Like many apparel companies that have gone global, GUESS? Inc.'s expansion to offices offshore opened many new opportunities, but made collaboration among those in design and pre-production rather difficult.
For years, GUESS? drove its wholesale and retail operations out of its L.A. headquarters, but as its international business increased, the company found it needed to expand its operations to support the growth.
So about two years ago, the company bought its Florence, Italy-based jeanswear licensee, and, just like that, the company had another design and sourcing organization in Europe, with designers on both sides of the ocean working together to develop the core GUESS line.
Also, at about the same time, GUESS? opened a sourcing office in Hong Kong to source for its Italy- and U.S.-based offices. Previously, the company had relied on sourcing agents.
"So we went from a North American office that did everything, to a global, multipletime- zone, multi-group [organization], all within the past two years," says Mike Relich, CIO.
- Business reporting: proprietary data warehouse built using MicroStrategy
- Color management: Datacolor
- EDI: SPS Commerce
- ERP: Jesta
- Finance: Oracle, implementing TradeCard
- Markdown optimization: Apex Decisions
- Merchandising, planning & allocation: JDA
- PLM: Enovia MatrixOne
- WMS: Manhattan Associates
Ultimately, that's what drove the need for collaboration, and what spurred the search for a product lifecycle management (PLM) solution that could bring the three groups together in a collaborative, real-time environment.
Tackling the travails of globalization
When the office in Italy first joined forces with the one in L.A., the two teams were working on different systems. In L.A., the designers used an internally developed .NET application called Stylebuilder that was heavily integrated to GUESS?' Essentus ERP system from Jesta. In Italy, the designers used a different program, which fed into its Stealth ERP system.
Stylebuilder was great for product development management (PDM) -- generating specifications and such. "But when we wanted to actually communicate anything about that product spec, it was done through e-mail and faxes," says Relich. Collaboration was tough.
Ditto for its communications with Hong Kong. "There was no global visibility," says Relich, and no "real" collaboration, which had previously not been a requirement.
Giving an example of the wasted time that resulted from dealing with multiple systems and a lack of visibility, he says that to prepare for a production status meeting, "we had to call the guys who created the manual tracking sheets to make sure the spreadsheets were updated. It took a day to update the spreadsheet and get ready for the meeting."
It didn't take long for GUESS? to realize that it needed a platform that would manage all activities around the product, from concept to purchase order, and that would be accessible from anywhere in the world.
A PLM system was the obvious solution. It would provide a single repository and definitive source for all information surrounding a style, and would allow all three locations to access one version of the data and work with each other on a real-time basis.
Other benefits the company sought included improved workflows and userfriendly reporting to replace the "army of people" maintaining spreadsheets.
The search process
For its search, GUESS? brought in a variety of vendors, seeking a solution that would cover its concept-to-PO scope.
It also sought a solution that would allow for initial, or "flash," costing as well as bill of materials (BOM) costing, so that prototypes would not have to be pushed into the ERP system until the point at which they were adopted into the product line.
Under GUESS?' old process, there was no way to do a costing process without using the ERP system, which became complicated and wasted time, Relich says, because many of the items that were run through the process ultimately were not adopted. 'We wanted the designers to be able to create samples and [experiment] without requiring all of this laborious data entry," he says.
After narrowing its search to a short list of three vendors, the company brought them in for demos that involved mimicking GUESS?' actual processes, so that users could experience a "day in the life" under each of the systems.
According to Relich, the team used very objective criteria to rate the demos, and also to rank the solutions relative to their technical architecture. "We ended up with a score, and MatrixOne won slightly over the others. ... We liked the group, and went with that product."
Rolling out the solution, initial results
GUESS? began its North American implementation at the beginning of the year, going live with its men's division -- which had served as the pilot for the project -- in January, followed by its factory division in March, its young contemporary women's division in April and its Marciano line in October.
Plans are to roll out the solution to the GUESS brand in Italy in the first quarter of 2008, and to its GUESS by Marciano division (formerly a licensee called Focus and now a division of GUESS? Inc., based in Bologna) by the second quarter.
The Hong Kong office has been accessing the system from day one, says Relich. As each group went live in North America, its corresponding sourcing group went live in Asia.
Although early in its implementation, GUESS? has already seen significant improvement in certain areas from the new system, he says.
Specifically, the single data repository has already eliminated a host of manual spreadsheets. Data accessibility also has improved drastically, especially when it comes to querying the system for reports and navigating within the solution, says Relich, who credits the ease and flexibility of the software's web-based architecture.
Still, it requires a bit of getting used to. "Initially, it's more complicated," says Relich, because the company's previous system, although it had much less functionality, was extremely easy to use.
Despite the required transition period, Relich says "what we've heard from the users time and time again is: 'Hey, once I learned to get around in it, it's a lot better.'"
Like any homegrown system, the user interface of its previous system was not consistent from screen to screen, and did not have very rich functionality, with data capture done manually, he says.
For example, if you wanted to carry a style over from a prior season, you had to 'be Sherlock Holmes" to track down information about that style, digging through e-mails to reconstruct the development of the piece, and hoping that the people who worked on the style previously had not left the company.
Now, with PLM, it's all right there, he says. "All of those types of problems have gone away."
PLM, other initiatives, shorten cycle time As for tangible results beyond the definite improvement in collaborative capabilities and data accessibility, Relich notes that time has definitely been taken out of the development process, but he credits a number of other internal company initiatives, as well as the PLM system, with bringing those about.
What are some of those other projects? Among other developments, GUESS? created a product development group to help facilitate communication and processes between the design and buying groups, and it also outsourced its sample creation.
Additionally, the company has moved to an online color management system, managing its lab dips electronically through a solution from Datacolor, which has eliminated time from the color approval process. (Going forward, the company is working with Enovia MatrixOne to integrate Data color's solutions into the PLM system.)
Another improvement to the company's processes has come about because its group of Hong Kong-based technicians is "really good," which has resulted in a reduction in the number of fit sessions and sample iterations per style, says Relich.
All of these things combined have brought about improvements in the company's processes and its ability to reduce the overall product development cycle, he says.
"This [implementation] is an iterative and evolutionary approach. We haven't even scratched the surface of what the system can do," says Relich.
As he sees it, GUESS? is still involved in phase one of the project: replicating the functionality of Stylebuilder, establishing the repository for style information to allow collaboration, and rolling it out to all divisions and locations.
Its second step will be to introduce workflows, which he recognizes will be a gradual process. "You really don't want to go from total anarchy to a police state overnight -- you won't get adoption," he quips.
But the goal is to track each stage of product development at a more granular level to establish better metrics relative to how many days each process should take. This will enable the company to establish more definite parameters and timelines to better manage the entire cycle, he says.
Step three of the process will be to provide its factory partners with access to the system. Today, communication with its vendors takes place via e-mail. With access to the PLM system, vendors would be able to log on and enter data, such as sample measurements or costing information, directly into the system.
And step four would be to pull its assortment plans into the system. This would allow the design team to have visibility into the overall plan for the season and to design to it, says Relich. For example, if the designers see a plan for three shortsleeved knit sweaters in one category, and know that the typical adoption rate is 50 percent, they will realize that they need to develop six styles.
Overall, Relich has high expectations for the improvements the PLM system will bring to GUESS?.
"When you have a system like this, that touches so many people, there are always challenges, but it's been a good tool for the organization, and it's only going to get better, he concludes.