Wipro Loses Nike SAP Maintenance Project Due to Delays
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Wipro, an information technology, consulting, and business process services company based in India, has recently lost a SAP maintenance project from Nike after a delayed implementation of a project involving business software for the latter. The project was estimated to cost between USD10 million to USD40 million.
This came in amidst a trend where IT firms are increasingly pushing for annuity contracts, contracts that bind companies to provide a guaranteed payment periodically upon retirement and the request of the commencement of payments from another. This trend continues to exist while traditional services businesses are experiencing growth challenges and while clients are pushing software service providers to cut costs on maintenance projects, expecting the latter to use automation tools for increased productivity.
According to reports, there has been a delay in the implementation of SAP software for Nike, and the maintenance projects have been given to a Wipro rival. Other software services are still assigned to Wipro despite the recent turn of events.
At times, projects that deal with SAP or Oracle change due to the adjustments in client business requirements, often resulting in changes in the scopes of work. According to analysts, the changes do not necessarily undergo negotiations between the parties involved which primarily cause the delay. Other analysts also report that there could be other reasons for the discontinuation of Wipro’s maintenance work for Nike, one factor being the quality of implementation of the project. Other analysts also point to the change of the scope of work being the primary reason for the discontinuation.
“All is not lost as both Wipro and other service providers have overcome similar setbacks, but it does give Wipro an uphill task as it fights for wallet share at Nike,” comments a global IT outsourcing sector analyst that preferred to remain anonymous.
Wipro is an information technology (IT), consulting, and business process services (BPS) company that deals with clients worldwide. Wipro’s IT Services segment offers several IT and IT-enabled services, including digital strategy advisory, customer-centric design, technology consulting, and IT consulting, among others. The company also serves customers in various industry verticals including banking, financial services, health business, consumer business, energy, natural resources, and manufacturing, among others. Wipro’s IT Products segment provides third-party IT products that deal with enterprise platforms, networking solutions, software and data storage products, among others. Wipro, also, has reported research collaboration agreements with academic institutions like Tel Aviv University and IISc. Wipro was founded in 1945 and is currently headquartered in Bengaluru, India.
NIKE is a company that has multiple subsidiaries that design, develop, market, and sell athletic footwear and apparel, among others, globally. It offers NIKE brand products in six categories: running, NIKE basketball, the Jordan brand, football, training, and sportswear.
Additionally, the company sells a line of performance equipment and accessories, including bags, socks, sport balls, and eyewear, among others. Various plastic products are also distributed by the company to other manufacturers, as well as athletic and casual footwear, apparel, and accessories under the Jumpman trademark, Converse, Chuck Taylor, All Star, One Star, Star Chevron, and Jack Purcell, including apparel and accessories under the Hurley trademark.
Nike also licenses agreements that permit unaffiliated parties to manufacture and sell apparel, digital devices, and applications, among others, under NIKE-owned trademarks. The company also sells its products to footwear, sporting goods stores, athletic specialty, and department stores. Nike was formerly known as Blue Ribbon Sports, Inc. and changed its name to NIKE, Inc. in 1971. It was founded in 1964 and is headquartered in Beaverton, Oregon.
What is SAP?
Systems, Applications, and Products (or SAP) is reportedly the fourth largest software company globally. It has systems designed to integrate all areas of businesses, including end to end solutions for financials, manufacturing, and logistics, among others.