I interviewed Michael Serwetz who discussed Effective, Low-Cost, Product Development and Sourcing Management by Simplifying Organization and Process.
Today we're speaking with Michael Serwetz, and we're going to discuss effective, low-cost product development and sourcing management by simplifying organization and process. So, Michael, can you first provide a brief background of yourself?
I have been doing overseas sourcing in China and more than 25 other countries for more than 30 years. During that time, I have delivered a lot of goods and have seen a lot of good things and bad things, a lot of problems. And I've learned by experience how to make things more effective and simpler so that the final goal of delivering a quality product on time can be achieved in more than 95% of the cases at least.
I have worked for big companies like [inaudible 00:01:01] department stores, Levi Strauss, Gold Toe, Meretz, Nick Graham, Joe Boxer, and also, I have been in my own business in China for the last 10 years. I lived in Shanghai up until recently and actually started my love affair with China by teaching in Wuxi in 1990. So my focus has been China, but I have done business throughout the world.
How can US companies that are doing business in China or other overseas countries, how can they simplify and streamline their process?
Like I said in my articles about how to make big problems out of little ones, I think that the companies need to organize themselves so that somebody takes ownership of all aspects of a project. Typically a big or even a medium-size company, they have the design department. They have a compliance department. They have a production department. They have a quality department. And all of these departments act like silos. They don't connect. And none of these departments individually has ultimate responsibility for the delivery, except maybe the sourcing VP or one person who is trying to get all of these people to work together.
So the first and best solution that I would offer is to try to change things to a project oriented basis rather than a part of the product oriented basis, such as design, etc. Someone should take responsibility for the entire project from beginning to end.
And second, that person should be empowered to make decisions if something goes wrong or something needs to be changed. The problem we've seen and the problem that I illustrate in my article is that every time there is a problem, it has to go up the flagpole to top management, which involves a lot of people running around trying to figure out what happened and who did what to whom.And it causes and lot of unnecessary emails, time, and headaches before the problem gets solved.
So I think that the people that are responsible for these projects should be empowered. And so that empowerment should be at the lowest feasible level. Everybody is just sitting around waiting for the manager to make a decision. And the manager is, by nature, not close to the decision, has to ask a lot of questions, and is really not capable of making the decision...as capable of making the decision as people who are involved in it day to day.
And then don't do anything that doesn't add value. A lot of companies waste a lot of time with processes that don't add value. I pointed out in my articles about inline inspection on reorder items. If it's the same item, for example, some companies insist on doing inline inspection for every PO, every style. And if it's the same item, why would you need to do that? As facts usually turn out, there is less than a 5% chance of defectives because it's a repeat order. So why would you need to 100% inspect orders that have less than 5% chance of having a problem? And secondly, if you do, if the customer is so involved in the process, the factory will back off and not take their full responsibility. So the second part of that is let the factory be responsible for what they're doing.
I think that pretty much sums it up.
Can you talk about avoiding the problem. I know you mentioned it. Is there a way to summarize how to avoid this problem?
Problems happen. And my first statement is that if you have people who are taking ownership of the process from the beginning to end, will be able to be on top of it and nip the problems in the bud because they understand what's going on in the factory. They'll be able to talk directly to the factory or the suppliers concerned and not let the problem become bigger than it needs to be.
And the second part, which is in my second article, is that everybody in the supply chain should be responsible for checking a product. So, for example, my example of the printed matter, how does the printed matter get delivered to a factory and defects are not discovered until it's being applied to the garment? That means that three people had a chance to check it and didn't— the supplier that made it, the office of the buyer, and the factory itself. So everybody needs to take responsibility and quality checking needs to be done at the source.
And the last and the most important thing is, in the apparel industry, we have a very antiquated and ineffective quality control system called AQL. AQL just waits for the end of the process to find problems. But as I pointed out in my article, if you have an example — all the examples I gave in my articles are real... If you have an example of the socks which have knitting defects, and the knitting defects are not discovered until the end, until packing, how can that be avoided? How it can be avoided is by process, by process quality control. That's what the apparel industry needs, the most major change that the apparel industry needs to make to be more effective.
About Michael Serwetz
I, Sourcerer-business growth and relief