Leveraging IT for Success in the Textile Supply Chain

1. The New Global Competitive Textile Marketplace: Information Technology as a Strategic Enabler

2. Key Facts with Textile Supply Chains – Opportunities for India • Marketing in most profitable places, manufacturing in most economical and efficient places • Supply Chain has to be growth ready • Growth requires handling more volume at even lower cost • Supply chain efficiencies gain importance A favourable environment for India with low labor costs and opportunities for capacity expansion. • A complete package is preferred • Backward and forward integration leading to complete package. A favourable environment for India with backward and forward integration in place.

3. Key Facts with Textile Supply Chains – Concerns for India • Supply chain structures are increasingly Dynamic • A 3 fold increase in manufacturing bases in the last 2 decades. Emergence of Mexico, Turkey • Severe Margins Pressure A not so favourable environment for India Mexico Vs Asia (Priorities for India) Quick Order Due Date Confirmations and adherence Lead Time Reductions Synchronized Operations with Early Warning Systems

4. Key Facts with Textile Supply Chain Product Variants are huge in number and are product characteristics driven. Manufacturing Base is limited but heavy movement of goods among the production units Direct delivery to Customer Direct and ongoing interfacing . The product mix for each plant is huge and production lead times are high A mix of continuous process and batch production

5. Competitive Advantage – Enterprise of the Future • Being Growth Ready. Bringing in Differentiation • Driving the fixed costs / direct costs down • Ensuring Operational Profitability • Order by Order

6. Enterprise of the Future • Production Efficiency • End to End Planning • Order Visibility from enquiry to delivery • Customer Collaboration • Costing at Enquiry Level • Enquiry / Order Due Date confirmation • Capacity Balancing / Dynamic Planning • Production and Inventory Cost Control (Planned costs vs Actual Costs) Growth Competitive Advantage Differentiation Profits

7. Health-Check for the “Enterprise of the Future” • No Enquiries in the system. No Enquiry level planning and costing • No end-to-end planning, No due date commitments through system • No end-to-end costing – sales order costing, product costing • No alerts / exception based management • No characteristics based decision making • Material codification is sub-optimal causing stress on the system No guarantee on Profitability ??

8. Partnering for Success IT as an Enabler – IBM and Intex Value Proposition

9. Requirements + Key Facts + Financial Priority = SCM priorities • Centralized Planning • End to End Planning • Synchronization with R/3 • Order Visibility from enquiry to delivery • Order Prioritization • Order Due Date confirmation • Capacity Balancing / Dynamic Planning • WIP visibility • Forecasting for Cotton / Yarn • Production and Inventory Cost Control • Change Management SCM Priorities for Textile Manufacturer IBM Confidential

10. SCM Priorities – A classification Operational Level Strategic Level Tactical Level IBM Confidential

11. Ideal Demand Response Strategy for Textile Manufactureres Linking the priorities to supply chain improvement areas Business Plan Strategic Planning Strategic Priorities Non-Critical Components Stock Levels Consumption Based Planning Order Promising Enquiry Management Dashboards Orders Cross Plant Planning Capacity Balancing Purchase Planning Known constraints Critical Components _ ProductionScheduling

12. Customer success story B.K.S At a Glance Customer: BKS Textile Pvt. Ltd. Palladam, Coimbatore, India Managing Director: Mr. M. Senthil Kumar Customer Success Story H o m e t e x t i l e s a n d to w e l weaving, f i n i s h i n g a n d m a k i n g u p

13. Intex Consulting Group With the implementation of Intex, all the processes of B.K.S were mapped and integrated in a single software – Intex. The previous software did not cover the confection stage and hence, demands from confection orders were not visible. Now, the yarn-to-fabric and fabric-to-confection MRP was integrated leading to a reduction in excess processed fabric production and a much slimmer WIP position. “This had a cascading effect on the surplus stock figures and in 6 months, the surplus inventory reduced by 40 %. “The delayed sales order value reduced by about 50 % in 2 months.” Mr. M. Senthil Kumar, Managing Director

14. The Smarter Supply Chain of the Future IBM Global Chief Supply Chain Officer Study www.ibm.com/supplychainstudy Niranjan Deshpande Head, SAP SCM Practice IBM Global Business Services niranjan.deshpande@in.ibm.com +91 9880200371. (C) 2008 asbl Atomium / Artists Rights Society (ARS), New York / SABAM, Brussels Photo Number: WC6D8959

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