When Clothing World first visited DAKSSimpson early in 1997, the company had just embarked on a four-year investment programmeto implement a series of new manufacturing techniques. With the end of this strategy nowin sight, Clothing World returned to the company’s production facility at Larkhall inScotland to see how this has progressed into a truly integrated approach to supply chainmanagement.
For any company the process of managingchange is a delicate one, and it requires a precarious balancing act to ensure that theprocess itself does not become more important than the end result. Set this against abackground of increasing off-shore competition and constant cost/price attrition, and itbecomes clear that a focus and dedication to the task in hand is key to its ultimatesuccess.
For Daks Simpson, one of the majorinternational brands in quality tailoring, the last four years have seen considerablechange and reorganisation at its main manufacturing plant at Larkhall in Scotland. For itis here, at what is thought to be the largest single storey clothing factory in Europe,that the company has been rolling out a £4 million, four-year, four part plan aimed atimproving production and manufacturing techniques, logistics and information technology,introducing total quality management, and enhancing the introduction of new products.
Now three-quarters of the way through, thistask is nearly complete and, under the guidance of managing director Kevin Johnson, thetransition has been impressive. Gone is the piecemeal attitude to production, and in itsplace has come an integrated approach to supply chain management where the business looksat the whole picture from the fabric mill to the customer.
All of which is paving the way for thecompany’s latest innovation. For now that the manufacturing set-up is reaching its fullcapabilities, DAKS is turning its attention towards enhancing the service it offers.
To this end, the company is currently inthe process of building its business in the UK through the introduction of an effectivestock service programme to strengthen its marketing mix. And it is here that its quickresponse manufacturing function will have a key role to play in supporting new productdevelopment, rapid turnaround, and on-time delivery to the retailer.
The service is already available for alimited number of items, but is now being extended across the men’s wear range and willsoon move into women’s wear. It revolves around the company’s core product, rather thanseasonal items, and has been developed by the merchandise teams working in conjunctionwith cloth partners who have also developed quick response techniques. The success of thescheme means that it will be possible to turn stock over 3 times per season, or six timesa year, ensuring fresh infusions of merchandise and encouraging customers to visit thestores.
One of the first areas to be addressed in the company’s four-year investment programme nowhas a key role to play in the launch and ultimate success of the new stock service. Thiswas the introduction of a multi-skilled, cellular unit concept – in which DAKS has been anindustry pioneer – which has served to enhance garment quality, improve laboureffectiveness, and reduce work in progress.
Initially, the ultimate goal was to ensurethat this British tailoring brand continued to be produced from a solid Britishmanufacturing base, as well as securing the future of its Scottish factories. But one ofthe added bonuses has been that the reorganised production lines now allow the company torespond more quickly to the demands of the market.
Manufacturing at DAKS was traditionallybased on two flow lines, with all jackets and all trousers passing down the appropriateline, irrespective of men’s or women’s styling differences. Large groups of machineoperatives would carry out one set task and then pass the work on to another group for thenext stage of manufacture. However, with the need for improved and consistent quality,quick response changes to the needs of the marketplace, and an increasing array of new andsometimes difficult fabrics, it became clear that alternative production methods wereneeded to take the company into the future.
In particular, it was recognised that mostopportunities for improvement lay with the short order runs of a number of differentgarment styles where quality, response time and productivity are key. The decision wastherefore taken to split production into garment types with small specialised assemblylines following a cellular or quick response system.
With the new method, the team is set in alarge horseshoe layout, and operators work standing up and move between at least twomachines each. Operations are defined so that as much of the garment as possible can beassembled by one person – for example, a complete sleeve, complete body lining, collarattach – before it is transported to the next station. This requires a large capitalinvestment, as well as a commitment to increased team members and re-training, but therewards of quality, response time, flexibility and worker satisfaction are considered tobe worth it.
From the original jacket line – which isthought to be the first in the world to make tailored jackets from beginning to end on ateamwork basis – the quick response system has been successfully extended into otherareas. DAKS is now running two jacket lines, two trouser lines, and three skirt lines and,having made the initial investment into machinery and labour, is building on the teamworkphilosophy to increase output whilst maintaining the quality levels that have so far beenachieved.
By increasing the number of jobs carriedout by each operative within the cellular system it is proving possible to raiseproductivity by 25 per cent. Weekly production of tailored men’s jackets has gone up from400 to 700 units. Similar levels of growth are also being achieved on the trouser lines,with increases from 650 to 1200 units per week. The skirt line is split 3 ways to caterfor short skirts, long skirts, and ladies’ trousers (including culottes), and has acapacity of 1100 a week between 24 people. Increasing capacity even further is essentialif the company is to meet growing demand for its ladies’ wear.
“In terms of quality and productivitythe QRS system has been a tremendous success”, comments manufacturing director JimFitzpatrick, adding that some of the lessons learnt from the QRS system are now being putback into the standard lines.
However, he notes: “QRS is not auniversal solution since it depends on the product and the volume of the runs. It is notsuitable for highly automated, large runs of a limited product range, but it is successfulwhere a large variety of products needs to be produced on a just-in-time basis”.
Robert Grant, QRS production manager, addsthat to put work in progress it has to go through the planning, computing and cuttingdepartments, which means that by the time it reaches the cellular manufacturing line thereis just one day for production. With a conventional line, he explains, this would not bepossible since production could take anywhere between 1 week and 10 days.
SUPPLY CHAIN MANAGEMENT
To guarantee good customer service and on-time deliveries, logistics executive SimonFreeman is in the process of ensuring that the whole supply chain, from raw materialscheduling through to despatch to the customer, works as a single entity.
“We have turned our focus around andare looking at what our customers say they want, rather than us telling them what’savailable”, he says.
Previously, customer service was dividedinto three areas – order processing, warehouse documentation, and a queries department -but this has now been re-grouped into different country departments, each with its own’country champions’ who process orders, despatch paperwork, arrange shipments and dealwith enquiries from the company’s agents around the world. Ultimately, this means thateveryone is much more knowledgeable and is able to build stronger relationships withcustomers.
“We are also asking our customers tobreak their orders down so that we can, in turn, give them a better service and betterutilise their resources”, adds Simon.
Alongside refining these efficiencies andlooking for continuous improvements, the next challenge is to meet the demands of thestock service.
“To a certain extent the success ofthe stock service depends on us being able to get the garments out on time, so we aregearing our production planning to meet the demands of the warehouse. We are allocatingstocks later in order to satisfy early deliveries – which gives us a better order fillthan we traditionally had. We also have a better range of products in the warehouse, andknow which customer wants what, and when they want it”.
The necessary checks are already in placeand a reporting service has been set up. Amendments have also been made to the existingMIS system, which is now multi-location with picking sheets for all markets – and furtherevaluation is underway.
Concludes Simon: “The information youget out is only as good as the information that you put in. We are driven by customerservice – our customers want dependability in their service”.
Speaking about the changes that have takenplace, customer services manager Helen Curry explains that: “Previously, once thegarments were in the warehouse, the warehouse gave the key to ship. The turnaround is thatnow the customer services department tells the warehouse when to start shipping”.
She adds: “We started this processwith the export side and are now focusing on the UK, which is broken down into regions.Large customers are looked after on a daily basis. Internally, the various teams aresupporting each other too.
“If we get the garments out on time,every time, then we don’t have them back. Logistically, too, it’s cheaper to handle 500garments than it is to handle 5”.
For a company that continues to export to over 45 countries, the success of the businessseems assured.
DAKS claims to be weathering the FarEastern crisis, and says that both volume sales and market share are still increasing.However, improving profitability is more of a challenge since the devaluation of the poundmeans that the company needs to sell 20 per cent more units in order to meet previouslevels of income.
Kevin Johnson points out that the vastmajority of the company’s Far Eastern activity is managed by licensees in Japan, Korea andTaiwan. DAKS is also striving to make inroads into new markets such as India, and isputting together a total package around the DAKS name. On the accessories side the companyhas licensed its leatherwear business to a major Italian player with well-establisheddistribution in Europe and the USA, and this is paving the way for the company tore-launch into the American market. A toiletries and perfume licensee has just been takenon too.
The introduction of the stock service andimproved logistics should also open up opportunities for DAKS to regain its share of thesuit and trouser markets in continental Europe where, at present, its men’s jackets have astronghold. Product development also has a part to play here and, for spring/summer 99,DAKS will be the sole UK company launching a range of suits and jackets made from thefinest New Zealand merino wool.
In spite of all the changes taking place across the business, Kevin Johnson is still keento emphasise his commitment to sustaining a UK production base for the company. He says:”Manufacturing is not a burden to the business, but enables us to produce what ourcustomers want. It also means that we can respond and make to order – so that the businessis, in fact, safer in the long term. We can make to specific sizes and certain styles andcan control the supply chain much better.
“Having our own manufacturing baseimproves the efficiency of the supply chain. The headline cost is higher if themanufacturer is based in the UK, but this does not take into account the other costs ofmanufacturing off-shore, such as the marketing supply chain, risky stock, subsequentdiscounts, and what all this does for brand credibility. It is very easy to make thetransition from being in control to out of control.
“However, there is no point inmanufacturing a product unless you have the expertise to do so. We have this expertise intailored garments, but in other areas we have to outsource, and are now identifying longterm partners with whom we can develop this kind of relationship.
“It is possible to have partnershiprelationships, but these need trust and long term commitment in order to succeed”, heconcludes.