i2 Fights Giants with Apps, Services

Updated: Under new leadership, the best-of-breed supply chain vendor takes different approaches to continuing competition with ERP vendors SAP and Oracle.

Supply chain specialist i2 Technologies Inc. plans to rebound from a recent dip in customer-driven revenues by pushing its products and services in some new directions, according to one top official.

i2 is also considering the possibility of new platforms for its supply chain applications, ranging from Microsoft .Net to open-source Linux, John Cummings, senior vice president and chief marketing officer, said during an interview.

In quarterly results announced earlier this month, i2 reported a decline in revenue from $111.1 million to $62.2 million during the comparable quarter last year.

Software development and licensing revenues both suffered.

/zimages/4/28571.gifClick here to read more about i2s next-generation SCM offerings.

As part of efforts by recently appointed CEO Michael McGrath to improve the companys financial situation, the vendor has since sold off its content and data businesses to IHS Inc. for $30 million.

According to Cummings, i2 is now working on customer recruitment and retention by leveraging its expertise into new product and service offerings.

i2 keeps facing rising competition in some major accounts from ERP vendors SAP AG and Oracle Corp., according to Mark Hillman, a former i2 marketing executive who is now an analyst with AMR Research Inc.

"i2s executive sponsors [at customer organizations] are feeling some pressure to defend why they chose i2," the analyst said in another interview. "But it helps that [supply chain solutions] are becoming more of a business buy. IT managers tend to be concerned about using the smallest number of systems possible. Business buyers are more interested in the core functionality."

As the vendors revenues have continued to slide over the past few months, other i2 officials have talked up partnership activities around i2s MDM (master data management) software engine.

/zimages/4/28571.gifRead details here about i2s vertical "partner ecosphere" middleware plans.

One major motivation behind these pacts is to migrate MDM beyond the supply chain into new industries such as financial services management, i2 officials said in earlier interviews.

But for his part, Cummings focused mostly on i2s current in-house development of specialized BPM (business process management), SOA (service-oriented architecture) and applications for SCM (supply chain management), the companys long-time key market.

As Cummings sees it, i2 is saving time and money for customers by innovating with these emerging technologies for MDM-based applications in the supply chain arena.

"Weve launched [several] next-generation solutions since last fall that use this approach, and well be launching more. These are giving us quite a bit of pull-through [with customers]," Cummings said.

"Weve used our expertise to build in a lot of processes and IP [intellectual property] that [are useful] for the supply chain. This really sets [these] applications apart from what you might find in the rest of the industry."

Next Page: i2 aims for innovation with caution.