Dive Brief:

• Walmart is expanding its technology center in Austin, Texas to accommodate its partnership with Microsoft, according to a company announcement. The center is set to open in early 2019.
• About 30 engineers from both companies, known as the "4.co" team, will work "side by side" to migrate Walmart's business applications to Microsoft Azure. Walmart wants to use the cloud provider's first-hand knowledge around what apps can move to the cloud quickly versus which ones cannot.
• Walmart CIO Clay Johnson wanted to "partner [Walmart's] smart people with Microsoft's smart people" to help innovate internet of things, computer vision, big data and real-time analytics, according to the announcement. Innovations will propel artificial intelligence, machine learning and cognitive services in Azure to help associates "go through unstructured text quickly," said Johnson. 

Dive Insight:

Walmart is making itself a tech company, aided by Johnson's "fail fast" approach to innovation. The organization Johnson is in charge of is "unique" because it's a combination of technology and shared services, he told CIO Dive in September. 

The combination in turn creates a tech model beyond a tech portfolio. It helps create speed and move Walmart into a product model. "I didn't really realize the benefit of it until we put it together," he said. Now the company can make decisions a lot quicker and put Walmart in a position of innovation that's sustainable.

The super retailer already has its own tech hub, Walmart Labs, that equips stores with solutions that better the customer experience in locations across the globe. In June, the company announced it was looking for more than 2,000 technologists to join its existing 6,000 technologists in Walmart Labs. 

The retailer wants to fill roles in data science, engineering and product management. But the extended partnership with Microsoft creates Walmart's first ever "co-location" which will lead to "co-innovation," Johnson said, in the announcement. 

By providing a place where Microsoft can understand Walmart's extensive global presence and its 11,200 international stores and 2.2 million employees, the companies can streamline engineering goals. When there is no disconnect between the two company's engineers, disruptive and large-scale innovations are more likely to happen at quicker speeds.