REWRITING THE RULES OF THE RACE

WITH SAP ERP, NIKE IS IN TOP FORM TO OUTPACE THE COMPETITION

Nike’s 30-year winning streak of product innovation has set new standards in each of its fiercely competitive market segments. IT has delivered an important competitive advantage by helping the company execute two key strategies: A single-minded focus on the consumer; and a highly effective category business approach.

Listening to the customer

“We want our customers to have a personal shopping experience that binds them closer to us,” says Bill Mullen, senior director of Process Excellence at Nike. “Customers today call for innovative, functional, stylish products in ever shorter cycles. SAP solutions help us understand our customers better – and rapidly respond to new trends and market signals.”

Going the distance 

For years, Nike managed its organization by product line. But to get closer to customers, the company shifted from a product orientation to a category-driven approach that includes basketball, running, football (soccer), men’s training, women’s fitness and sport culture. As a result, instead of focusing on transactions, Nike is driving a brand relationship and conversation with its consumers. With its deep insights into athletics and the needs of athletes, Nike delivers consumers a wide range of innovative products and compelling experiences tailored to their tastes, lifestyles and aspirations.

Executing a business model of this complexity on a global scale is a Herculean task. But with Nike’s SAP landscape, it is able to orchestrate a highly decentralized supply chain – linking the company’s disparate groups of designers, suppliers, manufacturers, logistics providers, retailers and customers into a powerful global business network.

“Our SAP solutions were crucial to our success in establishing global processes,” says Roland Paanakker, CIO of NIKE. “They were essential to our phenomenal revenue growth between 2000 and 2007 from US$8 billion to US$16 billion. And they improved our key performance numbers for greater cash flow, inventory management, and profitability.”

The integrated functionality of Nike’s SAP solutions also make it possible to consolidate large amounts of business data in real time, and to achieve tight integration with manufacturing partners across a shared logistics chain. “SAP solutions allow Nike to maintain a clear overview of our entire business network – they are crucial to our success,” says Roland Paanakker. 

Keeping the lead 

In the months ahead, Nike plans to upgrade to the latest version of SAP ERP, including SAP Apparel and Footwear – the comprehensive integrated solution for companies in the apparel, footwear, sports, and fashion industries. Together, the solutions will enable the company to transform its business network to deliver superior value to its consumers – and to maintain a strong lead in the race ahead.