Presented by- Aamir usmani,Meezan Alam

2.  Enterprise Resource Planning
 Support business through optimizing, maintaining, and tracking
business functions
 Broken down into business processes
 HRM
 Distribution
 Financials
 Manufacturing

3. EVOLUTION OF ERP
1960’s - Systems Just for Inventory Control
1970’s - MRP – Material Requirement Planning
(Inventory with material planning & procurement)
1980’s - MRP II – Manufacturing Resources Planning
(Extended MRP to shop floor & distribution Mgnt.)
Mid 1990’s - ERP – Enterprise Resource Planning
(Covering all the activities of an Enterprise)
2000 onwards – ERP II – Collaborative Commerce
(Extending ERP to external business entities)

4.  Supply chain management (SCM) is the oversight
of materials, information, and finances as they
move in a process from supplier to manufacturer to
wholesaler to retailer to consumer.

5. Three types of flows in SCM:
 Material flow – This is a physical flow which represents the
movement of product from supplier to customers as well as the
movement of product from customers to suppliers in case of
servicing, repairing etc.
 Information flow – This represents capacity, order tracking,
delivery schedule.
 Financial flow – This represents the credit terms, invoices and
other ownership arrangements. This flow requires highest level of
co-operation between the members of the supply chain.

6.  Push-based supply chain
With a push-based supply chain, products are pushed through
the channel, from the production side up to the retailer. It takes
longer for a push-based supply chain to respond to changes in
demand, which can result in overstocking or bottlenecks and
delays.
 Pull-based supply chain In a pull-based supply chain,
procurement, production and distribution are demand-driven
rather than to forecast. NIKE is frequently used as an example of
pull production. It changed from make to sell to make to order.

7.  Technology Advanced communications systems and wireless
technologies such as radio frequency identification (RFID) have
further streamlined supply chain processes. allowing companies
to share detailed
 real-time data
 Tracking individual store
 purchases as they are made,

8.  Improved efficiency across multiple departments and
organizations working within the supply chain.
 Automation of workflow for reduced overhead and operational
costs.
 Automated Purchasing
 Vendor Performance
 Improved Efficiency
 Order Tracking
 Helps in Decision making
 Minimize the Delay
 Improves Productivity

9.  The cost of ERP Software, planning, customization,
configuration, testing, implementation, etc. is too high.
 The installation of the ERP system is costly. ERP consultants are
very expensive take approximately 60% of the budget
 ERP deployments are highly time-consuming – projects may
take 1-3 years (or more) to get completed and fully functional.
 Too little customization may not integrate the ERP system
 The cost savings/payback may not be realized immediately
after the ERP implementation & it is quite difficult to measure the
same.

10. Implementation ERP in Supply Chain

11.  Founded in 1964
 Originally Blue Ribbon Sport
 Design, Manufacture and Distribute Athlete Wear
 Enterprise Resource Planning in 2001

12.  Founded in 1988 by Dallas, Texas
 Provide SCM software and services
 Employed in June 2000
Objectives:
 Reduce the cost and quantities of Raw Materials
 Predict the demand pattern to plan and control the production
volume
 Allow Nike to reduce the production of unsalable shoes

13.  Stored data's in different formats.
 Caused systems unable to integrate.
 Consumed too much time to record single entry.
 System frequently crashed.
 Ignored some orders and duplicated others.

14. Nike faced financial problems after an year of implementation:
 Profits reduced by 24%
 Lost sales worth millions of dollars
Affected Nike’s Reputation:
 Extra Stocks sold at discounted Price
 I2 and Nike blamed each other for the failure

15. As stated by Nike:
 The software could not predict the exact demand and supply
volume
 Underproduction of the popular products
As stated by i2 Technologies :
 Requested too much customisation
 Too dependent on the demand forecast software for project
management
 Lack of ability to meet the circumstances
 Unable to solve bugs and data errors

16.  Continued to work for i2 on 5 year project.
 Contract ended on 2004 due to challenges where setting goals
were found unrealistic.

17.  Systems Applications and Products in Data Processing.
 Founded in 1972, Germany.
 Provide enterprise software.
 Employed in 2004 by Nike.

18. Applied Single Instance Strategy (SIS)
 The Big Bang approach: to implement all enterprise functionality and ERP
modules in a single instance as a major event
Integrated With:
 i2 Technologies forecasting System
 Siebel’s Customer Relationship Management System (CRM)
Invested:
 6 years time
 $800 million
The value of Nike Supply Chain (NSC) Project
 Foresee the trends sooner
 Share accurate information in shorter time

20.  Uses actual data for calculation collected from orders and
invoices
 Share information within Supply Chain between Customers,
Retailers, Distributors and Manufacturers.

22. Implemented SAP apparel and Footwear software (AFS):
 An E-business solution to control the supply Chain
 Trained SAP ERP users before implementing the system.

24. From make-to-sell to make-to-order:
 To reduce Nike’s order interval time from 1 month to a week.
 Reduce inventory level.
Retailers do not prefer to order 6 months in advance because
fashion change instantly, unpredictable.

25. Reduction in:
 30% of make-to-sell shoes to 3%
 Solid waste: 28%
 Waste to landfill and incinerators: 70%
 Waste Consumption: 20%
Improvement in:
 Cash Flow Management
 Revenue Forecasting
 Lead time from 9 months to 6 months.
 Gross margin moved up to 42.9% from 39.9% in one year.

28.  http://ijmrr.com/admin/upload_data/journal_rajesh%20arora%20%
20%20%2018au12.pdf
 https://ixmba09.wikispaces.com/file/view/nike-finals-erp-
implementation-120549747734470-3.pdf
 http://www.casestudyinc.com/nike-erp-implementation-saga
 INTERNATIONAL JOURNAL OF MANAGEMENT RESEARCH
July 2012/ Volume 2/Issue 7/Article No-18/1293-1300