Supply Chain Management and I2 Implementation Nike

Topics: Supply chain management, Enterprise resource planning, ERP software Pages: 3 (1255 words) Published: May 1, 2013
Nike is the world's leading supplier of athletic shoes and apparel and a major manufacturer of sports equipment, with revenue in excess of US$24.1 billion in its fiscal year 2012 (ending May 31, 2012) (Nike Inc). The brand alone is valued at $10.7 billion making it the most valuable brand among sports businesses (Nike Inc). Starting in 1999, Nike decided to implement the first part of its supply chain strategy; the demand and supply chain planning application software from i2 technologies. Nikes total ERP implementation was estimated to cost $400 million,to upgrade their supply chain and ERP systems, however, the i2 implementation ended up costing Nike an estimated $100 million in lost sales, depressed its stock price by 20%, and triggered a flurry of class action lawsuits (Christopher Koch). The supply chain software implementation of i2, estimated to cost $40M, was the first part of a (NSC) Nike Supply Chain project. The (NSC) Nike Supply Chain project was a project to rollout an integrated ERP system from SAP, and customer relationship management (CRM) software from Siebel Systems. i2 Technologies was a supply chain management software and services company with software designed to improve the management of inventory, production, shipping, and sales forecasting (I2 Technologies). Nike was specifically looking to use the i2 software to help reduce the amount of manufactured materials needed in their shoe production by better forecasting customer demand and material requirements. Nike’s implementation of i2 software was also targeted to fulfill customers demand quicker. In 2000, Nike launched the i2 software using its old systems rather than launching it during the larger SAP ERP implementation. At the time of the i2 implementation Nike didn’t feel the current software offering had all the required functionality that they needed, and requested i2 customize the software specifically for Nike. In addition, when implementing i2, Nike chose to use a single...
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