i2 Appoints Head, Inspires User Hopes for a Rebound

Computerworld - Users of i2 Technologies Inc.'s applications last week said they are hopeful that the installation of a new CEO portends a brighter future for the troubled maker of supply chain software.
The Dallas-based company last week appointed one of its directors, Michael McGrath, CEO and president, replacing co-founder Sanjiv Sidhu (see story).
An i2 spokeswoman said McGrath, co-founder and retired CEO of Waltham, Mass.-based consulting firm Pittiglio Rabin Todd & McGrath Inc., was chosen from among several candidates. The company stated that McGrath's position is temporary. Eventually he will replace Sidhu as chairman, and a new CEO will take McGrath's slot.
Experience May Help
McGrath's background as a third-party integrator should help in i2's effort to broadly expand its consulting operation, said Ravi Vancheeswaran, director of planning for the integrated products group at ON Semiconductor Corp. in Phoenix. The company runs i2 Demand Planner, Supply Chain Planner and Factory Planner, among other applications.
McGrath's plan to expand i2's consulting services is also good news for ON, Vancheeswaran said, noting that "i2 has good supply chain management tools and supplier management tools, and this will bring a focus on how to extract their value for customers."
While i2 has provided ON with adequate technical consulting services to help in its effort to create a supply chain management infrastructure, the vendor needs more business-process-focused consulting to help users further exploit the software, Vancheeswaran said.
"The next question we need to ask is, 'Where should I be holding inventory, and how can I best leverage the tools to give us the biggest bang for the buck while keeping inventory levels down and on-time delivery up?' " he said.
Another i2 user, Richard Scheerer, CIO at The Clarks Companies, North America, also said he is encouraged by McGrath's appointment and plans for the vendor. "I2 continues to be an important component in Clark Companies' application portfolio," he said in an e-mail.
"It appears that i2 has weathered the troubled times, and any effort to grow the company and make it a bigger player in the supply chain space is good for the current user base," Scheerer said.
The Newton, Mass.-based maker of shoes uses i2's Demand Planner, Supply Chain Planner and Demand Fulfillment applications to support manufacturing and customer service processes.
While it's unlikely that anyone can rapidly restore i2 to full financial health, McGrath has a special advantage in that he is both an outsider to i2 and has some intimacy with its situation from his role on the board of directors, saidKevin O'Marah, an analyst at AMR Research Inc. in Boston.
"His interim role is not purely [to be] a temporary shepherd, but [it's] more of rescue mission to right a ship he will remain with," O'Marah noted.
Last year, i2 lost $1.4 million as revenue slumped by more than $100 million to $389 million. If i2 can stop hemorrhaging cash and change its focus to generate business results, its technological excellence could give it the ability to drum up meaningful new business, O'Marah said. "People tend to underestimate how strong the product set is and how satisfied early customers were," he said.

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