; and
to sell products that sustain our natural resources and the environment.” Its specific goals in the three areas are as follows:
Renewable energy: Existing stores are to be 20% more
efficient in 7 years, new stores are to be 30% more
efficient in 4 years, and the fleet is to be 25% more efficient in 3 years and twice as efficient in 10 years.
Zero waste: The goal is 25% reduction in solid waste in
3 years and improved brand packaging through rightsized packaging that uses reusable materials.
Sustainable resources and the environment: Walmart’s
goal is 20% of the supply base aligned in 3 years as well
as the design and support of a Green Company program
in China.
These three elements make up what Walmart refers to as its
Sustainable Value Networks. The company has focused on a list
of “Preferred Products,” made up of textiles, seafood, jewelry,
forest products, china, electronics, food and agriculture, and
chemical-intensive products. Renewable energy includes global
logistics, greenhouse gas emissions, and sustainable buildings in
addition to alternative fuels. Waste refers to packaging and opera
tions and procurement.
Walmart has launched various experiments and innovations,
including the following:
Two stores (McKinney, Texas, and Aurora, Colorado)
have shown how multifunctional teams can solve sustain
ability problems as well as foster a more positive shop
ping experience for customers.
Walmart built three high-efficiency stores using recycled
building materials and lighting that conserve energy. The
water-source heating, cooling, and refrigeration system is
completely integrated. The company included ordinary
innovations such as low-flow bathroom faucets and LED
lights and also adopted an advanced daylight harvesting
system and used white roofs.
The first of its next-generation high-efficiency stores in
corporated a secondary-loop refrigeration system, which,
along with other sustainable techniques, made it 25%
more energy efficient than the 2005 baseline and reduced
use of refrigerant 90%.
Walmart is purchasing solar power equipment at a rate
that could put it in the 10 largest ever solar power pur
chasers in the United States. It’s planning to install solar
power at 22 locations in Hawaii and California.
Walmart participates in the Blue Skyways Collaborative
of companies, municipalities, and organizations along
Interstate 35 (from Mexico to Canada) that have joined
forces to reduce pollution.
“Sandwich baling” refers to placing loose plastic between
layers of cardboard for recycling. This reduces waste nor
mally sent to landfills and generates income for Walmart.
Walmart works to reduce packaging. For example, its
changes to packaging for patio sets resulted in 400 fewer
shipping containers. It used 230 fewer shipping containers
to distribute toys.
It sells reusable bags that could eliminate 100 disposable
plastic bags each. It also encourages schools to collect
plastic bags, for which the schools are paid.
Walmart has adopted a series of innovations, including
the following, for its trucking fleet:
1. Improved wind skirts to reduce wind resistance
around the trailer
2. A rear axle single wheel that is smaller than the sum
of the two wheels it replaced
3. A more aerodynamic tractor
4. An eliminated internal drive train, making the rear
axle lighter
5. Development of an auxiliary power unit to keep drivers
warm or cool at night without using the main engine.
Sources: Above information paraphrased from http://
walmartstores.com/Sustainability/ and Erica L.
Plamback, “The Greening of Walmart’s Supply Chain,”
Supply Chain Management Review (July 1, 2007).
LO S5.2: Describe sustainability
AACSB: Ethical understanding and reasoning
2. Based on library and Internet research, report on other
Walmart sustainability efforts.
In addition to the above information, students should note
that Walmart is taking a very aggressive position regarding
the sustainability expectations of its supply chain.
LO S5.2: Describe sustainability
AACSB: Ethical understanding and reasoning
3. Compare the firm’s sustainability plan to that of Home Depot,
Target, or another big-box retailer.
Our reading of Walmart’s efforts is that Walmart is working
at getting ahead of the international movement toward sustainabil
ity and in the process is building a leadership position vis-à-vis
other retailers.
LO S5.2: Describe sustainability
AACSB: Ethical understanding and reasoning
4. How much of Walmart’s sustainability effort is (a) resource
focused, (b) recycle focused, (c) regulation focused, and
(d) reputation focused?
Walmart is making efforts is all four areas:
Its resource focus is somewhat less than that of a manu
facturer, but more than those of smaller, less dedicated
retailers.
Walmart’s recycle effort seems to be well behind the
performance of Frito-Lay, whose performance is stellar,
but ahead of the performance of many other firms.
Walmart seems to be exceeding regulatory requirements.
Walmart, as its Web site and performance suggest, seems to
understand the importance of sustainability on its reputation.
We thank Professor Asbjorn Osland of San Jose State Uni
versity for his contribution to this case and the solution.
LO S5.3: Explain the 3Rs for sustainability
LO S5.5: Explain the impact of sustainable regulations on operations
AACSB: Ethical understanding and reasoning
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Operations Management: Sustainability and Supply Chain Management, 12th Edition (Free Ebooks Download)
Jay Heizer, Texas Lutheran University
Barry Render, Graduate School of Business, Rollins College
Chuck Munson, Carson College of Business, Washington State University
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