Are you in control of your pre-production process?

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1 Ref: Fast React_Vision_Management React_Evolve_Management Brief_Critical Path Management In part 1 of this series we looked at the importance of Critical Path Management (CPM), the 5 main steps in the process of managing critical paths and the common problems faced in the fashion industry. To briefly recap: What is CPM? 1. Define the events, durations & persons responsible. Events for both style development (proto sampling, costing, fabric testing etc.) and for purchase orders (bulk production samples, bulk fabric approval, markers, AQL final audit etc.) are defined in the master database. Critical Path Management (CPM), Time & Action (T&A); there are many names, but they all describe the same process; that of ensuring that all essential steps from design and prototyping, either order receipt or buy process, costing, BOM creation, fit and material approvals, production and garment testing, shipment and delivery all happen on time. Why is good CPM now so vital? A general increase in fashion i.e. more styles, more often, creating increased demands on design and new product development. Example master list of events for new style development and PO tracking. A significant reduction in supplier lead times for almost all fashion products. Rapid in season replenishment programs for fast selling products. A significant and growing element of fast fashion, comprising much shorter product life cycles and more frequent updates of the retail offering. Each of these trends place considerably more pressure on the new style development and approval process, as well as on supplier relationships. - The 5 key steps to good CPM and Fast React tools to support these: From the master database different templates are then created to select the appropriate events, lead times and person responsible for the different activities in each case. In this management brief, we will look at how the Vision solution from Fast React Systems can support the 5 key steps to effective CPM. 1

2 Ref: Fast React_Vision_Management React_Evolve_Management Brief_Critical Path Management Example of a PO tracking template (buyer collect, short lead time) showing example events and specific user responsibilities. Targets normally work back from a key event, such as a sample submission or range selection date for new style development and delivery date (FOB/CIF etc.) for sourced products. NB: For true supplier collaboration, to support Just In Time (JIT) prioritisation and to achieve best speed of response, the approval process should be coordinated with the actual planned production start date at the supplier. That date will depend on variables such as style complexity (production time), materials availability, capacity availability, including any pull forward at low season and more time required for complex embellishments etc. In section 3 below, we show how Vision can allow you to communicate electronically with suppliers to receive easy updates. Templates typically vary by: New style development or order tracking CP. Buyer and product type. New or repeat order. Standard lead time or quick response. Each new design and order as it is entered into Vision is allocated the appropriate template. Further customisation can be done on specific design/order level to cope with special cases that do not fit with the standard templates. 2. Set targets and priorities for each event Having attached a timetable, a CPM solution needs to calculate the required date for each activity and assign it to the relevant person. The best approach is template based with the flexibility to amend an individual design/style/order CP. The template should also allow for a different person to be assigned to a particular activity, such as sample approval, depending on customer department. Implementing the Fast React (FR) solution has allowed us MUCH greater visibility of our overseas manufacturing, working collaboratively with our UK operation. We could not have achieved our recent strong business growth and still maintained control without Fast React." Michael Condon Operations Director, Shadowline 3. Update task status daily Once clear targets have been established these need to be communicated to the different people responsible. The interactive My tasks area is carefully designed for maximum ease of use, user appeal and flexibility. Updates on what has been completed can be made with just a few mouse clicks (events can also be imported from other systems if appropriate). 2

3 Ref: Fast React_Vision_Management Brief_Critical Path Management The updates can be analysed (Vision will summarise all changes), approved and can then be imported directly into your Vision solution. This allows much improved collaboration and a significant reduction in manual work. The same remote update packages can be used for travelling staff and even for receiving customer approvals. 4. Manage the exceptions, fast track & re-plan Events, target date and days in hand Red = overdue activities Green = future activities required. If requested targets are not achievable, advanced warnings can be communicated by entering expected completion dates. Vision offers management visibility to support rapid enquiries and decision making. A full audit trail is available on system notes give additional detail. We can get a quick overview of the status of any single or group of designs/styles/orders by event, person, order, buyer etc. Vision also allows electronic updates from suppliers, relating to both critical path activities and production updates. The schedule of required activities is sent to all suppliers automatically and the simple and intuitive style (spreadsheet look and feel ) is easy to use at the remote end. Management level status overview of a range of orders filtered for a single buyer Red = overdue activities Green = future activities required We can instantly see that most activities are under control (green). In so many businesses, because CP status is hidden in manual documents and not readily visible, each department is often working blind of the true priorities and of the real issues needing urgent action. 3

4 Ref: Fast React_Vision_Management Brief_Critical Path Management Once the latest status of each event can be reliably seen on system, we can actively start to report and manage the exceptions. The management level overview can be expanded to see more detail. We welcome the new Fast React system, with its user friendly set up which is uniquely tailored to meet the needs of the Panache business model. Used by other well established businesses akin to our trade, we welcome what it can do for us. Audrey Harris Head of Technical, Panache Lingerie 5. Measure your actual performance KPI & Continuous Improvement (CI) A full record of the CP history on all styles and orders is maintained. All data is stored in the Fast React database so it can be easily accessed, summarised and filtered. With Vision, because tasks are prioritised and re-prioritised clearly in task diaries across departments and staff, all departments can work together rather than independently in silos to their own perceived or preferred work sequence. Recording reasons for delay and failure means we can quickly review past performance each month/season by buyer or factory and see where we need to improve. Most businesses take a lot of time to build such reports, in Fast React it s automatic. Good coordination and communication is vital to on-time completion of events, reduced slippage and to achieving the overall lead time reduction that almost all businesses need these days! Users can record failures with reason codes to allow easy end of season analysis of right first time and reasons for failure as a basis for improvement initiatives. 4

5 Ref: Fast React_Vision_Management Brief_Critical Path Management Measuring overall performance against targets and monitoring to see if Continuous Improvement goals are being achieved is easy using the KPI module. Typically fashion businesses have little time to review what has happened. As soon as one season is over they rush into the next. The time consuming process of collecting and analysing the history of a season is almost impossible for most businesses when the information is somewhere in 1000 s of s or hand written notes and spreadsheets. This report shows that the main reason for failed AQL audits was button placement. 6. Conclusions Critical Path Management will be an increasingly important part of every fashion company s toolkit. Without a systematic and determined approach to CPM, it will be more and more difficult to complete the increasingly complex product development process in the shorter and shorter time frame allowed. The consequences of not managing CP effectively i.e. inefficient process, increased staff costs, unsustainable working hours, fire-fighting, cost penalties such as re-sampling charges, unscheduled air shipment, quality or compliance risks or in the worst case lost sales due to out of stock product are simply not sustainable with today s tight profit margins. There is already an answer to the problem... KPI analysis is essential for the improvement of business performance, for example, are we achieving our target lead times or right first time sample approval target? The Vision sourcing solution offers complete control from design to delivery and includes many other modular (optional) functions including design storyboard, costing and tech packs, materials purchasing and inventory to support CMT or fully factored products, along with management of sample materials. Fast React is a long term, specialist supplier of simple solutions to complex problems, specifically for the fashion industry. This graph shows that 62% of orders for buyer x in the current season fell in the day target range, 12% are still longer than target, 26% are quicker than target. With a strong background in fashion, they (FRS) have clearly understood our business needs and delivered a highly effective solution to meet those needs. Steven Downes Finance Director, REISS 5