CIO: Typically, companies start a pilot and develop one of these cross-functional teams, and meanwhile the rest of the organisation keeps cranking along, doing things the way it always has. Then you have conflict between the groups: Which is better, our way or theirs? How did you deal with that?

That's exactly how it played out. I remember sitting in a meeting with Dick Beckhardt, who is an organisation effectiveness guru, and him saying:"You know, your organisation is going to want to kill this."

Meaning they won't like what's going on at Wal-Mart because they're losing control. And he was absolutely right. So the senior sales executive had to support the team and protect it until it was strong enough.

CIO: Give me some examples of some of the things you had to defend against.

Drayer: Whereas before a product division might have had direct responsibility for Wal-Mart, now all of a sudden there was this corporate person responsible for the team and the business at Wal-Mart. The battles were continuous. Everything from, What resources are we going to put on this team? to, We don't like that particular promotion.

CIO: What enabled you to fight off the internal challenges?

Leadership: senior managers being committed to this change.

CIO: What would you say to industries that despair of this ever working?

Drayer: One of the hurdles when it started was I don't want to sit down with competitor X, Y, Z and compare data. What you find is that on things like EDI and even continuous replenishment, that shouldn't be an area of competitive advantage. It's how you execute a standard or an agreed-upon process that will determine your advantage in the marketplace. The leaders who started all this and shared the information are now onto the next innovation.

CIO: But you're P&G. You have clout and respect. How can a small company expect to do something like this?

Drayer: Well, the small companies that could never have done it all of a sudden had the opportunity to use continuous replenishment. The first company to take advantage of the IBM service offering was a little company called Golden Cat. They made kitty litter. Their CEO said: My gosh, that's perfect for my business! He had that system up and running for most of his big customers in two months. He was so successful he was purchased by Ralston Purina. So the small companies - if the CEO sees the advantage - can take advantage a lot quicker than the big guys.