Struggling supermarket Asda is facing multimillion-pound fine over botched IT upgrade

Asda has been attempting to untangle its technology systems from former majority owner Walmart for years in a scheme named ‘Project Future’, but is now facing the real chance of missing the February deadline.

If Asda does miss the deadline, it will face a penalty charge from Walmart for continued use of the American giant’s technology, which industry sources claim could “quickly rise to millions of pounds” according to The Telegraph.

“Everyone you talk to is saying that Asda is not going to meet the deadline,” said one employee, “IT and Asda don’t mix”.

Project Future has given Asda a number of problems since it began. In March last year, a botched update led to tens of thousands of Asda employees being paid incorrectly, with many being left hundreds of pounds out-of-pocket.

Another IT meltdown weeks later led to thousands of George at Asda orders being disrupted, with shoppers not receiving orders despite being charged.

Now three years old, problems with Project Future are bleeding into Asda’s wider issues, which stem from its debt-fuelled takeover by billionaire brothers Mohsin and Zuber Issa and private equity firm TDR Capital.

Since its sale, Asda’s market share has plummeted from 14.8% to 12.5% and the supermarket has just suffered its worst Christmas performance since 2015.

The IT upgrade has been deemed “mission critical” to Asda’s turnaround plan, but is threatening to blow out into a money sink pit.

With the Issa brothers having both stepped back from the business last year, the executive chairman who helmed the business under their ownership Lord Stuart Rose has also since left.

Now under the leadership of Allan Leighton, Asda announced earlier in January that it had launched a round of job cuts in a bid to reduce costs.

At the time, an Asda spokesman said: “We continue to make good progress delivering Project Future and have successfully migrated large parts of our business to brand-new systems.

“We will continue to take a pragmatic approach when delivering the remainder of the programme and Walmart continues to be incredibly supportive in every way in helping with the implementation.”