Nike Case Study
NIKE’S SUPPLY CHAIN CASE STUDY
Case Summary Nike is a retail giant that has different product lines in different parts of the world. Nike has different markets for different products for all four seasons of the year. It conducts business with 750 to 800 factories from around the world. In 1998, Nike had 27 order management systems spread out globally. These systems did not function in a way that allowed them to link to its headquarters in Beaverton, Oregon. This led to the implementation of a new supply chain management project. Now, all product design, factory contracting, and supply coordination is centralized in Beaverton. This new system uses Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM) software with a common database. With intense training for their employees, Nike has decreases their order cycles from nine months to six months with a goal of ultimately decreasing it to three months (Collier and Evans, 2010). The company faces four key challenges: 1. Changes in the global marketplace- Changing regulations and infrastructures in different countries are major challenges. 2. Consumer and consumer changes in behavior- Customer wants and needs are different in different markets. 3. Demanding retailers- Retailers are asking for shorter lead times and faster inventory turns. 4. Conflict between cost and flexibility- Too many costs associated with offshoring. Lead times suffer because of complex fabrics and products, thus the delays affect the global supply chain and causes lost sales (Collier and Evans, 2010).
Question 1 Nike’s competitive priorities are: 1. Time-Nike is a global business that involves an efficient supply chain system. They recently implemented a new supply chain system that will allow them to improve their lead time and consistency. 2. Flexibility- They are able to market and produce different lines for different markets globally. 3. Innovation- - Nike
Case Summary Nike is a retail giant that has different product lines in different parts of the world. Nike has different markets for different products for all four seasons of the year. It conducts business with 750 to 800 factories from around the world. In 1998, Nike had 27 order management systems spread out globally. These systems did not function in a way that allowed them to link to its headquarters in Beaverton, Oregon. This led to the implementation of a new supply chain management project. Now, all product design, factory contracting, and supply coordination is centralized in Beaverton. This new system uses Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM) software with a common database. With intense training for their employees, Nike has decreases their order cycles from nine months to six months with a goal of ultimately decreasing it to three months (Collier and Evans, 2010). The company faces four key challenges: 1. Changes in the global marketplace- Changing regulations and infrastructures in different countries are major challenges. 2. Consumer and consumer changes in behavior- Customer wants and needs are different in different markets. 3. Demanding retailers- Retailers are asking for shorter lead times and faster inventory turns. 4. Conflict between cost and flexibility- Too many costs associated with offshoring. Lead times suffer because of complex fabrics and products, thus the delays affect the global supply chain and causes lost sales (Collier and Evans, 2010).
Question 1 Nike’s competitive priorities are: 1. Time-Nike is a global business that involves an efficient supply chain system. They recently implemented a new supply chain system that will allow them to improve their lead time and consistency. 2. Flexibility- They are able to market and produce different lines for different markets globally. 3. Innovation- - Nike
References: Collier, D. and Evans, J. (2010-2011). OM2. Mason, OH: Southwestern Cengage Learning. Koch, C. (2004, June 15). Nike Rebounds: How (and why) Nike recovered from its supply Chain disaster. Retrieved November 16, 2010, from http://www.cio.com/article/32334/Nike_Rebounds_How_and_Why_Nike_ Recovered_from_Its_Supply_Chain_Disaster Navigating Today’s Supply Chain Challenges. (2007, March 7). Retrieved November 19, 2010 From http://www.mhia.org/news/industry/7070/navigating-today-s-supply-chain-challenges