Systems Thinking at Walmart Walmart and G.E. have combined forces to reduce the

Question

Systems Thinking at Walmart

Walmart and G.E. have combined forces to reduce the cost of lighting in Walmart stores world-wide. One step toward this effort was to switch from fluorescent lighting to LED lighting for overhead lights in Walmart stores. This move is estimated to save more than $34,000 a year per store. In addition to overhead lighting, Walmart introduced LED lighting in the freezer cases used in stores. A 50% reduction in wattage from the LED lights resulted in a 50% reduction in heat load in the freezers which resulted in less energy being used for the overall refrigeration load and extended life for the freezers. Additionally, Walmart has begun installing LED lights in their parking lot lighting. LED lights last longer than traditional light bulbs which means reduced maintenance costs on replacing burned out bulbs. Moving forward, Walmart is looking at switching to LED lighting in their warehouses and distribution centers.

Instead of only focusing on how much money can be saved through an investment in LED lighting, Walmart looks at all related costs. This would mean that, in terms of systems thinking, Walmart would consider which of the following? Check all that apply.

a)Costs associated with purchasing store inventory

b)Maintenance costs related to changing lightbulbs in stores

c)Freezer equipment replacement costs

d)Printing costs for weekly circular advertisements

Explanation / Answer

The costs that Walmart need to consider in terms of systems thinking include -

b) Maintenance costs related to changing lightbulbs in stores

c) Freezer equipment replacement costs

Both these costs are directly or indirectly related to energy saving and cost reduction plan. As a part of changing all the lighting to LED, the firm should also consider the maintenance costs related to changing the bulbs in teh stores. Also, freezer equipment lighting needs to be changed which might require the replacement costs for freezer equipment.

Rest two options are completely unrelated to the energy saving costs.

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