Researcher’s Note: UNIT 31. AI as Your CFO: Cutting Costs, Boosting Efficiency

Published by Dr. Ken – PhD

Doug McMillon, CEO of Walmart, isn’t just running a retail giant; he’s engineering a data-driven, AI-powered ecosystem that’s transforming how the company operates. McMillon recognizes AI’s potential not just to enhance customer experiences, but also to revolutionize Walmart’s internal processes, creating significant cost savings and boosting efficiency. Since 2017, Walmart has made AI a central part of its strategy26.

McMillon has emphasized Walmart’s commitment to integrating AI into its core operations, driven by the vision of becoming the world’s leading data-driven retailer26. This strategic vision has led to a surge in AI use cases across the company1.

The Turning Point: AI-Driven Optimization Across the Board

A pivotal moment in McMillon’s AI journey has been the implementation of AI solutions to tackle a broad array of challenges, going beyond the initial focus on supply chain and delivery optimization123.

Walmart is now using AI to manage its inventory, optimize deliveries, enhance developer efficiency, and improve the online shopping experience135. By applying AI across various facets of the company, McMillon is driving a comprehensive transformation that’s yielding tangible results357. The company follows three key principles: eliminate, automate, and optimize4.

As a result, Walmart has focused on developing AI-powered solutions that drive practical business outcomes, and that the success hinges on carefully selecting the right tools for specific use cases4.

The Strategy Behind AI-Driven Efficiency at Walmart

McMillon’s strategy for leveraging AI to cut costs and boost efficiency is based on several core principles:

1. Customer-Centric Approach: Walmart’s AI strategy is customer-centric, ensuring that automation translates into tangible benefits for shoppers4. By enhancing the online shopping experience and streamlining in-store processes, Walmart is creating a more convenient and enjoyable experience for its customers35.

2. Empowering Associates: McMillon recognizes that AI should empower Walmart’s associates, not replace them. By providing associates with AI-powered tools, Walmart is enabling them to work more efficiently and effectively57.

3. Data-Driven Insights: McMillon emphasizes the importance of using data to inform decision-making at all levels of the organization26. By leveraging AI to analyze vast amounts of data, Walmart is gaining valuable insights into customer behavior, market trends, and operational inefficiencies35.

4. Pragmatic mindset: Walmart focuses on real-world implementations that make sense for the business, the customer, and the associate4.

The Impact: Tangible Savings and Improved Efficiency

Under Doug McMillon’s leadership, Walmart is realizing significant benefits from its AI investments. For example, Walmart used large language models to create or improve over 850 million pieces of data across its product catalog3578. Walmart’s AI coding tools helped the firm save about 4 million developer hours1. By automating tasks, optimizing processes, and improving decision-making, Walmart is cutting costs, boosting efficiency, and creating a more agile and responsive organization357.

As Andrew Ng famously stated, “AI is the new electricity.” McMillon embodies this philosophy by integrating AI into every aspect of Walmart’s business, driving transformative change and positioning the company for long-term success. His strategic vision serves as an inspiration for business leaders looking to unlock the potential of AI to cut costs, boost efficiency, and create a more sustainable and profitable business.

Despite the successes, Walmart CFO John David Rainey acknowledged the ongoing uncertain time, and the retailer expects fiscal 2026 revenue growth below 2025’s 5.1% increase, at 3% to 4%1. Nonetheless, Walmart is planning a broader rollout of AI-powered coding tools9.