Everyone's heard the big success stories. Dell Computer and Wal-Mart, for example, have squeezed millions of dollars out of their supply chains by bringing innovation to those business processes. But not every company has the IT resources to devote to large-scale, enterprisewide supply-chain implementations. Those who've taken things a little slower have had to wait longer for the big payoff--but it's coming.

Fleming Companies Inc. has been hit hard by the tough economy. The grocery wholesaler, distributor, and retailer reported an $83.7 million loss last year. Things aren't expected to get easier, especially since Fleming this month ended its supply relationship with one of its biggest customers, Kmart Corp., which is in Chapter 11. But IT investments Fleming made in supply-chain software, which began nearly three years ago and were substantially completed in the third quarter last year, could brighten the picture, cutting millions of dollars out of the company's inventory and transportation costs and bringing in new revenue sources.

"Losses would have been even greater if we hadn't implemented the software," says Tre Ventling, Fleming's transportation systems manager.

Fleming isn't the only company that's finally seeing impressive returns from supply-chain software. Amid one of the worst periods in the history of the semiconductor industry, On Semiconductor Corp. says it expects to reap $20 million in overall value thanks to the supply-chain software it's using. Knowles Electronics LLC, a maker of hearing-aid and acoustic technology, has shaved as much as $10 million in inventory costs.

Fleming's losses could have been worse without supply-chain software, Ventling says.

Supply-chain software, such as order-management, inventory-management, demand-planning, and logistics applications, has been around since the late '90s. But according to Forrester Research, in a recent survey of 22 business executives at large manufacturing and distribution companies, only 41% have realized a noticeably positive return on investment from their supply-chain management systems.

AMR Research reports that about 65% of large companies have implemented supply-chain software, but probably less than a fifth of those find that the software makes a huge difference to their businesses. "When you start poking around, a company buys the software and is using it in just a few places," says John Bermudez, senior VP of research at AMR Research. "It hasn't penetrated the company." That's changing, as software vendors, feeling the pressure of a slow economy, work more closely with customers to ensure successful implementations, Bermudez says.

Tightening supply-chain links paid off for On Semiconductor, which last spring completed its initial deployment of software from i2 Technologies Inc., begun in 2000. "With what some are calling the mother of all downturns in the semiconductor industry, we're being pressed to do everything we can on every front," says John Mallon, director of supply-chain management services.

That includes expanding the company's supply-chain implementation to encompass i2's Factory Planner in its wafer fabrication plants and assembly sites, and Demand Planner, Master Planner, and Demand Fulfillment at its headquarters.

On Semiconductor can instantly acknowledge the receipt of an order 95% of the time. This time last year, that same process took 24 to 48 hours 75% of the time. It also can deliver real-time quotes, which has enabled the company to book an incremental $1 million in revenue per quarter in the last two quarters.

A significant portion of TaylorMade-Adidas Golf's $554 million in revenue through the third quarter of 2002 would have been at great risk if the company hadn't made collaboration a top priority and begun a multiyear i2 deployment when it faced an unexpected situation. Six months ago, the golf-equipment manufacturer started shipping a driver that promised longer, more accurate drives. The catch? The club was built based on an expected change in the United States Golf Association's rule book. Two months later, the USGA decided it wouldn't allow these new types of clubs to be used. TaylorMade needed to work quickly to remedy the situation.

Thanks to the i2 supply-chain software TaylorMade uses to support its global operations, the manufacturer stopped production, swapped distribution lines so that clubs already produced went to distribution facilities for international markets (where USGA regulations don't hold sway), redesigned the club, and began making it--all within 12 days.