PLM Hub Q1: Product Lifecycle Management (PLM) remains a much-talked about strategic advantage. What do you see as the key benefits for the apparel industry - both in the short- and long-term?

Tamara: In a word, collaboration.

Over the past decade a variety of factors have led to a rapid globalisation of the apparel industry; the desire for cheaper production, faster time to retail and expansion into new markets has created immense complexity. If you then add a variety of external factors including consumer trends, local/regional trade and import legislation and new competition an effective, scalable technology solution becomes a business imperative.

According to a survey published by AMR Research in August 2008, participants identified PLM’s three primary benefits as faster time to market, lower production costs and improved design. PLM’s ability to tie designers, suppliers, partners and retailers together into a unified technology platform provides the foundation for all of these benefits. For example, if a designer decides to change an element of the trim what’s the impact in terms of availability, cost per unit and production schedule? With PLM designers can work in near real time with suppliers and partners around the world to address all of these issues, make an informed decision and then change the design only if it makes economic and market sense.

Long term retail, footwear and apparel (RFA) companies will be constantly trying to evaluate which are the best product lines to develop, what do consumers want, which factories can produce the product to spec, to cost, and on time; all of these decisions have an impact on cost and competitive advantage. What happens when sourcing departments start adjusting the various levers available (e.g. supplier/factory, trade terms, ship mode, country of origin) and how does that impact cost and margin? 

A global PLM solution helps retailers and brands manage the inherent complexity of securing competitive bids, evaluating and selecting the appropriate vendor, and identifying multiple sourcing specifics to “land” the product at the best cost and on time. The ability to identify alternate suppliers for a fabric or trim and swap out alternate fabrics on a Bill of Material (BOM) could change a product with a less-than-attractive margin to a market and margin winner.

PLM Hub Q2: How can PLM improve an organisation's competitive advantage?

Tamara: Fundamentally it allows all of the key components of a product's lifecycle to be on the same page – particularly from a functional and a geographical perspective. In a distributed global business with lots of partners and suppliers this is absolutely crucial to being able to deliver products to market more effectively than the competition.

Currently so much time and resources are wasted due to a lack of coordination; an integrated PLM solution that allows a company to manage the process of innovation from concept to the rack can be a real differentiator. More specifically, a PLM solution helps to cut product development time through centralised data management and customised supplier access. For example, if you think about the process of developing and manufacturing a jacket there are a variety of trim elements beyond the fabric including buttons, zippers, buckles etc – all of which need to be sourced and delivered at the necessary quality and price.

When designers, sourcing users, and suppliers have one place to go for the most recent design decisions, test results, and sample results, redundant activities and actions based on out-of-date information are reduced. Additionally a broader frame of reference and perspective can improve a product’s chance of success. A shorter product development timeline also enables retailers and brands to delay design and colour decisions to the last possible minute to incorporate the latest in customer preferences while still hitting in-store dates. In addition, RFA companies can maximise the re-use of previously developed styles by easily pulling them into the current season/assortment with cost and spec details immediately available.

By managing the sourcing and production process effectively an apparel company can create rather than follow a trend. This can mean the difference between having a successful season by hitting their margins and target retail dates as opposed to a product being placed prematurely on the discount rack.

PLM Hub Q3:  How can PLM help unify product development teams to deliver trend-right, high quality products to market on time?

Tamara: Again, real time collaboration is essential to driving product development in the RFA industry. While the designer/product development team may sit in North America or in Europe, the agent or manufacturer is likely to be off-shore. Additional design and development partners inside and outside the company can communicate and review products visually. By managing the entire supply chain through a single, real time collaborative PLM platform, product development teams can more cost and time effectively identify new design/market opportunities, evaluate RFQ responses and finalise agreements.

On a more granular level, a PLM solution provides greater visibility into the tracking and history of changes made to the BOM. This functionality can help companies understand the factors driving production delays – were they due to designers’ last minute changes or were they driven by the supplier? A PLM solution provides the data to support vendor performance reporting, which supports supplier relationship management. The solution will also track the volume and efficiency of production offices and agents, supporting performance reporting on sourcing teams.

Another efficiency-related challenge for many RFA companies is measuring and managing the costs associated with the sampling process – every time the factory makes up a sample it can add to the cost of a collection.  Sampling is a critical part of fine-tuning a design, but are departments over-sampling? The ability to measure the sampling process by division or department is critical in understanding where costs are generated. A PLM solution provides the ability to track sample costs to determine whether the designers are sampling efficiently or not.

PLM Hub Q4: How can PLM support a company's Corporate Social Responsibility (CSR) strategy?

Tamara: With an increasing awareness of how and where materials and products are sourced, PLM can play an integral role in ensuring that an RFA company effectively tracks and manages its adherence to all of the key regulatory compliance/sustainability issues and relevant labour laws.

As part of its PLM solution Dassault Systèmes' customers are able to manage a number of different variables that go beyond pure economics. For example, depending on its track record with child labour laws and environmental issues, the lowest cost manufacturer involved in the RFQ process may not necessarily be the best long term choice as a business partner. In this instance it would make more sense to pay a higher price than to risk being exposed for indirectly supporting socially-unacceptable practices. Even though the upfront costs may be higher the damage done to a brand or company can be difficult to repair.

PLM also provides a complete view of a partner’s profiles, certifications, capabilities, and compliance metrics. Utilising this information early in the design and development stages can ensure a brand is meeting its CSR initiatives.

PLM Hub Q5: What are the stand-out features and benefits of your PLM system compared with others on the market?

Tamara: Over the course of the last few years Dassault Systemes, through its acquisition of MatrixOne, has developed the most extensive PLM solution designed specifically for the RFA market. As a result, the company’s roster of leading fashion houses and retailers enjoy a variety of benefits including:

  1. Replacement of multiple and disconnected systems and dislocated documents used to manage product, project, colour, material, line plans, vendor and sourcing with a single, global product lifecycle management system.
  2. Effectively allocates and manages resources across all functional teams by tracking seasonal line planning calendars, approvals and responsibilities in a single system that is integrated with all other aspects of product development
  3. Dynamically reacts to shifts in seasonal requirements, industry trends and consumer tendencies by leveraging robust and flexible workflow and planning template visible to all product/project teams.
  4. Improves gross margin by allowing more control over the cost analysis and negotiation with vendors as well as enforcing more structured hands-off between headquarters, buying offices, agents and vendors.
  5. Optimises sourcing opportunities and cost control through on-line RFQs enabling multiple quotations for supplier provided options based on volume, delivery dates, trade terms and alternative componentry.
  6. Reduces risk and executes strategic sourcing initiatives with a focus on lead time improvement, cost management and supplier collaboration with source and capacity planning and a formalised production placement process.
  7. A user friendly interface including drag and drop assignment of colour and components, product and cost comparisons and graphics, and standard tracking and analysis reports.
  8. Proven flexibility and scalability to support diverse business models and size.

PLM Hub Q6: How compatible is your PLM system with others in the marketplace?

Tamara: The DS PLM solutions are based on open SOA architecture and can be deployed in conjunction with a variety of industry solutions in the marketplace. This could include legacy or bespoke PDM if requested. Some companies look to initiate their PLM path with integration to PDM, but quickly move to replace these systems due to the indisputable business value in PLM. Importantly, PLM implementations are optimised when integrated into the larger brand eco-system. Having an open architecture simplifies the integration and interface between corporate systems such as ERP, Planning, and Merchandising and can greatly improve data standards and business processes.

PLM Hub Q7: What are the basic rules for a PLM project in the apparel industry compared to others?

Tamara: There are widely understood rules for success in any technology initiative. The uniqueness in apparel really comes from the fact that the industry is so trend driven and dynamic. Additional focus needs to be placed on usability and process design. Incorporating the user base early in refining the solution through an iterative review process can ensure user adoption and business benefit. The DS delivery teams look to provide a solution flexible to meet the changing business needs of a specific business framed by best practices.
Another major difference from the discrete manufacturing industries is calendar and portfolio or line management. In our industry we are planning back from an in-store or delivery period for a large collection of product vs forward planning from a single products concept or ideation. PLM projects of this nature must consider data management and user interaction en masse and not enforce a product-by-product information maintenance. Usability and performance are key success factors in this environment.

PLM Hub Q8: What would you say to companies who are thinking about deferring a PLM investment because of the current economic crisis?

Tamara: It’s really a case of how companies want to position themselves for the long term. Obviously there’s a short term investment to acquire a PLM solution, but it has been proven that this cost can be rapidly offset based on cost savings, greater operational and resource efficiency and more effective supply chain management. 

While companies cannot plan for all eventualities, a solid PLM solution will enable companies to be prepared for the changes that are going to impact the industry.

In many respects you only need to look at the impact that H&M and Zara have had on fast fashion in the last five years to understand that standing still in such an aggressive market is not an option. There’s no doubt that in large part their success has been built on a firm technological platform that’s flexible and scalable enough to deliver new products to retail in an ever shrinking window (often a matter of weeks rather than months).

On a macroeconomic level we believe that now’s the time to emerge with advantage. What does this mean? While many companies may view the current global economic situation as a reason to cut or limit spending, we’re seeing many of the market leaders increasing their level of investment to ensure that they’re well positioned to take advantage of new market opportunities as the economy begins to bounce back (which we’re already seeing in certain parts of Europe and Asia). We believe that this is going to create a greater chasm between the companies that will be shaping the future of the RFA sector and those that are following and struggling to catch up.

PLM Hub Q9: What are the best PLM practices learned from the apparel segment?

Tamara: Many other industries are looking to the Retail, Footwear, and Apparel sector as leaders in global sourcing and distribution, and differentiation strategies. CPG, Industrial, even Auto and Life Sciences industries are finding RFA practices can bring innovation and competitive advantage to their businesses.

RFA global sourcing strategies and practices have built in reliability, flexibility, and compliance elements that other industries look to emulate.

Additionally, the ever changing line planning and adoption process in apparel leverages and maximises new ideas and options right to the point of delivery. These too are PLM practices that other industries would like to employ.

Lastly, the supplier and partner collaboration process is much more agile in the apparel industry and leading companies in other industries are looking to implement these practices for innovation and improved products.

PLM Hub Q10: Where next for PLM?

Tamara: Most immediately, RFA companies are going to be continuing to figure out how to not only compete, but lead in the industry. Currently many companies are trying to address critical business issues with a patchwork of technology solutions. In the medium term, PLM will play an integral role in creating integrated sourcing processes that incorporate all of the elements of the supply chain including planning, product development, production allocation and authorisations.

However, long term we believe that getting closer to the consumer will be critical for understanding how the industry is going to change. PLM’s ability to extend the design and production process beyond the four walls of the apparel company is going to be crucial to this effort.  The voice of the customer has always been an important element for the industry, but typically this has been reflected only after a sample product has been developed. What if you could factor the mass consumer into the development process when the product is still at the concept phase?

We’re already starting to see a small number of companies who are interested in understanding how 3D could impact the future of innovation. For example, what if you could allow the most influential consumers an opportunity to interact with new design concepts via an online 3D environment? This would provide designers, suppliers, marketers and retailers with a unique insight into what the consumer wants before they get a chance to physically vote with their feet at retail. Ultimately a more informed design process will deliver those “can’t miss” products and lines that remain so elusive for most companies today.