CHAPTER 5
The Who Strategy
More than twenty-five years ago, Walmart and Procter & Gamble pioneered the transfer of decision rights governing the replenishment of store shelves.1 Walmart surrendered those decisions to P&G because it saw that P&G was best positioned to optimize the entire value chain if Walmart gave it access to point-of-sale data. Armed with Walmart’s demand information, P&G could optimize production and transportation logistics. Thus, what came to be known as vendor-managed inventory became the gold standard for many companies in the consumer packaged goods industry and beyond. It was a remarkable shift in the traditional business model. If a company as guarded about its information and decisions as Walmart could see the benefits ...
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