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Fortune Smiles on i2 Technologies

Written By: Steve McVey
Published On: September 3 1999

Fortune Smiles on i2 Technologies
S. McVey - September 3rd, 1999

Event Summary

Texas-based i2 Technologies recently ranked 44th on FORTUNE magazine's list of the top 100 software vendors. Companies were judged according to a combination of earnings-per-share, revenue growth and total return. i2 credits their success to the customer growth made possible by their Intelligent eBusiness solutions.

Market Impact

i2 Technologies' success comes at a time when other supply chain management (SCM) vendors are struggling with declining sales and negative earnings. With a 48% average revenue growth over the last five years, i2 seems unaffected by the general market slowdown. Reasons for their vigorous financial performance are not difficult to find. i2 has built a comprehensive suite of products from its early manufacturing planning and scheduling packages, (Factory Planner and Supply Chain Planner) that includes demand planning, transportation planning, and customer relationship management (CRM). In addition to tackling new functional areas of the supply chain, they have made strong implementation allies in the Big 5, including Andersen Consulting and PricewaterhouseCoopers, who bring their own implementation methodologies to i2's products.

While no one can dispute i2's ability to generate revenue and turn a profit, financial success does not necessarily imply that they have the best product, or the best services and support capability. Nor does it imply that they have aligned their corporate strategy in the best interests of their clients. Their RHYTHM product suite is highly functional with the flexibility to handle a variety of business processes, but like all complex enterprise software, can present a host of difficulties during implementation. Product releases can fall behind schedule, necessitating changes in system architecture and delayed timelines. Ironically, this problem is often found in companies undergoing rapid growth, who constantly must find, train, and retain competent development and testing resources. The same phenomenon arises with consulting resources that work alongside implementation partners. There can be no guarantee that, after a contract is signed, the consultant who comes to the project is ideally qualified to implement the product(s) involved. This is an unfortunate circumstance of companies whose consulting staff is patched together from employees from acquired companies.

User Recommendations

Prospective buyers should carefully consider all aspects of a vendor before purchasing. Although financial viability is important, successful vendors are not always the ones with superior product offerings and support organizations. As always, companies should employ a thorough, structured decision process that utilizes facts - not media hype.

 
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