“If you’re not cloud-based, go away.”
That was Lee Goldenberg’s approach to supply chain management when John Varvatos split from VF Corp. in 2012 and he was tasked with replacing the company’s existing systems.
Speaking Thursday at Sourcing Journal’s “Currents of Change” Summit in New York, the vice president and chief information officer for the iconic American menswear label explained, “The only thing we didn’t change were the cables in the walls; [we replaced] every device, every telephone, every server, every computer, every piece of software—from email to instant messaging to ERP (enterprise resource planning) for both wholesale and retail—and more.”
He added, “We’re now live close to three years and every one of our systems, including our social compliance systems, our payroll, our customer tracking in stores, all of my ERP systems, everything we have is cloud-based—and you can work anywhere on any device at any time as long as you have an internet connection.”
His fellow panelists, Gregory Bannister, chief operations officer at Sport Obermeyer, and Joanne Martorelli, head of global social compliance and product safety at Brooks Brothers, also lauded the economics of cloud computing in the supply chain.
Bannister: “We’ve got more clarity of movement and production than we’ve ever had. We banned e-mails to the factories, to our different merchants. We’re using the collaboration piece in PLM (product lifecycle management) or ISM (information storage and management) only and some of the factories were resistant to that but we keep hammering, ‘You have to use this collaborative tool to speak to us when it’s about this style. We want all the information about this style all in one place, not in 15 different e-mails.’”
Martorelli: “You’re able to send out broadcasts to multiple members of companies at the same time, giving them all the same message. You’re not writing a different e-mail every time. You’re not e-mailing large documents that may never get to them. It allows us to manage and track the signing of our compliance documents. We can e-sign within the system and have a track of that. Rather than a paper trail, we have it in the system. Vendors can come into the portal and upload documents and e-sign. It’s really helped to streamline our process.”
Goldenberg: “In pretty much any PLM system you can utilize several very good applications. What you really want to do is have your factories build your costing. You know what loads you put on after your FOB but they know what your fabric is, they know what your trim is, they know what your labor costs are. You have them build it in your system so there is no importation, there’s no Excel, there’s no somebody keying it in and misinterpreting it, it won’t be entered in a different currency. That’s how we control the he-said, she-said.”
Martorelli (on auto-evaluation of test data): “Not that our team wasn’t capable of evaluating but with the sheer number of test results that flow through our team it helps to streamline their process. The points that are rejected within the testing protocol actually jump out and they can address those and the things that are passing they can scan over more quickly.”
Less operational issues
Bannister: “Before, everything was done on spreadsheets or in a system where you had to literally re-key the same data in four times. Now, we outsource our e-mail, we outsource our payroll, we take the business systems that manufacture our clothing and use them the best we can. And we’ve not only improved our business system but it gives you a great excuse to change the process, because a lot of the time it’s the processes that are really broken.”
Goldenberg: “It’s the process and procedures that you put around your systems that are more important than the system. I’m not denigrating any one system over another, they all do the same thing and they all probably do them really well, but you have to pick the one that suits your business the most and then you have to put the policies and procedures around the system. If your people don’t follow the procedure, you’re not going to have the right result at the end.”
Quotes have been edited and condensed for clarity.