i2 Technologies

A Fading Star

As economic events of the past year abruptly put the tech market into a nosedive, i2 Technologies was among the previous high fliers that suddenly found itself in a tailspin. And that was an uncomfortable position for a company whose hard sell sometimes outstripped its ability to follow through.

I2’s mantra has been the creation of value for customers by some combination of reduced costs and increased sales and profit. (I2 claims it has provided $30 billion in value to customers over the past seven years.)

The company made its name in factory planning and supply-chain management software, which accounts for a good 90% of business. Successes with big-league manufacturing and high-tech customers including IBM, Dell and Frito Lay helped build i2’s reputation, but an ambitious expansion plan may have caused the company to overreach.

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Founded in 1988 by current Chairman Sanjiv Sidhu, i2 grew explosively in recent years, largely through aggressive acquisitions. Its $9.3 billion acquisition of Aspect Development, billed as the largest-ever software deal, allowed i2 to promise a much broader suite of products to facilitate complex supply-chain relationships among multiple companies, but some of those promises have taken awhile to come true.

Gary Cochran, Home Depot’s vice president of information systems, is impressed with i2’s commitment to support. Other customers give i2 credit for laying out a broad vision, but say they are often disappointed by the gap between the vision and what the software can deliver today.

Earlier this year, the company took a major hit when customer Nike blamed up to $100 million in lost sales on buggy supply-chain software from i2.

Now, the success of current projects at Kmart, Caterpillar, Siemens and other companies are seen as critical to the prospects of i2 Technologies.

In May, Sidhu stepped down as CEO in favor of Greg Brady, an Oracle veteran. This summer, i2’s head of sales, Brady protégé Reagan Lancaster, left the company and is now suing in a dispute over a severance and options package. Things are not altogether harmonious at a company that tries to make other companies’ pieces work together smoothly.

I i2 Place, 11701 Luna Road, Dallas, TX 75234
(469) 357-3027 www.i2.com/solutions

Ticker: ITWO
Exchange: NASDAQ

Gregory A. Brady
Chief executive officer
After a seven-year stint as i2 president, Brady was named CEO in May to succeed founder Sanjiv Sidhu. Brady was previously vice president of worldwide applications at Oracle, and had worked at J.D. Edwards and at McCormack & Dodge. He has a Bachelor of Science degree from Indiana University

Sanjiv Sidhu
Founder, chairman

Romesh Wadhwani
Vice chairman

Hiten D. Varia
Chief delivery officer

Pallab Chatterjee
EVP, worldwide development

Products and Services

Content management (i2 Content); customer relationship management (i2 Customer Relationship Management suite); electronic marketplace creation and management (the i2 TradeMatrix Platform and Open Commerce Network); procurement (i2 Supplier Relationship Management suite); supply-chain management (i2 Supply-Chain Management suite); services, application hosting, consulting, implementation and maintenance

Oracle, SAP, Manugistics, Ariba, PeopleSoft

Reference Checks

J.B. Hoyt
Supply chain project director and head of i2 User Group
(616) 923-5000
Project: Supply-chain management of production as well as retail operations for $10.3 billion (in sales) maker of home appliances, based in LaPorte, Ind.

Taylormade—Adidas Golf
Rob McClellan,
Global e-marketing manager
(760) 918-6000
Project: Since June 2000, the Carlsbad, Calif., company implemented advanced-planning CRM and supply-chain management modules after working with i2’s consulting arm

DSC Logistics
Paul Brand
Senior manager, information technology
(847) 390-6800
Project: A third-party supply-chain provider of warehousing and logistic services located in Des Plaines, Ill., DSC uses i2’s transportation software (Transport-ation Manager, Trans-portation Optimizer and Transportation Modeler) in its logistic centers across the United States

Hannaford Bros. Co.
Bill Homa
(207) 883-2911
Project: For 15 years, northeastern U.S. grocery chain with about 105 stores has been using Inforum software originally developed by IBM and now owned by i2 to drive warehouse replenishment

Home Depot
Gary Cochran,
VP, information systems
(770) 433-8211
Project: For the past three years, Home Depot has used i2 software with a focus on transportation products. It has expanded to use five i2 components, including Supply-Chain Strategist and Bid Optimizer

Alton Sanders
Manager, design re-use and standards
(562) 982-8875
Project: Boeing’s advanced research and development group uses i2’s eXplore application, initially created by Aspect Development, to compile a catalog of 800,000 standard parts specified in engineering designs or listed in billing materials