Models of Crime Prevention: Their application

Models of Crime Prevention: Their application Due to the increasing complexity brought about by modernisation, overpopulation, urbanisation, and globalisation, crime prevention has required a more urgent stance not only from government but also from communities, schools, citizens, families, and non-government institutions. While the prevention of crime has been unanimously agreed upon, the best way to go about it is still under debate. There have been several models of crime prevention which criminologists and law enforcement experts have introduced but until now, there remains no clear best model yet. Some of the major crime prevention programmes are situational or social in nature but so-called hybrid approaches or whole of government approaches have also gained popularity, especially in Australia. In order to develop a clear appreciation for the many-faceted nature of crime prevention as practiced today, it is necessary to define it clearly and analyse the different models used locally and overseas and examine how each model has fared when applied to actual crime prevention programmes. This essay discusses crime prevention, its models, and its application in the real-world setting. Defining Crime Prevention Crime prevention in its simplest definition is the process of deterring crime, criminals, and reducing levels of victimisation. White and Perrone (2005) view crime prevention as the creation and implementation of proactive programmes and strategies which are designed to prevent crime and address the fear of crime (p. 15). A more comprehensive definition is advanced by Van Dijk and De Ward (1991) to treat crime prevention as the total of all private initiatives and state policies, aimed at the reduction of damage caused by acts defined as criminal by the State (p. 415). The common thread of these definitions is the suggestion that crime prevention is not the sole responsibility of law enforcement and police, but rather a collective obligation of different sectors in society in government and in communities. Otherwise stated, crime prevention is a joint effort of various levels of society to work toward strategies that prevent crime occurrence. Rationale Behind Crime Prevention While concepts of crime and justice date back to antiquity, the enormity of concern attributed toward crime prevention emerged circa late 1980s and early 1990s. White and Perrone (2005) enumerated three major reasons why crime prevention has taken an unprecedented turn during this period: economic, operational, and community initiative. Economic. Crime prevention became an important economic concern because crime definitely pays, to use the popular catchphrase in huge amounts of fiscal resources. The cost of crime is increasing, and according to 2008 figures from the Australian Institute of Criminology (AIC), crime consumes almost 4 percent of the countrys GDP which is equivalent to $36 billion (Rollings, 2008). Crime-related expenditures include policing, corrections, the security industry, and the criminal justice system as well as hidden costs such as medical costs, compensation, and loss of productivity of victims. To curb this gargantuan cost, crime reduction is considered a feasible alternative. Operational imperatives of policing. Considering the massive cost of crime, it became incumbent upon police and law enforcement agencies to recruit and enlist the assistance of citizens in an effort to arrest the escalating costs of crime. Policing required the collaboration of the law enforcement structure with citizens in the so-called fight against crime (Martin Perrone, 2005). Demands of the community. As crime rates increased with demographic changes attributed to the sprawl of urbanisation and migration, citizens have learned to recognise that a singular campaign by law enforcement to prevent crime would not do; hence, citizens have assembled themselves into crime prevention groups based in their respective communities to assist in crime prevention. As citizens became more vulnerable to crime, so did their resolve to empower themselves to stop victimisation. While one or a combination of all factors may have contributed to the emergence of crime prevention theory and application in the modern world, another theory is the growing concern for human rights and individual freedoms have led to an influence leaning toward non-punishment forms of crime prevention. Sutton and Cherney (2002) emphasised that crime prevention is reflective of societys desire to handle crime by using processes other than those that are eliminative; instead of punitive action, restorative means are advanced in the campaign for crime deterrence. Models of Crime Prevention Throughout its history, differing models of crime prevention have been used by law enforcement and criminologists around the world to curb crime and reduce victimisation. The major conceptual models of crime prevention include: situation, social, and developmental. Crime prevention has also been classified into primary, secondary, and tertiary forms. Situational crime prevention. The situational theory of crime prevention suggests that the best way to stop criminals is to design physical space and environment in a manner that will make the commission of crime harder and increase the likelihood of apprehending criminals. The idea is to change criminals perceptions of the rewards of crime by making the situation harder and much riskier for them. The situational concept of crime prevention was developed initially in the 1980s by criminologist Ronald Clarke. Clarke (1992) suggested that the most effective way to prevent crime is to implement strategies that create conditions which make it harder for criminals to commit crime. Thus, as an intervention model, situational crime prevention requires the proper identification of routines, factors, and patterns associated with criminal activity. Clarke Cornish (2003) presented five types of techniques which criminology practitioners should consider when using the situational model: 1) incr easing effort required to commit crimes; 2) increasing risks of committing crimes; 3) reducing rewards out of crimes; 4) reducing conditions that provoke crime; and 5) removing excuses for committing crimes (as cited in Homel, 2005, p. 132). Social crime prevention. The theory of social crime prevention aims to prevent offending by changing not the physical environment but the social environment. Social prevention intends to create social conditions that will deter potential or actual offenders from doing crimes. Hence, strategies associated with social crime prevention include empowering communities with resources and programmes that create a diversion from criminal behaviour. As an intervention model, social prevention focuses on youth and children, and programmes liked to this model including employment programmes, skills building activities, leisure programmes, youth drop-in centres, and other activities that increase productive behaviour. Developmental crime prevention. Developmental crime prevention as a theory strives to link childhood development with later delinquency. Researchers that have conducted prevention experiments were able to establish that factors surrounding early childhood are significant precursors to delinquent behaviour. These risks to delinquency include poor parenting, socially disruptive behaviour, and cognitive deficits (Sutton Cherney, 2002). Poor parenting could involve factors such as neglect, conflict in the home, deviant behaviour of parents, and early experience of family disruption (Homel, 2005). Among the developmental intervention strategies used courses related to proper parenting and other school-based measures. Crime Prevention Programmes The theoretical concepts of crime prevention discussed earlier have generated various intervention strategies all aimed to preventing crime. Situational prevention. Situational prevention strategies aim at designing the physical environment in order to make it less desirable and riskier for individuals to commit crime. Advocates of situational prevention strategies are more likely than advocates of other models to claim empirical effectiveness in preventing crime. Situational prevention involves among others, identifying cities that are crime hotspots, the use of surveillance cameras or CCTV cameras, screens, reducing cash-handling among banks to curb robbery, the use of boom gates to reduce car theft, and the use of undergrounds inroads to prevent vandalism and graffiti (OMalley, 1997). One of the strongest critiques against situational prevention is that the approach is inherently biases in favour of the rich and against the poor. Moreover, opponents claim that the opportunity reduction strategy gives only cosmetic remedies and that crime involves economic and cultural aspects associated with capitalism and mass consume rist ideology (OMalley, 1997). Social prevention. In lieu of situational prevention techniques, some criminologists have advocated social prevention instead because of the view that crime as a social problem is deeply ingrained within the economic and cultural structures in society. One of the most prominent social prevention strategies implemented was the Bonnemaison programme of Epinay, France, named after the towns mayor, Monsieur Gilbert Bonnemaison, MP (Cornish, 1995). This programme was implemented in France during a period of turmoil characterised by high levels of unemployment, ethnic rioting, and violence. The French central government collaborated with the local governments to develop diversionary programmes for the youth and made it a national priority. Some of these crime prevention programmes inspired by the Bonnemaison strategy include (Cornish, 1995): education of young people; re-training of those who failed to cope in the education system; better housing; employment; adequate health service; aid to victims of crime; better conditions for immigrants and ethnic minority groups; drug abuse treatment; after school activities for the young; provision of youth, cultural, training and recreation centres in each council area. (p. 188) Another overseas example of successful social prevention strategies include the so-called head start projects pioneered in the United States since the 1960s. These programmes focused on social justice as a crime deterrent by empowering poor and disadvantaged families with educational and other family enrichment programmes (Cornish, 1995). To date, several community-based and community development strategies of crime prevention have been modelled after the social prevention concept. Hybrid or whole of government approaches. Instead of focusing solely on just one crime prevention strategy, several programmes have combined several strategies and developed so-called hybrid programmes or whole of government approaches as it is known in Australia (Homel, 2005). An example of this customised approach toward crime prevention is the Safety Action Projects implemented in Surfers Paradise and Queensland during the middle of the 90s. Other projects that were national in scale include Safer Australia and subsequently, the National Campaign Against Violence and Crime (NCAVAC) geared at the promotion of community-based crime prevention through coordination and operational partnerships with local and central government (Homel, 2005). Conclusion Crime impacts overall quality of life because it influences ones actions, where one lives, how one travels, people one associates with, and others. The major conceptual models of crime prevention are the situational, social, and developmental crime prevention strategies. However, there has been increasing acceptance that crime is more complex in nature so that not one single strategy is effective in deterring crime. The emergence of hybrid approaches toward crime addresses both situational and social factors, and is considered to be more appropriate for the complexity of the 21st century. Supply management: A complex function Supply management: A complex function 1. INTRODUCTION Supply management is a complex function thats critical to business success, responsible for delivering efficient costs, high quality, fast delivery and continuous innovation throughout companies entire supply chains. The strategic contribution of supply management is measured not only in savings made, but also in increased shareholder value (Niezen, Weller Deringer, 2007). Nike and Adidas are two global companies try to improve their competitive advantage through strategically managing and utilizing their supply chain. The purpose of this report is to compare and evaluate the supply chain management practices of Nike Adidas. 2. CORPORATE PROFILE 2.1 Nike Corporate Profile Based in Beaverton, Oregon, and employing approximately 29,000 people worldwide, Nike Inc. is the worlds leading designer and marketer of authentic athletic footwear, apparel, equipment and accessories for a wide variety of sports and fitness activities (Comtex, 2002; Nikebiz, 2007a). Nike holds a 32 percent worldwide market share, a $20 billion market cap (Koch, 2004), has 40,000 stock-keeping units of goods (Mongelluzzo, 2002) and sells over 120,000 products in four cycles per year (Koch, 2004). 2.2. Adidas Corporate Profile Adidas is a leading producer of sportswear and sports equipment, offering its products primarily through four brands: Adidas, TaylorMade-Adidas Golf, Maxfli and Reebok (Datamonitor, 2007) The Adidas group and its 150+ subsidiaries are directed from the headquarters in Herzogenaurach, Germany, and employ 26,376 people (Adidas, 2007) The Adidas product line includes more than 20,000 items, with thousands of product variations. To keep up with market demand, the company changes its product range twice a year; more often if new technologies are available and in demand (Webex, 2004). 3. REPORT SCOPE Nike and Adidas are global players across a number of product categories. Supply chain management practices vary as the different products across the portfolios work towards different objectives. Due to the wide scope of product categories, the following report limits itself to analyzing the supply chain management practices of Nike and Adidas within the context of the global footwear market. Key supply chain processes under analysis include; manufacturing flow management supplier relationship management, demand management, order fulfillment customer services and relationship management (Lambert, 2007). 4. MANUFACTURING FLOW MANAGEMENT 4.1 Outsourcing as procurement strategy The international sports shoe industry is typified by the large scale vertical disintegration of functions and high levels of subcontracting activity. Multinationals such as Nike and Adidas no longer manufacture products, relying strongly on outsourcing all production in low-cost overseas labor markets, invariably resulting in the majority being manufactured in Asia. Outsourcing practices allow Nike and Adidas to focus on their core competencies; marketing, design and product innovation, areas in which they can best achieve a competitive advantage (Anderson, 2005). The trade-off to outsourcing to offshore manufacturers is that companies face substantially longer lead-times for delivery typically taking six to eleven weeks to receive products from Asia (Sahling, 2007). Efficiencies gained in terms of reduced wages are countered by the increased difficulty of monitoring the product and the actual working conditions in the factories (Van Dusen, 1998). Also, Nike Adidas production capa bilities are governed by the economic state of emerging markets; as countries prosper, there is a need to find new, low cost opportunities. Conversely, production could also be affected by external factors such as natural disasters or political instability. 4.1.1 Nike Approach Asia provides the majority of Nikes manufacturing and distribution, delivering to more than 80 destinations throughout the world, which now accounts for 65% of U.S. imports (Mongelluzzo, 2002). China now supplies 40% of Nikes U.S. consumption, increasing its reliance on southern Chinese ports (such as the Yantian port) instead of the port of Hong Kong (Field, 2003a). Yantian currently handles about 20% of Nikes volume from China, and approximately 10% is shipped from the port of Qingdao (Field, 2003a). The Yantian port has increased efficiency due to the close proximity to the Nike factory base, and quicker transits to the States (Field, 2003a). Nike places more importance on choosing the right local partners, not just the right ports. Nike doesnt own any of its facilities, and local partners make important logistics decisions (Field, 2003a). To manage relationships, Nike has both a global and regional vendor management team as output volume increases, Nike dont expand the number of suppliers, but increase the volume of business they do with each supplier (Field, 2003a). The Nike production system can be stratified into three classes; developed partners, volume producers and developing sources (Donaghu Barff, 1990). Although Nike has developed different levels of supplier relationships with each class the production network is commonly classified as a virtual enterprise where independent firms work together based on shared values and a common way of doing business to exploit a business opportunity through joint manufacturing (Pfohl Buse, 2000). 4.1.2 Adidas Approach Adidas has also been referred to as a virtual enterprise however, it may be better characterized as a strategic network because its supply chain utilizes three different types of suppliers; The first group have a direct contractual business relationship with Adidas, whilst the second group, subcontractors, are companies that have been subcontracted by their suppliers and do not have a direct business relationship with Adidas; and thee third group includes local sourcing companies, which source and manufacture products for local markets, rather than group-wide distribution (Adidas, 2002). Further, Adidas provides all of their suppliers with detailed technical and design specifications for the production and delivery of products, with strict quality control enforcement and inspections (Pfohl Buse, 2000), rather than adopting co-operation techniques and joint manufacturing ideals. 4.2 Lean Manufacturing Principles Lead Time Reduction According to Gernaat (2006), the fashion (footwear) market characterized by short product life cycle, high variety, high demand volatility, low demand predictability, low volumes and high level of impulse purchase. Therefore short lead times are highly important functions of responsive, reactive and flexible supply chains (Gernaat, 2006). Global sourcing creates longer lead times, and more complex supply chains. Nike and Adidas have instituted lean manufacturing principles to rationalize the supply chain processes and decrease costs. However, lean manufacturing approaches leave the companies more vulnerable to potential stock outs and there is increased reliance upon other supply chain elements running in sync and without interruption. 4.2.1 Nike Approach Nike utilizes several subcontracting arrangements that allow the company: a high degree of flexibility in dynamic and fluid markets a flexible demand-driven production system to shift production between factories and countries; opening plants and signing contracts that potentially only last a year and it to utilize capacity subcontracting methods to meet variable market demands (Donaghu Barff, 1990). Nike is upgrading its supply chain to try to drive the manufacturing cycle for a sneaker down from nine months to six to match its lead time to retailers ordering schedule. Nike aims to manufacture its sneakers to order rather than three months in advance (Donaghu Barff, 1990). Nikes new supply chain, using just-in-time management already active in the US and Europe enables shipment of products to customers faster. Select retailers receive delivery within days rather than months; cutting costs and improving profits by freeing up inventory and increasing sales (Herzog, 2003) 4.2.2 Adidas Approach Prior to 2002, Adidas operations were traditional batch and queue, and stored in warehouses until the order was processed. As part of its overhaul of its supply chain, Adidas sought to significantly reduce footwear lead times by introducing lean manufacturing principles across its supplier network. The time-to-market initiative involved a coordinated, global effort on behalf of Adidas and its consultants which included training suppliers, technology improvements in supply chain planning and a focus on internal design processes (Productivity Press, 2006). Efficient implementation of lean manufacturing principles also removed non-value-adding procedures, improved labeling and special handling to reduce lead time (Datamonitor, 2007). The reduction in lead time also lead to a 33% increase in correct product choice, increased accuracy in ordering and in some cases, resulted in larger orders as customers were less risk averse and displayed increased commitment (Productivity Press, 2006). 4.3 Centralisation 3rd Party Logistics Specialisation 4.3.1 Nike Approach The theme of Nikes sneaker supply chain is centralisation. All product design, factory contracting and delivery is planned and co-coordinated from Beaverton, Oregon (Koch, 2004). Nike runs a single instance of SAP R/3 (a single planning engine), and centralised demand management to work with outsourced suppliers (MSI, 2004). Nike is currently pursuing a total information integration strategy integrating ERP (enterprise resource planning), supply chain planning and CRM software onto a single platform shared by Nike operations in North America, as well as Europe, the Middle East and Africa. Initial results are promising; improved financial visibility, cash flow management, revenue forecasting, and taking advantage of shifting exchange rates through the re-allocation of Nikes cash resources (Koch, 2004). Nikes key supply chain strategy is through achieving up-to-date shipment data that can be used to make the supply chain more efficient, with transit time being the deciding factor over other considerations (Mongelluzzo, 2002). Nike has pared its number of logistics providers from five to two. Nikes two third-party logistics providers specialise in data management APL Logistics handles eastbound shipments to the U.S., Canada and Latin America and Maersk Logistics manages U.S. outbound shipments (Mongelluzzo, 2002). Nike requires transportation vendors to provide: Geographic coverage of U.S., Canada and Latin America Carrier specialisation Multiple ports of entry Multiple consortia Expedited air and courier services Cargo security EDI interface Data and documentation management (Mongeluzzo, 2002). For 60 percent of cargo from Asia, Nike controls the transportation move from Asian factories directly to the distribution centres of its U.S. retailer customers. The company moves the rest through its own U.S. distribution centres, where they are stored until a retailer needs them (Field, 2003b). Although the shipper and its logistics partners manage the supply chain, decisions on how much to ship and when to ship it are made in response to customer needs Demand drives the logistics strategy (Mongelluzzo, 2002). 4.3.2 Adidas Approach Traditionally Adidas has operated in a decentralized manner, with separate operating units independently choosing software that suited their internal preferences and geography (Tibco, 2007). Since 2002, Adidas has begun implementing common processes to help establish a global direction and help regain its competitive advantage. Tibco software was implemented to streamline and automate its business operations, improving flexibility, scalability and visibility across the enterprise helping to reduce product delivery times (Tibco, 2007). Similarly, Adidas inadequate paper-based warehouse and distribution systems were replaced with unique WMS and RF software to halve distribution costs, reduce labour costs and improve accuracy and efficiency through automated cross-checking of all orders (CIPA, 2004). John Hamilton, the Development Manager for Supply Chain Applications noted that We use third-party manufacturing so we are involved with a lot of different partners, from people who manufacture our product, to people who manufacture our raw materials, to the distributors that sell our product throughout the world We had a bit of a lag in our ability to see downstream demand Its hard to see the end customers demand because we are working through a lot of different subsidiaries. (i2, 2004) i2 solutions replaced the home-grown planning system, to ensure that Adidas continued to meet the needs of customers, suppliers, and consumers enabling the company to reduce order confirmation times and to get products to market faster through its ability to improve asset utilization, factory fill rates, and to plan at multiple lead times (ibid). Adidas moved further toward a centralization strategy as it implemented logistics software SAP AFS to facilitate process and system standardization worldwide, providing a solution that supported a consolidated global focus. Adidas chose the software because AFS is specific to the apparel and footwear industry with its emphasis on seasonal fluctuation, proliferation of design variations and product characteristics, multiple distribution channels and customer-service requirements, and outsourced manufacturing (SAP, 2002). Adidas consolidated the distribution system into UPS, a single streamlined network, with automated inventory and fulfillment systems that rapidly scaled its services and add enhancements as required (UPS, 2005) 4.4 Supplier Relationship Management 4.4.1 Nike Approach Athletic footwear producers use similar techniques to promote stability and trust in their relationships with subcontractors; Nike develops and produces all high-end products with exclusive partners, while its volume producers manufacture more standardized footwear that experience larger fluctuations in demand (Donaghu Barff, 1990). Nikes strategies for alliance involve: Seeding Nike expatriate technicians into factories producing Nike footwear to function as a liaison between head office and RD to ensure smooth product development processes and maintain product control. Encouraging partners to participate in joint product development activities, sharing responsibility for the development of new footwear Stabilize production and reducing demand variance with key factories partners by placing monthly orders with partners that exclusively produce Nike products (Donaghu Barff, 1990) Nike are establishing longer-term contracts with key suppliers, operating more as partners (ibid), fostering strategic alliances and creating value-add capabilities within the supply chain. 4.4.2 Adidas Approach Adidas current approach to supplier relationship management is consolidation; in 2001 it reduced the manufacturing base by over 25% with a medium term goal of reducing the suppler base by 40% (Adidas, 2002). The aim is to deepen relationships and therefore reliability, also to increase Adidas influence and bargaining power with suppliers. Adidas focus is on building their suppliers own capacity and internal management systems in health and safety and human resource management, seeking to develop sustainable compliance processes and to drive self-enforcement (Anderson, 2005) 5. DEMAND MANAGEMENT 5.1 Forecasting Order Fulfillment Gernaat (2006) argues that accurate forecasting is highly difficult in the fashion industry, as it is characterized by short PLCs, volatile demand and high variety. Wide product lines are challenged by an increasing individualization of demand, which Nike and Adidas combat by creating an increasing number of variants (Berger Piller, 2003). This makes forecasting and planning for the companies increasingly difficult which has the potential to result in high overstocks, increased supply chain complexity and the need to provide significant markdowns to get rid of surplus stock (ibid). Forecast accuracy can be increased through flexible supply chains with shorter lead times. However Gernaat (2006) also points to the use of Point Of Sale data to adjust forecasts and quick response programs to respond accordingly as a way of combating inaccuracies. Nikes forecasting is largely based on its Futures program, where retailers must order up to 80% of their merchandise inventory 6 months in advance in order to get substantial discounts and guaranteed delivery times (Porter, Harris Yeung, 2002). The futures ordering program allows Nike to minimize the amount of inventory held, purchasing costs, the time necessary to fill customer orders, and the risk of non-delivery (Nikebiz, 2007b). Nike gained a significant competitive advantage in the 90s as retailers were eager to secure discounts and guaranteed delivery times. Nike now faces pressure from customers and rivals because retailers are more reluctant to commit to ordering 6 months in advance as consumers tastes are increasingly fickle and smaller, more agile rivals are willing and able to work within shorter order cycles. Nike also is behind its rivals in direct point-of-sale (POS) integration with retailers; supply chain experts believe that actual store data, rather than software algorithms, are the best predictors of demand, but Nikes SAP system cannot yet accept POS data (Koch, 2004). Adidas recently launched World Class Supply Chain initiative appears to be moving away from a forecast-based supply chain to a demand-driven supply chain. The company has re-engineered its supply chain to customize its business to five differentiated and dynamic business models which target consumer needs (Adidas, 2006). The initiative covers the whole concept-to-shelf process and incorporates marketing, sales and operations functions; Brand Model delivers Adidas brand statement products, supported by comprehensive customer service, marketing, retail and supply chain capabilities (launched 2006) Evergreen Model short lead times and never-out-of-stock capabilities for Adidas most commercial and long life cycle product lines (launched 2006). Quick Response model seizes additional market opportunities with a 3-6 month concept-to-shelf process (launched 2007) Global/Regional model creates regional adaptations of global concepts to reflect consumer needs in regional markets (launched 2007) 2008 model aims to reduce the percentage of products turned around with 18 months lead time to only 25%. (Adidas, 2006) 5.2 Customer Service Relationship Management The success of global supply chains is the value they add to their ultimate customers in terms of the cost/price and the related services they provide (Coyle, Bardi Langley, 2003). IT can play a significant role in facilitating customer service that provides the opportunity to remain competitive, improve differential advantage and finally, gain market share (ibid). Advances in IT allow sharing real-time information between supply chain partners, which facilitates better inventory management which increases customer service and value. Sharing data also strengthens relationships between supplier and customer, as there is a development on trust and reliability. However, it is important to note that increased reliance on IT and software can potentially negatively affect positive customer service outcomes. Nike and Adidas have both been exposed to the negative consequences; Nike lost $100million in revenue due to software bugs in its supply planning software in 2001 (Interestingly this is the i2 solutions supply chain planning software that Adidas has taken on board), and Adidas first attempt at implementing WMS software resulted in massive market share losses in 1996 when the system failed to work and could not process orders (Supply Chain Digest, 2006). 5.2.1 Mass Customisation Pillar et al (2004) see information technology, along with flexible manufacturing practices as facilitators of mass customization and its promise to deliver goods and services that meet individual customer needs with near mass production efficiency. Adidas and Nikes approach to mass customization provides a good example of the trade off between the increased complexity of mass customization and supply chain economies of scale. The mi Adidas concept offers a full range of shoe customization options in regard to fit, functionality and aesthetic design. In contrast, Nikes NikeId program, in line with its highly centralized approach, limits customer integration and feedback by only offering the different colour choices of a shoes components (Piller, Moeslein Stotko, 2004). Relative to Nike, the degree of product, process and information complexity is much higher for Adidas thus incurring increased supply chain costs. However the costs are offset by higher premiums charged up to 50% co mpared to the customized shoes of Nike (between 5% and 10%) (ibid). Adidas develops a learning relationship with consumers through the brand interaction, increasing the revenue from each transaction because as well as the actual product benefits, the simplified purchasing decision process entices repeat purchase, thus creating loyalty (Piller, Moeslein Stotko, 2004) and deepening customer relationships. The mass consumption concept can also help generate better customer service and relationship management, as Adidas gains sticky knowledge about its consumers; valuable market research which could help inform more efficient planning for new products for the mass market segment (ibid). 6. KEY FACTOR ANALYSIS Coyle, Bardi Langley (2003) argue that the key factors of successful supply chain management include inventory, cost, information, and customer service and collaboration relationships. Based on the above inventory management, financial measurement and performance measures, Nikes tightly controlled, centralized supply chain management practices appear to have the advantage over Adidas; in fact, Nike was recognized as being one of the top 25 companies that exhibit superior supply chain capabilities and performance (AMR, 2007). Such performance indicators strongly suggest that Adidas has a continued need to improve operating efficiency, inventory management and also seek to deploy assets in more profitable avenues (Datamonitor, 2007). Adidas relatively poor financial performance (compared to industry leader Nike) was recorded across the 2002-2006 period, during which the company began to implement substantial changes across its supply chain management processes. Adidas has significantly centralized and automated elements of its supply chain, boosting efficiency and effectiveness of the processes by reducing errors and increasing productivity. At the same time it seems better equipped to accommodate consumers individualized demands through the more sophisticated mass customization practices, and increased collaborative relationships. 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