Slide 1: SCM & ERP Software Implementation At Nike: from Failure To Success
GROUP- E ARVIND ACHANTA HARINI CHODAGAM MANISH KHURANA MUDITA MEHROTRA NITHEEN PATRIC PRATEEK BAJORIA SAKET KHANDELWAL S P PARHI SWATI
Slide 2: OVERVIEW OF THE CASE
• • • • • • • • Introduction: NIKE Supply chain management NIKE’S supply chain i2’s debacle Reasons for i2’s software failure Implementing SAP AFS Benefits Conclusion
Slide 3: Introduction: NIKE
• Founded in 1957 by Philip Knight. • Manufacture:
– – – – Sports equipment Sports wear Apparels Accessory products
• Products sold in over 140 countries.
Slide 4: SUPPLY CHAIN MANAGEMENT
• SCM is a business network covering from buying, making, moving, warehousing to selling
Making Buying Moving
Selling
Ware housing
Slide 5: NEED FOR SCM
Slide 6: NIKE’S SUPPLY CHAIN
• In 1975, Nike introduced Future Program. Supply Chain Management was inadequate. 1998, Nike’s global operations were broadly divided into 5 geographic regions. Nike’s profit dropped by 50% from US$ 798 million to US$ 399 million. • Launched NSC Project. Initiative of “Shelley Dewey”, Vice President of Supply Chain and Steele. Implement its ERP, Supply Chain, & CRM Software onto a single SAP Platform.
Slide 7: NSC PROJECT
Slide 8: NSC IMPLEMENTATION STRATEGY
Slide 9: i2’s Software Implementation
• First part of supply chain strategy. • Cost of this project was US $40 million. • To match supply with demand. • To reduce the amount of raw material. • Used it as a legacy system rather than as apart of SAP ERP project.
Slide 10: i2 Trade Matrix Plan Solution
Solution Objective Challenge Capability Benefit
Strategic Planning
Maximize profitability by optimally allocating resources Anticipate and influence demand
Unclear parameters
Optimization
Long term profitability
Demand management
Accurate demand estimation is difficult
Demand planning, channel collaboration
Improved customer service
Supply planning
Determine what to make and when and how to profitably distribute supply Determine what to produce and when
Size and complexity of problem
Collaboration, optimization, Speed
Global visibility and coordination , fast reaction to changes Reduced inventory, Improved due date performance
Production
Managing material & capacity trade offs is complex
Fast finite material & capacity planning & scheduling
Slide 11: REASONS FOR i2’S SOFTWARE FAILURE
• • • • • Third party integrator. Inexperience of i2. Customization. Trying to forecast too far out ahead. Pilot test.
Slide 12: Continued. . .
•Problems in smooth integration. •Inadequate information. •Changing market conditions. •Complication of NSC project. •Review meetings.
Slide 13: Implementing SAP Apparel and Footwear Solutions (AFS)
SAP E RP Projec t
Big Bang Approach
Single Instance Strategy
R/3 Variant
Purchased in1998
Slide 14: Im pl e
Continued. . .
a il t l Bu ba o Gl plate m Te
me nt a n ti o
e los sC er tn Par ip h
n itio ng ns Tra Traini g , lan estin P &T
Slide 15: After Learning the Lesson
i2 Software
The SAP AFS
Just Do It
Slide 16: BENEFITS
Slide 18: Measures to overcome demand forecasting problem
Slide 19: Importance of demand forecasting
• Determining the quantities. • "make to stock" rather than "make to order“ • Reduces supply time. • Efficient forecasting
Slide 20: Ways to avoid supply chain problems
Slide 21: Lessons Learned
Be Patient Define a business Goal Re-engineering Process Just Do It Over Keep your eye on the price
Slide 22: CONCLUSION
• Implementation is a complex process. • Evaluating pros and cons. • Continuous assessment. • Adaptability • Importance of pilot test.
Slide 23: Thank you
Just do it
