A few short years ago, most pundits had written off Walmart, the giant retailer that revolutionized commerce but was being threatened and seemingly bested by Amazon. In the past few months, however, Walmart seems to have rekindled its competitive spirit, and has gained ground on Amazon in areas from providing a unique data center offering leveraging its stores, to local grocery delivery that has made a significant impact as millions stay home due to COVID-19.
SEE: How to cultivate an inclusive workplace for LGBTQ employees (free PDF) (TechRepublic)
Recently, Walmart announced the rather brilliant concept of turning its parking lots into drive-in movie theaters. Initially, this might seem like an odd offering for a retailer, but on closer inspection it’s an incredibly savvy move on two primary dimensions. First, Walmart is leveraging a unique and largely underutilized asset that it already owns: Its thousands of parking lots. Secondly, movies create a broader “brand halo” and position hundreds of people within a dozen paces of its core retail offering.
The power of lazy assets
Walmart’s parking lots are the quintessential lazy asset: A physical object or capability that is key to your core business, but otherwise underutilized. Stores, especially those in rural areas, obviously need parking, and Walmart is famous for generally locating its stores in lower-cost rural areas and providing what seems like miles of blacktop to facilitate peak parking demand. That land is otherwise unused, and a minimal investment of projection equipment and temporary screens easily turns it into a movie theater that’s uniquely suited for an era of social distancing combined with consumers who are craving entertainment outside their homes.
These parking lots are also a perfect asset in that they’re difficult to copy. A competitor could easily acquire hundreds of projectors, but acquiring the real estate to create thousands of square miles of parking that’s in driving reach of most US residents would be costly and time consuming. This is also not the first time that Walmart is leveraging the power of its retail footprint, as the company announced that it would use stores as distributed data centers optimized for “edge computing,” whereby geographic proximity to a data center was required for applications like self-driving vehicles or Internet of Things (IoT) platforms.
Feeding the core business
The second element of this announcement that makes it so compelling is that the drive-in business directly augments Walmart’s core retail business. In many rural communities, Walmart is not only a store, but a grocer, eye doctor, and informal community hub. Adding “entertainment” to that list of features makes sense, especially since a drive-in movie theater requires minimal additional staff and puts potentially hundreds of additional customers at your store, most of whom might want a snack with their movie or need to do some shopping. It’s not much of a cognitive leap to imagine someone entering a store for a pack of Skittles and coming out with a half-dozen other items.
Look for your lazy assets
Walmart’s move may seem outside the purview of technology leaders who don’t exert control of a company’s physical assets. However, at most companies an “inverse Pareto principle” of sorts is probably in operation, with 80% of your assets utilizing only 20% of their capabilities.
Consider your major software and technology platforms. Do your employees use more than 20% of the capabilities of an asset as simple as Microsoft Outlook? Does more than 20% of the data swimming in your data lakes get analyzed and leveraged into action? Does that peak capacity designed into your data center or cloud computing projects ever get used? An asset as simple as a desktop workstation that’s generally left on in the evening is a lazy asset, and video production companies have used exactly these assets to augment their video “render farms” when office workers have gone home.
SEE: TechRepublic Premium editorial calendar: IT policies, checklists, toolkits, and research for download (TechRepublic Premium)
As part of your planning, take an inventory of your most expensive assets, as these are likely ubiquitous, difficult to duplicate, and potentially underutilized. Consider how that asset could be otherwise leveraged, even if it’s an idea that seems as strange as a retailer creating ad hoc drive-in movies, as there may very well be a direct link back to your core business. When doing this exploration, it can be helpful to bring in outsiders from other groups or even outside your company, as they will have the “beginner’s mind” that’s sometimes required to question why you’ve acquired assets that seem obvious to an expert.
While you may not be airing summer blockbusters using excess server capacity, it’s highly likely that there are technology assets that can create new value, and ideally augment the core business as well. Done well, you’ll also turbocharge the return delivered from assets you already own, creating a performance that’s anything but lazy.