PG and Walmart Collaboration - 5345 Words

Supply-Chain Integration through Information Sharing: Channel Partnership between Wal-Mart and Procter Gamble Michael Grean Director, Information Technology Customer Business Development The Procter and Gamble Distributing Company, 655 East Millsap Road, Fayetteville, Arkansas 72703 Michael J. Shaw Department of Business Administration University of Illinois at Urbana-Champaign Champaign, IL 61820 Abstract This paper describes the development of channel partnership between a manufacturer (Procter and Gamble, or PG) and a retailer (Wal-Mart). Both major players in their industries, PG and WalMart found a way to leverage on information technology by sharing data across their mutual supply chains. The resulting channel has become more†¦show more content†¦Yet, as described in this paper, the two companies in the beginning were both tentative. They essentially stumbled into the idea and then, as the value started to be discovered, progressively built stronger collaboration as more benefits were unleashed. The partnership started with the simple desire to improve business relationships, and was gradually enhanced by sharing information and knowledge about their respective markets. This sharing in turn enabled more effective execution of such concepts as category management, continuous replenishment, and process coordination, which collectively helped make the supply chain more effi cient. Clark and McKenny (1995) detail the development of the supply-chain collaboration and describe the process in which the channel partnership between the two companies was built on an incremental basis. 3 The remainder of the paper is organized as the following. Section 2 presents the business background behind how the two companies started building the partnership. Section 3 discusses how PG and Wal-Mart built channel partnership and information sharing. In Sections 4, the details of how the two companies implemented information sharing and continuous replenishment is discussed. Section 5 further describes the additional benefits of the information partnership. Section 6 discusses the logic category management. Finally, Section 7 concludes the paper. 2. Business Background To fully comprehend the role that technology has played in theShow MoreRelatedWal Marts Competitive Advantage1744 Words   |  7 Pageswas able to find lower-cost suppliers and also shared his data than those used by other stores. Walmart is an organization that uses analytics extensively and systematically to outthink and execute the competition. Walmart has gained competitive advantage by following four pillars of analytical competition. These are; Walmart support strategic distinctive capability. 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