NIKE- Failure in Demand Forecasting

NIKE- Failure in Demand Forecasting •

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Veer Gupte Akshay Agarwal Sagar Kulkarni Prathamesh Priyolker Hardik Shah

• Founded in 1957 by Philip Knight • Manufacture: • Sports equipment • Sports wear • Apparels • Accessory products • Products sold in over 140 countries

Supply Chain Management

Business network covering from buying, making, moving, warehousing to selling Making Buying

Selling

Moving

Ware housing

NEED FOR SCM

Distribution network configuration

Distribution strategy

Information

Inventory management

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

REASONS FOR i2’S SOFTWARE FAILURE 

Third party integrator

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Inexperience of i2

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Customization Trying to forecast too far out ahead

Pilot test

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Problems in smooth integration

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Inadequate information

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Changing market conditions

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Review meetings

Measures to overcome demand forecasting problem Well equipped and competent system Continuous interaction with the customer Proper analysis of data

Supplier and retailer feedback

Importance of demand forecasting

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Determining the quantities

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"make to stock" rather than "make to order“

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Reduces supply time

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Efficient forecasting

Ways to avoid supply chain problems

Monitor delivery performance Coordinator for troubled situations Report obligations Assessment of Supplier financial situation

Press and other reports

Lessons Learned

Be Patient Define a business Goal Re-engineering Process Just Do It Over Keep your eye on the price