Speaking with style: Dilan Gooneratne, CEO, MAS Bodyline
Dilan Gooneratne, CEO, MAS Bodyline
Bodyline was one of the first factories set up by Sri Lankan apparel manufacturing giant MAS Holdings in partnership with Victoria's Secret and Triumph. Looking back over the past 20 years, the company's CEO Dilan Gooneratne tells Petah Marian about the challenges Bodyline faced, and how the business was turned around in the midst of the economic crisis.
MAS Holdings is one of the largest apparel manufacturing groups in Asia, with a combined staff of more than 57,000 primarily based out of Sri Lanka. The group has evolved over the past 25 years to become a fully-fledged apparel solutions provider in lingerie, swimwear and sportswear categories, with its own design studios and R&D centres located in Sri Lanka, Hong Kong and New York. The group also owns the lingerie brand Amante, launched five years ago in India and is now beginning to expand across the South Asian region.
A focus on innovation
For many Sri Lankan manufacturers, their ethical and eco commitments are their point of difference. Yet for Gooneratne, these expectations are treated as the norm, and the company looks to differentiate itself through innovation and by how it partners with its customers.
Describing the company's strategy and how it competes with lower cost countries like China and Bangladesh, Gooneratne says: "You need to accept that the world is changing. If you're building yesterday's product, you have to do it cheaper. But if you compete on cost, you can't innovate on technology. It's about getting better, faster, on tomorrow's methods".
Getting to this point has meant following a rocky road, after getting into "a bit of trouble" in 2006 and 2007, and then being hit by the global financial crisis in 2007/2008 - which led to the division recording a loss to the first time.
Among the issues faced by the company in 2008 was the introduction of a range of sub-brands by Victoria's Secret, as the lingerie retailer saw demand for its main brand begin to soften.
"We started bringing a lot of brands into the business and over-complicated things," says Gooneratne.
What is interesting is how the team has turned the business around since then, putting it on track to produce 17m garments in 2012, up from just 3m in 1993.
Gooneratne showed just-style around the company's Horana site, which is based about an hour outside of Colombo, and is the country's largest manufacturing site by workforce size in Sri Lanka. It has more than 5,000 staff under one roof, and covers 282,000 square feet.
He is almost evangelical in his support of lean manufacturing, and credits the vision of MAS chairman, Mahesh Amalean, for moving to this approach across the business. As well as being a key element in turning the business around in 2008, lean manufacturing focuses on creating more value for customers with fewer resources through the minimisation of waste.
"The complaints that the customer had at that time was that we were not fast enough, we were not agile enough, that we were concentrating more on yesterday's business," he said describing the perception of the company before implementing the manufacturing process.
"Lean is something you have to believe in first," says Gooneratne, "because the early payback is not there, it looks hard, it looks analytical and it looks confusing."
But if you have a good strategy, he emphasises lean can "help you deliver what you want to deliver more efficiently".
"It helps you take everything that does not add value out of the system. That makes you more efficient. It gives you a lot of tools to do that, but more than that, it helps you build a culture, helps your team understand this is what you're doing, this is how we're doing it. And if you can't break down your strategy bit by bit, how can you question whether there's a different way of doing it?"
Part of shifting to this lean manufacturing strategy has seen the company reduce the length of time it takes to get a garment off the production line. Today it can be achieved in just a few hours, versus over a week before.
This is making the company increasingly agile, amidst a 400% increase in style changeovers on the lines and a shortening of the average length of runs to 1/5th of that seen in 2004.
Gooneratne believes that this, combined with diversification, allows the company to maintain its worker base and the economies of scale it has worked so hard to achieve.
"Looking at the numbers we very quickly realised that we were not going to cut and downsize and restructure our way out of the business, because we would have lost the talent. We would have lost the stability and we would have wound up increasing costs," he said.
Focusing on its strengths
Gooneratne also considered the things that the company was best at: 3D, the commercialisation of technology and strong project management.
Other ideas considered were moving into new channels where its expertise could easily be transferred, for instance areas like sports bras and swimwear - where the business had tried and failed to enter in the past.
"Those businesses that we had failed in, were close enough to what we did that we could do a better job. Firstly it was about developing operational excellence, and secondly it was about building up their confidence," argues Gooneratne.
The manufacturer also focuses heavily on research and development with some 100 people working in development across the different MAS divisions.
This has helped to open a number of doors for Bodyline, with the company providing Nike World Cup jerseys to the UK rugby team, and some 13,000 Nike track and field uniforms for the London Olympics in 2011. The highly technical garments featured bonded seams, and dimpled fabric to help reduce the aerodynamic drag of the athlete which, Nike claimed, helped athletes become 0.023 seconds faster over 100m than its previous track uniforms.
It now makes some 70% of the brand's sports bras, starting from almost nothing four years ago.
Bodyline also is working to tighten up its relationships along the supply chain so that all partners can maximise collaboration of their unique capabilities.
But, for Gooneratne, MAS Bodyline's role is not to dominate the process, but to work as a facilitator - bringing everyone together as equals. "We want to allow the best ideas to come out, and thereby the supply chain creates meaningful value," he says.
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