As Walmart has sought to build out a technology operation to compete with Amazon, it has changed the way it thinks about the role of its tech executives. The company has gone from thinking of its e-commerce and tech teams as entirely separate divisions to giving its top tech leaders more responsibility over multiple parts of the company.
Walmart first started building out a separate tech division in 2011, when it acquired a social media analytics company called Kosmix. Walmart used the remaining hires from Kosmix to start building out a new division called Walmart Labs, which it branded as the technology arm of Walmart. Since then, Walmart has continued to staff up Walmart Labs — most recently, going on a hiring spree last year for the division to power its grocery pickup efforts. Walmart didn’t provide an exact number of people employed by Walmart Labs by press time, but at this time but last year, it employed a combination of roughly 6,000 full-time and part-time employees within Walmart Labs and planned to hire 2,000 more by the end of the year.
However, it’s no longer just Walmart Lab employees who are working on building out Walmart’s most important tech initiatives. Marc Lore, founder of Jet.com, which Walmart acquired in 2016, now oversees the company’s U.S. e-commerce operations. In April, Walmart announced it was acquiring advertising tech startup Polymorph Labs, to bring on the tech talent necessary to help Walmart build out an advertising operation.
Earlier this week, Walmart appointed a new CTO: Suresh Kumar, formerly Amazon’s vp of worldwide retail systems and most recently Google’s vp and gm of display, video, app ads and analytics. Kumar will not replace former CTO Jeremy King, who left Walmart to join Pinterest in March, but instead will step into a newly created dual role as the company’s chief technology officer and chief development officer. In his role, Kumar will report directly to CEO Doug McMillon. The chief technology officers from Walmart’s U.S., Sam’s Club, and international divisions will all report directly to Kumar, as well as the chief information officer of Walmart’s internal IT organization, called its global business services division.
That will give Kumar the ability to see what kind of new tech and services are gaining traction in different divisions — Sam’s Club, for example, last year opened a new test store in Dallas to experiment with new technology like scan-and-go checkout, wayfinding technology and electronic shelf labels. Meanwhile, Walmart’s chief information officer has been overseeing the launch of a joint engineering office with Microsoft, where the two companies develop internal apps. By creating a more unified reporting channel for its tech leaders, Walmart will get the ability to scale new tech services and applications faster — something that will be critical as it seeks to compete with Amazon, which has in the past been able to roll out capabilities like next-day delivery much faster than Walmart.
“We have started a significant digital transformation in our business, but we have a long way to go. We want to pick up the pace and increase the magnitude of change,” McMillon said in an email to employees explaining why Walmart had decided to create a new role for Kumar.
It’s indicative of the elevated role technology now plays in Walmart’s business growth, as the company seeks to roll out a variety of new services, like grocery pickup, that require technological capabilities to be built in-store and online.
“It’s a clear indication that Walmart’s not just a retail organization, but a technology company,” said Robert Hetu, lead retail analyst for Gartner.
Kumar in inheriting a tech foundation established by King, who oversaw both the technology teams for Walmart’s websites and stores — a move designed to help Walmart create a more unified customer experience across both online and in-store. While at Walmart, King’s pitch to potential recruits was that Walmart, given its store reach, was a place to work on unique machine learning problems that consisted of large data sets.
“Jeremy reinvented the way Walmart did technology — previously they were a very dyed-in-the-wool brick-and-mortar retailer,” Jon Reily, vp of global commerce strategy at Publicis Sapient said. “They didn’t play much in e-commerce.”
On the e-commerce end, Jet.com co-founder Marc Lore has led acquisitions and next-generation retail initiatives to help attract new talent. Lore is now the president and CEO of Walmart’s U.S. e-commerce division, and has overseen efforts like the company’s push to roll out next-day delivery, and the launch of internal incubator Store No. 8 in 2017. That initiative has been staffed by a number of Jet.com alumni, like Katee Finnegan, who recently left the company. It has also attracted some high-level retail talent, like former Rent the Runway co-founder Jenny Fleiss, who oversaw the launch of personal shopping service Jetblack.
Now, with the addition of Kumar, Walmart gets another high-profile name with connections to multiple high-profile tech companies to attract new recruits.
“It’s difficult for a company like Walmart to bring people from Pinterest, to bring people from Google,” Reily said. “The fact that they are doing it and doing it successfully means they are paying people a fair amount of money and are pretty invested in bringing them in.”
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