Online innovation at Walmart?

According to a recent post about Walmart’s strategy to grow its online business on Wired.com: “Big companies tend to pay a lot of lip service to maintaining a startup vibe. Bring in a pool table and ping-pong (both on display here, along with a small cadre of inflatable aliens) and, whadaya know, innovation begins! Bureaucracy disappears!

“But Walmart’s engineers have pulled off at least one project that appears to prove the principle that giving a few smart people some freedom and time to work on something hard can end up making a company a lot of money.

“Walmart VP and former eBay engineer Sri Subramaniam says the team he led to build Walmart.com’s new search engine had about 15 people. In three months, he says they had a prototype. The A/B testing started in fewer than six months. About nine months after they started, the search engine, designed to translate your searches into the stuff you really want to buy, went live. Subramaniam says it’s still being tweaked constantly. “The culture of experimentation is very much alive,” he says.

“’And that experimentation pays off,’ says Walmart.com CEO Joel Anderson. Since the new search engine launched in August, 20 percent more searches turn into sales than before. With those results, Anderson is more than happy to pay tribute to the startup ideals of iteration and failing fast. “Testing is really critical to long-term success,” he says.”

Click here to read the full story.

This story got Linkage’s innovation expert Shannon Bayer wondering: “Is Walmart truly ready to disrupt its own business to compete with Amazon? It’s rare that a retail giant of this magnitude would so readily attack its own brick and mortar locations to ensure long-term growth. Can this ‘old’ organization truly create a disruptive innovation spirit with the startup ideals of iteration and failing fast? Maybe so, and according to Wired, Walmart certainly has the funds for failure, and the hopes to grab at some success that will allow them to dominate the online retail space the way they want.”

It appears that Walmart is already seeing positive results from this new strategy. And it just goes to show that you can’t rest on your past success even if you’re the biggest retailer in the world with yearly revenues that dwarf many countries.

What do you think? Is innovation really possible in a large organization? 

More about Shannon
Shannon Bayer is a Senior Consultant at Linkage. She specializes in providing facilitation and program design for innovation and change leadership. She also works with organizations to improve team effectiveness, negotiation, and coaching. Follow her on Twitter @ShannonJBayer.